TELUS reports third quarter 2013 results

Double-digit net income and EPS growth driven by wireless and wireline
Returning more than $1.6 billion to shareholders year-to-date
Increasing quarterly dividend 12.5 per cent year-over-year to 36 cents per 
share 
VANCOUVER, Nov. 8, 2013 /CNW/ - TELUS Corporation's third quarter 2013 revenue 
increased by 3.6 per cent to $2.87 billion from a year earlier while earnings 
before interest, taxes, depreciation and amortization (EBITDA) increased by 
4.6 per cent to $1.04 billion. EBITDA excluding restructuring and other like 
costs increased by 5.7 per cent to $1.05 billion. Basic Earnings per share 
(EPS) rose by 14 per cent to $0.56, or 18 per cent to $0.58 on an adjusted 
basis. 
The increase in consolidated revenue was generated by five per cent growth in 
wireless network revenue and three per cent growth in wireline revenue. 
Wireless revenue benefited from continued subscriber growth, higher average 
revenue per unit (ARPU) due to increased smartphone adoption and related 
increased use of data services. Wireline revenue growth was driven by a nine 
per cent increase in data revenue, generated by ongoing TELUS TV and 
high-speed Internet subscriber growth and increasing revenue per customer. 
TELUS attracted 115,000 net new customer connections in the quarter, including 
106,000 postpaid wireless customers, 34,000 TV subscribers and 19,000 
high-speed Internet customers. The growth in TELUS' wireless customer base was 
supported by an 11 basis point year-over-year decline in monthly postpaid 
subscriber churn to just 0.99 per cent - the lowest level in over six years. 
This growth was partially offset by the modest loss of prepaid wireless 
customers and a continued decline in legacy wireline services. TELUS' total 
wireless customer base of 7.8 million is up over three per cent 
year-over-year, while the TELUS TV subscriber base of 776,000 is up 22 per 
cent and high-speed Internet connections are up more than five per cent to 
1.37 million. 
During the third quarter, TELUS returned $941 million to shareholders 
including $222 million in dividends and $719 million in share purchases. For 
the nine months ended September 2013, the company returned $1.639 billion to 
shareholders, including $639 million in dividend payments and $1.0 billion in 
share purchases. 
Free cash flow of $365 million in the third quarter was down $61 million, 
largely reflecting increased capital investments to expand the capacity, 
speeds and coverage of TELUS' advanced broadband networks, as well as higher 
cash income taxes, which mitigated growth in EBITDA. 
FINANCIAL HIGHLIGHTS                                                   
C$ and in millions, except per share       Three months ended
amounts 
                                          September 30    per cent 
(unaudited)                                 2013         2012   change 
Operating revenues                         2,874        2,774      3.6 
Operating expenses before depreciation and
amortization((1))                          1,839        1,784      3.1 
EBITDA((1)(2))                             1,035          990      4.6 
EBITDA excluding restructuring and other
like costs((1)(2)(3))                      1,050          993      5.7 
Net income((1))                              356          323     10.2 
Adjusted net income((1)(4))                  365          323     13.0 
Basic earnings per share (EPS)((1))         0.56         0.49     13.6 
Adjusted EPS((1)(4))                        0.58         0.49     18.4 
Capital expenditures                         555          471     17.8 
Free cash flow((5))                          365          426   (14.3) 
Total customer connections((6))            13.27        12.98      2.2 


                                                                       

((1))      Figures for 2012 have been adjusted for retrospective
           application of accounting standard IAS 19 Employee
           benefits (2011).

((2))      EBITDA does not have any standardized meaning prescribed
           by IFRS-IASB. For definition and explanation, see
           Section 11.1 in the accompanying 2013 third quarter
           Management's discussion and analysis (MD&A).

((3))      For the third quarter of 2013 and 2012 restructuring and
           other like costs were $15 million and $3 million,
           respectively.

((4))      Adjusted net income and Adjusted EPS do not have any
           standardized meaning prescribed by IFRS-IASB. These
           terms are defined in this news release as excluding
           (after income taxes): 1) Restructuring and other like
           costs; 2) income tax-related adjustments. For further
           analysis of the aforementioned items see Section 1.3 in
           the accompanying 2013 third quarter MD&A.

((5))      Free cash flow does not have any standardized meaning
           prescribed by IFRS-IASB. For definition and explanation,
           see Section 11.1 in the accompanying 2013 third quarter
           MD&A.

