Wolters Kluwer Strategy Update DELIVERING VALUE FROM LEADING POSITIONS.

Wolters Kluwer Strategy UpdateWolters Kluwer Strategy Update

DELIVERING VALUE FROM

LEADING POSITIONS

DELIVERING VALUE FROM

LEADING POSITIONS

AgendaAgenda

Opening Remarks

Overview

Corporate Strategy

– Growth Plan

– Cost Restructuring

– Organization

Division Profiles and Strategies

Measuring Performance and Financials

Summary

3January 2004

The Professional’s First ChoiceProvide information, tools and solutions to

help professionals make their most critical decisionseffectively and improve their productivity

The Professional’s First ChoiceProvide information, tools and solutions to

help professionals make their most critical decisionseffectively and improve their productivity

Our Vision:

Large and profitable markets with potential to create value for customers

Leading and distinct positions in key professional segments

Emerging customer needs and technologies create opportunities to build new products and services

Build on proven capabilities in content development, technology and customer service

4January 2004

What Will Be Different:

Going Forward

Growth by investing in leading market positions, guided by ROIC

Integrated, customer focused divisions, managed with operational and financial rigor

Alignment of investments around leading market positions

Six Key Performance Measures linked to shareholder value

Past

Acquisitions cornerstone of strategy

Fragmented, decentralized managed business

Investments applied broadly across many opportunities

Multiple performance measures for corporate, cluster and operating units

5January 2004

Overview

Invest in growth around leading market positions

Reduce costs through structural improvements to deliver growth and improve manageability

Reorganize the business to deliver growth

Establish clear and transparent financial targets tied to shareholder value

Maintain dividend at € 0.55 per share for 2003

Reduce debt position through sizeable bond buy back

3-Year Plan To Deliver Improved Value To Shareholders

6January 2004

Accelerate Investments In Growth by €200 Million To A Cumulative Level of €800 Million Over The Next 3 Years

Keep current portfolio, but manage it differently and in line with growth expectations

Strengthen and expand customer relationships

Deliver end to end solutions

Invest in on-line growth and migration to achieve 45% of 2006 revenues from electronic products (currently 30%)

Pursue acquisitions, only selectively

ROIC Is The Key Financial Measure Of All Actions

7January 2004

Reduce €240 Million In Cost Base From 2003 To 2006 Through Structural Improvements

Develop shared services in Finance, HR and select Technology functions

Consolidate real estate

Rationalize back office functions within operating companies and across divisions

Standardize and consolidate technology platforms, data centers and increase use of off-shore development and IT outsourcing

Total FTE Reductions from 2003 to 2006:1600 FTEs (~ 8%)

8January 2004

Reorganize Business To Deliver Growth

Organize business into five divisions, focused on distinct customer segments

Manage the business differently and in line with shareholder interests

- Integrate units into larger, less fragmented businesses

- Drive operational performance at corporate and divisions with commitment and urgency

- Set high standards of performance centered on company values of customer value, accountability, and value creation

- Establish realistic, bottom up targets, tied to shareholder value

- Link long term executive compensation to improvements in TSR

- Strengthen management team

9January 2004

Revenue growth

EBITA margin

After exceptional items

Cash conversion

Free cash flow

ROIC

EPS

Key Operational Measures

Key Financial Measures

0-1%

14-15%

13-14%

85%

Target 2004

€ 150-200 mln

Moving towards WACC*

0.99

3-4%

19-20%

85-90%

2007 onwards

> € 300 mln

Above WACC*

> 1.40

Strategy Will Increase Shareholder Value

* WACC is currently 8% after tax

10January 2004

Actions To Date Support New Strategic Direction

Restructuring begun at Health, North America and Europe

Turnaround underway in the UK, Belgium and Aspen

Aggressive cost reduction plans in place for 2003

Much tighter, more disciplined acquisition policy

Significant management changes and new governance model

AgendaAgenda

Opening Remarks

Overview

Corporate Strategy

– Growth Plan


– Organization



Summary

12January 2004

Our Strategy:

Invest in growth around leading positions

22 Reduce costs through structural improvements

11

Reorganize the business to deliver growth33

13January 2004

Our Strategy:



