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The Corporate Executive Board Reports Second Quarter Pro Forma Earnings of $0.21 Per Share On 35.4% Growth in Revenues

WASHINGTON--(BUSINESS WIRE)--July 26, 2000--The Corporate Executive Board Company (CEB) (Nasdaq/NM:EXBD) today announced financial results for the second quarter and six months ended June 30, 2000. For the quarter, revenues increased 35.4% to $22,612,000 from $16,700,000 for the second quarter of 1999. Pro forma net income increased 54.9% to $3,701,000 from $2,389,000. Pro forma diluted earnings per share for the second quarter increased 40.0% to $0.21 from $0.15 for the same period last year. Pro forma adjustments exclude stock option and related expenses for both periods.

For the first six months of 2000, revenues increased 33.9% to $43,396,000 from $32,403,000 for the first half of 1999. Pro forma net income rose 57.0% to $7,021,000 from $4,471,000. Pro forma diluted earnings per share for the latest six months were $0.41, an increase of 46.4% from $0.28 for the first six months of 1999. Pro forma adjustments exclude stock option and related expenses for both periods and include income taxes of 41.5% for the six months ended June 30, 1999. The income tax rate for the first half of 2000 was 39%.

Jay McGonigle, CEO of the Corporate Executive Board commented, "Our second quarter results again reflected the predictable, scalable nature of our business model. Continued strength in our established programs coupled with positive performance from our newer program offerings contributed to another quarter of better than 30% growth in revenues. This growth was again accompanied by margin expansion: pro forma operating margins increased to 24.9% in the second quarter of this year from 22.7% in the second quarter of 1999. This expansion was powered by the underlying scalability of our business model, as we leveraged a fixed-cost research investment over a growing subscriber base.

"Revenue growth for the quarter was attributable to cross-selling, new customer acquisition, new programs and price increases. In the second quarter, our average cross-sell ratio climbed to 1.96 from 1.76 in the comparable period last year. New customers included The News Corporation Ltd., Japan Tobacco, Oracle Corporation and Rubbermaid, Inc. In addition, on July 13th, we announced the launch of the Operations Management Roundtable(TM) (OMR). This brand new membership program for senior operations executives in large global corporations is our second new program launched in 2000, and brings our total number of program offerings to 14. The program will initially focus on best practices in driving performance and coordinating activities across the supply chain. The design and research focus of OMR was guided by a group of charter advisors, including senior executives from Alcoa Inc., Cisco Systems, Gillette, Intel, Nokia, Procter & Gamble, Rolls-Royce plc and Toyota NA."

McGonigle concluded, "With a strong pipeline of new product ideas, high degree of revenue visibility, and ample room to cross-sell and add new subscribers in our target Global 3000 universe, we believe that the CEB is well positioned to continue our record of consistent, profitable growth."

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You are hereby cautioned that these statements may be affected by the important factors, among others, set forth below and in CEB's filings with the Securities and Exchange Commission, and consequently, actual operations and results may differ materially from the results discussed in the forward-looking statements. Factors that could cause actual results to differ materially from those indicated by forward-looking statements include, among others, the dependence on renewal of membership based services, dependence on key personnel, the need to attract and retain qualified personnel, management of growth, new product development, competition, risks associated with anticipating market trends, industry consolidation, variability of quarterly operating results, various factors that could affect the estimated tax rate and possible volatility of stock price. The Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.

The Corporate Executive Board Company is a leading provider of best practices research and analysis focusing on corporate strategy, operations and general management issues. CEB provides its integrated set of services currently to more than 1,500 of the world's largest and most prestigious corporations, including over 70% of the Fortune 500. These services are provided primarily on an annual subscription basis and include best practices research studies, executive education seminars, customized research briefs and web-based access to a library of over 120,000 corporate best practices. -0-

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                 THE CORPORATE EXECUTIVE BOARD COMPANY
                    Unaudited Financial Highlights
                 (in thousands, except per share data)

                                      Three Months Ended
                                           June 30,
                                      ------------------
                                        2000       1999
                                      --------   -------
Revenues                               $22,612   $16,700
Net income                             $ 3,620   $ 2,332
Basic earnings per share               $  0.23   $  0.18
Diluted earnings per share             $  0.21   $  0.15
Weighted average shares outstanding:
   Basic                                15,422    13,189
   Diluted                              17,350    15,954

Pro forma: (1) (2)
   Net income                          $ 3,701   $ 2,389
Diluted earnings per share             $  0.21   $  0.15


                                        Six Months Ended
                                             June 30,
                                       ------------------
                                        2000       1999
                                       -------   -------
Revenues                               $43,396   $32,403
Net income                             $ 6,308   $ 7,200
Basic earnings per share               $  0.43   $  0.55
Diluted earnings per share             $  0.37   $  0.46
Weighted average shares outstanding:
   Basic                                14,816    12,989
   Diluted                              17,032    15,738

Pro forma: (1) (2)
   Net income                          $ 7,021   $ 4,471
Diluted earnings per share             $  0.41   $  0.28


(1) Excludes stock option and related expenses.
(2) Includes income taxes of 41.5% for the six months ended
    June 30, 1999.


