Left to right, William J. Pesce, Chief Operating Officer; Bradford Wiley II, Chairman of the Board; and Charles R. Ellis, President and Chief Executive Officer, pose in the new Science, Industry and Business Library of The New York Public Library. The $100 million facility, to which Wiley is a contributor, is one of the most information-packed and technologically sophisticated libraries in the world, providing electronic access to catalogs, databases, and the Internet. The facility reflects some of the key changes taking place in Wiley's markets, including the growth of electronic publishing. Wiley continues to address these changes in a timely and effective manner with new products and services for the digital age. This annual report highlights some of the changes taking place in the publishing industry and Wiley's programs to profit from those changes. The competitive landscape of the publishing industry continues to evolve rapidly, driven by globalization and new digital technologies. We believe this is an exciting time of opportunity for Wiley. We have the people, the strategies, the financial resources, and the worldwide market presence to grow profitably in the changing global publishing industry. Our operations are focused on targeted market sectors within: scientific, technical, and medical (STM) publishing; educational publishing; and professional/trade publishing. We hold a leading competitive position in each of our chosen markets and continue to invest significantly in our businesses, targeting resources to areas of highest potential return. Moreover, we believe that being an independent, midsized publisher is a competitive advantage. It allows us to be highly focused and agile, with short lines of communication, and to identify opportunity and move quickly to capitalize on it. We invite you to read through this annual report to learn more about our fiscal 1997 results and our objectives for the coming years. FISCAL 1997 RESULTS Wiley achieved excellent revenue gains in the fiscal year ended April 30, 1997. However, earnings decreased from fiscal 1996 due primarily to the costs of acquiring and integrating VCH Publishing Group, an important element of our growth plans, and due to the one-time impact of a tax refund in 1996. Revenues advanced to $432.0 million in fiscal 1997, up 19% from fiscal 1996. Net income was $20.3 million, or $1.24 per share, compared with $24.7 million, or $1.49 per share, in fiscal 1996. Fiscal 1997 net income included a loss of $4.4 million, or $0.27 per share, for VCH, acquired in June 1996. This loss related to financing costs and the amortization of intangibles. Year-to-year earnings comparisons were skewed also by the inclusion in 1996 results of a special item of $2.6 million, or $0.16 per share, relating to interest received on the favorable resolution of amended tax return claims. We believe our 1997 earnings results, following four consecutive years of sharply higher net income, represent an expected pause in our growth, not a change in direction. Higher revenues and operating income in 1997 were driven primarily by the strong performance of our worldwide STM journals program and our college division. International operations performed well across the board. Revenues of our professional/trade publishing operations increased, but were below expectations. The largest single factor giving rise to that shortfall was a change in the inventory practices of some major distributors. This change masked the continued strength of our ultimate market - retail buyers of professional/ trade books and digital products. By the fourth quarter, the impact of this inventory downsizing appeared to be over, and we are cautiously optimistic about the prospects for renewed growth in professional/trade publishing in fiscal 1998. WILEY'S GROWTH STRATEGY As discussed in prior annual reports, since 1991 Wiley has dramatically improved its financial performance by implementing a strategic program aimed at maximizing return on equity, increasing cash flow, and sustaining profitable growth. We have refined that program a number of times as market conditions have warranted, but its basic elements remain in place: investment in our strong core businesses - STM, educational, and professional/trade; emphasis in STM and professional publishing on subscription and continuity products, which generate ongoing revenues and high cash flow; rapid international growth; and effective investment in technology-based products, and in infrastructure technology to improve operations and reduce costs. VCH: LANDMARK ACQUISITION In June 1996, we acquired 90% of VCH Publishing Group for approximately $99 million, financed by debt. Headquartered in Weinheim, Germany, Wiley-VCH Verlag GmbH publishes scientific, technical, and professional journals and reference works in both English and German. This key acquisition supports all four of our strategies: It represents a major investment in the growth of our STM business; it brings us important journals and other subscription products; it accelerates our international growth; and it provides a platform for developing new digital products. To date, the acquisition has exceeded our expectations. Although the impact of the acquisition on Wiley's earnings is initially dilutive because of the amortization of intangible assets and financing costs, Wiley-VCH is expected to be a net contributor to earnings about two years after acquisition, with increased contributions