11


14January 2004

ROIC is the Key Financial Measure of All Actions

Pursue Selected Acquisitions

Invest In Online Growth and Migration

Manage Portfolio In Line With Growth Opportunities

Deliver End-To-End Solutions

Strengthen and Expand Customer Relationships

Invest In Growth: Key Actions

15January 2004

Portfolio Of Five Significant Businesses With Powerful Brands

Corporate & Financial Services

Health EducationLegal, Tax &

Regulatory Europe

Tax, Accounting & Legal

(US & Asia Pacific)

16January 2004

WK's Market Position

13%

45%

16%

33%

87%100%

55%

84%

67%

Tax, Accounting

& Legal

€ 772 mln€173 mln

Legal, Tax &

Regulatory Europe

€1,355 mln€239 mln

Corporate & Financial

Services

€526 mln€166 mln

Health

€749 mln€131 mln

Education

€300 mln€56 mln

2002:Total Revenues €3,895 mlnTotal EBITA €777 mln*

Leading Market Positions

#1 or 280%

Not #1 or 2

20%

ProRata new divisions; excluding divested non-core Revenues €193 mln; EBITA €49 mlnSources: Company financials, analyst reports, WK analysis

RevenuesEBITA

* Including Corporate Charge €37 mln

17January 2004

Wolters Kluwer’s Key Sources of Growth

Prune Product Line or Divest: €125-150 million with limited profit potential

Moderate GrowthTax, Accounting & Legal

(North America & Asia Pacific)

Steady Growth Education

Manage Portfolio In Line With Growth Opportunities

Legal, Tax and RegulatoryEurope

High Growth Health Corporate & Financial Services

18January 2004

Key Growth Areas: Health, Corporate & Financial Services

DivisionMarket

Size

Market Growth

(2004-2006)Key Growth Investments

Health $ 5.3 bln 2-5%Clinical tools innovationContent expansionInternational expansion

Corporate and Financial Services

$ 1.1 bln 3-5%

Corporate legal department workflow suiteLarge bank market expansionPatriot Act compliance and fraud managementInsurance and securities workflow tools

Tax, Accounting & Legal (US & Asia Pacific)

$ 2.9 bln 2-3%Integrated content productsNew content and forms platformTax compliance and practice management suite

Legal, Tax & Regulatory Europe

€ 4.1 bln 2-3%European Internet Platform / On-line productsForms, services, workflow tools

Education € 1.4 bln 1-3%Additional textbook positionsSchool services

Sources: Company financials, analyst reports, WK analysis

19January 2004

Tax Compliance: An Example Of Growth

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%O

rgan

ic G

row

th

Organic Grow th 5.0% 6.0% 7.0% 7.0%

2000 2001 2002 HY2003

20January 2004

Example Ovid

Strengthen And Expand Customer Relationships

Value Added ProductsResearchers

Workflow Integration

Value Added ProductsContent Creators

Ovid@Hand

SkolarMD@Ovid

Society Membership Module

Society Portal Creation

MS Office Research Pane

HP Medical Desktop

Pay Per View Access

Paperless Workflow

Peer Review Tracking Software

Portal Toolkit

LinkSolver

Higher Retention Rates

Broader Distribution

Increased Revenue and Profit

OvidResearcher

Article Pre-publication

21January 2004

HealthMedi-Span, e-prescribing,

PDA products, SkolarMD@Ovid, Clineguide,

Medical Communications

Point-of-care Systems, Pharma Databases, Business Intelligence

Text and Reference, SkolarMD@Ovid, Other CME

LWW Text and Reference, LWW and Adis Journals, OVID, Medi-Span, Facts &

Comparisons


Expere, CCH Wall Street, Actimize, hCue, Representation, Corporate and UCC compliance services, ARTA Lending, ARTA

Deposit, eForms, IRA Center, Patriot Act Compliance

BSI Compliance Training, Learn@CT,

CLE Accredited Seminars

Primary and secondary content in corporate securities, banking, insurance and trade

regulations

Professional/ Other Education

Research/ Reference

Workflow Productivity

Business/Practice Management

Growth Area

EducationCurriculum-based

Publishing,Distance Learning

Deliver End-to-End Solutions:

Tax, Accounting &

Legal

Tax compliance systems and forms and systems, paperless

audit tool

Tax compliance, time and billing, web site building and

hosting, Client Relate

Aspen Legal and Paralegal Education, CCH Learning Center

Primary and secondary legal, tax , accounting, audit health and human resources content

