##### Table of Contents



Exhibit 99.1
 MANAGEMENTS DISCUSSION AND ANALYSIS
 FOR THE YEAR ENDED DECEMBER 31, 2007




---



TABLE OF CONTENTS  OVERVIEWUSE OF NON-GAAP FINANCIAL MEASURESRESULTS OF OPERATIONSLIQUIDITY AND CAPITAL RESOURCESRELATED PARTY TRANSACTIONSACTUAL AND ESTIMATED COSTS OF EMPLOYEE FUTURE BENEFITSSUBSEQUENT EVENTSCHANGES IN ACCOUNTING POLICIESCRITICAL ACCOUNTING POLICIESRECENTLY ISSUED ACCOUNTING STANDARDSADDITIONAL INFORMATIONRECONCILIATIONSQUARTERLY INFORMATION (UNAUDITED)CAUTIONARY NOTE CONCERNING FACTORS THAT MAY AFFECT FUTURE RESULTS    Table of Contents  THE THOMSON CORPORATION
 MANAGEMENTS DISCUSSION AND ANALYSIS
 PageOverview
    
    
    1Use of Non-GAAP Financial Measures
    
    
    11Results of Operations
    
    
    12Liquidity and Capital Resources
    
    
    29Outlook
    
    
    40Related Party Transactions
    
    
    40Actual and Estimated Costs of Employee Future Benefits
    
    
    41Subsequent Events
    
    
    42Changes in Accounting Policies
    
    
    43Critical Accounting Policies
    
    
    45Recently Issued Accounting Standards
    
    
    48Additional Information
    
    
    49Reconciliations
    
    
    50Quarterly Information
    
    
    52Cautionary Note Concerning Factors That May Affect Future Results
    
    
    53
 2




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##### Table of Contents



The following managements discussion and analysis is intended to assist you in understanding and
evaluating changes in our financial condition and operations for the year ended December 31, 2007,
compared to the preceding two fiscal years. We recommend that you read this managements discussion
and analysis in conjunction with our consolidated financial statements prepared in accordance with
accounting principles generally accepted in Canada, or Canadian GAAP, and the related notes to
those financial statements. All dollar amounts in this discussion are in U.S. dollars unless
otherwise specified. References in this discussion to $ are to U.S. dollars, references to £
are to British pounds sterling and references to C$ are to Canadian dollars. Unless otherwise
indicated, references in this discussion to we, our and us are to The Thomson Corporation and
its subsidiaries. In addition to historical information, this managements discussion and analysis
contains forward-looking statements. Readers are cautioned that these forward-looking statements
are subject to risks and uncertainties that could cause our actual results to differ materially
from those reflected in the forward-looking statements. These factors include those identified in
the sections of this managements discussion and analysis entitled Cautionary Note Concerning
Factors That May Affect Future Results and in the Risk Factors section of our management
information circular dated February 29, 2008 relating to our special meeting of shareholders to be
held on March 26, 2008. These risk factors are also incorporated by reference in our annual
information form for the year ended December 31, 2007, which is also contained in our annual report
on Form 40-F for the year ended December 31, 2007. This managements discussion and analysis is
dated as of March 6, 2008.
 
 OVERVIEW
 Our Business and Strategy
 What Thomson does 
 How Thomson makes money 
 Thomsons business environment 
  1




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Thomsons operational structure 
  
    
    Thomson Legal- a leading provider of critical information, decision support
tools and services to legal, intellectual property, compliance, business and
government professionals throughout the world. Major brands include Westlaw,
Aranzadi, BAR/BRI, Carswell, Thomson CompuMark, Thomson Elite, FindLaw, LIVEDGAR
and Sweet & Maxwell;
    
    Thomson Financial- a leading provider of products and integration services to
financial and technology professionals in the corporate, investment banking,
institutional, wealth management and fixed income sectors of the global financial
community. Our flagship brand is Thomson ONE. Other major businesses and brands
include AutEx, Baseline, Datastream, First Call, I/B/E/S, Investext, IR Channel,
SDC Platinum, StreetEvents, Thomson Transaction Services and TradeWeb;
    
    Thomson Tax & Accounting- a leading provider of critical information, decision
support tools and software applications for tax and accounting professionals in
North America. Major brands include Checkpoint, Creative Solutions and RIA;
    
    Thomson Scientific- a leading provider of critical information and decision
support tools to researchers, scientists and information professionals in the
academic, scientific, corporate and government marketplaces. Major businesses and
information solutions include Derwent World Patents Index, MicroPatent, Thomson
Pharma, Web of Science and ISI Web of Knowledge; and
    
    Thomson Healthcare- a leading provider of critical information and decision
support tools to physicians and other professionals in the healthcare, corporate
and government marketplaces. Major businesses and information solutions include
Medstat, Micromedex, PDR (Physicians Desk Reference) and Solucient.
 plus plus
  2




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##### Table of Contents



Percentage of Total 2007
Revenues
 
  Year ended December 31(millions of U.S. dollars, except per share amounts)
    
    2007
    
    2006
    
    2005(3)Consolidated Statement of Earnings Data:Revenues
    
    
    7,296
    
    
    
    6,591
    
    
    
    6,122Operating profit(1)
    
    
    1,297
    
    
    
    1,248
    
    
    
    1,159Earnings from continuing operations(1)
    
    
    1,096
    
    
    
    912
    
    
    
    652Earnings from discontinued operations, net of tax(1)
    
    
    2,908
    
    
    
    208
    
    
    
    282Net earnings(1)
    
    
    4,004
    
    
    
    1,120
    
    
    
    934Diluted earnings per common share from continuing operations(1)
    
    $
    1.69
    
    
    $
    1.41
    
    
    $
    0.99Diluted earnings per common share(1)
    
    $
    6.20
    
    
    $
    1.73
    
    
    $
    1.42Consolidated Balance Sheet Data:Cash and cash equivalents
    
    
    7,497
    
    
    
    334
    
    
    
    407Total assets
    
    
    22,831
    
    
    
    20,142
    
    
    
    19,434Total long-term liabilities
    
    
    6,021
    
    
    
    5,922
    
    
    
    6,364Total shareholders equity
    
    
    13,571
    
    
    
    10,481
    
    
    
    9,963Dividend Data:Dividends per common share (US$)
    
    $
    0.98
    
    
    $
    0.88
    
    
    $
    0.79Dividends per Series II preferred share (C$)
    
