John Wiley & Sons, Inc. (NYSE:JWa) (NYSE:JWb) announced today that third quarter revenue of $278 million increased 8% from $258 million in the same period of the previous year, or 9% excluding foreign exchange. Operating income increased 7% over the previous year’s third quarter, or 9% excluding foreign exchange. Adjusted earnings of $0.57 per diluted share for the third quarter increased 8%, excluding an income tax benefit in the current quarter, as described below. Reported earnings per diluted share for the third quarter including the tax benefit was $0.69.

The quarter's results were driven primarily by the global Scientific, Technical, and Medical and Professional/Trade businesses. Higher Education's revenue also increased during the quarter. The growth in earnings per diluted share reflects the positive effects of the increase in operating income and the share repurchase program, partially offset by increased interest expense resulting from higher rates and the one-time costs associated with the refinancing of the Company’s borrowing facilities. Results for the quarter were also adversely affected by the strengthening of the US dollar, primarily against the EURO and Pound Sterling.

For the first nine months of fiscal year 2006, Wiley’s revenue advanced 6% to $778 million. Adjusted earnings per diluted share for the nine-month period increased 7% to $1.36, excluding the income tax benefits in the current year, as described below. Reported earnings per diluted share for the nine-month period including the tax benefits was $1.59. During the first nine months of fiscal year 2006, the Company repurchased approximately 2.1 million shares of common stock at an average price of $39.40.

"Wiley had a solid third quarter with all of our global businesses contributing to these results," said William J. Pesce, President and Chief Executive Officer. "We are pleased that our 'must have' products and services, enabled by technology and new business models, are being well received by our customers. Based on year-to-date results, leading indicators, and market conditions, we anticipate full-year revenue growth in the mid-single digits and EPS growth in the high single digits, excluding the aforementioned tax benefits."

Mr. Pesce added, "We are honored to be included again on FORTUNE magazine's list of the '100 Best Companies to Work For'. Wiley continues to thrive nearly two hundred years after it was founded because its unique culture supports collaboration, open dialogue, and enduring relationships. This recognition is a tribute to my colleagues around the world whose integrity, creativity, and dedication have made Wiley one of the best performing companies in the industry." Wiley is the only publishing company on the list. As part of the selection process, FORTUNE randomly surveyed 400 Wiley colleagues about their views of the company, its culture, and practices.

In January, The Wiley Foundation announced the winners of the fifth annual Wiley Prize in Biomedical Sciences. Dr. Elizabeth H. Blackburn, Morris Herztein Professor of Biology and Physiology in the Department of Biochemistry and Biophysics at the University of California, San Francisco, and Dr. Carol Greider, Daniel Nathans Professor and Director of Molecular Biology & Genetics at Johns Hopkins University were chosen for their discovery of telomerase, the enzyme that maintains chromosomal integrity and the recognition of its importance in aging, cancer, and stem cell biology. The Wiley Prize in Biomedical Sciences recognizes contributions that have opened new fields of research or have advanced novel concepts or their applications in a particular biomedical discipline. It honors a specific contribution or a series of contributions that demonstrate significant leadership and innovation.

In the third quarter of fiscal year 2006, the Company reported an income tax benefit of $6.8 million or $0.11 cents per diluted share, on the resolution of certain tax matters. Separately, in the first quarter of fiscal year 2006, the Company recorded a tax benefit of approximately $7.5 million, or $0.12 per diluted share on the repatriation of earnings from its European subsidiaries. The first quarter tax benefit offsets a tax charge recorded in the fourth quarter of fiscal year 2005. Neither the tax charge in the fourth quarter of last year, nor the tax benefit in the first quarter of this year, had a cash impact to the Company. The Company has excluded these tax items from its analytical and narrative discussion to identify operating trends without unusual items.

Segment Highlights
Professional/Trade (P/T)
Wiley’s U.S. P/T revenue of $101 million for the third quarter advanced 10% over the prior year, bolstered by a solid holiday season and strong performances of its business, technology, and architecture/engineering categories. P/T’s finance and leadership lists, as well as the Sybex technology titles it acquired in May, helped to deliver the positive results. Revenue from licensing and website advertising, particularly Frommers.com, was very strong during the quarter. For the first nine months of the fiscal year, P/T revenue was 7% ahead of the previous year. Direct contribution to profit was up 5% for the quarter and 6% for the year-to-date period. The improved top-line results were partially offset by product mix and higher inventory provisions.

A number of titles published during the quarter contributed to the performance and attracted media attention. Most notable is The Little Book That Beats the Market by Joel Greenblatt, which published in November and was featured in The Wall Street Journal. This book has earned a place on most of the major bestseller lists, alongside other Wiley titles such as SuDoku For Dummies, Volumes I and 2 by Andrew Heron and Edmund James; Empire of Debt: The Rise of an Epic Financial Crisis by William Bonner and Addison Wiggin; J.K. Lasser’s Income Tax 2006; Investing For Dummies by Eric Tyson; and Five Dysfunctions of a Team by Patrick Lencioni. Lencioni’s latest book, Silos, Politics, and Turf Wars, was successfully released during the quarter, as was Hedgehogging by Barton Biggs, the well known Morgan Stanley investment management chairman turned hedge fund entrepreneur.

