To Our Shareholders | Wiley had another excellent year, continuing our performance as one of the fastest-growing publishing companies. We have achieved double-digit compound annual growth in revenues and earnings during the past decade:

•  11% compound annual growth in revenues from fiscal 1992 to fiscal 2002;
•  26% compound annual growth in EBITA (earnings before interest, taxes, and amortization of intangibles), before unusual items, in the same period;
•  35% compound annual growth in net earnings per share, before unusual items, over the past decade.
•  Driven by this performance, Wiley's Class A stock has appreciated in value at a compound annual rate of 27% in the 10 years ended April 30, 2002.

SOLID RESULTS IN FISCAL 2002
We continued our growth in fiscal 2002 despite the weak economy and the impact of the events of September 11th. Revenues advanced 20%, including the acquisition of Hungry Minds. Revenue growth, excluding Hungry Minds, was 5%. Net income rose 10% in fiscal 2002, or 11% per diluted share, excluding an unusual charge for the relocation of the Company's headquarters to a waterfront site in Hoboken, New Jersey. The after-tax charge amounted to $7.7 million, or $0.12 per diluted share. We expect to incur an additional after-tax charge of approximately $2.5 million in the first quarter of fiscal 2003 for relocation-related expenses. The move to Hoboken provides a more collaborative and efficient workspace with room for expansion.

We maintained a healthy balance sheet, supported by operating cash flow of $140.4 million in fiscal 2002. The Company does not have any off-balance-sheet debt. After fiscal year-end, the Board of Directors increased the quraterly dividend on both the Class A and Class B Common Stock to $0.05 per share from $0.045, marking the ninth consecutive year in which the dividend has been raised.

ORGANIC GROWTH AND ACQUISITIONS
We are pleased with the past year's results, which were achieved through the continued effective execution of our strategy. We are creating value for our stakeholders by generating strong organic growth complemented by acquisitions. We have a well-established track record of acquiring companies at attractive prices and improving their performance. In fiscal 2002, we acquired several publishing properties for a total of $232.4 million, including Hungry Minds in September 2001 for $184.9 million, the largest acquisition in Wiley's history. Hungry Minds' extensive portfolio of best-selling brands includes the For Dummies series, the technological Bible and Visual series, Frommer's travel guides, CliffsNotes, and Webster's New World Dictionary. The integration and success of Hungry Minds offer a textbook case study of strategy, planning, and execution on the part of dozens of talented people working as a team throughout the organization. Since completing the acquisition, we have reduced costs and improved the distribution of Hungry Minds' products, especially through online channels. Equally important, the acquisition has strengthened Wiley's skills in brand management and product development. The acquisition was accretive to earnings in fiscal 2002 and is exceeding our expectations.

FOCUS ON THREE CORE BUSINESSES
Wiley is a leading provider of must-have content and services for communities of interest. Demand for our content and services continues to be driven by the rapid pace of change in science and technology, an increasingly global business environment, and favorable demographics. Our businesses are not heavily dependent on advertising revenues. With our leadership positions in attractive markets, we see many opportunities for continued growth.

•  Our professional/trade business publishes books and subscription products for professionals and consumers in targeted segments, including business, consumer, psychology, architecture, technology, teacher education, travel, reference, accounting, and culinary. Global revenues advanced 48% in fiscal 2002. While organic growth, excluding acquisitions, was 1%, if we leave out the September-to-December period following the terrorist attack, organic growth in our professional/trade business was 8%. The Hungry Minds acquisition approximately doubled the size of our professional/trade business, adding scale and enabling us to leverage our infrastructure to drive revenues and profits. Fiscal 2002 results were powered by several best-selling titles, including Windows XP For Dummies, the industry's top-selling computer book during the year; Martha Inc.: The Incredible Story of Martha Stewart Living Omnimedia by Christopher Byron, which was published on April 8th and quickly moved onto best-seller lists at The New York Times and many other periodicals; and The Ultimate Safe Money Guide: How Everyone 50 and Over Can Protect, Save and Grow Their Money by Martin Weiss, which appeared on best-seller lists at Business Week, The Wall Street Journal, and other publications.

•  Our scientific, technical, and medical (STM) business publishes journals, encyclopedias, books, and online products and services. Global revenues increased 7% in fiscal 2002. This business is moving rapidly into the electronic world. Wiley InterScience, our profitable online service launched commercially in January 1999, is now licensed by customers in 87 countries, delivering STM content to nearly six million scientists, researchers, academics, and professionals. Customer response has been strong, with more than 43,000 user sessions per day being recorded at the end of fiscal 2002, up from 23,000 per day a year earlier. We continue to add functionality and content to Wiley InterScience to increase its value to our customers and build its revenue stream.

