John Fairfax Holdings Limited
ACN 008 663 161

The Company's assessment of its potential exposure to the Year 2000 problem has not changed significantly from its June, 1998 statement to the Australian Stock Exchange. The focus of the Company’s activities continues to be those systems identified as business critical. The original objective to have business critical systems compliant by the end of December, 1998 was not achieved for reasons which included late delivery of compliant software and delayed responses from suppliers.

By 31 December, 1998, 74% of business critical systems had been proved compliant. No problems have been identified which cannot be overcome within the required timeframe. The majority of the Company's critical systems are now compliant and those that are not are identified below. All systems are scheduled to be compliant by 30 June, 1999.

The budget for the Year 2000 Compliance Project has been increased from $3.8 million to $4.7 million mainly due to the inclusion of previously excluded internal staff costs.

The continuity of critical business processes is addressed as part of the Company's ongoing risk management programme. The risks associated with Year 2000 issues affecting materials supply are addressed by ensuring adequate stock levels to cover failure to deliver. The risk of potential systems disruption has been addressed and appropriate expertise for remediation will be available during periods identified as critical.

BUSINESS CRITICAL SUPPLIERS AND SERVICE PROVIDERS

Whilst the Company cannot guarantee the Year 2000 readiness of any external organisation, it has taken all reasonable steps to ensure that critical paths are not disrupted by third party problems.

Relevant external parties have been contacted to ascertain their level of compliance where appropriate. Regular meetings have taken place to co-ordinate remediation. Practical contingency plans have been identified. Further contact will continue during 1999.

John Fairfax Publications Pty Limited (Sydney Publications)
New editorial systems are being introduced with a staggered implementation running up to November, 1999. As a contingency, the current editorial system is also compliant and can continue to be used.

David Syme & Co. Limited (Melbourne Publications and Printing)
New classified advertising systems are being progressively implemented and are planned to be fully operational by the end of June, 1999. A contingency plan has been prepared in the event of any slippage in the implementation schedule and will be reviewed at the end of June, 1999 to determine whether the contingency plan should be pursued. Should it become necessary, this will take two months to implement and incur costs estimated at $0.5 million.

Newcastle Newspapers Pty Limited
The graphics processing component of the production system is being upgraded, and is scheduled for completion by June 1999.

Group Financial Systems
The supplier of the systems currently being installed across the group has stated that the package is compliant. The customisations made to this package are in the process of being assessed. Testing will continue through 1999.

Wire Services
Suppliers of these systems have been identified and contacted with the appropriate technical discussion groups established. Compliant software has been installed, however, tests have yet to be conducted.

Newsprint / Ink / Film
Discussions continue. Testing of replacement systems underway.

Telecommunication Carrier(s)
In addition to conducting regular discussions with the relevant carrier, the Company has further attempted to minimise exposure to this area by utilising more than one carrier.

Electricity / Water / Gas
Compliance information has been exchanged. Follow up procedures are in place.

Others

New Business / Fairfax Information Services
The web development division is in a constant state of development. Consequently, management decided to postpone compliance work until late 1998. Most critical systems are now Year 2000 Compliant, however, there are some planned upgrades to Operating Systems that will not be completed until the end of May, 1999.

Homes Pictorial
Replacement of financial systems is scheduled for May, 1999.

6 April, 1999

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