    C$
    1.07
    
    
    C$
    1.00
    
    
    C$
    0.77Other Data(2):Underlying operating profit
    
    
    1,492
    
    
    
    1,308
    
    
    
    1,159Adjusted earnings from continuing operations
    
    
    1,089
    
    
    
    857
    
    
    
    677Adjusted earnings per common share from continuing operations
    
    $
    1.69
    
    
    $
    1.33
    
    
    $
    1.03Net debt
    
    
    (3,048
    )
    
    
    3,741
    
    
    
    3,646Free cash flow
    
    
    1,066
    
    
    
    1,440
    
    
    
    1,194
 
 (1)
    
    Results are not directly comparable due to certain non-recurring or special items. For more
information, please see the Results of Operations section of this managements discussion
and analysis.(2)
    
    These are non-GAAP financial measures. Definitions are provided in the Use of Non-GAAP
Financial Measures section of this managements discussion and analysis.(3)
    
    A full discussion of results for 2006 compared to 2005 is included in our managements
discussion and analysis for the year ended December 31, 2006. Significant trends and items
affecting comparability over the three-year period are noted within this managements
discussion and analysis. 3




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Proposed Acquisition of Reuters Group PLC
 Overview.
  Consideration.
 Ownership.
 4




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##### Table of Contents



Synergies.
 Antitrust/Regulatory review process.
 Shareholder approvals.
 Information regarding Reuters.
 
    
    advanced desktop financial information products, analytics and trading systems
designed for use by traders and salespeople;
    
    information feeds and tools designed for use by machines to help customers
automate their businesses;
    
    in-depth information, analysis and research products designed mainly for use by
people making investment decisions; and
    
    news for use by professional publishers, multimedia websites and mobile
information services for use by individual consumers.
   Risk factors.
 5




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Revenues
  
  By media.
 By type.
 By geography.
 6




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Expenses
  Acquisitions
   Aggregate CostYear Ended December 31,
    
    Number
    
    ($ in millions)2007
    
    
    33
    
    
    
    4882006
    
    
    25
    
    
    
    7442005
    
    
    28
    
    
    
    246
 7




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##### Table of Contents




    
    2007- Deloitte Tax LLP Property Tax Services, a provider of property tax
outsourcing and compliance services; CrossBorder Solutions, a provider of tax
software; and Prous Science, a provider of life sciences information solutions;
    
    2006- Solucient, LLC, a provider of data and advanced analytics to hospitals
and health systems; Quantitative Analytics, Inc., a provider of financial database
integration and analysis solutions; and LiveNote Technologies, a provider of
transcript and evidence management software to litigators and court reporters; and
    
    2005- Global Securities Information (GSI), a provider of online securities and
securities-related information and research services.
 Dispositions
  Pending
  Completed
  
    
    In July 2007, we sold Thomson Learnings higher education, careers and library
reference businesses to funds advised by Apax Partners and OMERS Capital Partners.
As a result of the sale, we received gross proceeds of approximately $7.6 billion.
    
    In May 2007, we sold NETg, a leading provider of continuing corporate education
and training, to SkillSoft PLC for approximately $270 million.
    
    In October 2007, we sold Prometric, a provider of assessment services, to ETS
for $310 million in cash and a 6% promissory note for approximately $79 million due
in 2014. The principal amount of the note, which was previously reported as
$125 million, was adjusted to $79 million reflecting adjustments made based on the
continuity of offerings from certain customer contracts. The promissory note was
reflected in our financial statements at its estimated fair value of $60 million to
account for the difference between the market and stated rates of interest. The
principal amount of the note is subject to further adjustment based on certain
contingencies.
 8




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##### Table of Contents



Business
    
    Segment
    
    ClosedGEE  a regulatory information business in the United Kingdom
    
    Legal
    
    December 2007New England Institutional Review Board  an ethical review
board that monitors clinical research involving human
subjects
    
    Healthcare
    
    December 2007CenterWatch  a provider of clinical research information
    
    Healthcare
    
    December 2007Fakta  a Swedish regulatory information business
    
    Legal
    
    November 2007NewsEdge  a provider of business information and news
    
    Legal
    
    July 2007Market Research  a provider of business information and news
    
    Legal
    
    May 2007IOB  a regulatory information business in Brazil
    
    Legal
    
    June 2007Thomson Medical Education  a provider of medical education
    
    Healthcare
    
    April 2007North American operations of Thomson Education Direct, a
consumer-based distance learning career school
    
    Learning
    
    March 2007American Health Consultants  a medical newsletter publisher
and medical education provider
    
    Healthcare
    
    August 2006K.G. Saur  a German publisher of biographical and
bibliographical reference titles serving the library and
academic communities
    
    Learning
    
    August 2006Petersons  a publisher of college preparatory guides
    
    Learning
    
    July 2006Lawpoint  an Australian provider of print/online regulatory
information services
    
    Legal
    
    June 2006Law Manager  a software and services provider
    
    Legal
    
    April 2006
   THOMSON plus
 plus
 9




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##### Table of Contents




    
    Realigning our business units into five segments;
    
    Streamlining and consolidating certain functions such as finance, accounting and
business systems;
    
    Leveraging infrastructure and technology for customer contact centers;
    
    Establishing low-cost shared service centers;
    
    Consolidating certain technology infrastructure operations such as voice and
data networks, data centers, storage and desktop support; and
    
    Re-engineering certain product development and production functions and
realigning particular sales forces within our business segments.
 plus
 plus
  plus plus
 plus
 10




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Seasonality
  
 USE OF NON-GAAP FINANCIAL MEASURES
  
    
    Underlying operating profit and underlying operating profit margin.We measure
our operating profit to adjust for costs associated with our corporate efficiency
initiatives and other items affecting comparability, which we refer to as
underlying operating profit. We refer to underlying operating profit as a
percentage of revenues as the underlying operating profit margin. We use these
measures to assist in comparisons from one period to another as they remove the
impact of items which distort the performance of our operations. See the
reconciliation of this measure to the most directly comparable Canadian GAAP
measure in the Results of Operations section of this managements discussion
and analysis.
    
