Press Release Details

Thomson Reports Third-Quarter 2005 Results

October 25, 2005 at 7:03 AM EDT
                               Revenues up 8%;
Organic revenue and adjusted operating profit growth across all market groups

STAMFORD, Conn., Oct. 25 /PRNewswire-FirstCall/ -- The Thomson Corporation (NYSE: TOC; TSX: TOC), one of the world's leading information services providers, today reported financial results for the third quarter ended September 30, 2005.

(Logo: http://www.newscom.com/cgi-bin/prnh/20020227/NYW014LOGO )

Revenues rose 8% to $2.39 billion in the third quarter as a result of growth in existing businesses and contributions from acquisitions.

Earnings for the quarter were $0.47 per share compared to $0.52 per share in the third quarter of 2004. After adjusting for one-time items, discontinued operations and the normalization of the quarterly effective tax rate, underlying earnings were $0.51 per share in the quarter compared to $0.47 per share in the previous-year period.

"It was another good quarter for Thomson, as we continued to implement our strategies and build upon our strong market positions and the underlying strength of our business model," said Richard J. Harrington, president and CEO of Thomson.

"Overall, revenue and operating profit growth was solid in the quarter, with each market group contributing to the increases. Importantly, revenues were driven by double-digit growth in online products, software and services. We are very pleased that the acceleration in organic revenue growth that we saw in the second quarter was sustained in the third quarter.

"Our strategy of developing comprehensive information solutions that enable our customers to be more productive and innovative continued to drive results at Thomson. Thomson Financial partnered with Merrill Lynch to complete its rollout of Thomson workstations to over 23,000 of Merrill's retail wealth managers. We have also seen continued market acceptance of Thomson solutions across our other businesses, including strong demand for Westlaw Litigator in the legal space and increased contract signings for our Thomson Pharma solution, which serves customers in the pharmaceutical and biotech research markets.

"Thomson also further strengthened its capital structure in the quarter by refinancing a portion of its debt, which included the issuance of $400 million of 30-year bonds. This was the first time Thomson issued 30-year debt and we were able to lock in very attractive rates.

"In addition, we continue to invest in initiatives designed to promote future growth and efficiencies across the company. We are well-positioned to build upon our strong foundation to drive growth, returns and free cash flow," Mr. Harrington concluded.

    Consolidated Third-Quarter Financial Highlights:
    -- Revenues increased 8% to $2.39 billion in the third quarter of 2005 as
       a result of organic growth and acquisitions.  Organic revenue growth
       accounted for approximately half of the overall revenue growth in the
       quarter.  Currency translation had no significant impact on overall
       growth in the quarter.
    -- Operating profit increased 6% to $522 million, driven by improvements
       in all market groups.  In the quarter, operating profit margins
       increased in three of the four market groups, but declined slightly on
       a consolidated basis.  The decline was due in part to higher corporate
       expenses, including increased pension expense.
    -- Earnings attributable to common shares were $308 million, or $0.47 per
       share, in the third quarter of 2005 compared to $344 million, or $0.52
       per share, in the same quarter of 2004.  One-time items impacting
       quarter-over-quarter comparisons included a $19 million expense in 2005
       primarily related to the early redemption of debt and a one-time
       benefit of $35 million in the third quarter of 2004 from the release of
       tax credits.  After adjusting for these items, discontinued operations
       and normalizing the tax rate in each period, underlying earnings were
       $336 million, or $0.51 per share, for the third quarter of this year
       compared with $308 million, or $0.47 per share, in the third quarter of
       2004.
    -- Free cash flow was $390 million, compared to $360 million in 2004.

    Market Group Third-Quarter Highlights:

    Legal & Regulatory
    -- Revenues grew 7% in the third quarter of 2005 to $864 million.
       Adjusted operating profit grew 10% to $248 million.
    -- North America-based as well as international online revenues continued
       to drive overall growth in the quarter.  The primary drivers of
       top-line growth of North America online were Westlaw, including
       Litigator, and Checkpoint.  International online revenue grew 20% due
       to good growth in European online products.  Thomson Tax & Accounting
       software products, FindLaw and tactical acquisitions also contributed
       to revenue growth in the quarter.

