APN Chairman's Address

APN CHAIRMAN'S ADDRESS TO SHAREHOLDERS

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

Dublin/London - 2nd May 2013: APN News & Media Ltd ['APN'], in which Independent News & Media PLC ['INM'] has a 29.0% shareholding, today issued an address from the Chairman to Shareholders as follows:

Today I am going to update you on the business performance over the last 12 months, explain the Board changes that have occurred since the last AGM and take you through some of the key priorities for your Company.

I have also invited two of APN's senior executives to provide you with an update on two of our principal divisions. They are Martin Simons, CEO of New Zealand Media and Ciaran Davis, CEO of Australian Radio Network.

Overview of 2012

2012 was another challenging year for the publishing businesses, driven predominantly by weak advertising markets and ongoing structural changes. APN faces the same challenges to its newspaper operations that are being experienced around the world and we are vigorously reengineering our publishing businesses in both New Zealand and Australia.

This process involves product rejuvenation, ensuring our digital businesses interact more closely with the publishing operations and the creation of new products. It also includes extensive cost reduction programs, which delivered $25m of savings in 2012 with another $25m reduction expected this year.

The full impact of these measures will not be fully felt until 2014. In the meantime we have valuable brands that have served this Company well in past years and will continue to do so.

The strong market positions we have in regional newspapers in Queensland play a critical role in many local communities. We believe that newspapers that provide local, relevant news and information to their communities, via print or online, will remain an effective way to engage with local businesses and consumers for a long time to come.

The New Zealand Herald continues to be New Zealand's leading publication and was relaunched as a compact with a new approach in design, content and deeper digital integration in September.

It was a very successful year for the Australian Radio Network which outperformed the market, increasing share and achieving the highest ratings in its target audience, aged 25 to 54, in five years. While results at The Radio Network in New Zealand were somewhat disappointing, new CEO Jane Hastings started in September and is driving a program of change to rebuild the business. The improvements have already resulted in some early wins.

The outdoor market in Australia demonstrated its resilience and grew 2% in 2012. We remain very positive about the sector and our portfolio which gives us coverage across the key forms of outdoor advertising.

Product development remains a key focus. APN Outdoor is expanding its portfolio of large format digital billboards and Adshel is delivering innovative campaigns enabling consumers to interact with advertisements on street furniture via digital screens or smart phones. Adshel delivered a particularly good performance last year, with significant market share gains.

We strengthened our digital ventures portfolio in 2012, increasing equity in GrabOne from 75% to 100% and acquiring 82% of brandsExclusive. The key digital ventures GrabOne, brandsExclusive and CC Media provide APN with the core transactional platforms we need in Australia and New Zealand. The digital ventures generated solid revenue growth during the year.

2012 Financial Results

We have already reported to shareholders the financial results for 2012. In short, revenue for the year was $929 million and EBITDA was $156 million, with the declines in publishing somewhat offset by good performances in radio and outdoor.

The formation of APN Outdoor as a joint venture with Quadrant Private Equity in May 2012 had a significant impact on results, as APN ceased to consolidate APN Outdoor from this date. It is important to note that although this reduced APN's earnings, the proceeds from disposal were used to reduce debt by $180m, significantly strengthening the Company's balance sheet.

Net profit after tax and before exceptional items was $54 million. Impairment charges were taken against our publishing assets in Australia and New Zealand. After taking into account the impairments, the gain on the disposal of APN Outdoor and other exceptional items, the statutory net loss for the year was $456 million.

Board Renewal

There have been a number of changes to the Board over the past year. In particular I would like to provide the context relating to the events that resulted in the resignation of APN's Chairman, CEO and three directors on 19 February 2013.

The issue which led to the resignations was whether or not APN would undertake a capital raising to reduce debt in February 2013.

The departing directors believed that a capital raising should be undertaken at the time the Company announced its full year results. The current directors believed that a capital raising should be undertaken in a timeframe to allow other options to be pursued.

Independent News & Media PLC (INM) and fund manager Allan Gray, representing approximately 50% of APN's issued shares, expressed opposition to a capital raising at the proposed February timeframe.