((6))      Sum of wireless subscribers, network access lines, total
           Internet subscribers and TELUS TV subscribers (IPTV and
           satellite TV). Effective with the second quarter of 2013
           and on a prospective basis, machine-to-machine (M2M)
           subscriptions have been excluded from all
           subscriber-based measures. Cumulative subscribers
           include an April 1, 2013 opening balance adjustment to
           remove approximately 76,000 M2M subscriptions.


Darren Entwistle, President and CEO said, "TELUS once again delivered strong 
results, underpinned by our strategic investments in advanced broadband 
technology and services, coupled with our unwavering focus on putting 
customers first and realising operational efficiencies. Our customers first 
culture continues to attract new clients as evidenced by our third quarter 
addition of 106,000 new postpaid wireless customers, 34,000 new TV clients, 
and 19,000 new high-speed Internet connections. In addition to these strong 
growth numbers we are also reporting an industry-leading monthly postpaid 
wireless subscriber churn rate of only 0.99 per cent - our lowest since the 
first quarter of 2007. Gaining customers and earning their loyalty is critical 
to our ongoing success, so we were pleased with the results of the annual CCTS 
report on customer complaints issued earlier this week, which saw complaints 
by our customers decline significantly for the second year in a row. While we 
have more work to do on this front, we are clearly delivering a differentiated 
customer service experience and providing Canadians with a clear reason to 
choose TELUS. 
This excellence in customer service helped TELUS generate record earnings per 
share this quarter, with 14 per cent growth. Furthermore, we continue to 
produce robust free cash flow that will enable our organization to further 
invest in our growth whilst providing superior investment returns to our 
valued shareholders." 
Mr. Entwistle added "In the first nine months of 2013, we returned $1.639 
billion to our shareholders through our dividend growth and share purchase 
programs and today we raised our quarterly dividend by two cents to 36 cents a 
quarter, or $1.44 annually, a 12.5 per cent year-over-year increase. Our 
consistently strong execution combined with our balance sheet strength has 
placed TELUS in a unique position to successfully complete our unique 
multi-year shareholder friendly initiatives. This includes, through 2016, our 
dividend growth program targeting semi-annual increases of circa 10 per cent 
annually and share purchases totaling up to $2.5 billion."  John Gossling, 
TELUS Executive Vice-President and CFO said "TELUS' sustainable cash flow 
generation combined with our strong balance sheet enabled our organization to 
successfully and expeditiously complete our 2013 share purchase program 
announced in May and expanded in July. In total, we bought back and cancelled 
more than 31 million TELUS common shares for $1 billion, at an average cost of 
approximately $32 per share. This reduced shares outstanding by 4.8 per cent 
and enhanced both our earnings per share, and the affordability of future 
dividend increases."  
Reflecting year-to-date results, TELUS updated its annual wireless external 
revenue guidance to reflect slightly lower than expected wireless equipment 
revenue. TELUS now expects external wireless revenue to be in the range of 
$6.1 to $6.2 billion from $6.2 to $6.3 billion previously. External wireline 
and consolidated revenue guidance remain unchanged. In addition, the capital 
expenditure target is being raised to approximately $2 billion from 
approximately $1.95 billion previously. Importantly, our guidance for 2013 
EBITDA and EPS remain unchanged and are being reaffirmed today.   
 _____________________________________________________________________
|This news release contains statements about financial and operating  |
|performance of TELUS and future events, including with respect to    |
|future dividend increases and normal course issuer bids to 2016 and  |
|the annual 2013 guidance, that are forward-looking. By their nature, |
|forward-looking statements require the Company to make assumptions   |
|and predictions and are subject to inherent risks and uncertainties. |
|There is significant risk that the forward-looking statements will   |
|not prove to be accurate. Readers are cautioned not to place undue   |
|reliance on forward-looking statements as a number of factors could  |
|cause actual future performance and events to differ materially from |
|that expressed in the forward-looking statements. Accordingly, this  |
|news release is subject to the disclaimer and qualified by the       |
|assumptions (including assumptions for 2013 annual guidance, CEO     |
|three-year goals to 2013 for EPS and free cash flow growth excluding |
|spectrum costs, semi-annual dividend increases to 2016, ability to   |
|sustain and complete multi-year share purchase programs to 2016),    |
|qualifications and risk factors referred to in the first, second and |
|the accompanying third quarter Management's discussion and analysis, |
|in the 2012 annual report, and in other TELUS public disclosure      |
|documents and filings with securities commissions in Canada (on SEDAR|
|at sedar.com) and in   |
|the United States (on EDGAR at                                       |
|sec.gov). Except as      |
|required by law, TELUS disclaims any intention or obligation to      |
|update or revise forward-looking statements, and reserves the right  |
|to change, at any time at its sole discretion, its current           |
|practice of updating annual targets and guidance.                    |
|_____________________________________________________________________| 