    Learning
    -- Revenues in the third quarter of 2005 were $810 million, an 8% increase
       over the prior-year period, and adjusted operating profit increased 5%
       to $249 million.
    -- Revenue growth in the third quarter of 2005 was the result of growth in
       the global higher education business, global library reference
       business, and contributions from acquisitions in the corporate
       e-learning and testing markets.
    -- Adjusted operating profit margin decreased slightly, primarily due to
       the loss of a significant e-testing contract in September 2004 as well
       as adverse timing of certain expenses.  Year-to-date margins remain
       unchanged.

    Financial
    -- Revenues increased 4% in the third quarter of 2005 to $475 million and
       adjusted operating profit increased 6% to $85 million.
    -- Growth continued to be driven by transaction-based businesses,
       including TradeWeb, as well as continued strong demand for Thomson ONE
       workstations.
    -- In the third quarter, TradeWeb launched its online market for trading
       U.S. dollar interest rate swaps, extending its reach into the
       $200 trillion interest rate swap market and Canadian investors started
       trading Canadian bonds using TradeWeb through an alliance with CanDeal.
       TradeWeb also continued to expand its asset classes and increase its
       quarterly transaction volume.
    -- Thomson ONE workstations increased 43% to 108,000, compared to the
       third quarter of 2004, as a result of continued user migration from
       legacy products and new client wins.  In addition, Thomson Financial
       partnered with Merrill Lynch to complete the rollout of more than
       23,000 workstations across more than 550 Merrill Lynch offices.
       Thomson is the largest provider of wealth management workstations to
       Merrill Lynch employees in North America.

    Scientific & Healthcare
    -- Revenues in the third quarter of 2005 were $248 million, up 17% from
       2004, and adjusted operating profit increased 17% to $48 million.
    -- Revenue growth in the quarter was driven primarily by acquisitions,
       particularly IHI, increased subscriptions for ISI Web of Science and
       Micromedex clinical knowledge solutions, as well as increased customer
       spending for Medstat healthcare decision support products.  In
       addition, the group saw accelerated organic revenue growth in the
       quarter.
    -- Thomson Pharma continued to make strides in the pharmaceutical and
       biotech research markets with increased contract signings of new
       customers as well as the migration of existing customers to the new
       platform.

    Corporate & Other
    -- Corporate and other expenses were higher in the quarter, due in part to
       increased pension expense, investments in programs to drive
       efficiencies across Thomson and higher stock-related expense.

    Nine-Month Results
    -- Revenues increased 9% to $6.30 billion in the first nine months of 2005
       as a result of organic growth, acquisitions and favorable currency
       translation.  Excluding the effects of currency translation, revenues
       rose 8% in the first nine months of the year.
    -- Operating profit increased 8% to $912 million, driven by strong
       improvements in all market groups.  Growth was partially offset by
       increased amortization expense and higher corporate expenses, including
       increased pension expense.  The first nine months of 2004 included a
       benefit from a $19 million insurance recovery.
    -- Earnings attributable to common shares were $681 million, or $1.04 per
       share, in the first nine months of 2005 compared to $571 million, or
       $0.87 per share, in the previous-year period.  Earnings in the 2005
       period included a one-time gain of $137 million from the release of tax
       credits related to prior-year periods.  Earnings in the 2004 period
       included a benefit from a legal settlement, and one-time tax benefits.
       After adjusting for these items, discontinued operations and
       normalizing the tax rate in each year, underlying earnings were
       $543 million, or $0.83 per share, for the first nine months of this
       year compared with $481 million, or $0.73 per share, in the first nine
       months of 2004.
    -- Free cash flow for the first nine months of 2005 was $775 million
       versus $691 million in the previous-year period, due to higher
       operating profit and lower capital expenditures resulting from
       efficiency programs and timing of certain expenditures.
    -- Acquisition activity: Thomson made a number of tactical acquisitions in
       the first nine months of the year for an aggregate cost of
       $198 million.

