Q1 2013
TELUS investor conference call
May 9, 2013
Darren Entwistle
President & Chief Executive Officer
Joe Natale
EVP & Chief Commercial Officer
John Gossling
EVP & Chief Financial Officer
TELUS forward looking statement
Today's presentation and answers to questions contain statements about future events and
financial and operating performance of TELUS 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,
our comments are 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 to 2013 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 quarter Management’s discussion and analysis and 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). In addition, there can be no assurance that the Company will initiate a normal course
issuer bid. 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.
2
Agenda
 CEO Introduction
 Q1 operational highlights
 Q1 financial results
 Questions and Answers
3
CEO introduction
Series of shareholder friendly initiatives
 Increasing dividend July 2 – up 11.5% from a year ago
 Extending dividend growth program of circa 10% annually to 2016
 Launching $500M issuer bid to December 2013, subject to TSX
approval
 Targeting share repurchase program of $500M in 2014, 2015, 2016
 Reporting strong Q1 results
Returning to shareholders up to $6B or $10 per share 2013 - 2016
4
Robust postpaid net additions
Wireless
subscribers
Postpaid net adds (000s)
63
52
59
1.1M
prepaid
14%
7.7M
total
Q1-11 Q1-12 Q1-13
6.6M
postpaid
86%
Postpaid base up 6.6% YoY
Now 2nd largest player in national mobility market
5
Strong smartphone adoption and ARPU growth
5.8
6.2
6.6
68%
56%
$57.89
$58.87
$60.04
17.71
22.83
25.62
36.04
34.42
Q1-12
Q1-13
40.18
38%
Q1-11
Q1-12
Q1-13
Q1-11
Postpaid subscribers (millions)
Voice ARPU
Smartphone % of postpaid
Data ARPU
Smartphone penetration up 12 points to 68% of postpaid base
supporting ARPU growth of 2% in Q1
6
Industry leading wireless churn
Blended
Postpaid
1.70%
1.55% 1.48%
1.33%
1.14%
Q1-11 Q1-12 Q1-13
1.11%
Q1-11 Q1-12 Q1-13
Best Q1 blended churn since 2007
Cost of Retention stable
7
Industry leading lifetime revenue per susbcriber1
$3,798
$4,057
$3,405
Q1-11
Q1-12
Q1-13
Industry leading ARPU and churn
generating leading lifetime revenue per subscriber
1
Lifetime revenue derived by dividing ARPU by blended churn rate
8
Healthy TV and Internet growth
TELUS TV (000s)
712
High-speed Internet (000s)
29%
1,183 1,257
1,342
6.8%
553
358
Q1-11
Q1-12
Q1-13
Q1-11
Q1-12
Q1-13
TELUS focused on balancing
subscriber growth with profitability
9
Continued strength in Optik
60K
50K
16K
16K
44K
High-speed Internet
34K
-47K
-34K
Q1-12
Q1-13
TELUS TV
Residential NALs
TV and high-speed Internet loading exceeds
residential NAL losses for tenth consecutive quarter
10
Q1 2013 wireless financial results
($M, except margins)
Q1 2013
Change
1,472
6.4%
666
7.4%
48.6%
0.5 pts
134
(11)%
Revenue (external)
EBITDA1
EBITDA margins
(network revenue)
Capital expenditures
TELUS delivers another strong quarter of wireless results
1
For definition, see Section 11.1 in Q1 2013 Management’s discussion and analysis
11
Wireless data revenue ($M)
583
498
366
Q1-11
Q1-12
Q1-13
Strong Q1 data revenue growth of 17% year-over-year
Data now 43% of wireless network revenue, up 4 points
12
Q1 2013 wireline financial results
($M, except margins)
Revenue (external)
EBITDA
EBITDA margins
(total revenue)
Capital expenditures
Q1 2013
Change
1,284
2.9%
368
1.9%
27.8%
(0.2) pts
333
15%
Another quarter of EBITDA growth reflecting revenue growth
and improved Optik TV and high-speed Internet margins
13
Wireline data revenue ($M)
700
764
619
Q1-11
Q1-12
Q1-13
Strong data revenue growth of 9% driven by TV and Internet
Data revenue 60% of external revenue, up 4 points
14
Q1 2013 consolidated financial results
Q1 2013
Change
Revenue (external)
2,756
4.8%
EBITDA
1,034
5.4%
EPS (basic)
0.56
14%
Capex
467
5.9%
EBITDA less capex
567
5.0%
Free cash flow1 (FCF)
358
__
FCF before cash taxes
506
25%
($M, except EPS)
Strong consolidated results driven
by both wireless and wireline
1
For definition, see Section 11.2 in Q1 2013 Management’s discussion and analysis
15
EPS continuity analysis
0.49
Q1-12
reported
0.06
0.56
0.02
(0.01)
Higher
EBITDA
Depreciation &
Amortization
Change in
tax expense
Q1-13
reported
EPS up 14.3% driven by strong EBITDA growth
16
Successful $1.7 billion financing
 $1.1 billion 11 year at 3.35%
 $600 million 30 year at 4.40%
 Funds $300 million 5.0% Notes maturing June 2013
 Redeeming one year early May 2014 $700 million 4.95% Notes
 Early redemption fee to negatively impact Q2 EPS by approx 3 cents
17
TELUS long-term debt maturity profile ($M)
New debt issue
Debt to be
repaid
1,100
1,000 1,000
700
700
625
600
600
500
300
245
175
20131 20141 2015 2016
2017 2018
200
2019 2020 2021 2022 2023 2024 2025
2043
Reducing financing risk
Average term to maturity 9 years from 5.2
1 $300
million June 2013 notes to be repaid at maturity; $700 million May 2014 notes to be redeemed one year early
on May 15, 2013
18
investor relations
1-800-667-4871
telus.com/investors
ir@telus.com
Appendix – Q1 2013 free cash flow comparison
2012
Q1
2013
Q1
981
1,034
Capex
Net Employee Defined Benefit Plans Expense
(441)
27
(467)
26
Employer Contributions to Employee Defined Benefit Plans
(116)
(36)
Interest expense paid, net
(55)
(57)
Income taxes refunded (paid), net
(48)
(148)
Share-based compensation
7
12
Restructuring costs net of cash payments
2
(6)
358
358
(188)
(30)
(16)
(209)
(26)
(4)
(62)
(138)
61
(19)
(39)
(67)
22
(85)
C$ millions
EBITDA
Free Cash Flow
Dividends
Cash payments for acquisitions and related investments
Real estate joint venture
Working Capital and Other
Funds Available for debt redemption
Net Issuance (Repayment) of debt
Increase (decrease) in cash