Legal, Tax, & Regulatory

Europe

Forms, Compliance & Expert Software, Workflow Tools, Consulting Services (e.g.,

Croner) and Teleroute

Practice Management Software (primarily

Legal and Tax)

Training, Seminars

Primary and Secondary Content on print, electronic

and on-line media

General school services: ‘rent-a-teacher’, risk

assessment, teacher training, school management products

Testing/ assessment quality assurance, ICT components,

Learning Management Systems, corporate e-learning,

22January 2004

Wolters Kluwer has in recent years invested significantly in online products and electronic compliance tools

– Internet and other Electronic revenues growing rapidly

– Represent 30% of current total revenues

– Management projects to reach 45% of total revenues by 2006

Invest In Electronic Growth & Migration: 45% Of Revenues By 2006

23January 2004

Strategy Attractive Market Strengthen Leading Positions Leverage/Enhance Scale Platform For Future Growth in

Emerging Markets

Integration Short Term Viability More Rapid Integration Market/Product & Organizational Fit

Transaction Relevant Size Ease Of Execution Regulatory Constraints

Financial Investment Requirements Risk exposure Incentivized earn-outs ROIC above hurdle rates

(Current WACC 8% after tax)

Pursue Selected Acquisition Opportunities

24January 2004

Accelerate Investments In Growth by €200 Million To A Total Level of €800 Million Over The Next 3 Years

All divisions investing to enhance core products and build new products to support customer demand for tools and solutions as well as changes in law, medicine and education

Investments focused on Health and Corporate & Financial Services divisions

Incorporates investments communicated previously for Europe and North America

25January 2004

Our Strategy:



11


26January 2004

Total FTE Reductions from 2003 to 2006:1600 FTEs (~ 8%)

Consolidate real estate

Standardize and consolidate technology platforms, data centers and increase use of off-shore development and IT outsourcing

Rationalize back office functions within operating companies and divisions

Develop shared services for Finance, HR and some Technology functions

Reduce Costs Through Structural Improvements: Key ActionsReduce Costs Through Structural Improvements: Key Actions

27January 2004

Cost Savings Over Three Years Will Be €240 Million

Division

Education

Selective Shared Services

Real Estate Consolidation

Back Office and System

Rationalization

IT Rationalization

Restructuring Costs* ’03-’06

€ mln

Cost Savings’03-’06€ mln


Tax, Legal & Regulatory Europe

40 50

80 80

Health


35 40

45 55

15 15

TOTAL ~ 215 ~ 240* Shared services initiatives may cause divisional differences

28January 2004

A Restructured Operating Base Reduces Costs And Improves Execution

Provides permanent savings to fund growth initiatives

Simplifies our business to improve customer relationships and speed decision-making

Creates larger and more integrated businesses

Provides a more flexible cost structure

29January 2004

Impact of Restructuring 2003-2006

RestructuringCosts* (€ mln)

FTEReductions

Total Cost Savings (€ mln)

2003 2004 2005 2006

100 80 25 10

500 500 400 200

20 40 80 100

TOTAL

~ 215

~ 1600

~ 240

Beyond 2006, annualized cost savings of about €100 million

* Of which € 150 mln will be charged as exceptional items

30January 2004

Our Strategy:



11


31January 2004

Reorganize The Business To Deliver Growth

Organize business into five divisions, which become primary operating units

– Organize into customer driven businesses with distinct growth opportunities

– Drive integration of operating units

– Simplify businesses through consolidation of functions, elimination of management layers and combined locations

– Provide day to day management

Shift in Corporate Governance

– Divisions report to Chairman of Executive Board

– Formation of Executive Committee

– Greater operational role for corporate office

Strengthen corporate HR, Technology and Strategic Planning

32January 2004

Organisation Structure

* Asia Pacific will report to Jean-Marc Detailleur in 2004

Health

Christopher Ainsley

Health

Christopher Ainsley

Education

Harry Sterk

Education

Harry Sterk


(US & Asia Pacific*)


(US & Asia Pacific*)

ChairmanNancy McKinstry

ChairmanNancy McKinstry

Shared Services Europe

Shared Services Europe


Christopher Cartwright


Christopher Cartwright


Rolv Eide


Rolv Eide

Create two divisions within LTBNA

Merge Asia Pacific into US Tax, Accounting & Legal division

Create shared services in North America and in Europe

Shared Services North America

Shared Services North America

33January 2004

Strengthen Management Team

External Appointments(Last 12 months)

