London – Reuters, the global information and technology group, will accelerate its previously announced business transformation to improve operational effectiveness and drive margin improvement in the core business.

These new initiatives will:

• increase the speed of decision-making and reduce organisational complexity by removing layers of management
• streamline the relationship between the four customer segments and their sales channels to enhance customer service
• accelerate the obsolescence of legacy products and focus on key product deliverables
• enable a new generation of executive talent to take on more senior responsibilities
• rationalise the Group portfolio by extracting synergies from large units (Instinet, Radianz, Tibco and Factiva) and generating proceeds from the disposal of non-core holdings.

These actions are expected to generate £100 million in annual savings, which are in addition to the previously announced £235 million of cost reductions planned for 2003. These new initiatives will reduce headcount by a further 650, primarily in senior and middle management ranks.

To achieve the benefits of these initiatives, Reuters will incur a restructuring charge of approximately £100 million in 2002 and realise £20 million in resulting cost savings this year. Reuters remains on track to achieve a core operating margin of 12% in 2002 before the £80 million net impact of this restructuring.

Tom Glocer, Reuters Chief Executive, said: “The customer segment organisation we put in place this January has provided us with greater control of our cost base and enabled us to accelerate our business transformation.

“While market conditions remain challenging, I see tangible progress being made towards meeting our 2002 targets for installing 3000 Xtra, deploying Reuters instant messaging and trade management tools, and improving customer service.

“The accelerated cost savings initiatives we announce today will improve our 2003 margin beyond 12% in advance of a general market recovery. We remain committed to our long term margin targets.”

End

Contact:

Investors – UK
Miriam McKay
Tel: +44 (0) 20 7542 7057
miriam.mckay@reuters.com

Press – UK
Peter Thomas/Adrian Duffield
Tel: +44 (0) 20 7542 4890/4728
peter.v.thomas@reuters.com or adrian.duffield@reuters.com

Investors and press – USA
Nancy Bobrowitz
Tel: +1 646-223-5220
nancy.bobrowitz@reuters.com

Note to editors:

Reuters (www.about.reuters.com) is the leading global provider of financial information, news and technology solutions to financial institutions, the media, businesses and individuals. Reuters strength is our unique ability to offer customers a combination of content, technology and connectivity. Our premier position is founded on continuous technological innovation and a reputation for speed, accuracy, integrity and impartiality. We have over 19,000 staff in 97 countries, including some 2,500 editorial staff in 230 bureaux serving approximately 160 countries, making us the world's largest international multimedia news agency. In 2001, Reuters Group had revenues of £3.9 billion.

This news release may be deemed to include forward-looking statements relating to Reuters within the meaning of Section 27A of the US Securities Act of 1933 and Section 21E of the US Securities Exchange Act of 1934. Certain important factors that could cause actual results to differ materially from those disclosed in such forward-looking statements are described in Reuters Annual Report and Form 20-F for the year to 31 December 2001 under the heading ‘Risk Factors'. Copies of the Annual Report are available on request from Reuters Group PLC, 85 Fleet Street, London EC4P 4AJ.

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