Q2 2007 TELUS investor conference call
August 3, 2007
TELUS forward looking statements
This session and answers to questions contain forward-looking statements that require
assumptions about expected future events including 2007 guidance, competition,
financing, financial and operating results, and regulation that are subject to inherent risks
and uncertainties. There is significant risk that predictions and other forward looking
statements will not prove to be accurate so do not place undue reliance on them.
Factors that could cause actual results to differ materially include but are not limited to:
competition; capital expenditure levels (including possible spectrum purchases); financing
and debt requirements (including share repurchases, debt redemptions and refinancing
plans); tax matters (including acceleration or deferral of payment of significant cash
taxes); regulatory developments (including local forbearance, local number portability, the
timing, rules, process and cost of future spectrum auctions, and possible changes to
foreign ownership restrictions); process risks (including conversion of legacy systems and
billing system integrations); and other risk factors discussed herein and listed from time to
time in TELUS’ reports.
There are many factors that could cause actual results to differ materially. For a full
listing and description of the potential risk factors and assumptions, please refer to the
TELUS 2006 annual report and updates in the 2007 quarterly reports (see Section 10
Risks and Risk Management in Management’s discussion and analysis), and other filings
with securities commissions in Canada (sedar.com) and the United States (sec.gov).
All dollars referenced are in C$ unless otherwise specified.
2
Q2 2007 TELUS
investor conference call
Darren Entwistle
member of the TELUS team
August 3, 2007
Decision on BCE acquisition
 TELUS pursued discussions on benefits of acquisition to June 26
 Potential for TELUS to pursue offer on investment grade model
 Completed assessment of this opportunity considering
 Disadvantageous auction process
 Substantive price offered by private equity consortium
 Deteriorating debt market conditions
 Positive benefits of not bidding
 Timeline and uncertain outcome of competition approval
 Risk to TELUS shareholders
 TELUS does not intend to submit a competing offer
Stand-alone TELUS can continue to create future value
4
Wireline highlights – Q2 2007
 Resilient wireline revenue as per operating strategy
 Data growth continues to be strong at 8%
 Moderate NAL loss at 3%
 Converted Alberta consumers to new customer care platform
 Critical billing function performed well
 Initial difficulties reduced capability for new orders
 Additional resources impacted EBITDA by $29 million
 Backlogs and call centre operations returning to normal
Committed to consolidated care platform and its benefits
5
Wireline highlights – Q2 2007
 Major $200 million contract with Department of National Defence
 Local forbearance in key markets beginning
 Fort McMurray residential service deregulated July 25th
 Large urban markets waiting for deregulation decisions
 Vancouver, Victoria, Calgary, Edmonton, and Rimouski
Continued
resiliency
in on
wireline
New regulatory
framework
based
market forces
6
Wireless highlights – Q2 2007
 Wireless Number Portability impacts
 Churn increased 15 basis points
 Higher gross and net additions contributed to higher COA
 Investment in customer retention increased 32%
 Wireless revenue growth of 11%
 18th consecutive quarter of increased year over year ARPU
 Data revenue growth up 64%
 Operating profit (EBITDA) increased by 3%
Continued
in wireline
Reiterating
full yearresiliency
wireless segment
guidance
7
Wireless highlights – Q2 2007
 AMP’D Mobile entered bankruptcy proceedings in U.S.
 TELUS discontinuing sales in Canada
 Continued rollout of high-speed EVDO and EVDO Rev A network
 Introduction of new CDMA/GSM Blackberry World Edition
 Advanced Wireless Services spectrum auction
 Rules expected in fall for auction early 2008
 TELUS advocates an open and fair auction process
Continued
in wirelineand successful
Canadian wireless
industryresiliency
remains competitive
8
Consolidated highlights – Q2 2007
 Committed to improving performance in coming quarters
 Second quarter impacted by special events
 Committed to original consolidated guidance for 2007
 Balancing interests of debt and equity holders
 Refinanced $1.5 billion 7.5% notes at lower interest cost
 Repurchased $170 million of shares in quarter
 Repurchased 45.6 million shares for $2.1 billion since 2004
 Quarterly per share dividend 37.5 cents, up 36%
Strongly positioned to advance growth strategy
9
Q2 2007 TELUS
investor conference call
Robert McFarlane
EVP & Chief Financial Officer
August 3, 2007
Wireless segment – Q2 2007 financial results
($M)
Q2-06
Q2-07
Change

Revenue
945
1,048
11%
EBITDA1
441
451
 2.2%
Capital expenditures
147
173
 17%
1 EBITDA includes non-cash charge of $1.8M in Q2-07 for net cash settlement feature of options
granted prior to 2005. Excluding this charge EBITDA (as adjusted) increased by 2.7%
Higher COA & retention costs related to WNP impacted EBITDA
while EVDO Rev A investments contribute to capex increase
11
WNP update
Industry1
TELUS
Gross additions