Current Role Experience

Bob Becker CEO LegalJupiter Media MetrixThe Thomson Corporation

Rolv Eide CEO Legal, Tax & Regulatory EuropeTele AtlasDun and Bradstreet

Kevin Entricken CFO Aspen Reed Elsevier

Fred Grainger MD Nelson ThornesGlobalenglish CorporationThe Thomson Corporation

Arjen Holl MD Wolters NoordhoffReed Elsevier

Andres Sadler Senior VP StrategyAccentureBooz, Allen & Hamilton

Erik Tamboryn MD Wolters PlantijnVNUUnilever

Boudewijn Beerkens Member Executive Board / CFO PricewaterhouseCoopers

Gustavo Dobles VP Operations & IT AspenAOL Time Warner Little Brown Publishing

AgendaAgenda

Opening Remarks

Overview

Corporate Strategy

– Growth Plan


– Organization



Summary

Health DivisionHealth Division

36January 2004

Health Market Size ($5.3 bln) Key Trends & Dynamics

Health – Attractive Market

$ 5.3 bln market growing at 2-5% per year

Medical research: Growing medical budgets

Professional & Education: Growth in allied health and nursing

Pharma Solutions: Increased spend on R&D data and tools

Clinical Tools: Demand for evidence based medical tools.

High Growth (>5%) Moderate Growth (2-5%) Flat to Declining (<2%)

Source: Company financials, analyst reports, Outsell, Verispen, Pharmaceutical Executive, WK information, WK analysis

Medicine $317 mln

Nursing $245 mln

Health Professionals$173 mln

AnatomicalCharts $38 mln

Referential DrugInformation $346 mln

Integrated DrugInformation $66 mln

Business & ClinicalIntelligence $125 mln

MedicalCommunications

$1,250 mln

Detail Aids$600 mln

Teaching Hospitals$521mln

Private Hospitals$624 mln

ResearchOrganizations

$1,021 mln

Professional & Education

Medical Research Clinical Tools

Pharma Solutions

37January 2004

Strong Share In WK Market Segments

Market ShareMarket = $ 5.3 bln

Reed17%

Thomson9%

WK13%

Other59%

McGraw Hill 1%Pearson 1%

WK Highlights

Leading global online medical platform

Three of the top ten titles in all critical specialties in medical and nursing

Largest repository of full text and bibliographic medical content

Key publishing partner for more than 60 top medical societies

Source: Company financials, analyst reports, Outsell, Verispen, Pharmaceutical Executive, WK information, WK analysis

38January 2004

Health Strategy

Reduce CostsReduce Costs Develop shared services in finance and HR Consolidate production, fulfillment and distribution22

Reorganize Reorganize Organize around four customer segments Enhance presence in select international markets33

InvestInvest11

Drive penetration and use of on-line platform

Strengthen core text and reference business

Pursue growth in pharmaceutical and clinical tools

Drive penetration and use of on-line platform

Strengthen core text and reference business

Pursue growth in pharmaceutical and clinical tools

39January 2004

Corporate & Financial Services Division

40January 2004

Corporate & Financial Services — A High Growth Potential Market

A $1.1 bln market growing at 3-5% per year

Increasing need for compliance, risk management and outsourcing solutions

Positive impact of regulations

Stable representation market

Growth in end-to-end automation of client work

Addressable Market Size* ($ 1.1 bln) Highlights

Sources: Annual Report of the Jurisdictions, Representation Data from Delaware, Lieberman Research Group, Hase –Shannen ResearchFind/SVP, TowerGroup, Hoovers, D&B, Celente, Company financials, analyst reports, WK information

Representation, Corporate, UCC

Search and Filing$743 mln

(70%)

Banking and Financial

Compliance$324 mln

(30%)

* Excludes national bank market where BSI has share of <3%, securities and insurance

41January 2004

Strong Market Share In Corporate & Financial Services

Corporate Legal Services Market ShareAddressable market = $743 mln

Legal Information

Services40%

Regional Players36%

CSC24%

Financial Compliance Services Market ShareAddressable market = $324 mln(*)