•  Our higher education business creates educational materials, in print and electronic formats, for undergraduate and graduate students as well as for lifelong learners. Global revenues were up 5% in fiscal 2002. We are focused on courses in the sciences, mathematics, engineering, and accounting, with growing positions in business, computer science, psychology, education, nutrition, and modern languages. As the higher education community embraces technology, we are creating powerful platforms and tools — such as eGrade and Calculus Machina — that can be used across all our programs, yet can be customized to meet the needs of each course. In addition, we have approximately 1,700 Web sites that support our texts, as well as many Web-based free and for-sale supplements.

To optimize sales, we develop products that can be distributed globally. Examples include higher education titles such as Boyce and DiPrima: Elementary Differential Equations and Tortora and Grabowski: Principles of Anatomy and Physiology, both of which are used in classrooms worldwide; business titles such as the new second edition of Damodaran: Investment Valuation: Tools and Techniques for Determining the Value of Any Asset; and technology titles such as Chirillo: Hack Attacks Revealed. Including the Hungry Minds acquisition, about one-third of Wiley's revenues are generated outside the United States. We also optimize revenues by selling across markets, such as by selling professional/trade and STM products for use in college courses and selling higher education products for use by professionals.

THREE STRATEGIC GOALS
We measure our performance based on three strategic goals:

•  Increase profitability, cash flow, and return on investment. Wiley is a performance-driven company. We constantly seek ways to improve our financial results, as reflected in our excellent 10-year growth record.

•  Build long-term relationships with customers. A key strategic goal is to build lasting relationships with the communities we serve throughout their personal, educational, and professional lives. We are using the Web to facilitate customization, searchability, interactivity, and easier access to our deep reservoir of quality content, thereby serving our customers better and generating incremental revenue.

•  Strengthen the Company's position as the place to be for authors, employees, and partners. Wiley's leadership team recognizes that sustainable competitive advantage is achieved by attracting, developing, and retaining highly capable people and creating an environment in which these people work together, with authors and partners, to serve the needs of our customers.

MAJOR GROWTH STRATEGIES
We seek to achieve these goals by pursuing five key growth strategies:

•  Exploiting Wiley's global position and brands. Our ability to distribute content worldwide provides a competitive advantage, attracting authors and maximizing revenues.

In addition, brand recognition is increasingly important as competition among publishers intensifies. Our highly regarded brands and Wiley's reputation for quality and collaboration are hallmarks of authenticity to customers, authors, and other stakeholders.

•  Driving Web-enabled revenue growth. We are leveraging the Internet as a growth vehicle by distributing content online, selling print products through online retailers, and developing direct-to-end-user capabilities. Including the Hungry Minds acquisition, approximately 25% of our global revenues are currently Web-enabled, and we expect that figure to increase to approximately 40% within the next three years. By employing technology to meet customer needs, rather than forging ahead with technology for its own sake, we have avoided costly mistakes.

•  Leveraging the connections among Wiley's core businesses. There are significant opportunities to capitalize on the connections among Wiley's three core businesses, such as by selling professional/trade titles into higher education markets and by sharing technology, like Wiley InterScience, across our businesses. We intend to fuel revenue and earnings growth by exploiting these connections even more in the future.

•  Pursuing strategic partnerships and alliances. We have formed product and marketing alliances with some of the most prestigious organizations in the world, including the Peter F. Drucker Foundation, CNBC, PricewaterhouseCoopers, Ernst & Young, the American Institute of Architects, the American Cancer Society, and the British Journal of Surgery Society Ltd. Our alliances have resulted in a growing list of top-selling titles, such as the new edition of the Culinary Institute of America's The Professional Chef, one of the world's most influential culinary books. We will continue to form new alliances that create value.

•  Building on our successful track record with acquisitions. During the past three years, we have invested more than $390 million in acquisitions. We remain opportunistic in our approach and have the financial resources to make acquisitions that fit our strategic goals and meet our high financial standards.

A COMMITTED LEADERSHIP
The leadership team responsible for Wiley's success during the past decade remains intact, reflecting its commitment to Wiley's long-term success and the Company's ability to attract and retain talent. This team's compensation is performance driven, including a competitive base salary and annual and long-term incentive plans. The annual incentive is based on the achievement of revenue, earnings, and cash flow goals and strategic objectives. The long-term incentive is comprised of performance shares and stock options. Performance shares are paid out only when earnings and cash flow goals projected in the Company's three-year strategic plan are achieved. The options have value only when the share price appreciates. Both forms of equity have vesting provisions that encourage retention.

OUTLOOK
We look to the future with confidence and enthusiasm. We anticipate another year of profitable growth in fiscal 2003, as we continue to implement our strategies. We thank Wiley's authors, employees, partners, and shareholders for their support and dedication to the Company's success.


William J. Pesce
President and Chief Executive Officer


Bradford Wiley II
Chairman of the Board

June 21, 2002