Independent News & Media Regulatory News (INM)

APN Chief Executive Officer's Address to Shareholders

Ticker: (Bloomberg) INM.ID/ INM.LN and (Reuters) INME.I/ INME.L

Dublin/London - 2nd May 2012: APN News & Media Ltd ['APN'], in which Independent News & Media PLC ['INM'] has a 29.5% shareholding, today issued an address from the Chief Executive Officer to Shareholders as follows:

Good morning. It is my great pleasure to be addressing you as CEO of APN News & Media.

Today I will give you a formal update on our strategic approach and make a number of announcements including a trading update. I will then take you through some slides detailing our 2011 results and some of the key initiatives in our divisions this year.

STRATEGIC APPROACH

When I joined APN a little more than a year ago, it was with a mandate to substantially reposition APN and transform it into a high growth media company. We are one year into a five year program and I am pleased to report that we have made substantial progress.

We have strengthened the leadership in my team and in each of our businesses. Our leadership is first rate and combined with talented and dedicated people throughout the Company, I am confident we have the right people for the job.

Our strategic approach to transforming APN is very clear, we are:

·; optimising our core media assets; and

·; increasing our exposure to high growth media businesses.

The CEOs of our publishing, radio, outdoor and digital businesses are working with their teams to continually improve our media assets. Their absolute focus is driving the operational success that is required to win in their respective sectors.

They are competing as hard as possible for every available dollar in the market place, while evolving our business models to meet consumer and advertiser requirements in a multi-media context. This demands quality sales execution, increasing the use of technologies to drive effectiveness and productivity, high quality content, the best talent and creative advertising solutions.

There has been a relentless focus on cost and this will continue.

It has required some hard decisions, such as consolidating printing sites, closing non-profitable publications and selling businesses not aligned with our strategy. We have proven in the last year that we are not afraid to make these necessary changes.

My focus as CEO of APN is to develop and position our media portfolio with a bias towards higher growth media assets.

The most significant step towards this so far is establishing APN Outdoor as a joint venture with Quadrant Private Equity. The joint venture will leverage APN's expertise into a well capitalised vehicle that is able to pursue growth opportunities, such as digital innovation and expansion. The transaction also improves APN's balance sheet and provides some flexibility in APN's capital structure to pursue our strategy.

Our Chief Development Officer is leading the acceleration of digital capabilities within our existing assets and expanding our portfolio of digital ventures. This will enable us to take advantage of emerging business models and the next wave of advertising solutions. Together, our broadcast media assets and our digital ventures will strengthen our brands, extend our audiences and create new revenue streams.

I am convinced that APN's portfolio must become more biased towards growth to rebuild our share price and the value of our Company.

2011

The past year has also provided extraordinary challenges.

The natural disasters in our key markets, together with some of the toughest economic conditions Australia and New Zealand have seen in years, set the tone for a difficult 2011. These impacts are still being felt across many of our markets and we have not seen the revenue recovery we anticipated.

Further, our position in New Zealand means our results are strongly affected by the New Zealand economy, which remains subdued.

In response we developed a substantial remediation plan to reduce costs and improve immediate performance. We have delivered against those targets. Our performance in the second half of the year was much improved as a result.

Despite the difficult backdrop, our commitment to quality journalism and providing relevant, local content, has seen our audiences continue to increase across our print, online and mobile platforms. Our publications, websites and our people continue to receive critical acclaim at national and international awards.

Our radio businesses are building momentum. In Australia, our investment in programming and marketing is starting to pay off. Ratings are increasing, we have attracted top on-air talent and we have grown our advertising market share. In New Zealand, we have the number one national network and three of the top five networks. We also grew revenue ahead of the market.

We have more than doubled our digital revenue over the past 12 months. Our new digital team has developed and is executing against a robust strategy. They have worked closely with the divisions to deliver a range of important initiatives. We have made acquisitions to expand our digital portfolio and GrabOne, in particular, has performed exceptionally well.

Outdoor delivered an impressive result with EBIT up 31%. The division outperformed the market in all major categories in Australia and New Zealand as well as strong performances in Hong Kong and Indonesia.

I will take you through a more detailed performance of our divisions in 2011 shortly.