8.0 %

16%
Net additions

1.6%

3.5%
Churn

6 bps

15 bps
COA

3.0%

7.9%
1 Based on Q2-07 wireless results from Rogers, Bell, and TELUS
Results reflect first full quarter of WNP
12
Wireless EBITDA normalization
($M)
EBITDA (as adjusted)1
Q2-06
441
Q2-07
453  2.7%
Incremental COA (due to higher loading)
-
20
Incremental cost of retention (COR)
-
27
EBITDA (excl. incremental COA & COR)
441
Change
500  13%
1 Excludes non-cash charge of $1.8M in Q2-07 for net cash settlement feature of options granted prior to
2005.
With advent of WNP, higher COA and COR significantly
affected EBITDA growth
13
Amp’d Mobile Canada Update
 Parent Amp’d Mobile, Inc. entered bankruptcy in U.S. in June
 Disruptions of Amp’d Live content expected - Amp’d Mobile sales
discontinued in Canada
 Voice and basic messaging services continue for Amp’d clients
 Migration of Amp’d Canada subscribers now underway
 No notable impact expected on reported revenue or subscribers
 Impact of writedowns on Q2-07 results:
 $11.8M write-off in ‘other expenses’ for Amp’d US venture capital
investment
 Approx. $2M opex impact on EBITDA
 $5M for accelerated depreciation of assets used to support Amp’d
 Negative EPS impact of approximately 4 cents
Amp’d Mobile subscribers being migrated to TELUS
14
Wireless subscriber results
net additions
124K
83%
128K
total wireless subscribers
prepaid
postpaid
77%
4.2M
Q2-06
1.0M
Prepaid
20%
Postpaid
80%
Q2-07
5.3 million
Continued strong net additions
15
Wireless ARPU growth
Data ARPU
Voice
$63.18
$63.65
4.45
6.58
58.73
57.07
Q2-06
Q2-07
48% increase in data more than offsetting voice decline
16
Q2 2007 wireless churn (%)
2.7
2.6
1.8
1.6*
1.6
1.45
1.3
Source: Company reports, analyst reports. Sprint Nextel and T-Mobile USA Q1-07.
* TELUS estimates for Rogers blended churn – not including 90K TDMA subscriber write down in Q2-07
Churn remains at best in class levels
17
Wireline segment – Q2 2007 financial results
($M)
Q2-06
Q2-07
Change
1,190
1,180

(0.8)%
EBITDA (reported)
456
434

(4.9)%
Capital expenditures
311
309

(0.9)%
Revenue
Results impacted by implementation of new wireline billing
and client care system in Alberta
18
Wireline revenue profile
($M)
Q2-06
Q2-07
Change
Voice – Local
523
516

(1.5)%
Voice – Long Distance
206
168

(19)%
Data
403
435

7.8%
Other
58
62

7.6%
1,190
1,180

(0.8)%
Total External Revenue
Continued solid data growth offsets local and LD erosion
19
Long distance revenue normalized
206
One-time system implementation
adjustment
Long distance revenue (normalized)
Total external revenue (excl. system
impacts)
168
(19)%

Long distance revenue (reported)
Q2-06 Q2-07 Change

($M)
(12)%
(13)
206
1,190
181
1,193  0.3%
Flat to positive wireline revenue growth adjusted for system
implementation impact
20
Wireline EBITDA normalization
EBITDA
Q2-06
Q2-07
456
434
LD revenue adjustment
-
(13)
Increased labour costs
-
(16)
456
463
Change

($M)
(4.9)%

1.5%
System implementation impacts:
EBITDA (excl. system impacts)
System implementation significantly impacted wireline EBITDA
21
High-speed Internet subscribers
Internet subscribers
High-speed Internet net
additions
Dial-up
15%
29K
14K
963K
Q2-06
172K
High-speed
85%
Q2-07
1.13 million total
Results reflect system implementation in Alberta
Lowering annual guidance from > 135K to > 125K
22
Network access line results
% of network access lines lost (yr. over yr.)
Q1-06
Q2-06
Q3-06
Q4-06
Q1-07
Q2-07
-2.7%
-2.6%
-2.8%
-3.0%
-2.9%
-3.1%
Stable overall line losses due to business line growth
23
TELUS total subscriber connections
9.9
10.4
10.9
(millions)
Res NALs
Bus NALs
Dial-up Internet
High-speed Internet
Wireless
Q2-05
Q2-06
Q2-07
Connections increasing with wireless and Internet growth
24
Consolidated – Q2 2007 financial results
($M excluding EPS)
Q2-06
Q2-07
Change
Revenue
2,135
2,228