BSI46%

Others33%

Harland21%

#1 position in the communitybanks, credit unions and

mortgage lenders segment

Corporate

Representation leader since 1892

Registered agent to 200K businesses

Representing 80% of Fortune 1000

CT is the law firm’s preferred provider

Largest compliance services provider to the National Law Journal top 250

Financial

Limited direct competition in banking compliance

#1 position in community banks and mortgage segments

Aggressively pursuing regional/national segments

WK Highlights

Includes:GulfPak, CSI, CUNA Mutual, Greatland

Sources: Annual Report of the Jurisdictions, Representation Data from Delaware, Lieberman Research Group, Hase –Shannen ResearchFind/SVP, TowerGroup, Hoovers, D&B, Celente, Company financials, analyst reports, WK information

* Excludes national bank market where BSI has share of <3%, securities and insurance

42January 2004

Corporate & Financial Services Strategy

Reduce CostsReduce Costs Outsource select technology functions Streamline/automate service fulfillment workflows Consolidate real estate

22

Reorganize Reorganize Realign into customer-facing units Increase sales force effectiveness33

InvestInvest11

Strengthen position in corporate legal workflow tools

Build integrated solutions for banking, brokerage and insurance

Expand banking compliance – large banks / insurance

Strengthen position in corporate legal workflow tools

Build integrated solutions for banking, brokerage and insurance

Expand banking compliance – large banks / insurance

43January 2004

Tax, Accounting & Legal Division

44January 2004

Tax, Accounting & Legal Addressable Market ($2.9 bln) Key Trends & Dynamics

Tax, Accounting & Legal Markets — Fundamentally Attractive For WK

$2.9 bln Market

Tax and Accounting:

– Demand for more integrated research and compliance offerings

– Growth of tools for CPAs

– Expanding new services market

Legal

– Demand for specialty content associated with top authors/titles

– Lawyers requiring more integrated primary and secondary offerings

– Small law market growing and under-penetrated

Growth: 2-3%

Tax andAccounting$1,345 mln

Legal$1,542 mln

2-3%

Growth: 2-3%

Source: Company Reports, YE Company Reportgs, MSDW, UBS Warburg, Lehman Brothers, WK Analysis

Accounting, research &

software

Tax research & software

Small law firm

Law school textbook & study

aids

Secondary legal research content

$265 mln

$1,080 mln

$108 mln$80 mln

$1,354 mln

45January 2004

WK Is # 1 In TaxUS Tax Market Share

Addressable Market*: $1,080 mln

WK32%

Intuit 17%

BNA5%

Other22%

Thomson24%

US Legal Research Market ShareAddressable Market**: $1,542 mln

Other10%

West44%

BNA8%

Reed19%

ASPEN/CCH Legal

19%

WK Highlights

Leading position in tax research and compliance markets

Top Tax Compliance Product - #1 in 5 out of 10 offerings

94 of the top 100 US accounting firms are CCH and/or tax compliance customers

#1 in Securities law and other speciality areas

* Excludes accounting market, Asia Pacific and Canada ** Includes specialized legal content and law school marketSource: Company Reports, YE Company Reports, MSDW, UBS Warburg, Lehman Brothers, WK Analysis

46January 2004

Tax, Accounting & Legal Strategy

Reduce CostsReduce Costs Outsource select technology functions Consolidate real estate Develop shared services in Finance and HR

22

Reorganize Reorganize Realign into customer-facing units Merge Asia Pacific under this unit33

InvestInvest11

Fix Aspen

Expand #1 position in tax and rapidly build position in accounting

Deliver integrated content and software suites

Strengthen content delivery platform

Fix Aspen

Expand #1 position in tax and rapidly build position in accounting

Deliver integrated content and software suites

Strengthen content delivery platform

47January 2004

Legal, Tax & Regulatory Europe Division

48January 2004

Market Size (€ 4.1 bln) Key Trends & Dynamics

Legal, Tax & Regulatory, Europe — A Large, Moderate Growth Market For WK

A € 4.1 bln market

Country differences drive demand for local content/offerings across all markets

Mostly local competitors

Growing demand for more integrated tax and accounting workflow and compliance tools

Legal market driven primarily by secondary content and tools – slower online platform adoption

Regulatory markets expanding at the local, country and EU levels

By Market Segment (€ mln)

Other103

(3%)

SC148 (4%)

CE155 (4%)

UK230 (6%)

Spain 255 (6%)

Belgium 278 ( 7%)