Before I do that, I want to make a number of announcements and provide you with our trading update.

ANNOUNCEMENTS

APN completes outdoor joint venture with Quadrant

As announced yesterday, APN has successfully completed its transaction to establish APN Outdoor as a 50/50 joint venture with Quadrant Private Equity.

The joint venture retains the name APN Outdoor and is effective as at 1 May 2012. The transaction values APN Outdoor at $272m on an enterprise value basis and has generated gross cash proceeds of approximately $190m for APN.

APN intends to use the funds to re-invest in growing APN, including Outdoor, and reducing corporate debt.

Major rejuvenation of New Zealand Media

APN is undertaking a major rejuvenation program in New Zealand Media, our New Zealand publishing division, to reposition it in an evolving media market. The key initiatives include:

·; Reviewing the content and design of The New Zealand Herald to make it more contemporary with a focus on multi-platform delivery over the 24 hour cycle. Central to this is an assessment of converting to a compact format for Monday to Friday editions.

It also involves:

- tighter alignment with web, tablet, mobile and print;

- modular advertising formats; and

- more integrated advertising solutions across all of APN's New Zealand assets.

·; Creating the largest multi-media sales team in New Zealand, with a single structure selling online, print and national magazines, partnering with our radio and outdoor joint venture businesses to provide customer solutions that are unrivalled in the New Zealand market.

·; Further developing nzherald.co.nz as a national online brand with enhanced content and behavioural targeting capability to better connect with rich audience segments.

·; Aligning all North Island regional dailies to morning delivery and tabloid format, which is well underway, to enable more efficient sharing of content from the newly created APNZ news service.

Strategic review of all APN media assets New Zealand

APN has commenced a strategic review of our media assets in New Zealand. In recent months, APN has identified a number of opportunities and at the same time received approaches in relation to potential transactions involving some or all of our New Zealand assets. We have engaged Deutsche Bank to advise APN on various options available to maximize profitability and value for shareholders.

Digital ventures portfolio

APN has increased its equity in GrabOne to 100%. GrabOne continues to lead the group buying market with approximately 70% market share in New Zealand and is proving to be a strong platform to develop digital marketing services to small to medium businesses (SMBs) which is core to our digital strategy.

As part of the transaction, GrabOne founder and CEO Shane Bradley, has agreed to continue the development of services for SMBs and to drive the overall performance of GrabOne. We look forward to continuing and extending our successful partnership with Shane - he is a digital entrepreneur of the highest calibre.

CC Media, APN's digital retail advertising network, has launched in New Zealand this month, having won its first anchor client. We are excited by the opportunities that this business affords us.

APN is also in advanced negotiations on a number of additional digital acquisitions and partnerships. The closure of one or more of these transactions will accelerate APN's digital scale and momentum. We look forward to updating you in due course.

TRADING UPDATE

APN continues to execute well in difficult advertising markets.

After a very slow start to the year in the New Zealand market, we have seen some recent improvement. In Australia advertisers are very cautious. In this regard, we are in line with the views expressed by our peers in recent weeks.

On a group basis our operational execution has been to plan - ahead in many of our businesses. We have benefitted from strong market share gains in Australian radio (up from 20.4% to 22.1% for the first quarter) and in Australian Regional Media our continued commitment to cost control has delivered year on year EBIT growth for the first quarter.

Our key digital businesses GrabOne and CCMedia are delivering on our expectations.

In New Zealand, and in publishing in particular, it has been a difficult start to 2012 and despite some improvement in March and a 3% reduction in publishing costs for the quarter, the business remains well below the prior year.

As previously noted, we have commenced a major strategic review of all aspects our New Zealand assets. Further, in our publishing division we are driving some fundamental change which will centralise and streamline our operations. These are major initiatives for us and we will update the market further at the half year results. In the meantime, we have identified a further $7m annualised cost savings in this business.

Results for the half year will include the dilution effect of the APN Outdoor joint venture with Quadrant for two months following effective completion on 1 May 2012. Assuming current market conditions continue, APN's overall NPAT (pre Exceptional Items) for the half is expected to be behind last year by approximately $3m.

-- ENDS -

For further information, please contact:

APN - Peter Brookes, Citadel Communications, +61 407 911389