    OPERATING HIGHLIGHTS

TELUS wireless
    --  Wireless network revenues increased by $71 million or 5.2 per
        cent to $1.44 billion in the third quarter of 2013, compared to
        the same period a year ago, driven by continued subscriber
        growth and higher ARPU driven by ongoing smartphone adoption
        and associated data services.
    --  Data revenue increased by $91 million or 17 per cent to $637
        million, representing 44 per cent of wireless network revenue
        in the quarter. Data ARPU increased by $3.21 or 13 per cent to
        $27.72. These increases were due to continued strong adoption
        and usage of smartphones and data applications as well as
        higher roaming volumes.
    --  Blended ARPU increased by $1.07 or 1.7 per cent to $62.49 as
        data ARPU growth more than offset a 5.8 per cent voice ARPU
        decline. This is the twelfth consecutive quarter of
        year-over-year growth in blended ARPU.
    --  Monthly postpaid subscriber churn declined 11 basis points to
        0.99 per cent, the lowest in over six years, while blended
        monthly churn was down by eight basis points to 1.36 per cent.
        TELUS' industry-low churn reflects the company's successful
        Customers First service approach, investments in retention, and
        lower churn on smartphones.
    --  Postpaid net additions of 106,000 were partially offset by a
        modest loss of 2,000 lower-ARPU prepaid subscribers for net
        additions of 104,000, compared to 111,000 a year ago. Total
        wireless subscribers was up 3.3 per cent from a year ago to 7.8
        million, while the proportion of high-value postpaid
        subscribers grew to 86 per cent of the base. Smartphone
        subscribers now represent 75 per cent of TELUS' postpaid base,
        up from 63 per cent a year ago.
    --  Reported wireless EBITDA of $680 million increased by $42
        million or 6.6 per cent over last year due to network revenue
        growth. The wireless EBITDA margin, based on total network
        revenue, increased by 60 basis points to 46.8 per cent. EBITDA
        excluding restructuring and other like costs increased by $45
        million or seven per cent to $684 million or 47.0 per cent on
        total network revenue.
    --  Wireless simple cash flow (EBITDA less capital expenditures)
        increased by $23 million to $486 million in the quarter due to
        higher EBITDA.

TELUS wireline
    --  External wireline revenues increased by $38 million or 3.0 per
        cent to $1.31 billion in the third quarter of 2013, when
        compared with the same period a year ago. This growth was
        generated by increased data service revenue, partially offset
        by declines in legacy voice revenues.
    --  Data service and equipment revenues increased by $64 million or
        8.7 per cent, due primarily to strong growth in TELUS TV
        subscribers, high-speed Internet and enhanced data services,
        combined with TV and high-speed Internet ARPU growth, and TELUS
        Health services.
    --  Total TV additions of 34,000 were lower by 8,000 from the same
        quarter last year, while the total TV subscriber base of
        776,000 increased by 139,000 or 22 per cent from a year ago.
    --  High-speed Internet net additions of 19,000 were lower by 7,000
        from the same quarter a year ago, while TELUS' high-speed
        subscriber base of 1.37 million is up 71,000 or 5.4 per cent
        from a year ago.
    --  Total network access lines declined by 4.8 per cent from a year
        ago to 3.3 million. Residential lines were down 7.4 per cent
        over last year, reflecting ongoing wireless and Internet
        substitution and competition. Business lines were down 1.8 per
        cent over last year, reflecting ongoing price-based competition
        in the small and medium business market and customer adoption
        of IP services.
    --  Reported wireline EBITDA of $355 million increased by
        $3 million or 0.8 per cent year over year, reflecting improving
        Optik TV and Internet margins helped by subscriber and ARPU
        growth, as well as ongoing operating efficiency initiatives.
        EBITDA excluding restructuring and other like costs increased
        by $12 million or 3.4 per cent to $366 million.
    --  Wireline simple cash flow (EBITDA less capital expenditures)
        decreased year-over-year by $62 million due to higher capital
        expenditures to support business service growth and investments
        in broadband infrastructure including connecting more homes and
        businesses directly to fibre optic cable.