    2005 Financial Outlook

Thomson continues to expect full-year 2005 revenue growth to be in line with the Corporation's long-term target of 7% to 9% (excluding the effects of currency translation). Full-year 2005 revenue growth will continue to be driven by existing businesses supplemented by tactical acquisitions.

Operating profit margins are expected to expand slightly in 2005, reflecting continued operating improvements, partially offset by higher pension costs and corporate expenses.

Thomson also expects to continue to generate strong free cash flow in 2005.

    Media Contact:                    Investor Contact:
    Jason Stewart                     Frank J. Golden
    Vice President, Media Relations   Vice President, Investor Relations
    (203) 539-8339                    (203) 539-8470
    jason.stewart@thomson.com         frank.golden@thomson.com

    The Thomson Corporation

The Thomson Corporation (http://www.thomson.com), with 2004 revenues of $8.10 billion, is a global leader in providing integrated information solutions to business and professional customers. Thomson provides value-added information, software tools and applications to more than 20 million users in the fields of law, tax, accounting, financial services, higher education, reference information, corporate e-learning and assessment, scientific research and healthcare. With operational headquarters in Stamford, Conn., Thomson has approximately 40,000 employees and provides services in approximately 130 countries. The Corporation's common shares are listed on the New York and Toronto stock exchanges (NYSE: TOC; TSX: TOC).

The Thomson Corporation will webcast a discussion of third-quarter results beginning at 9:00 am EDT today. To participate in the webcast, please visit http://www.thomson.com and click on the "Investor Relations" link located at the top of the page.

Note: The Corporation's financial statements are prepared in accordance with Canadian generally accepted accounting principles (GAAP) and are reported in U.S. dollars. When applicable, prior periods are restated for discontinued operations. Adjusted operating profit, free cash flow and adjusted earnings from continuing operations are used by Thomson to measure the Corporation's and its segments' performance but do not have any standardized meaning prescribed by GAAP and therefore are unlikely to be comparable with the calculation of similar measures used by other companies, and should not be viewed as alternatives to operating profit, operating profit as a percentage of revenues, net earnings, cash flow from operations or other measures of financial performance calculated in accordance with GAAP. We reconcile non-GAAP financial measures to the most directly comparable GAAP measure in the following tables. Adjusted operating profit is defined as operating profit before amortization of identifiable intangible assets. We use this measure because we do not consider such amortization to be a controllable operating cost for purposes of assessing the current performance of our businesses. We also use adjusted operating profit margin, which we define as adjusted operating profit as a percentage of revenues. We evaluate our operating performance based on free cash flow, which we define as net cash provided by operating activities less additions to property and equipment, other investing activities and dividends paid on our preference shares. We use free cash flow as a performance measure because it represents cash available to repay debt, pay common dividends and fund new acquisitions. We present our earnings attributable to common shares and per share amounts after adjusting for non-recurring items, discontinued operations, and other items affecting comparability, which we refer to as adjusted earnings from continuing operations and adjusted earnings per common share from continuing operations. We use these measures to assist in comparisons from one period to another. Adjusted earnings per common share from continuing operations do not represent actual earnings per share attributable to shareholders.

The Corporation is no longer reporting adjusted EBITDA but will continue to report depreciation expense for each of its market groups, as set forth in the attached tables. Segmented results include the results of all operations. Prior to 2005, segmented results were presented on the basis of ongoing businesses, which excluded disposals. Disposals are businesses sold or held for sale, which did not qualify as discontinued operations. Results for the third quarter of 2004 were reclassified to present disposals within the appropriate market group.

This news release, in particular the section under the heading "2005 Financial Outlook" includes forward-looking statements, such as the Corporation's expectations and intentions regarding its full-year financial results and its strategy, that are based on certain assumptions and reflect the Corporation's current expectations. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. Some factors that could cause actual results to differ materially from current expectations are: actions of our competitors; failure of our technology investments to increase our revenues or decrease our operating costs; failure to fully derive anticipated benefits from our acquisitions; failure to develop additional products and services to meet customers' needs; failures or disruptions of our electronic delivery systems or the Internet; failure to meet the challenges involved in expanding outside North America; increased use of free or relatively inexpensive information sources; failure to obtain certain information through licensing arrangements and changes in the terms of our licensing arrangements; changes in the general economy; inadequate protection of our intellectual property rights; an increase in our effective income tax rate; and impairment of our goodwill and identifiable intangible assets. Additional factors are discussed in the Corporation's materials filed with the securities regulatory authorities in Canada and the United States from time to time, including the Corporation's annual information form, which is also contained in its annual report on Form 40-F for the year ended December 31, 2004. The Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.


