Reader's Digest Investor Information

Back in 1922, DeWitt and Lila Wallace published their first issue of Reader's Digest, sold exclusively by mail and priced at 25¢. Working out of their Greenwich Village apartment, the Wallaces printed 5,000 copies with 31 carefully selected articles including "The Future of Poison Gas," "Wanted: Motives for Motherhood" and "Advice from a President's Physician."

Since then, the Company has grown to be one of the world's preeminent publishers and direct marketers. Reader's Digest, the largest-selling magazine in the world, now appears in 48 editions and 19 languages. The Company also reaches millions of readers through its special-interest magazines; books, including the popular Select Editions series and offerings in the do-it-yourself, cooking, health, gardening and children's titles; music from Beethoven to Ella Fitzgerald to today's pop divas; and videos and audio books. These are sold through an increasing range of channels, including direct mail, display marketing, direct response television, catalogs, retail and the Internet.

In the inaugural issue of Reader's Digest, the Wallaces offered articles of "enduring value and interest." Today, in a broad range of media formats, the Company continues to be committed to informing, enriching, entertaining and inspiring people of all ages and cultures.

Following are milestones in the history of The Reader's Digest Association, Inc.:

1922 -- DeWitt and Lila Wallace publish 5,000 copies of the first issue of Reader's Digest, sold exclusively through the mail.

1929 -- Reader's Digest appears on the newsstands for the first time and, despite the looming Depression, 62,000 copies are sold. Just six years later, circulation passes the one million mark.

1938 -- The magazine's first international edition is published in the United Kingdom.

1940-1948 -- During World War II, editions are published for the first time in Latin America and Sweden. After the war, editions soon appear in Australia, Belgium, Canada, Denmark, Finland, France, Germany, Italy, Norway, South Africa and Switzerland.

1950 -- Readers' Digest Condensed Books (today called Select Editions) are launched in the United States and Canada. Four years later, the series is introduced in Australia and the United Kingdom.

1955 -- Already in our international editions, paid advertising appears for the first time in the U.S. Reader's Digest.

1958 -- Reader's Digest's first computer is installed, signaling a commitment to leading-edge technology. Today, it operates two Global Data Centers that process information from around the world.

1959 -- Music, the first non-print product line, is launched with the classic anthology, Music of the World's Great Composers.

1962 -- Reader's Digest revolutionizes direct mail marketing by introducing easy-to-enter Sweepstakes.

1963 -- The first original General Book, Reader's Digest Great World Atlas, is published in the United Kingdom. The Quality School Program (QSP) is founded. Today, QSP is one of the largest fund-raising organizations of its kind, helping over 25,000 schools and youth groups in the United States and Canada.

1969 -- A first-of-its-kind survey of European consumers, "Europe Today," is conducted, providing a wealth of demographic information and product preference data.

1981 -- DeWitt Wallace dies at 91. Three years later, in 1984, Lila Wallace, 94, dies.

1986 -- Reader's Digest enters the video business with Why We Fight. The Company begins to acquire special interest magazines, a roster that would grow to today's lineup of: The Family Handyman, American Woodworker, New Choices, Moneywise and Benchmark.

1988 -- Household Hints & Handy Tips sells more than 1.2 million copies within 30 days in the United States alone. The following year, a major new reading series, Today's Best Nonfiction, is launched.

1990 -- With annual revenues of $2 billion, Reader's Digest goes public, trading as "RDA" on the New York Stock Exchange; "RDB" is listed in 1992.

1991 -- The Russian edition of Reader's Digest is launched, marking entry into Eastern and Central Europe. This new edition is the 40th one and 16th language for the flagship magazine. It is soon followed by editions in Hungary, the Czech Republic and Poland.

1992 -- The Reader's Digest video, Great National Parks II, wins an Emmy Award -- the first of five Emmys won by the company's videos.

1994 -- The 10 billionth copy of the U.S. edition of Reader's Digest is published. Reader's Digest Young Families, Inc., is established. The direct response television commercial for The Family Handyman's Helpful Hints, one of the first such commercials brings 125,000 paid orders.

1996 -- Reader's Digest World, a multitiered global Web site, is launched. Reader's Digest expands its reach in Asia with its Thai edition. Within that region, the Company also publishes editions in Australia, Hong Kong, India, Korea, Malaysia, New Zealand, the Philippines, Singapore and Taiwan.

1997 -- On its 75th anniversary, Reader's Digest magazine publishes a special commemorative 13th issue.

1998 -- Thomas O. Ryder, a leader in the publishing and direct marketing industries with extensive international expertise, is appointed Chairman and Chief Executive Officer. The Company initiates a four-phase strategy, including global re-engineering and growth initiatives, to build on its fundamental strengths and create long-term opportunities.

The U. S. Postal Service honors the philanthropic and cultural contributions of DeWitt and Lila Wallace by issuing a new postage stamp, part of the "Great Americans" series.

1999 -- The Company achieves earnings growth in each quarter, versus the comparable 1998 quarters, posting Fiscal 1999 operating profit up 67 percent, or $167.0 million for the year. The Company also begins its program of "strategic growth initiatives" -- start-ups, acquisitions and partnerships -- to build for the future.

The Company acquires Books Are Fun, Ltd., the largest Display marketer in North America. BAF provides Reader's Digest with a new source of revenue and operating profit, while also offering a promising new marketing channel for the Company's products.

2000 -- The Company achieves a second straight year of strong earnings growth. Operating profit is up 54 percent, to $257 million. Revenue also begins to grow and is up for the fiscal year.

2001 -- Reader's Digest magazine is given the most far-ranging redesign in its history. A new, contemporary look unifies home-delivery and newsstand versions. An exciting cover treatment is adapted to all 48 global editions. The redesign unfolds over the course of a full year and is called "the Quiet Revolution."

The company expands its profitable program of offering various financial services through partnerships. What began in 1999 as a single insurance venture now extends to initiatives in well over 30 countries.