8 January 2003

WOOLWORTHS TO AWARD TELECOMMUNICATIONS CONTRACT TO TELSTRA

Woolworths Limited announced today that, following an extensive tender and review process, it had reached agreement in principle to award a five-year telecommunications service and management contract to Telstra Corp. in a ‘whole of business’ transaction which will provide significant savings on Woolworths’ current telecommunications costs.

The two leading Australian Companies will, subject to final approvals, move to complete formal documentation during the next few weeks. Telstra will assume responsibility for the management of the Woolworths’ voice, data and mobile telecommunications hub across more than 1500 operating sites, distribution centres and support offices throughout Australia and New Zealand.

Under the terms of the proposed agreement, which is unprecedented in size and scope in the Australian retail sector, Telstra will fully manage all of Woolworths’ telecommunications services. Subject to final negotiations, the new service arrangements will be in place by the end of March 2003 with a six-month transition period to full implementation. Currently, Woolworths has a number of suppliers servicing its telecommunications needs.

Woolworths’ Group Managing Director and Chief Executive Officer Mr Roger Corbett said that the new telecommunications relationship with Telstra will provide Woolworths with immediate and significant savings in line with the ongoing Project Refresh program. “Woolworths will have ongoing access to the latest innovations in telecommunications technology as Telstra is committed to maintaining world-class standards going forward. The relationship will greatly enhance the efficiency with which Woolworths operates its communications network throughout Australia,” Mr Corbett said.

“The process for tendering was an open one, with Telstra, Optus and Telecom New Zealand all being participants in the process. The other operators exhibited a high degree of professionalism and Woolworths expresses its admiration for the two other tender participants. In the final analysis, however, Telstra was the winning tender,” he said.

Telstra Chief Executive Officer, Dr Ziggy Switkowski, said that the Woolworths’ contract signalled the strengthening of Telstra’s partnerships with Australia’s leading Companies. “…Our Companies have been entwined on the Australian business landscape for nearly 80 years, so we’re delighted Woolworths has chosen Telstra as its key communication partner...,” Dr Switkowski added.

Woolworths is Australia’s leading food retailer, employing more than 147,000 people in over 1500 stores and operating facilities in the Company’s business Divisions of Woolworths/Safeway Supermarkets; BIG W Discount Department Stores; Consumer Electronics (Dick Smith Electronics and Tandy), Plus Petrol, liquor, Ezy Banking and e-business(Homeshop and Greengrocer.com).

For further information please call: Ian Brown (02) 9323 1580 or (0418) 466 129

540 George Street, Sydney NSW 2000 PO Box Q70, QVB Post Shop, Sydney NSW 1230 Telephone (02) 9323 1555 Facsimile (02) 9323 1593 Website www.woolworthslimited.com.au