Several magazines and newspapers cited Wiley cookbooks in holiday best-of-the-year round-ups, including Paula Wolfert’s Cooking of Southwest France (New York Times, National Public Radio); Lisa Yockelson’s ChocolateChocolate (New York Times, Boston Globe); Elizabeth Karmel’s Taming the Flame: Secrets for Hot-and-Quick Grilling and Low-and-Slow BBQ (Boston Globe, Chicago Tribune); Leslie Revsin and Rick Rodgers’ The Simpler the Better: Sensational One Dish Meals (Boston Globe); Laxmi Hiremath’s The Dance of Spices: Classic Indian Cooking for Today’s Home Kitchen (Boston Globe, Chicago Tribune); and Cecilia Hae-Jin Lee’s Eating Korean: From Barbecue to Kimchi, Recipes from My Home (Boston Globe).

A graphic redesign of Frommers.com was launched in November, providing a fresh online look for the brand, more user-friendly navigation features, a visitor’s poll to entertain and retain visitors, and instant messaging capability.

P/T is delivering its content to customers in a variety of new formats. Impact Audio downloads to facilitate study for the CPA exam were published in the quarter. Four Web CT/Blackboard courses, which provide test banks and supplementary course material for professors and students, were released in November.

In January, Wiley acquired the publishing assets of the Stock Trader's Almanac from the Hirsch Organization. Since 2004, Wiley has been the co-publisher of this unique and popular suite of print and online books, newsletters, and analytical tools for the finance market, but will now have the opportunity to extend the brand by developing new products.

Scientific, Technical, and Medical (STM)
Wiley’s U.S. STM business continued to deliver excellent results in the third quarter with revenue of $50 million up 15% over the previous year’s comparable period. Subscription and non-subscription journal revenue from advertising, commercial reprints, and journal backfiles contributed to these results. The reference book program continues its strong performance, driven by strong title output and global market strength. For the first nine months of the fiscal year, STM revenue grew by 9%. STM’s contribution to profit increased by 12% during the quarter and 11% for the year-to-date period, reflecting the combined effects of higher non-subscription journal revenue and improved book margins.

The value of Wiley’s journals to the research community was evident in the 26% increase in the number of full-text accesses to the more than one million journal articles available on the Company’s online service, Wiley InterScience. This significant gain was fuelled by increased traffic from search engines and the addition of backfile articles. The value of Wiley’s content is also reflected in the results of the ISI Impact Factor Analysis released in 2005, an independent ranking that measures how often individual journal articles are cited by researchers. Many of Wiley’s journals, such as the Journal of Biomedical Materials Research, Catheterization and Cardiovascular Intervention, Neurology and Urodynamics, Head and Neck, and the American Journal of Physical Anthropology, showed significant increases.

In November, STM acquired Dialysis and Transplantation, an advertising focused publication that is the world’s oldest peer reviewed journal for renal care, catering to nephrologists, internists, surgeons, and other physicians in more than 130 countries. Multi-year agreements were signed with the Crohn’s and Colitis Foundation of America to publish the journal, Inflammatory Bowel Diseases, beginning in 2007, and the National Association of Research in Science Teaching to continue publishing the Journal of Research in Science Teaching.

Soon after the close of the third quarter, STM signed a multi-year agreement with The American Ceramic Society to publish 20-30 books and conference proceedings. STM also renewed its book publishing agreement with the IEEE, the premier professional organization for electrical and electronics engineers around the world.

Higher Education
Revenue of Wiley’s U.S. Higher Education business increased 3% during the third quarter to $46 million, driven by year-on-year growth in science and mathematics. For the first nine months of the year, revenue increased 2%. Higher Education’s direct contribution to profit was essentially flat with prior year for the quarter and the nine-month period, as the profit generated by the revenue growth was offset by investments, primarily to support WileyPLUS, the highly successful online learning service.

WileyPLUS (formerly known as eGrade Plus) continued to gather momentum around the world with significant adoptions in the U.S., Canada, Europe, and Asia, as well as in non-traditional academic settings. Since it was first introduced in 2003, more than 250,000 students have purchased WileyPLUS with their course materials. In a recent survey of students who used WileyPLUS, 89% responded that it increased their understanding of the course material and 69% said it helped them achieve a better grade. WileyPLUS was named a finalist by the Software & Information Industry Association in its 21st Annual CODiE Awards. WileyPLUS was named one of five finalists in the Education Category for "Best Postsecondary Course or Content Management Solution."

During the third quarter, Higher Education signed a new agreement with the National Geographic Society, extending Wiley's global partnership with the Society, to create new products sold exclusively with Wiley textbooks and WileyPLUS.

As part of an ongoing copyright enforcement program, Wiley successfully stopped 45 infringers from selling instructor solutions manuals on eBay. Since the program began a year ago, Wiley has issued 550 cease and desist letters and negotiated settlements to shut down these operations and recover damages.

