REED ELSEVIER NV Profit and loss accounts For the year ended 31 December 2003 Group Parent Company 2003 2002 2003 2002 Note € m € m € m € m Turnover Including share of turnover of joint ventures 3,571 3,991 – – Less: share of turnover of joint ventures (3,571) (3,991) – – – – – – Administrative expenses 1 (3) (3) (3) (3) Operating loss (before joint ventures) (3) (3) (3) (3) Share of operating profit of joint ventures Before amortisation and exceptional items 2 858 904 – – Amortisation of goodwill and intangible assets (323) (419) – – Exceptional items (53) (79) – – 482 406 – – Operating profit/(loss) including joint ventures 479 403 (3) (3) Share of non operating exceptional items of joint ventures 19 (9) – – 19 (9) – – Dividends received from joint ventures – – 200 150 Net interest income/(expense) Company 5 7 7 7 7 Share of net interest of joint ventures (129) (171) – – (122) (164) 207 157 Profit on ordinary activities before taxation 376 230 204 154 Tax on profit on ordinary activities 6 (134) (86) (1) (2) Profit attributable to ordinary shareholders 242 144 203 152 Equity dividends paid and proposed 7 (221) (221) (221) (221) Retained profit/(loss) taken to reserves 21 (77) (18) (69) Group Parent Company 2003 2002 2003 2002 Note € € € € Basic EPS 9 0.31 0.18 0.26 0.19 Diluted EPS 9  0.31 0.18 0.26 0.19 Adjusted EPS (before amortisation of goodwill and intangible assets and exceptional items) 9  0.69 0.69 Earnings per ordinary share ("EPS") The above amounts derive from continuing activities. 2003 2002 Note € m € m Adjusted group profit before tax 8 733 737 Adjusted group profit attributable to ordinary shareholders 8 540 542  Adjusted figures Adjusted figures, which exclude the amortisation of goodwill and intangible assets, exceptional items and related tax effects, are presented as additional performance measures, and are reconciled to the reported figures in note 8 to the financial statements. Group financial statements, reflecting Reed Elsevier NV’s 50% interest in the Reed Elsevier combined businesses, are presented using the gross equity method. 94 REED ELSEVIER ANNUAL REPORTS & FINANCIAL STATEMENTS 2003