TELSTRA GROUP LIMITED — Capital/Financing Update 2005

Jun 21, 2005

22 June 2005

The Manager

Company Announcements Office Australian Stock Exchange 4^th Floor, 20 Bridge Street SYDNEY NSW 2000

Office of the Company Secretary

Level 41 242 Exhibition Street MELBOURNE VIC 3000 AUSTRALIA

Telephone 03 9634 6400 Facsimile 03 9632 3215

ELECTRONIC LODGEMENT

Dear Sir or Madam

Telstra announces successful €1billion Eurobond issue

In accordance with the listing rules, I attach a copy of an announcement for release to the market.

Yours sincerely

Pont brak

Douglas Gration Company Secretary

Telstra Corporation Limited ACN 051 775 556 ABN 33 051 775 556

Media Release

22 June 2005

202/2005

Telstra announces successful €1 billion Eurobond issue

Telstra today announced the successful completion of a $E1.0$ billion Eurobond issue comprising two $€0.5$ billion tranches with five and ten year maturities.

The bond was almost four times over-subscribed and the order book closed early having received more than 250 individual orders from a wide range of major European and Asian fixed income investors.

The bond issue follows a recent well received roadshow led by Telstra's Chief Financial Officer, Mr John Stanhope and Corporate Treasurer, Mr Cliff Davis,

"This was an exceptional result and all the more remarkable given our negative ratings outlook and the significant uncertainties surrounding Telstra's transition to full privatisation," Mr Stanhope said.

"It is a tribute to the depth, maturity and long standing support for Telstra in the Euro markets that we could get a superb result like this without having to pay a premium. We achieved our preferred maturity targets and pricing was right in line with fair value in the secondary market and telco comparables," he said.

"This transaction is likely to be Telstra's last issue in the public markets prior to privatisation which is expected in late 2006 and meets a significant part of Telstra's known 2005/2006 funding requirements and puts Telstra in good shape going forward."

The pricing for the fixed rate issues were equivalent to 37 and 57 basis points over the Euro five and ten year mid-swap levels and provides Telstra with a competitive cost of funding on an all-in cost basis after swapping into Australian dollars.

Issue proceeds will be mainly used for general working capital purposes and to refinance maturing debt.

The bond issue was jointly led by Barclays Capital, BNP Paribas, Deutsche Bank and JP Morgan.

Telstra is Australia's leading telecommunications services provider with long term rating of $A^+$ (negative outlook) by $S\&P$ . A1 (negative outlook) by Moody's and $A+$ (stable) by Fitch.

Telstra Media Contact Kerrina Lawrence Telstra Media Relations 03 9634 5611 0419 352 313

Telstra's national media inquiry line is 13 1639 and Telstra's Media Centre is located at: www.telstra.com.au/communications/media