Europe
Wiley Europe’s revenue was up 10% for the third quarter and the first nine months of the fiscal year. Excluding foreign currency exchange effects, revenue was up 16% for the quarter and 12% for the year-to-date period. This robust performance was attributable to the STM journal and book programs, as well as P/T products, specifically, SuDoku For Dummies. The growth in Wiley Europe’s direct contribution to profit, excluding the currency exchange impact, was 17% for the third quarter and 12% for the year-to-date period, or 11% and 9%, respectively, including the currency impact.

Sales of SuDoku For Dummies, Volumes I, 2, and 3 by Andrew Heron and Edmund James continued at a phenomenal pace. In December, Kakuro For Dummies by Andrew Heron published to similarly strong demand. Neuro-linguistic Programming For Dummies and eBay.co.uk For Dummies were also top performers. Eleven German-language For Dummies titles were published successfully during the third quarter. The European market for STM products delivered through Wiley InterScience remained strong.

During the quarter, Wiley-VCH, which is based in Germany, announced a publishing partnership with leading chemical societies in China, India, Japan, Korea and Germany to publish a new journal, Chemistry – An Asian Journal. Nobel Laureate Ryoji Noyori will serve as Chairman of the Editorial Board. Complementing its sister journals, Chemistry – A European Journal (published on behalf of the Editorial Union of European Chemical Societies) and Angewandte Chemie (published on behalf of the German Chemical Society) the new journal will provide a highly visible arena for prominent researchers from around the world, especially from Asia.

In December, the U.K. Parliament conducted a debate on the Science and Technology Select Committee's report on scientific publications, and reiterated its position that the government should not intervene in the market nor fund institutional repositories.

Asia, Australia, and Canada
Wiley’s revenue in Asia, Australia, and Canada increased by 8% during the third quarter and the first nine months of the fiscal year. Excluding foreign currency effects, the year-to-date gain was 5%. Contributing to these results were strong sales in Asia, especially in India, Japan and China. Wiley Canada benefited from improved sell-through of Higher Education products and improved P/T sales. Wiley Australia’s third quarter revenue growth was outstanding for its Higher Education business. The segment's direct contribution to profit was flat for the quarter and for the nine-month period. Higher selling and shipping costs and product mix contributed to these results.

At the close of the quarter, Wiley Asia completed the acquisition of the outstanding shares of Wiley Dreamtech (India) Private Ltd. This acquisition is an important step in the Company's plans to grow Wiley's presence in India, extending its sales and marketing reach for all Wiley products in an important and rapidly growing market. Wiley acquired a majority interest in Dreamtech in 2001 as part of its highly successful acquisition of Hungry Minds Inc., which brought to the company such well known brands as For Dummies, Frommer's, and CliffsNotes, among others. Wiley has had a presence in India since 1965.

Conference Call Instructions

Wiley will hold a conference call on Tuesday, March 7, at 10:30 a.m. (ET) to discuss its financial results for the third quarter of fiscal year 2006. The call will include a brief management presentation followed by a question and answer session.

To participate in the conference call, please dial the following number approximately ten minutes prior to the scheduled starting time:

Callers outside the U.S. may participate by dialing: (913) 981-5532

A replay of the call will be available from 1:30 p.m. (ET) on Tuesday, March 7 through midnight (ET) on Monday, March 13 by dialing (888) 203-1112 or (719) 457-0820 and entering Passcode 9356164. A live audio Webcast will be accessible at http://www.wiley.com/go/communications. A replay of the Webcast will be accessible for 14 days afterwards.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995

This report contains certain forward-looking statements concerning the Company's operations, performance, and financial condition. Reliance should not be placed on forward-looking statements, as actual results may differ materially from those in any forward-looking statements. Any such forward-looking statements are based upon a number of assumptions and estimates that are inherently subject to uncertainties and contingencies, many of which are beyond the control of the Company, and are subject to change based on many important factors. Such factors include, but are not limited to (i) the level of investment in new technologies and products; (ii) subscriber renewal rates for the Company's journals; (iii) the financial stability and liquidity of journal subscription agents; (iv) the consolidation of book wholesalers and retail accounts; (v) the market position and financial stability of key online retailers; (vi) the seasonal nature of the Company's educational business and the impact of the used book market; (vii) worldwide economic and political conditions; (viii) the Company's ability to protect its copyrights and other intellectual property worldwide and (ix) other factors detailed from time to time in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to update or revise any such forward-looking statements to reflect subsequent events or circumstances.

Founded in 1807, John Wiley & Sons, Inc., provides must-have content and services to customers worldwide. Its core businesses include scientific, technical, and medical journals, encyclopedias, books, and online products and services; professional and consumer books and subscription services; and educational materials for undergraduate and graduate students and lifelong learners. Wiley has publishing, marketing, and distribution centers in the United States, Canada, Europe, Asia, and Australia. The Company is listed on the New York Stock Exchange under the symbols JWa and JWb. Wiley's Internet site can be accessed at http://www.wiley.com.

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