World Class Products for Global Markets During 1997 there were important advances in three key aspects of AND International Publishers' business. We made excellent progress in building the unique data assets that are a foundation for current and future growth in revenue and profits. At the same time, the company enhanced the technology and skills it uses to convert these data assets into products for business and consumer markets. Thirdly, AND strengthened the commercial infrastructure through which it brings its products and services to customers. Most significant among the projects to increase our data assets is the programme to build a digital infrastructure model of the world on a scale of 1:250,000. This unique model, representing features including world geography, roads and rail networks, is scheduled for completion during the year 2000. Nearly one million hours of staff resource will be devoted to the programme. To build this model in a cost effective way, AND Mapping has established an operation in Galway, Ireland. By the end of 1998, it is expected that the work force in Ireland will reach 100. During 1997 the company also added to its data assets by acquisition of the Cambridge Encyclopaedia database and the rights to the Servotte Business Dictionary. Since these data sets were purchased, their value has been increased by extension and restructuring which makes them more attractive to consumer and business markets. These dictionary and encyclopaedia data sets now offer a powerful means of improving the computer's natural language knowledge resource. Similar asset enhancement has been applied to the airline flight database acquired in 1996. A special team has spent one year expanding this database and ensuring that it conforms to internationally accepted standards for data formats. As a result, it is now suited to world-wide consumer and business markets, and is one of the world's leading sources of flight information. In addition to providing data to other companies for use in their own value-added products, AND is also a leading supplier of technology for converting such data into useful information. During 1997, the CompLex electronic publishing platform was further enhanced, confirming it as one of the world's leading search and retrieval engines for dictionaries, encyclopaedias and reference works of all types. Following the success of CompLex over the recent years, AND is now developing a Travel & Transport engine. Used with AND's data on world transportation systems, this will allow journeys for people and goods to be planned from "door-to-door", using the optimum combination of transport modalities. The new engine will be used in AND's Active Travel products, which offer companies and individuals important savings by giving the lowest cost and time route options for any journey. The software will also be licensed to the travel industry as an authoring tool to create a wide variety of travel titles, and can be used in travel-related products and services. AND continually enhances its skills base through training and recruitment. In addition, it also makes major improvements in key areas through acquisitions. During the second quarter of 1997, we acquired AND Map Graphics (AMG), a company with 30 staff, based at Finchampstead in the UK. AMG's cartographic skills complement those of AND Mapping and AND Publishing Technology, and will play an important part in converting AND's world data resources into commercial products and services. During 1997, much time and effort has been devoted to ensuring that AND's unique combination of products and services reach all their potential customers. A new division has been created to focus on the huge and rapidly growing information technology and telecommunication markets. AND owns data and technology that enable companies in these sectors to greatly enhance the value of their products and services. The new unit will ensure that our data and technology offerings are tuned to the needs of the major IT systems providers. As well as strengthening its own sales and marketing resources across the company, AND is forming partnerships and alliances. These are designed to make our data and technology more widely available, creating new markets and opening additional sales channels. An example of this is the CompLex Partner Program, which licenses other companies to market, sell and support the latest CompLex version 3.5. Co-operation was also established during 1997 with Enterprise Resource Planning package vendors. An example is our co-operation with SAP, the world's leading supplier of the ERP solutions. Under the terms of the arrangement, AND's Clavis postcode databases can be integrated as complementary software in SAP's R/3 product, giving users an immediate means of accessing address data. During the coming year, AND will continue to form new commercial alliances as part of its plans to increase growth across world markets. AND is producing more titles under its own brand, as well as enabling other publishers to make long-term use of the AND CompLex publishing platform in producing their own products. During 1998 we will be introducing 200 titles, and more than 50 titles will be produced by other publishers using AND CompLex. This is a key step in the strategy to establish AND CompLex as the standard electronic publishing platform. Last year saw new offices established in Italy and France, and the launch of our products in Scandinavia. In 1998 we expect to see further growth in Europe's biggest market, Germany, and from the end of 1998 we also expect strong growth in the USA, the world's largest market. Continued investment will be needed to achieve our objectives. Much has been accomplished in 1997, and the management foundations are in place to control the rapid growth of our organisation. On behalf of the Board of Management Hans Abbink Chairman Company Profile - Strategy - Forecast LEVERAGE home page