    Adjusted earnings and adjusted earnings per common share from continuing
operations. We measure our earnings attributable to common shares and per share
amounts to adjust 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.In interim periods, we adjust our reported earnings and earnings per common share to
reflect a normalized effective tax rate. Specifically, the normalized effective rate
is computed as the estimated full-year effective tax rate applied to the
consolidated pre-tax income of the interim period. The reported effective tax rate
is based on separate annual effective income tax rates for each taxing jurisdiction
that are applied to each interim periods pre-tax income. Because the seasonality of
our businesses impacts our geographical mix of profits in interim periods and
therefore distorts the reported effective tax rate, we believe that using the
expected full-year effective tax rate provides a more meaningful comparison among
interim periods. The adjustment to normalize the effective tax rate reallocates
estimated full-year income taxes between interim periods, but has no effect on full
year income taxes or on cash taxes paid.See the reconciliation of this measure to the most directly comparable Canadian GAAP
measure in the Results of Operations section of this managements discussion
and analysis.
    
    Net debt.We measure our net debt, which we define as our total indebtedness,
including associated fair value hedging instruments (swaps) on our debt, less cash
and cash equivalents. Given that we hedge some of our debt to reduce risk, we include hedging
 11




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instruments
as we believe it provides a better measure of the total obligation associated with
our outstanding debt. However, because we generally intend to hold our debt and
related hedges to maturity, we do not consider the associated fair market value of
cash flow hedges in our measurements. We reduce gross indebtedness by cash and cash
equivalents on the basis that they could be used to pay down debt. See the
reconciliation of this measure to the most directly comparable Canadian GAAP measure
in the Liquidity and Capital Resources section of this managements discussion
and analysis.
    
    Free cash flow.We evaluate our operating performance based on free cash flow,
which we define as net cash provided by operating activities less capital
expenditures, 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. See the
reconciliation of this measure to the most directly comparable Canadian GAAP
measure in the Liquidity and Capital Resources section of this managements
discussion and analysis.
    
 RESULTS OF OPERATIONS
  Basis of Analysis
  12




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Year ended December 31(millions of U.S. dollars, except per share amounts)
    
    2007
    
    2006
    
    2005Revenues
    
    
    7,296
    
    
    
    6,591
    
    
    
    6,122Operating profit(1)
    
    
    1,297
    
    
    
    1,248
    
    
    
    1,159Operating profit margin(1)
    
    
    17.8
    %
    
    
    18.9
    %
    
    
    18.9
    %Net earnings(1)
    
    
    4,004
    
    
    
    1,120
    
    
    
    934Diluted earnings per common shares(1)
    
    $
    6.20
    
    
    $
    1.73
    
    
    $
    1.42
 
 (1)
    
    Results are not directly comparable due to certain non-recurring or special items. Revenues.
    
    In 2007, revenues increased 11% comprised of the following:
 
    
    6% from higher revenues of existing businesses;
    
    3% from contributions of newly acquired businesses; and
    
    2% from foreign currency translation.
   Operating profit. plus plus
 13




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plus
 Year ended December 31(millions of U.S. dollars, except per share amounts)
    
    2007
    
    2006
    
    2005Operating profit
    
    
    1,297
    
    
    
    1,248
    
    
    
    1,159Adjustments:THOMSONpluscosts
    
    
    153
    
    
    
    60
    
    
    
    Reuters transaction costs
    
    
    76
    
    
    
    
    
    
    
    Settlement of pension plan
    
    
    (34
    )
    
    
    
    
    
    
    Underlying operating profit
    
    
    1,492
    
    
    
    1,308
    
    
    
    1,159Underlying operating profit margin
    
    
    20.4
    %
    
    
    19.8
    %
    
    
    18.9
    %
  plus
 plus
 Depreciation and amortization.
  Net other income/expense.
 Rodriguez v. West Publishing Corp. and Kaplan Inc.
  14




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##### Table of Contents



Net interest income/expense and other financing costs.
  Income taxes.
 
    
    In 2007, our provision included benefits of $60 million resulting primarily from
the recognition of Canadian tax losses, but also reflecting a change in Australian
tax law. These benefits reduced our 2007 effective tax rate by approximately 5%.
The Canadian tax losses were recognized in anticipation of using them against
taxable income from the sale of Thomson Learnings Canadian education operations,
which was completed in July 2007.
    
    In 2006, we increased valuation allowances against deferred tax assets which
increased our tax rate by 4%. The net change in the valuation allowance included
benefits associated with our Thomson Learning segment which, under the requirements
of discontinued operations accounting, were not allowed to be reclassified to
discontinued operations along with the other results for the business. The impact
of including the benefits related to the Thomson Learning segment in our continuing
operations tax charge reduced our effective tax rate by 3% in 2006, and 2% in 2005.
    
    In 2005, we released $98 million of contingent income tax liabilities based upon
the outcome of certain tax audits of prior year periods. Additionally, we
repatriated a substantial portion of certain of our subsidiaries accumulated
profits. The repatriation was related to the recapitalization of these
subsidiaries, which was effected through intercompany financing arrangements. We
incurred a non-recurring tax charge of $125 million in connection with this
repatriation, which reduced our cash flow from operations and our net earnings in
the fourth quarter by the same amount. The net effect of both of these
non-recurring or special tax items was a $27 million increase in the tax provision
for the full year of 2005.
  15




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##### Table of Contents



Earnings attributable to common shares and earnings per common share.
   Year ended December 31(millions of U.S. dollars, except per common share amounts)
    
    2007
    
    2006
    
    2005Earnings attributable to common shares
    
    
    3,998
    
    
    
    1,115
    
    
    
    930Adjustments for non-recurring or special items:Net other expense (income)
    
    
    34
    
    
    
    (1
    )
    
    
    28Reuters transaction costs
    
    
    76
    
    
    
    
    
    
    
    Gain on settlement of pension plan
    
    
    (34
    )
    
    
    
    
    
    
    Tax on above items
    
    
    (17
    )
    
    
    (16
    )
    
    
    (4
    )Tax (benefits) charges
    
    
    (60
    )
    
    
    (33
    )
    
    
    5Discontinued operations
    
    
    (2,908
    )
    
    
    (208
    )
    
    
    (282
    )Adjusted earnings from continuing operations
    
    
    1,089
    
    
    
    857
    
    
    
    677Adjusted earnings per common share from continuing operations
    
    $
    1.69
    
    
    $
    1.33
    
    
    $
    1.03
 plus
 plus
 16




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Operating Results by Business Segment
 Thomson Legal
 Year ended December 31(millions of U.S. dollars)
    
    2007
    
    2006
    
    2005Revenues
    
    
    3,318
    
    
    
    3,008
    
    
    
    2,795Segment operating profit
    
    
    1,044
    
    
    
    943
    
    
    