NL289 (7%)

EHS298 (7%)

Transport183 (4%)

Tax & Accounting

1,213(30%)

HR508

(12%)

Public &Social

705(17%)

Legal1,209(30%)

Italy543

(13%)

France632

(15%)

Germany1,483(35%)

By Country (€ mln)

Source: Company Reports, D&B estimates, Analyst Reports and MSDW

49January 2004

Highlights

A Clear Leader In Europe:

Leading provider of information, software tools and services for European tax and accounting, legal and regulatory markets

Balanced national presence

Deeply rooted local brands and recognized content quality

#1 or #2 player in almost every core market and geography

Strong penetration and market shares

* Environment, Health & SafetySource: Company Reports, D&B estimates, Analyst Reports, MSDW, WK information and analysis

WK LTR Europe Market Position

NL F UK B I G S CE SC

Legal

Tax

HR

EHS*

Public/Social

Trans.

1 2 1 2 4 2 1 1

1 3 2 1 1 4 1 1 3

1 1 1 1 1 3 1 4 5

3 2 1 1 2 3 1 5 2

1 1 1 2 1 1 1 2

1 1

50January 2004

Reduce CostsReduce Costs Consolidate content delivery / software development Develop shared back-office services22

Reorganize Reorganize Establish Chief Publishing Officer (CPO) and Chief Services Officer (CSO) role in all countries33

InvestInvest11 Grow on-line penetration in all core markets

Extend into software tools and forms

Strengthen weaker positions opportunistically

Fix UK, Belgium and the Netherlands

Grow on-line penetration in all core markets

Extend into software tools and forms

Strengthen weaker positions opportunistically

Fix UK, Belgium and the Netherlands

Legal, Tax & Regulatory Europe Strategy

51January 2004

Education Division

52January 2004

Market Size (€ 1.4 bln) Market Attractiveness and Share Position

WK Is The Leader In European Education

Germany25%

Netherlands26%

U.K.21%

Sweden20%

Belgium 5%Austria 3%

Attractiveness

Stable, traditional text book business

Market-driven by multi-local content needs

Evolving electronic solutions

Attractive margins and stable cash flows; cycle improvement in next 3 years

Share

#1 in the Netherlands, Sweden, Belgium

#3 in the U.K.

#1 in Germany, in vocational; strengthening presence in primary

Source: Company Reports, D&B estimates, Analyst Reports, MSDW, WK information and analysis

53January 2004

Reduce Costs Develop shared back-office services

Right-sizing in country operations

Develop shared back-office services

Right-sizing in country operations22

Reorganize Strengthen senior management team33

Invest11 Reinforce text book publishing leadership position

Expand market share - mixed-media learning solutions

Pursue growth in adjacent markets

Reinforce text book publishing leadership position

Expand market share - mixed-media learning solutions

Pursue growth in adjacent markets

Education Strategy

AgendaAgenda

Opening Remarks

Overview

Corporate Strategy

– Growth Plan


– Organization



Summary

Q&A

55January 2004

Revenue growth

EBITA margin

After exceptional items

Cash conversion

Free cash flow

ROIC

EPS

Key Operational Measures

Key Financial Measures

0-1%

14-15%

13-14%

85%

Target 2004

€ 150-200 mln

Moving towards WACC*

0.99

3-4%

19-20%

85-90%

2007 onwards

> € 300 mln

Above WACC*

> 1.40

Strategy Will Increase Shareholder Value

* WACC is currently 8% after tax

56January 2004

Modify Short Term Incentive Plan

- Measures aligned to Key Performance Measures (KPMs) (e.g. ROIC, Personnel costs as percentage of sales)

- Top 220 managers

Create New Long Term Incentive Plan*

- Replaces existing stock option program

- Total Shareholder Return (TSR) and Return On Invested Capital (ROIC) are key performance measures of new plan

- Performance shares earned over 3 years

- Top 80 executives

Executive Compensation Tied To Shareholder Interests:

* AGM approval needed in April for Executive Board compensation

57January 2004

Financials

Reiterate Outlook 2003

EBITA margins 2003 at 17% (before exceptional items)