4.4%
EBITDA1
897
885

(1.4)%
EPS (reported)
1.03
0.76

(26)%
EPS (excl. tax adjustments)
0.69
0.73

5.8%
Capital Expenditures
459
482

5.0%
1 EBITDA includes non-cash charge of $1.8M in 2007 for net cash settlement feature of options granted
prior to 2005. Excluding this charge EBITDA (as adjusted) decreased by 1.2%
Increased expenses related to WNP, new system
implementation & Amp’d affected results
25
EPS continuity
$1.03
$0.13
$0.06



$0.14
$0.05

$0.31
$0.04
$0.08
Q2-06
Net tax Normalized Restructuring COA & Billing &
Amp’d
Other
1
related
EBITDA
costs
COR client care write-down
(incl.
adjustments
system
lower avg o/s
shares)
$0.76
Q2-07
1 Normalized to exclude billing system, restructuring, acquisition & retention, and AMP’d impacts
26
Share buy backs – 3rd Normal Course Issuer Bid
Q2-07
% change in o/s shares
(end of period)
$2,140
2.7
6.2
45.6
-
331.7
26.8
1.8%
7.5%

Shares outstanding (M)
$370

Total shares (M)
$170

Total investment (M)
Since NCIB
inception
In 2007
Year to date
since Dec-04
Outstanding shares already 2% lower than at 2006 year end
27
Strong record of returning capital
$ per share
4
3.73
Share repurchases
3.30
3.43
Dividends
3
2.23
1.11
2
2.50
2.33
1.50
0.82
1
0.60
2003
1
2
0.22
0.60
2004
1.10
0.80
2005
2006
Annualized dividend, plus YTD NCIB share repurchases as at June 30/07, annualized
See forward looking statement caution.
2007E1,2
28
Financing update
 Launched unsecured commercial paper program in Q2
 Backstopped by credit facility
 Can issue up to $800 million
 $664 million issued, as at June 30
 Successfully raised $1 billion in March at 4.8% blended
 Redeemed $1.5 billion 7.5% Notes on June 2007 maturity
Strong balance sheet with extended maturities and lower interest
29
TELUS debt maturity schedule ($M)
Debt
Deferred FX Hedge Liability
$ 3,500
3,000
2,500
2,000
1,500
1,000
500
0
2007
2008
2009
2010
2011
2012
2013
2014+
No significant debt maturities until 2011
30
2007 guidance* - consolidated
2007 guidance1
YoY growth
Revenue
$9.175 to $9.275B

6 to 7%
EBITDA (as adjusted)2
$3.725 to $3.825B

4 to 7%
EPS (as adjusted)3
Capital expenditures
1 Confirmed August
2 Excludes
3
$3.25 to $3.45
approx. $1.75B
 17 to 24%

8%
3, 2007
expense of approx. $180 million in 2007 for net cash settlement feature for options.
Excludes an after-tax charge per share of approx $0.33 for cash settlement feature for options. Year over
year growth rate normalized for $0.48 of positive tax-related adjustments in 2006.
* See forward looking statement caution
Original consolidated guidance reconfirmed
31
Questions?
investor relations
1-800-667-4871
telus.com
ir@telus.com
Appendix – Free cash flow (2007 definition)
($M)
Q2-06
Q2-07
EBITDA
$897
$885
Capex
(459)
(482)
Interest expense paid
(271)
(213)
(0.7)
(3)
Non-cash portion of share-based compensation
13
15
Restructuring payments (net of expense)
19
(7)
Cash related to other expenses
(8)
(9)
$191
$186
-
(24)
$191
13
(249)
$162
0.2
(170)
Dividends
(95)
(125)
Accounts Receivable Securitization
135
(2)
350
($8)
(10)
$286
(817)
($18)
($532)
Cash income taxes; and other
Free cash flow (before cash settled option pmt)
Cash settled options paid
Free cash flow
Share Issuance (non-public)
Purchase of shares for cancellation (NCIB)
Working capital & other
Funds avail. for debt redemption
Net debt issuance / (repayment)
Net change in cash
68
Appendix - definitions
 EBITDA: Earnings, after restructuring and workforce reduction costs, before
interest, taxes, depreciation and amortization
 Capital intensity: capex divided by total revenue
 Cash flow: EBITDA less capex
 Free cash flow: EBITDA, adding Restructuring and workforce reduction costs,
cash interest received and excess of share compensation expense over share
compensation payments, subtracting cash interest paid, cash taxes, capital
expenditures, cash restructuring payments, and cash related to Other expenses
such as charitable donations and securitization fees
 Cost of retention (COR): total costs to retain existing subscribers, often
presented as a percentage of network revenue
TELUS definitions for non-GAAP measures