CORPORATE AND BUSINESS DEVELOPMENTS

TELUS named as a 2013 component of the Dow Jones Sustainability North America 
Index
TELUS has been named to the Dow Jones Sustainability North America Index (DJSI 
North America) for the 13th consecutive year. TELUS is the only Canadian 
telecom company and one of three North American telecom companies to be named 
to the index. TELUS received a score of 100 per cent in both Risk and Crisis 
Management as well as in Corporate Citizenship and Philanthropy. TELUS also 
had the best industry score for Codes of Conduct/Compliance/Corruption and 
Bribery. The DJSI North America tracks the performance of the top 20 per cent 
of the 600 largest Canadian and American companies in the S&P Global Broad 
Market Index that lead the field in terms of sustainability.

Dividend Declaration - increased to 36 cents per quarter, up 12.5 percent from 
a year ago
The TELUS Board of Directors has declared a quarterly dividend increase of two 
cents to 36 cents($0.36) Canadian per share on the issued and outstanding 
common shares of the Company payable on January 2, 2014 to holders of record 
at the close of business on December 11, 2013. The new dividend represents a 
four cent or 12.5 per cent increase from the $0.32 quarterly dividend paid on 
January 2, 2013.

This new quarterly dividend is the sixth increase under TELUS' dividend growth 
program originally announced in May 2011 and recently extended through 2016, 
wherein the company plans to continue with two dividend increases per year, 
normally announced in May and November, of circa 10 per cent annually. 
Notwithstanding this, dividend decisions will continue to be dependent on 
earnings and free cash flow and subject to the Board's assessment and 
determination of TELUS' financial situation and outlook on a quarterly basis. 
There can be no assurance that the company will maintain its dividend growth 
program through to 2016.

About TELUS 
TELUS (TSX: T, NYSE: TU) is a leading national telecommunications company in 
Canada, with $11.3 billion of annual revenue and 13.3million customer 
connections, including 7.8million wireless subscribers, 3.3million 
wireline network access lines, 1.4million Internet subscribers and 776,000 
TELUS TV customers. Led since 2000 by President and CEO, Darren Entwistle, 
TELUS provides a wide range of communications products and services, including 
wireless, data, Internet protocol (IP), voice, television, entertainment and 
video.

In support of our philosophy to give where we live, TELUS, our team members 
and retirees have contributed more than $300million to charitable and 
not-for-profit organizations and volunteered 4.8million hours of service to 
local communities since 2000. Fourteen TELUS Community Boards lead TELUS' 
local philanthropic initiatives. TELUS was honoured to be named the most 
outstanding philanthropic corporation globally for 2010 by the Association of 
Fundraising Professionals, becoming the first Canadian company to receive this 
prestigious international recognition.

For more information about TELUS, please visit telus.com.

Access to Quarterly results information

Interested investors, the media and others may review this quarterly earnings 
news release, management's discussion and analysis, quarterly results slides, 
audio and transcript of investor webcast call, supplementary financial 
information and our full 2012 annual report at telus.com/investors.

Full quarterly earnings release available at: 
http://www.newswire.ca/en/releases/archive/November2013/08/c5618.html

TELUS' third quarter 2013 conference call is scheduled for November 8, 2013 at 
11 a.m. ET and will feature a presentation followed by a question and answer 
period with investment analysts. Interested parties can access the webcast at 
telus.com/investors. A telephone playback will be available on November 8 
until December 7 at 1-855-201-2300. Please use reference number 1052450# and 
access code 35175. An archive of the webcast will also be available at 
telus.com/investors and a transcript will be posted on the website within a 
few business days.



SOURCE  TELUS Corporation 
Media relations: Shawn Hall (604) 619-7913 shawn.hall@telus.com 
Investor relations: Robert Mitchell (647) 837-1606 ir@telus.com 
To view this news release in HTML formatting, please use the following URL: 
http://www.newswire.ca/en/releases/archive/November2013/08/c4089.html 
CO: TELUS Corporation
ST: British Columbia
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-0- Nov/08/2013 13:30 GMT
 
 
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