    849Segment operating profit margin
    
    
    31.5
    %
    
    
    31.3
    %
    
    
    30.4
    %
 Year Ended December 31, 2007 Compared to Year Ended December 31, 2006
  
    
    7% from higher revenues of existing businesses;
    
    1% from contributions of newly acquired businesses; and
    
    2% from foreign currency translation.
    17




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Year Ended December 31, 2006 Compared to Year Ended December 31, 2005
  
    
    7% from higher revenues of existing businesses;
    
    1% from contributions of newly acquired businesses; and
    
    a negligible impact from foreign currency translation.
    Outlook
  Thomson Financial
 Year ended December 31(millions of U.S. dollars)
    
    2007
    
    2006
    
    2005Revenues
    
    
    2,186
    
    
    
    2,025
    
    
    
    1,908Segment operating profit
    
    
    454
    
    
    
    380
    
    
    
    334Segment operating profit margin
    
    
    20.8
    %
    
    
    18.8
    %
    
    
    17.5
    %
 Year Ended December 31, 2007 Compared to Year Ended December 31, 2006
  
    
    5% from higher revenues of existing businesses;
 18




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##### Table of Contents




    
    1% from contributions of newly acquired businesses; and
    
    2% from foreign currency translation.
     Year Ended December 31, 2006 Compared to Year Ended December 31, 2005
  
    
    4% from higher revenues of existing businesses;
    
    2% from contributions of newly acquired businesses; and
    
    a negligible impact from foreign currency translation.
  19




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##### Table of Contents



Outlook
   Thomson Tax & Accounting
 Year ended December 31(millions of U.S. dollars)
    
    2007
    
    2006
    
    2005Revenues
    
    
    705
    
    
    
    598
    
    
    
    532Segment operating profit
    
    
    184
    
    
    
    168
    
    
    
    141Segment operating profit margin
    
    
    26.1
    %
    
    
    28.1
    %
    
    
    26.5
    %
 Year Ended December 31, 2007 Compared to Year Ended December 31, 2006
  
    
    10% from higher revenues of existing businesses; and
    
    8% from contributions of newly acquired businesses.
   20




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Year Ended December 31, 2006 Compared to Year Ended December 31, 2005
  
    
    11% from higher revenues of existing businesses; and
    
    1% from contributions of newly acquired businesses.
   Outlook
  Thomson Scientific
 Year ended December 31(millions of U.S. dollars)
    
    2007
    
    2006
    
    2005Revenues
    
    
    651
    
    
    
    602
    
    
    
    569Segment operating profit
    
    
    175
    
    
    
    151
    
    
    
    129Segment operating profit margin
    
    
    26.9
    %
    
    
    25.1
    %
    
    
    22.7
    %
 Year Ended December 31, 2007 Compared to Year Ended December 31, 2006
  
    
    4% from higher revenues of existing businesses;
    
    2% from contributions of newly acquired businesses; and
 21




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##### Table of Contents




    
    2% from foreign currency translation.
   Year Ended December 31, 2006 Compared to Year Ended December 31, 2005
  
    
    4% from higher revenues of existing businesses;
    
    2% from contributions of newly acquired businesses; and
    
    a negligible impact from foreign currency translation.
   Outlook
  Thomson Healthcare
 Year ended December 31(millions of U.S. dollars)
    
    2007
    
    2006
    
    2005Revenues
    
    
    452
    
    
    
    374
    
    
    
    334Segment operating profit
    
    
    85
    
    
    
    81
    
    
    
    80Segment operating profit margin
    
    
    18.8
    %
    
    
    21.7
    %
    
    
    24.0
    %
 22




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##### Table of Contents



Year Ended December 31, 2007 Compared to Year Ended December 31, 2006
    Year Ended December 31, 2006 Compared to Year Ended December 31, 2005
  
    
    3% from higher revenues of existing businesses;
    
    9% from contributions of newly acquired businesses; and
    
    a negligible impact from foreign currency translation.
   Outlook
  23




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##### Table of Contents



Corporate and Other
 Year ended December 31(millions of U.S. dollars)
    
    2007
    
    2006
    
    2005Expenses excluding THOMSONplusand Reuters transaction costs
    
    
    160
    
    
    
    175
    
    
    
    139THOMSONplus
    
    
    153
    
    
    
    60
    
    
    
    Reuters transaction costs
    
    
    76
    
    
    
    
    
    
    
    Total
    
    
    389
    
    
    
    235
    
    
    
    139
 Year Ended December 31, 2007 Compared to Year Ended December 31, 2006
 plus
 plus
 Year Ended December 31, 2006 Compared to Year Ended December 31, 2005
 plus
 plus
 Outlook
 plus
 Discontinued Operations
  24




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##### Table of Contents




    
    In July 2007, we sold Thomson Learnings higher education, careers and library
reference businesses to funds advised by Apax Partners and OMERS Capital Partners.
As a result of the sale, we received gross proceeds of approximately $7.6 billion
and recognized a post-tax gain of $2.7 billion.
    
    In May 2007, we sold NETg, a leading provider of continuing corporate education
and training, to SkillSoft PLC for approximately $270 million and recorded a
post-tax loss of $10 million.
    
    In October 2007, we sold Prometric, a provider of assessment services, to ETS
for $310 million in cash and a 6% promissory note for approximately $79 million due
in 2014. The principal amount of the note, which was previously reported as $125
million, was adjusted to $79 million reflecting adjustments made based on the
continuity of offerings from certain customer contracts. The promissory note was
reflected in our financial statements at its estimated fair value of $60 million to
account for the difference between the market and stated rates of interest. We
recognized a post-tax gain of $18 million related to this transaction. The
principal amount of the note is subject to further adjustment based on certain
contingencies.
     25




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Return on Invested Capital
  Review of Fourth Quarter Results
  Three months endedDecember 31(millions of U.S. dollars)
    
    2007
    
    2006Revenues
    
    
    2,033
    
    
    
    1,850Operating profit(1)
    
    
    410
    
    
    
    422Operating profit margin(1)
    
    
    20.2
    %
    
    
    22.8
    %Net earnings(1)
    
    
    434
    
    
    
    391Diluted earnings per common shares(1)
    
    $
    0.67
    
    
    $
    0.61
 
 (1)
    
    Results are not directly comparable due to certain non-recurring or special items, as noted
below. 26




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##### Table of Contents



Revenues.
 