thereafter. In addition to being an important investment in Wiley's growth, the acquisition highlights our commitment to targeted subject areas across the company's businesses. For instance, the Wiley-VCH program includes a wealth of publications in chemistry, a fundamental discipline for Wiley not only in STM publishing but also in educational materials for college students. Our trade group even publishes chemistry books for children. Increasingly, we are seeking to capitalize on these and other subject area synergies by building a Wiley brand identity that overarches our publishing businesses. For example, the college student who uses a Wiley chemistry textbook, and who goes on to a career in science, becomes a customer for our STM products. We continue to be acquisition-minded, and have ample financial resources to make acquisitions in our core markets as attractive opportunities arise. GLOBAL GROWTH Global growth is an integral part of Wiley's future. With nearly half our revenues deriving from international markets, Wiley has one of the leading global positions in the publishing industry. We will continue to leverage that position to competitive advantage. Indeed, the disciplines in which we publish, including science, engineering, and business, lend themselves to globalism. For example, the research scientist in Asia or Australia is as eager for new information as is the scientist in North or South America, Europe, or Africa. Collaboration among our worldwide staff continues to increase. Products are developed with the objective of maximizing their global sales, not just their local or regional sales. We have global editorial strategies, global marketing plans, and global sales conferences. Technology and global growth are intertwined. The Internet and other online technologies allow products to be delivered instantly to customers anywhere in the world. INVESTMENT IN ELECTRONIC JOURNALS The VCH acquisition has moved Wiley to the front rank of STM publishers. STM publishing now accounts for approximately 47% of our worldwide revenues and a larger portion of earnings. We continue to invest in this business to support its profitable growth. In the coming year, we will implement a program to deliver nearly all our journals, STM and otherwise, as full-text electronic files over the World Wide Web of the Internet while continuing to publish them in print. Our objective is to fully exploit the potential of online publishing by providing effective, useful tools to our authors and customers and, thereby, to protect and grow our journals business. With the advent of online systems, the journals publishing industry has entered a period of transition. By developing an online publishing program that, we believe, will set a standard for the industry, we are clearly stating our commitment to the future of Wiley's journals business. MANAGEMENT We announced a number of executive changes, recognizing the vital importance of people to Wiley's continued success. Effective May 1, 1997, William J. Pesce assumed the new position of Chief Operating Officer, responsible for all the company's publishing divisions and subsidiaries. Mr. Pesce joined Wiley in 1989 and, since February 1996, had been Executive Vice President and Group President, Educational and International Publishing. His appointment as Chief Operating Officer reflects both the growth of the company and the orderly management development program we have instituted at Wiley in recent years. Mr. Pesce reports directly to Charles R. Ellis, President and Chief Executive Officer, to whom staff and corporate support operations continue to report, as well. This change will allow the CEO to devote more time to strategic planning, including the transition to an electronic future and global expansion. Bonnie Lieberman was named Senior Vice President and General Manager-College, effective June 22, 1996. Ms. Lieberman joined Wiley in 1990 and had been Vice President and Editorial Director for the College Division since fiscal 1991. Stephen A. Kippur, Executive Vice President and Group President, Professional, Reference, and Trade Publishing, was given oversight for Wiley-Canada. Mr. Kippur has been with Wiley for 18 years. Dr. Manfred Antoni was appointed Managing Director, Wiley-VCH, effective May 1, 1997. Since 1992, Dr. Antoni had been Managing Director of Schäffer-Poeschel Verlag, a leading business and economics publisher that is part of the Holtzbrinck Group in Germany. Dr. Antoni reports to Dr. John Jarvis, Senior Vice President, Europe. OUTLOOK We are confident and excited about Wiley's future. Assuming reasonable economic conditions, we anticipate solid revenue and earnings growth in fiscal 1998, as the dilutive impact of the VCH acquisition abates. Our five-year strategic program envisions favorable earnings results not only in 1998, but also in the years beyond. We thank you, our shareholders, for your patience in 1997 as we integrated the VCH acquisition, an important investment in the company's future. We are determined to justify your support by delivering substantially improved financial results in the future. We express our sincere appreciation to Wiley people worldwide for their commitment, creativity, and hard work on behalf of the company. Working as a team, Wiley people drive the company's success. We thank them for a job well done.

Charles R. Ellis President & Chief Executive Officer June 26, 1997	Bradford Wiley II Chairman of the Board