                      Consolidated Statement of Earnings
           (millions of U.S. dollars, except per common share data)
                                 (unaudited)

                                     Three Months Ended     Nine Months Ended
                                     ------------------     -----------------
                                        September 30           September 30
                                        ------------           ------------
                                     2005        2004        2005        2004
                                     ----        ----        ----        ----
    Revenues                        2,391       2,223       6,299       5,771
    Cost of sales, selling,
     marketing, general and
     administrative expenses       (1,630)     (1,488)     (4,692)     (4,261)
    Depreciation                     (170)       (173)       (462)       (454)
    Amortization                      (69)        (70)       (233)       (210)
                                   -------     -------     -------     -------
    Operating profit                  522         492         912         846
    Net other (expense) income        (19)         (1)        (18)         28
    Net interest expense and other
     financing costs                  (59)        (63)       (169)       (176)
    Income taxes                     (144)       (100)        (56)       (148)
    Equity in net earnings (losses)
     of associates, net of tax          2          --           4          (1)
                                   -------     -------     -------     -------
    Earnings from continuing
     operations                       302         328         673         549
    Earnings from discontinued
     operations, net of tax             7          16          11          24
                                   -------     -------     -------     -------
    Net earnings                      309         344         684         573
    Dividends declared on preference
     shares                            (1)         --          (3)         (2)
                                   -------     -------     -------     -------
    Earnings attributable to common
     shares                           308         344         681         571
                                   =======     =======     =======     =======
    Basic and diluted earnings per
     common share                   $0.47       $0.52       $1.04       $0.87
                                   =======     =======     =======     =======
    Basic weighted average
     common shares            654,404,078 655,377,297 655,291,124 655,216,373
                              =========== =========== =========== ===========
    Diluted weighted average
     common shares            655,701,229 656,081,609 656,152,584 655,811,530
                              =========== =========== =========== ===========

    Supplemental earnings information:
    ----------------------------------
    Earnings attributable to common
     shares, as above                 308         344         681         571
    Adjustments:
       One time items:
        Net other expense (income)     19           1          18         (28)
        Tax on above item               1          --           1          11
        Release of tax credits         --         (35)       (137)        (35)
       Interim period effective tax
        rate normalization (1)         15          14          (9)        (14)
       Discontinued operations         (7)        (16)        (11)        (24)
                                   -------     -------     -------     -------
    Adjusted earnings from
     continuing operations            336         308         543         481
                                   =======     =======     =======     =======
    Adjusted basic and diluted
     earnings per common share
     from continuing operations     $0.51       $0.47       $0.83       $0.73
                                   =======     =======     =======     =======

    Notes to consolidated statement of earnings
    (1) Adjustment to reflect income taxes based on the estimated full-year
        effective tax rate of the consolidated group.  Reported earnings for
        interim periods reflect income taxes based on estimated effective tax
        rates of each of the group's jurisdictions.  The adjustment
        reallocates estimated full-year income taxes between interim periods,
        but has no effect on full-year income taxes.



                          Consolidated Balance Sheet
                          (millions of U.S. dollars)

                                               -------------------------------
                                                September 30,     December 31,
                                                   2005                 2004
                                               --------------     ------------
                                                (unaudited)
    Assets
    Cash and cash equivalents                        451                 405
    Accounts receivable, net of allowances         1,545               1,648
    Inventories                                      330                 312
    Prepaid expenses and other current assets        315                 313
    Deferred income taxes                            214                 214
                                               --------------     ------------
    Current assets                                 2,855               2,892