    
    6% from growth of existing businesses;
    
    2% from contributions of acquired businesses; and
    
    2% from the favorable impact of foreign currency translation.
  Operating profit. plus
 plus
 Three months endedDecember 31(millions of U.S. dollars)
    
    2007
    
    2006Operating profit
    
    
    410
    
    
    
    422Adjustments:THOMSONpluscosts
    
    
    68
    
    
    
    29Reuters transaction costs
    
    
    45
    
    
    
    Settlement of pension plan
    
    
    (34
    )
    
    
    Underlying operating profit
    
    
    489
    
    
    
    451Underlying operating profit margin
    
    
    24.1
    %
    
    
    24.4
    %
  Depreciation and amortization.
 Net other expense.
 27




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##### Table of Contents



Rodriguez v. West
Publishing Corp. and Kaplan Inc.
 Net interest income/expense and other financing costs.
 Income taxes.
 Earnings attributable to common shares and earnings per common share.
   Three months endedDecember 31(millions of U.S. dollars, except per common share amounts)
    
    2007
    
    2006Earnings attributable to common shares
    
    
    432
    
    
    
    390Adjustments for non-recurring or special items:Net other expense
    
    
    40
    
    
    
    35Reuters transactions costs
    
    
    45
    
    
    
    Gain on settlement of pension plan
    
    
    (34
    )
    
    
    Tax on above items
    
    
    (9
    )
    
    
    (15
    )Tax (benefits) charges
    
    
    1
    
    
    
    (12
    )Interim period effective tax rate normalization
    
    
    32
    
    
    
    8Discontinued operations
    
    
    (123
    )
    
    
    (86
    )Adjusted earnings from continuing operations
    
    
    384
    
    
    
    320Adjusted earnings per common share from continuing operations
    
    $
    0.60
    
    
    $
    0.50
 plus
 28




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##### Table of Contents



LIQUIDITY AND CAPITAL RESOURCES
 Financial Position
   As of December 31(millions of U.S. dollars)
    
    2007
    
    2006Thomson Legal
    
    
    6,562
    
    
    
    6,445Thomson Financial
    
    
    3,618
    
    
    
    3,489Thomson Tax & Accounting
    
    
    1,440
    
    
    
    1,086Thomson Scientific
    
    
    1,419
    
    
    
    1,344Thomson Healthcare
    
    
    772
    
    
    
    755Corporate and Other
    
    
    9,010
    
    
    
    1,452Discontinued operations
    
    
    10
    
    
    
    5,571Total assets
    
    
    22,831
    
    
    
    20,142
 Assets by Segment
 
 29




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##### Table of Contents



As of December 31(millions of U.S. dollars)
    
    2007
    
    2006Short-term indebtedness
    
    
    183
    
    
    
    333Current portion of long-term debt
    
    
    412
    
    
    
    264Long-term debt
    
    
    4,264
    
    
    
    3,681Total debt
    
    
    4,859
    
    
    
    4,278Swaps
    
    
    (424
    )
    
    
    (257
    )Total debt after swaps
    
    
    4,435
    
    
    
    4,021Remove fair value adjustment of cash flow hedges
    
    
    14
    
    
    
    54Less: Cash and cash equivalents
    
    
    (7,497
    )
    
    
    (334
    )Net debt
    
    
    (3,048
    )
    
    
    3,741Total shareholders equity
    
    
    13,571
    
    
    
    10,481Net debt/equity ratio
    
    
    (0.22:1
    )
    
    
    0.36:1
      30




---



##### Table of Contents



(millions of U.S. dollars)Balance at December 31, 2006
    
    
    10,481Effect of accounting change for income taxes(1)
    
    
    (33
    )Restated balance as of December 31, 2006
    
    
    10,448Earnings attributable to common shares for the year ended December 31, 2007
    
    
    3,998Additions to paid in capital related to stock compensation and other plans
    
    
    48Common share issuances
    
    
    102Repurchases of common shares
    
    
    (168
    )Common share dividends declared
    
    
    (628
    )Net unrealized gains on derivatives that qualify as cash flow hedges(2)
    
    
    (55
    )Change in translation adjustment
    
    
    (174
    )Balance at December 31, 2007
    
    
    13,571
 
 (1)
    
    Effective January 1, 2007, we voluntarily adopted a new accounting policy for uncertain tax
positions and recorded a non-cash charge to opening retained earnings with an offsetting
increase to non-current liabilities.(2)
    
    Effective January 1, 2006, the unrealized gains and losses on certain derivatives that
qualify as cash flow hedges are recorded as a component of accumulated other comprehensive
income within shareholders equity in our consolidated balance sheet. See the section entitled Accounting Changes for further discussion on both of these changes
  Standard &
    
    DBRS LimitedMoodys
    
    Poors
    
    (DBRS)Long-term debt
    
    Baa1
    
    
    A-
    
    
    A (low)Commercial paper
    
    
    
    
    
    
    
    
    
    R-1 (low)Trend/Outlook
    
    Stable
    
    Negative
    
    Stable
    31




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##### Table of Contents



Hedging Program for Reuters Consideration
    Share Repurchase Program
  Number of SharesShares
    
    Average Price
    
    Available forThree-month period ended
    
    Repurchased
    
    per Share
    
    RepurchaseMarch 31, 2006
    
    
    4,570,000
    
    
    $
    36.83June 30, 2006
    
    
    3,110,000
    
    
    $
    39.58September 30, 2006
    
    
    1,710,600
    
    
    $
    39.27December 31, 2006
    
    
    1,289,400
    
    
    $
    41.41March 31, 2007
    
    
    1,305,000
    
    
    $
    41.74June 30, 2007
    
    
    495,000
    
    
    $
    42.68September 30, 2007
    
    
    
    
    
    
    December 31, 2007
    
    
    2,370,500
    
    
    $
    38.76
    
    
    
    12,629,500
  32




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##### Table of Contents



Dividend Reinvestment Plan (DRIP)
  Cash Flow
  Operating activities. plus Rodriguez v. West Publishing Corp. and Kaplan
Inc.
  Investing activities.
   33




---



##### Table of Contents



Financing activities.
   Year endedDecember 31(millions of U.S. dollars)
    
    2007
    
    2006Dividends declared
    
    
    628
    
    
    
    567Dividends reinvested
    
    
    (16
    )
    
    
    (14
    )Dividends paid
    
    
    612
    
    
    
    553
  Free cash flow.
 Year endedDecember 31(millions of U.S. dollars)
    
    2007
    
    2006Net cash provided by operating activities
    
    
    1,816
    
    
    
    2,125Capital expenditures
    
    
    (608
    )
    