€ 100 million restructuring charge in 2003

Maintain Dividend at € 0.55 per share for 2003

58January 2004

Prudent Balance Sheet Management

1. Reduce Debt - Tender Offer for:

6.125% Bonds due 2005 and 5.50% Bonds due 2006

1.000% Convertible Bonds 2001 due 2006

2. Extend Debt Majurity - Euro denominated bond issue

Benchmark Euro offering - 10 year

Rationale:

Reduce re-financing risk in 2005 and 2006

Smooth the maturity profile and improve duration

Efficiently utilize existing cash position

Current low interest rate environment and strong, stable markets

Proactively address the redemption obligations of 2005/2006 and efficiently utilise cash

59January 2004

Transaction Summary

Tender offers: straight bonds and convertible

Success rate on the straight bond tender approx. 70% and the convertible tender 30%

We significantly reduced the debt redemption in 2005/2006 with approx. EUR 1.1 bln

New bond issue:

With the successful issue of EUR 700 mln 10.1 year notes due Jan. 2014, we prudently termed out our debt, significantly increasing our duration

60January 2004

OutcomeTender: Face/nominal value

Senior bond’05 € 550 mln: Tender, 69% buy € 380 mln

Senior bond’06 € 750 mln: Tender, 71% buy € 536 mln

Convertible ’06 € 700 mln: Tender, 30% buy € 210 mln

Total buy back: approx. € 1,125 mln

Sources: New senior bond € 700 mln Surplus cash € 425 mln

Total: approx. € 1,125 mln

Debt maturity profile

182

732

1.450

227

227

225182

227

227

700

225

704

352

-

200

400

600

800

1.000

1.200

1.400

1.600

2003 2004 2005 2006 2007 2008 2009 2013 2014+

Debt

in E

UR m

ln

Pre Sting

Post Sting

AgendaAgenda

Opening Remarks

Highlights / Executive Summary

Corporate Strategy

– Growth Plan


– Organization



Summary

62January 2004

Our Strategy Will Deliver Value To Shareholders

Invest in growth around leading market positions

Reduce costs through structural improvements to fund growth and increase flexibility

Reorganize the business to deliver growth by getting closer to our markets and customers

Manage the business in a fundamentally different way

– Operational focus and rigor

– Clear financial targets focused on ROIC

– Tighter alignment of management and shareholder interests

– Optimize financial structure and working capital

Now is the time to put this strategy in place. We have the people and processes in place to make this happen. We are determined to succeed.

AgendaAgenda

Opening Remarks

Overview

Corporate Strategy

– Growth Plan


– Organization



Summary

The Professional’s First ChoiceThe Professional’s First Choice

AppendixAppendix

66January 2004

EBITA Margin Development 2003-2004

Underlying Business

EBITA MarginIncluding Impact of Additional Product

Development Spend

Impact of Restructuring

2003 2004

17% 16-17%*

14-15%

14% 13-14%

*Effect of one-off cost savings in 2003

67January 2004

2002 EBITA (€ 777 mln)**2002 Revenues (€ 3,895 mln)

Wolters Kluwer

Non-Core*€ 340 mln

Education€ 300 mln

LTB Asia Pacific

€ 65 mln

LTB Europe€ 1,228 mln

LTB North America€ 1,214 mln

Health€ 748 mln

* non-core includes KAP, Ten, Hagen& Stam, ISBW** including corporate costs (excluding = € 814 mln) and before exceptional items

Non-Core*

€ 62 mln

Education€ 56 mln

LTB Asia Pacific€ 9 mln

LTB Europe€ 230 mln

LTB North America€ 326 mln

Health€ 131 mln

68January 2004

Definitions KPMs

Revenue growthThe outcome of total (recognized) revenue divided by the revenue of the previous period

EBITA marginEarnings before exceptional items, interest, tax, and amortization divided by revenue

Cash conversionCash flow from operations less net expenditure fixed assets / EBITA before exceptional items

Free cash flowCash flow from operating activities minus net expenditure in fixed assets and the release/appropriation of the acquisition provisions

ROIC (Return on Invested Capital)Full year EBITA before exceptional items and after tax, divided by average invested capital adjusted for cumulative goodwill amortization and goodwill charged to equity

Adjusted EPSEarnings (benchmark net income) divided by the fully diluted weighted average number of shares

Wolters Kluwer Strategy Update DELIVERING VALUE FROM LEADING POSITIONS.

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Transcript of Wolters Kluwer Strategy Update DELIVERING VALUE FROM LEADING POSITIONS.