    Property and equipment, net                    1,555               1,624
    Identifiable intangible assets, net            4,536               4,721
    Goodwill                                       9,068               9,119
    Other non-current assets                       1,241               1,287
                                               --------------     ------------
    Total assets                                  19,255              19,643
                                               ==============     ============
    Liabilities and shareholders' equity
    Liabilities
    Short-term indebtedness                          302                   7
    Accounts payable and accruals                  1,491               1,738
    Deferred revenue                                 953               1,043
    Current portion of long-term debt                147                 295
                                               --------------     ------------
    Current liabilities                            2,893               3,083

    Long-term debt                                 3,979               4,013
    Other non-current liabilities                    822               1,015
    Deferred income taxes                          1,573               1,570
                                               --------------     ------------
    Total liabilities                              9,267               9,681

    Shareholders' equity
    Capital                                        2,728               2,696
    Cumulative translation adjustment                273                 458
    Retained earnings                              6,987               6,808
                                               --------------     ------------
    Total shareholders' equity                     9,988               9,962
                                               --------------     ------------
    Total liabilities and shareholders'
     equity                                       19,255              19,643
                                               ==============     ============



                     Consolidated Statement of Cash Flow
                          (millions of U.S. dollars)
                                 (unaudited)

                                          Three Months Ended Nine Months Ended
                                          ------------------ -----------------
                                                September 30    September 30
                                                ------------    ------------
                                                 2005   2004    2005    2004
                                                ------------    ------------
    Cash provided by (used in):
    Operating activities
    --------------------
    Net earnings                                  309    344     684     573
    Remove earnings from discontinued
     operations                                    (7)   (16)    (11)    (24)
    Add back (deduct) items not involving cash:
    Depreciation                                  170    173     462     454
    Amortization                                   69     70     233     210
    Net (gains) losses on disposals of
     businesses and investments                    (4)     1      (5)     (4)
    Loss on redemption of debt                     23     --      23      --
    Deferred income taxes                          23     (9)     26       4
    Equity in (earnings) losses of associates,
     net of tax                                    (2)    --      (4)      1
    Other, net                                     45     21      14     126
    Voluntary pension contribution                (11)    --     (11)     --
    Changes in working capital and other items    (75)   (68)   (211)   (205)
    Cash provided by operating activities -
     discontinued operations                       --     15      --      30
                                                ------------   -------------
    Net cash provided by operating activities     540    531   1,200   1,165
                                                ------------   -------------
    Investing activities
    --------------------
    Acquisitions(1)                              (152)  (155)   (248)   (810)
    Proceeds from disposals                         3     --       4      11
    Additions to property and equipment, less
     proceeds from disposals                     (138)  (159)   (397)   (430)
    Other investing activities                    (11)   (12)    (25)    (40)
    Additions to property and equipment of
     discontinued operations                       --     --      --      (2)
    Proceeds from (income taxes paid on)
     disposals of discontinued operations          --     --    (105)    137
    Cash used in other investing activities -
     discontinued operations                       --     --      --      (5)
                                                ------------   -------------
    Net cash used in investing activities        (298)  (326)   (771) (1,139)
                                                ------------   -------------
    Financing activities
    --------------------
    Proceeds from debt                            400     --     400     434
    Repayments of debt                           (411)  (332)   (556)   (332)
    Net borrowings (repayments) under
     short-term loan facilities                   132     13     296     (75)
    Premium on debt redemption                    (22)    --     (22)     --
    Repurchase of common shares                   (84)    --    (129)     --
    Dividends paid on preference shares            (1)    --      (3)     (2)
    Dividends paid on common shares              (128)  (122)   (378)   (362)
    Other financing activities, net                 7      1      16       2
                                                ------------   -------------
    Net cash used in financing activities        (107)  (440)   (376)   (335)
                                                ------------   -------------
    Translation adjustments                        (2)    --      (7)     --
                                                ------------   -------------
    Increase (decrease) in cash and cash
     equivalents                                  133   (235)     46    (309)
    Cash and cash equivalents at beginning of
     period                                       318    609     405     683
                                                ------------   -------------
    Cash and cash equivalents at end of period    451    374     451     374
                                                ============   =============
    Supplemental cash flow information:
    -----------------------------------
    Net cash provided by operating activities,
     as above                                     540    531   1,200   1,165
    Additions to property and equipment, as
     above                                       (138)  (159)   (397)   (430)
    Other investing activities, as above          (11)   (12)    (25)    (40)
    Additions to property and equipment of
     discontinued operations                       --     --      --      (2)
    Dividends paid on preference shares, as
     above                                         (1)    --      (3)     (2)
                                                ------------   -------------
    Free cash flow                                390    360     775     691
                                                ============   =============