    
    (452
    )Additions to property and equipment of discontinued operations
    
    
    (97
    )
    
    
    (185
    )Other investing activities
    
    
    (37
    )
    
    
    (26
    )Dividends paid on preference shares
    
    
    (6
    )
    
    
    (5
    )Other investing activities of discontinued operations
    
    
    (2
    )
    
    
    (17
    )Free cash flow
    
    
    1,066
    
    
    
    1,440
 34




---



##### Table of Contents



plus Rodriguez v. West
Publishing Corp. and Kaplan Inc.
 Year endedDecember 31(millions of U.S. dollars)
    
    2007
    
    2006Free cash flow
    
    
    1,066
    
    
    
    1,440Items affecting comparability:Cash used in (provided by) operating and investing activities of discontinued operations
    
    
    93
    
    
    
    (370
    )Interest on proceeds from the sale of Thomson Learning, net of taxes
    
    
    (155
    )
    
    
    Spending on THOMSONplusinitiatives
    
    
    162
    
    
    
    69Spending on Reuters related costs
    
    
    73
    
    
    
    Settlement of lawsuit
    
    
    36
    
    
    
    1,275
    
    
    
    1,139
 Credit facilities and commercial paper program.
   35




---



##### Table of Contents



Debt shelf registration.
  Off-Balance Sheet Arrangements, Commitments and Contractual Obligations
  (millions of U.S. dollars)
    
    2008
    
    2009
    
    2010
    
    2011
    
    2012
    
    Thereafter
    
    TotalLong-term debt(1)
    
    
    412
    
    
    
    634
    
    
    
    326
    
    
    
    254
    
    
    
    700
    
    
    
    1,942
    
    
    
    4,268Operating lease payments
    
    
    157
    
    
    
    135
    
    
    
    107
    
    
    
    82
    
    
    
    68
    
    
    
    204
    
    
    
    753Unconditional purchase obligations
    
    
    92
    
    
    
    45
    
    
    
    18
    
    
    
    10
    
    
    
    
    
    
    
    2
    
    
    
    167Total
    
    
    661
    
    
    
    814
    
    
    
    451
    
    
    
    346
    
    
    
    768
    
    
    
    2,148
    
    
    
    5,188
 
 (1)
    
    Represents hedged principal payments. As substantially all non-U.S. dollar-denominated debt
has been hedged into U.S. dollars, amounts represent the net cash outflows associated with
principal payments on our long-term debt.       36




---



##### Table of Contents



Contingencies
 Lawsuits and Legal Claims
  Rodriguez v. West Publishing Corp. and Kaplan
Inc Park v.
The Thomson Corporation and Thomson Legal & Regulatory Inc. Arendas v. The Thomson Corporation, West Publishing Corporation d/b/a
BAR/BRI and Doe Corporation
  Taxes
  37




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##### Table of Contents



Financial Risk
  Market Risk
 Currency Risk
    Operating
    
    
    Impact onCurrency
    
    Revenues as
    
    
    Impact on
    
    
    profit as
    
    
    operating(millions of U.S. dollars)
    
    reported
    
    
    revenues
    
    
    reported
    
    
    profitU.S. dollar
    
    
    5,859
    
    
    
    
    
    
    
    1,138
    
    
    
    British pounds sterling
    
    
    715
    
    
    
    72
    
    
    
    71
    
    
    
    7Euro
    
    
    230
    
    
    
    23
    
    
    
    9
    
    
    
    1Canadian dollar
    
    
    170
    
    
    
    17
    
    
    
    4
    
    
    
    Australian dollar
    
    
    100
    
    
    
    10
    
    
    
    7
    
    
    
    1Other
    
    
    222
    
    
    
    22
    
    
    
    68
    
    
    
    7Total
    
    
    7,296
    
    
    
    144
    
    
    
    1,297
    
    
    
    16
  38




---



##### Table of Contents



Cash Flow and Fair Value Interest Rate Risk
     Price Risk
  Credit Risk
    39




---



##### Table of Contents



Liquidity Risk
  OUTLOOK
 The information in this section is forward-looking and should be read in conjunction with the
section below entitled Cautionary Note Concerning Factors That May Affect Future Results.
   
 RELATED PARTY TRANSACTIONS
      40




---



##### Table of Contents



ACTUAL AND ESTIMATED COSTS OF EMPLOYEE FUTURE BENEFITS
     41




---



##### Table of Contents



SUBSEQUENT EVENTS
 TaxStream Acquisition
  Dividends
  42




---



##### Table of Contents



TradeWeb Partnership
  Reuters Acquisition
     Litigation
  
 CHANGES IN ACCOUNTING POLICIES
 Income Taxes
   
    
    First, we determine whether it is more likely than not that a tax position will
be sustained upon examination, including resolution of any related appeals or
litigation processes, based on the technical merits of the position. In evaluating
whether a tax position has met the more-likely-than-not recognition threshold, we
presume that the position will be examined by the appropriate taxing authority that
has full knowledge of all relevant information.
    
    Second, a tax position that meets the more-likely-than-not recognition threshold
is measured to determine the amount of benefit to recognize in the financial
statements. The tax position is measured at the largest amount of benefit that is
greater than 50% likely of being realized upon ultimate settlement. If the tax
position does not meet the more-likely-than-not recognition threshold, no benefit
from the tax position is recorded.
 43




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##### Table of Contents



Financial Instruments and Comprehensive Income
 Capital Disclosures Financial
Instruments  Disclosures.
 Comprehensive Income Financial Instruments  Recognition and Measurement Hedges
   
    
    an increase of $53 million to Other non-current assets and Accumulated other
comprehensive income in the consolidated balance sheet relative to derivative
instruments that consisted primarily of interest rate contracts, which convert
floating rate debt to fixed rate debt and qualify as cash flow hedges;
    
    a reclassification of $5 million from Other current assets and $3 million from
Other current liabilities to Accumulated other comprehensive income in the
consolidated balance sheet related primarily to previously deferred gains and
losses on settled cash flow hedges; and
    
    an increase of $16 million to Other non-current assets and Long-term debt in
the consolidated balance sheet related to derivative instruments and their related
hedged items. These derivative instruments consist primarily of interest rate
contracts to convert fixed rate debt to floating and qualify as fair value hedges.
  Discontinued Operations
 Discontinued
Operations
 44




---



##### Table of Contents



Stock-Based Compensation
 Stock-Based Compensation for Employees Eligible to
Retire Before the Vesting Date
 
 CRITICAL ACCOUNTING POLICIES
   Revenue Recognition
    45




---



##### Table of Contents



Capitalized Software
  Identifiable Intangible Assets and Goodwill
    Identifiable intangible assets with finite lives
  Identifiable intangible assets with indefinite lives
  Goodwill
  46




---



##### Table of Contents




    
    In the first step, we determine the fair value of each reporting unit. If the
fair value of a reporting unit is less than its carrying value, this is an
indicator that the goodwill assigned to that reporting unit might be impaired,
which requires performance of the second step.
    
