How to cite a conference paper in an "extended" journal version?

Question

I recently presented a paper at a conference which was published in its proceedings. Now it is time to submit an "extended" version with "30% new content". The new content isn't a problem, I've added several figures, a couple of genuinely new findings and some helpful illustrations that I developed while preparing my talk. However, the instructions from the publisher state:

In the extended paper clearly cite the conference paper and list it as one of the references.

In my opinion, this can be interpreted in one of two ways:

1. Write a new article that assumes knowledge of the proceedings. This is kind of a scary option because it implies that it really has to be a new work.
2. Explain that an earlier version exists and what's new here. This is a comforting interpretation but seems kind of uncharacteristic for the style in most journal articles.

What's the best path to follow here?

Answer 1

I write something along the lines of:

This paper is an extended version of work published in [1]. We extend our previous work by A, B and C.

Note that some new figures etc. will probably not really count as new content (this would probably be called new presentation rather than new content). New findings and new data, that's what people will really be interested in.

One common pattern that I often see in my field is that the conference paper has most of the ideas in place, but a rather cursory evaluation. The journal extension then has the ideas of the conf paper + whatever input came out of discussions at the conference + a more or less large-scale validation. The "nucleus" of the paper is reproduced more or less in verbatim. To be fair, I am not sure if this is even ok from a copyright point of view, but it certainly is common practice in my field FWIW.