                 THE CORPORATE EXECUTIVE BOARD COMPANY
                    Unaudited Financial Highlights
                 (in thousands, except per share data)

                                                 Three Months Ended
                                     Selected         June 30,
                                      Growth   ---------------------
                                       Rates     2000       1999
                                     --------  -------    ----------

Contract Value                          31.7%  $90,893      $69,011

Statements of Income
Revenues                                35.4%  $22,612      $16,700
Cost of services                                 8,372        6,748
                                               -------      -------
     Gross profit                               14,240        9,952

Member relations and marketing                   5,236        3,778
General and administrative                       2,919        2,126
Depreciation                                       463          263
Stock option and related expenses                  132           96
                                               -------      -------
     Income from operations                      5,490        3,689

Other income                                       446          298
                                               -------      -------
Income before provision for income taxes         5,936        3,987

Provision for income taxes                       2,316        1,655
                                               -------      -------
     Net income                                $ 3,620      $ 2,332
                                               =======      =======

EPS-basic                                      $  0.23      $  0.18
EPS-diluted                                    $  0.21      $  0.15

Pro forma net income (1) (2)            54.9%  $ 3,701      $ 2,389

Pro forma EPS-basic (1) (2)                    $  0.24      $  0.18
Pro forma EPS-diluted (1) (2)           40.0%  $  0.21      $  0.15

Weighted average shares outstanding
   Basic                                        15,422       13,189
   Diluted                               8.8%   17,350       15,954

Percentages of Revenues
Gross profit                                     63.0%        59.6%
Member relations and marketing                   23.2%        22.6%
General and administrative                       12.9%        12.7%
Pro forma income from operations (1)             24.9%        22.7%
Pro forma net income (1) (2)                     16.4%        14.3%


                                                  Six Months Ended
                                     Selected       June 30,
                                      Growth   --------------------
                                       Rates     2000         1999
                                     --------- -------      -------
Contract Value

Statements of Income
Revenues                                33.9%  $43,396      $32,403
Cost of services                                16,849       13,501
                                               -------      -------
     Gross profit                               26,547       18,902

Member relations and marketing                   9,509        7,181
General and administrative                       5,648        4,141
Depreciation                                       915          480
Stock option and related expenses                1,168          191
                                               -------      -------
     Income from operations                      9,307        6,909

Other income                                     1,035          543
                                               -------      -------
Income before provision for income taxes        10,342        7,452

Provision for income taxes                       4,034          252
                                               -------      -------
     Net income                                $ 6,308      $ 7,200
                                               =======      =======

EPS-basic                                      $  0.43      $  0.55
EPS-diluted                                    $  0.37      $  0.46

Pro forma net income (1) (2)            57.0%  $ 7,021      $ 4,471

Pro forma EPS-basic (1) (2)                    $  0.47      $  0.34
Pro forma EPS-diluted (1) (2)           46.4%  $  0.41      $  0.28

Weighted average shares outstanding
   Basic                                        14,816       12,989
   Diluted                               8.2%   17,032       15,738

Percentages of Revenues
Gross profit                                     61.2%        58.3%
Member relations and marketing                   21.9%        22.2%
General and administrative                       13.0%        12.8%
Pro forma income from operations (1)             24.1%        21.9%
Pro forma net income (1) (2)                     16.2%        13.8%

(1) Excludes stock option and related expenses.
(2) Includes income taxes of 41.5% for the six months ended
    June 30, 1999.


                 THE CORPORATE EXECUTIVE BOARD COMPANY
                       CONDENSED BALANCE SHEETS
                            (in thousands)

                                       June 30, 2000   Dec. 31, 1999
                                        (Unaudited)
Assets

Current assets:
    Cash and cash equivalents           $    15,478    $     19,726
    Membership fees receivable, net           8,820          26,603
    Deferred income taxes, net               13,236           8,047
    Deferred incentive compensation           2,396           2,801
    Prepaid expenses and other current
      assets                                  1,930           1,318
                                        -----------    ------------
         Total current assets                41,860          58,495

Deferred income taxes, net                   20,223              --
Marketable securities                        37,270          13,348
Property and equipment, net                  13,126           9,921
                                        -----------    ------------
         Total assets                   $   112,479    $     81,764
                                        ===========    ============

Liabilities and stockholders' equity

Current liabilities:
    Accounts payable and accrued
      liabilities                       $     8,243    $      6,082
    Accrued incentive compensation            1,930           3,877
    Stock option repurchase liability         3,140           4,710
    Deferred revenues                        45,972          55,436
                                         ----------    ------------
          Total current liabilities          59,285          70,105

Other liabilities                               925             813
                                         ----------    ------------
          Total liabilities                  60,210          70,918

          Total stockholders' equity         52,269          10,846
                                         ----------    ------------
Total liabilities and stockholders'
  equity                                 $  112,479    $     81,764
                                         ==========    ============
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    CONTACT:  The Corporate Executive Board Co., Washington
              Clay Whitson
              Chief Financial Officer
              202/777-5455
              heroldl@executiveboard.com
              www.executiveboard.com