In addition, the Board received a requisition from INM for an Extraordinary General Meeting to remove certain directors and to establish a new Board. The requisition has been withdrawn.

We are committed to expanding the number of non-executive directors with at least two new directors, who are Australian or New Zealand residents, before the end of the year.

Our search for a new CEO is progressing well and we will make an appointment as soon as possible.

In the interim there is a leadership team in place comprising myself, Ted Harris and Jeff Howard, and we have very capable CEOs and management teams across our business divisions.

Current priorities

Although we are in a period of transition, we are getting on with business.

You will have seen APN's announcement on 24 April 2013 which advised changes to the leadership of our Digital and Australian Regional Media divisions.

With the digital ventures now in place, we have simplified the management of the portfolio. We are putting resources as close as possible to the businesses, speeding up decisions and reducing administrative overheads. Digital is important to APN. Our focus is now to drive the performance of these businesses and link them with each other and our publishing, radio and outdoor assets.

We decided our Australian Regional Media division needed a new direction in leadership and we are pleased to welcome Neil Monaghan as the new CEO.

In terms of our other priorities, we maintain a strong focus on reducing debt.

Net debt was reduced by $180 million in 2012. Our intention is to reduce debt again this year by $40 million to $50 million through organic cash generation, active management of the cost base and some asset sales. As part of the debt reduction program the Board decided not to pay a final dividend.

Our debt reduction focus will continue into 2014 which will place us in a stronger position to renew, extend or replace our 2015 bank facilities.

The balance sheet of the Company was disclosed in the release of the full year results on 21 February 2013.At 31 December 2012 we were compliant with our covenants and this continues to be the case. The Company has undrawn facilities sufficient to cover maturities in 2013 and 2014.

I would now like to invite Martin Simons to take you through our plans for New Zealand Media, followed by Ciaran Davis who will present our radio businesses.

Q1 2013

APN had a mixed performance in the first quarter of 2013.

There have been encouraging improvements in New Zealand Media. Revenue declines have moderated reflecting the recovery in the New Zealand economy and the benefits of the product rejuvenation program. Cost savings have more than offset the revenue declines and EBITDA is slightly ahead year to date.

In contrast, Australian Regional Media had a tough quarter and revenue is down 13%. The slowdown in the mining sector, declines in government advertising and floods earlier in the year account for more than half of the decline.

Our publishing divisions are well on track to achieving $25m cost reduction in 2013.

Australian Radio Network continues to perform strongly, with increases in revenue and market share. It currently has the number one FM station in Sydney, Brisbane and Adelaide.

The Radio Network in New Zealand is benefiting from a growing radio market. Changes made by our new CEO Jane Hastings are gaining traction and The Radio Network has gained share in each month this quarter.

Our outdoor businesses are performing well and are aggressively pursuing growth opportunities.

All of our digital ventures have produced strong revenue growth. We continue to work with brandsExclusive to improve capabilities and earnings momentum. We expect our digital businesses will make a positive contribution to our operating profits this year.

Summary

All newspapers worldwide continue to confront the loss of revenue to other online platforms. Our Company faces the same challenges. Even so, our publishing assets generate significant cash flows and profits and you have heard today of the steps that are being taken to reduce costs, stabilise profits and find new revenues.

Our radio and outdoor operations are performing well and make increasingly valuable contributions to profit and the overall strength of the group. Digital is small but positive.

The Board will continue to explore all options to strengthen the balance sheet and we are reducing debt.

It was with regret that the Company received the resignation of the CEO, Brett Chenoweth, and I take this opportunity to convey to him the Board's appreciation of his contribution to the Company and we wish him well for the future. I also take the opportunity to thank those directors who left the Board as well as Kevin Luscombe who retired in April.

In finishing, I would like to emphasise our priorities:

·; We are focused on reducing debt

·; We will continue to reduce costs

·; We are rejuvenating our products and identifying new revenue

·; We are driving the performances of all our businesses, and

·; We are connecting our audiences to our transactional businesses.

As demonstrated by recent management changes and the presentations by Martin and Ciaran, we are moving forward and are determined to rebuild value for all shareholders.

-- ENDS --

For Further Information:

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