    In the second step, we allocate the fair value of the reporting unit to the
assets and liabilities of the reporting unit as if it had just been acquired in a
business combination, and as if the purchase price was equivalent to the fair value
of the reporting unit. The excess of the fair value of the reporting unit over the
amounts assigned to its assets and liabilities is referred to as the implied fair
value of goodwill. We then compare that implied fair value of the reporting units
goodwill to the carrying value of that goodwill. If the implied fair value is less
than the carrying value, we recognize an impairment loss for that excess.
   Income Taxes
     
    
    First, we determine whether it is more likely than not that a tax position will
be sustained upon examination, including resolution of any related appeals or
litigation processes, based on the technical merits of the position. In evaluating
whether a tax position has met the more-likely-than-not recognition threshold, we
presume that the position will be examined by the appropriate taxing authority that
has full knowledge of all relevant information.
 47




---



##### Table of Contents




    
    Second, a tax position that meets the more-likely-than-not recognition threshold
is measured to determine the amount of benefit to recognize in the financial
statements. The tax position is measured at the largest amount of benefit that is
greater than 50% likely of being realized upon ultimate settlement. If the tax
position does not meet the more-likely-than-not recognition threshold, no benefit
from the tax position is recorded.
  Employee Future Benefits
  
 RECENTLY ISSUED ACCOUNTING STANDARDS
   48




---



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ADDITIONAL INFORMATION
 Depreciation by Segment
  Year endedDecember 31(millions of U.S. dollars)
    
    2007
    
    2006
    
    2005Legal
    
    
    205
    
    
    
    187
    
    
    
    171Financial
    
    
    172
    
    
    
    180
    
    
    
    178Tax & Accounting
    
    
    21
    
    
    
    22
    
    
    
    20Scientific
    
    
    32
    
    
    
    23
    
    
    
    20Healthcare
    
    
    24
    
    
    
    16
    
    
    
    14Corporate and Other
    
    
    14
    
    
    
    10
    
    
    
    10Total
    
    
    468
    
    
    
    438
    
    
    
    413
 Disclosure Controls and Procedures
  Internal Control over Financial Reporting
 plus
  Share Capital
  49




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##### Table of Contents



Public Securities Filings
 www.sedar.com www.sec.gov
 
 RECONCILIATIONS
 RECONCILIATION OF RETURN ON INVESTED CAPITAL (ROIC) TO GAAP MEASURES
 2007(excludingdiscontinued
    
    
    2006(millions of U.S. dollars) (unaudited)
    
    operations)(1)
    
    
    (as reported)
    
    
    2005Calculation of Adjusted Operating Profit After TaxesOperating profit
    
    
    1,297
    
    
    
    1,248
    
    
    
    1,159Add:Amortization
    
    
    256
    
    
    
    240
    
    
    
    235Reduce amount by Thomson Learning adjustments(2)
    
    
    
    
    
    
    (19
    )
    
    
    Segment operating profit of discontinued operations
    
    
    
    
    
    
    398
    
    
    
    386Adjusted operating profit
    
    
    1,553
    
    
    
    1,867
    
    
    
    1,780Taxes paid on operations(3)
    
    
    (315
    )
    
    
    (311
    )
    
    
    (326
    )Post-tax adjusted operating profit
    
    
    1,238
    
    
    
    1,556
    
    
    
    1,454Calculation of Adjusted Invested CapitalEquity
    
    
    13,571
    
    
    
    10,481
    
    
    
    9,963Total debt(3)
    
    
    4,859
    
    
    
    4,321
    
    
    
    4,283Invested capital
    
    
    18,430
    
    
    
    14,802
    
    
    
    14,246Adjustments:Cash and other investments(4)
    
    
    (7,497
    )
    
    
    (334
    )
    
    
    (423
    )Debt swaps(5)
    
    
    (424
    )
    
    
    (257
    )
    
    
    (193
    )Current and long-term deferred taxes(3)(4)
    
    
    846
    
    
    
    1,122
    
    
    
    1,310Accumulated amortization and non-cash goodwill(3)(6)
    
    
    1,844
    
    
    
    2,390
    
    
    
    1,885Present value of operating leases(3)(7)
    
    
    604
    
    
    
    783
    
    
    
    754Historical intangible asset and equity investment write-downs(8)
    
    
    124
    
    
    
    162
    
    
    
    162Other(3)(4)
    
    
    778
    
    
    
    798
    
    
    
    821Adjusted invested capital
    
    
    14,705
    
    
    
    19,466
    
    
    
    18,562Average invested capital
    
    
    14,288
    
    
    
    19,014
    
    
    
    18,639Return on invested capital
    
    
    8.7
    %
    
    
    8.2
    %
    
    
    7.8
    %
 
 (1)
    
    For 2007, we calculated ROIC based on reported results from continuing operations. No
adjustment was made to add back the results of discontinued operations given that numerous
disposals occurred during the year and partial year adjustments in these circumstances distort
annualized results. In particular, the largest disposal, Thomson Learning, had a significant
impact due to the fact that it is a highly seasonal business which
was disposed of mid-year. Accordingly, the 2007 ROIC calculation excludes all impacts from
businesses classified as discontinued operations. 50




---



##### Table of Contents



(2)
    
    This adjustment reflects the actual results of the higher education, careers and library
reference, NETg and Prometric businesses in Thomson Learning as if they had been part of
continuing operations for the periods presented. Specifically, this amount reflects
depreciation expense which is excluded from GAAP results under the accounting requirements for
discontinued operations. Costs incurred in connection with the disposal of the businesses have
been excluded.(3)
    
    For 2006 (as reported) and 2005, amounts include discontinued operations.(4)
    
    Items excluded as not deemed components of invested capital; Other primarily consists of
non-current liabilities.(5)
    
    Excludes debt swaps as balances are financing rather than operating-related.(6)
    