    Notes to consolidated statement of cash flow
    --------------------------------------------

(1) Included within Acquisitions for the three-month and nine-month periods ended September 30, 2005 is a $50 million contingent consideration payment related to the purchase of TradeWeb LLC in May 2004.



                        Business Segment Information *
                          (millions of U.S. dollars)
                                 (unaudited)

                                 Three Months Ended       Nine Months Ended
                                 ------------------       -----------------
                                    September 30            September 30
                                    ------------            ------------
                                2005    2004   Change    2005   2004    Change
                               -----   -----   ------   -----  -----    ------
    Revenues:
     Legal & Regulatory          864     811      7 %   2,517  2,358       7 %
     Learning                    810     752      8 %   1,665  1,531       9 %
     Financial                   475     455      4 %   1,403  1,262      11 %
     Scientific & Healthcare     248     212     17 %     730    638      14 %
     Intercompany eliminations    (6)     (7)             (16)   (18)
                               -----   -----            -----  -----
     Total revenues            2,391   2,223      8 %   6,299  5,771       9 %
                               =====   =====            =====  =====
    Operating Profit: (1)
     Adjusted operating profit
      by segment
       Legal & Regulatory        248     225     10 %     674    618       9 %
       Learning                  249     237      5 %     211    194       9 %
       Financial                  85      80      6 %     225    203      11 %
       Scientific & Healthcare    48      41     17 %     130    101      29 %
       Corporate and other (2)   (39)    (21)             (95)   (60)
                               -----   -----            -----  -----
     Total adjusted operating
      profit                     591     562      5 %   1,145  1,056       8 %
     Amortization                (69)    (70)            (233)  (210)
                               -----   -----            -----  -----
     Operating profit            522     492      6 %     912    846       8 %
                               =====   =====            =====  =====

    * Notes to business segment information for continuing operations
    (1) Please see reconciliations to GAAP measures in the following tables.
    (2) "Corporate and other" includes corporate costs and costs associated
        with the Corporation's stock-related compensation expense.


    Detail of depreciation by segment:


                               Three Months Ended            Nine Months Ended
                                  September 30                 September 30
                                  2005        2004             2005     2004
                               -------------------           -----------------
    Legal & Regulatory              50          48              149      141
    Learning                        64          65              142      143
    Financial                       42          48              133      134
    Scientific & Healthcare         10           8               30       25
    Corporate and other              4           4                8       11
                               -------------------           -----------------
                                   170         173              462      454
                               -------------------           -----------------


                               Reconciliations
       Reconciliation of Adjusted Operating Profit to Operating Profit
                    (millions of U.S. dollars, unaudited)

                For the Three Months Ended September 30, 2005

                                                   Scientific
                      Legal &                          &      Corporate
                    Regulatory Learning  Financial Healthcare and Other  Total
    --------------------------------------------------------------------------
    Adjusted operating
     profit               248      249         85        48       (39)    591
    Less:
       Amortization       (26)     (16)       (23)       (4)       --     (69)
    --------------------------------------------------------------------------
    Operating profit      222      233         62        44       (39)    522
    ==========================================================================


                For the Three Months Ended September 30, 2004

                                                   Scientific
                      Legal &                          &      Corporate
                    Regulatory Learning  Financial Healthcare and Other  Total
    --------------------------------------------------------------------------
    Adjusted operating
     profit               225      237         80        41       (21)    562
    Less:
       Amortization       (22)     (17)       (23)       (8)       --     (70)
    --------------------------------------------------------------------------
    Operating profit      203      220         57        33       (21)    492
    ==========================================================================