    Excludes accumulated amortization as only gross identifiable intangible assets and goodwill
cost are considered components of invested capital. Excludes goodwill arising from adoption of
CICA 3465. This goodwill was created via deferred tax liability instead of cash
purchase price.(7)
    
    Present value of operating leases deemed component of invested capital.(8)
    
    Adds back write-downs that were not cash transactions. 51




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QUARTERLY INFORMATION (UNAUDITED)
  Quarter ended
    
    Quarter ended
    
    Quarter ended
    
    Quarter endedMarch 31
    
    June 30
    
    September 30
    
    December 31(millions of U.S. dollars, except per common share amounts)
    
    2007
    
    2006
    
    2007
    
    2006
    
    2007
    
    2006
    
    2007
    
    2006Revenues
    
    
    1,662
    
    
    
    1,500
    
    
    
    1,805
    
    
    
    1,624
    
    
    
    1,796
    
    
    
    1,617
    
    
    
    2,033
    
    
    
    1,850Operating profit
    
    
    225
    
    
    
    208
    
    
    
    352
    
    
    
    306
    
    
    
    310
    
    
    
    312
    
    
    
    410
    
    
    
    422Earnings from
continuing
operations
    
    
    209
    
    
    
    204
    
    
    
    262
    
    
    
    197
    
    
    
    314
    
    
    
    206
    
    
    
    311
    
    
    
    305Discontinued
operations, net of
tax
    
    
    15
    
    
    
    (67
    )
    
    
    115
    
    
    
    (24
    )
    
    
    2,655
    
    
    
    213
    
    
    
    123
    
    
    
    86Net earnings
    
    
    224
    
    
    
    137
    
    
    
    377
    
    
    
    173
    
    
    
    2,969
    
    
    
    419
    
    
    
    434
    
    
    
    391Dividends declared
on preference
shares
    
    
    (1
    )
    
    
    (1
    )
    
    
    (2
    )
    
    
    (2
    )
    
    
    (1
    )
    
    
    (1
    )
    
    
    (2
    )
    
    
    (1
    )Earnings
attributable to
common shares
    
    
    223
    
    
    
    136
    
    
    
    375
    
    
    
    171
    
    
    
    2,968
    
    
    
    418
    
    
    
    432
    
    
    
    390Basic earnings
(loss) per common
shareFrom continuing
operations
    
    $
    0.32
    
    
    $
    0.31
    
    
    $
    0.41
    
    
    $
    0.30
    
    
    $
    0.49
    
    
    $
    0.32
    
    
    $
    0.48
    
    
    $
    0.47From discontinued
operations
    
    
    0.03
    
    
    
    (0.10
    )
    
    
    0.18
    
    
    
    (0.03
    )
    
    
    4.14
    
    
    
    0.33
    
    
    
    0.19
    
    
    
    0.14$
    0.35
    
    
    $
    0.21
    
    
    $
    0.59
    
    
    $
    0.27
    
    
    $
    4.63
    
    
    $
    0.65
    
    
    $
    0.67
    
    
    $
    0.61Diluted earnings
(loss) per common
shareFrom continuing
operations
    
    $
    0.33
    
    
    $
    0.31
    
    
    $
    0.40
    
    
    $
    0.30
    
    
    $
    0.49
    
    
    $
    0.32
    
    
    $
    0.48
    
    
    $
    0.47From discontinued
operations
    
    
    0.02
    
    
    
    (0.10
    )
    
    
    0.18
    
    
    
    (0.04
    )
    
    
    4.12
    
    
    
    0.33
    
    
    
    0.19
    
    
    
    0.14$
    0.35
    
    
    $
    0.21
    
    
    $
    0.58
    
    
    $
    0.26
    
    
    $
    4.61
    
    
    $
    0.65
    
    
    $
    0.67
    
    
    $
    0.61
  52




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##### Table of Contents



CAUTIONARY NOTE CONCERNING FACTORS THAT MAY AFFECT FUTURE RESULTS
 Certain information in this managements discussion and analysis are forward-looking statements
that are not historical facts but reflect our current expectations regarding future results. These
forward-looking statements also include statements about our beliefs and expectations related to
anticipated run-rate savings and costs related to THOMSONplus as well as the timing for the program
and the delivery of expected synergies arising from the proposed Reuters acquisition. There can be
no assurance that the proposed Reuters acquisition will be consummated or that the anticipated
benefits will be realized. The proposed Reuters acquisition is subject to shareholder and court
approvals and the fulfillment of certain closing conditions, and there can be no assurance that any
such approvals will be obtained and/or such conditions will be met. 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. These risks and uncertainties include the
ability to achieve the synergies contemplated through the proposed acquisition; the failure of
Reuters shareholders to approve the proposed acquisition; the reaction of Thomsons and Reuters
customers, employees and suppliers to the proposed acquisition; the ability to promptly and
effectively integrate the businesses of Thomson and Reuters after the acquisition closes; and the
diversion of management time on proposed acquisition-related issues. Some of the factors that could
also cause our actual results or events to differ materially from current expectations are: changes
in the general economy; actions of competitors; changes to legislation and regulations; increased
accessibility to free or relatively inexpensive information sources; failure to derive fully
anticipated benefits from future or existing acquisitions, joint ventures, investments or
dispositions; failure to develop new products, services, applications and functionalities to meet
customers needs, attract new customers or expand into new geographic markets; failure of
electronic delivery systems, network systems or the Internet; detrimental reliance on third parties
for information; failure to meet the challenges involved in the expansion of international
operations; failure to realize the anticipated cost savings and operating efficiencies from ongoing
initiatives; failure to protect our reputation; impairment of goodwill and identifiable intangible
assets; failure of significant investments in technology to increase revenues or decrease operating
costs; increased self-sufficiency of customers; inadequate protection of intellectual property
rights; downgrading of credit ratings; threat of legal actions and claims; changes in foreign
currency exchange and interest rates; failure to recruit and retain high quality management and key
employees; funding obligations in respect of pension and post-retirement benefit arrangements; and
actions or potential actions that could be taken by Woodbridge. Additional factors are discussed in
our materials filed with the securities regulatory authorities in Canada and the United States from
time to time, including our management information circular dated February 29, 2008, relating to
our special meeting of shareholders to be held on March 26, 2008. These risks are also incorporated
by reference in our annual information form for the year ended December 31, 2007, which is
contained in our annual report on Form 40-F for the year ended December 31, 2007. We disclaim any
intention or obligation to update or revise any forward-looking statements, whether as a result of
new information, future events or otherwise, other than as required by law, rule or regulation.
 53