                 For the Nine Months Ended September 30, 2005

                                                   Scientific
                      Legal &                          &      Corporate
                    Regulatory Learning  Financial Healthcare and Other  Total
    --------------------------------------------------------------------------
    Adjusted operating
     profit               674       211       225       130       (95)  1,145
    Less:
       Amortization       (80)      (49)      (68)      (36)       --    (233)
    --------------------------------------------------------------------------
    Operating profit      594       162       157        94       (95)    912
    ==========================================================================


                 For the Nine Months Ended September 30, 2004

                                                   Scientific
                      Legal &                          &      Corporate
                    Regulatory Learning  Financial Healthcare and Other  Total
    --------------------------------------------------------------------------
    Adjusted operating
     profit               618      194        203       101       (60)  1,056
    Less:
       Amortization       (73)     (52)       (59)      (26)       --    (210)
    --------------------------------------------------------------------------
    Operating profit      545      142        144        75       (60)    846
    ==========================================================================

Reconciliation of Adjusted Operating Profit Margin to Operating Profit Margin

                   (as a percentage of revenue, unaudited)

                For the Three Months Ended September 30, 2005
                ----------------------------------------------
                          Legal &                     Scientific &
                        Regulatory Learning Financial  Healthcare    Total
    --------------------------------------------------------------------------
    Adjusted operating
     profit                  28.7 %   30.7 %   17.9 %       19.4 %     24.7 %
    Less:
         Amortization        (3.0%)   (1.9%)   (4.8%)       (1.7%)     (2.9%)
    --------------------------------------------------------------------------
    Operating profit         25.7 %   28.8 %   13.1 %       17.7 %     21.8 %
    ==========================================================================


                For the Three Months Ended September 30, 2004
                ----------------------------------------------
                          Legal &                     Scientific &
                        Regulatory Learning Financial  Healthcare    Total
    --------------------------------------------------------------------------
    Adjusted operating
     profit                  27.7 %   31.5 %   17.6 %       19.3 %     25.3 %
    Less:
         Amortization        (2.7%)   (2.2%)   (5.1%)       (3.7%)     (3.2%)
    --------------------------------------------------------------------------
    Operating profit         25.0 %   29.3 %   12.5 %       15.6 %     22.1 %
    ==========================================================================


                 For the Nine Months Ended September 30, 2005
                ----------------------------------------------
                          Legal &                     Scientific &
                        Regulatory Learning Financial  Healthcare    Total
    --------------------------------------------------------------------------
    Adjusted operating
     profit                  26.8 %   12.7 %   16.0 %       17.8 %     18.2 %
    Less:
         Amortization        (3.2%)   (3.0%)   (4.8%)       (4.9%)     (3.7%)
    --------------------------------------------------------------------------
    Operating profit         23.6 %    9.7 %   11.2 %       12.9 %     14.5 %
    ==========================================================================


                 For the Nine Months Ended September 30, 2004
                ----------------------------------------------
                          Legal &                     Scientific &
                        Regulatory Learning Financial  Healthcare    Total
    --------------------------------------------------------------------------
    Adjusted operating
     profit                  26.2 %   12.7 %   16.1 %       15.8 %     18.3 %
    Less:
         Amortization        (3.1%)   (3.4%)   (4.7%)       (4.0%)     (3.6%)
    --------------------------------------------------------------------------
    Operating profit         23.1 %    9.3 %   11.4 %       11.8 %     14.7 %
    ==========================================================================

SOURCE  The Thomson Corporation
    -0-                             10/25/2005
    /CONTACT:  Media Contact: Jason Stewart, Vice President, Media Relations,
+1-203-539-8339, jason.stewart@thomson.com, or Investor Contact: Frank J.
Golden, Vice President, Investor Relations, +1-203-539-8470,
frank.golden@thomson.com, both of The Thomson Corporation/
    /Photo:  http://www.newscom.com/cgi-bin/prnh/20020227/NYW014LOGO /
    /Web site:  http://www.thomson.com/
    (TOC TOC.)

CO:  The Thomson Corporation
ST:  Connecticut
IN:  FIN PUB
SU:  ERN CCA ERP

KC
-- NYTU042 --
4378 10/25/2005 07:00 EDT http://www.prnewswire.com