TELUS reports operational and financial results for first quarter 2022

Vancouver, B.C. –TELUS Corporation today released its unaudited results for the first quarter of 2022. Consolidated operating revenues and other income increased by 6.4per cent over the same period a year ago to approximately $4.3 billion. This growth was driven by higher service revenues in our two reportable segments: TELUS technology solutions (TTech) and Digitally-led customer experiences – TELUS International segment (DLCX). TTech service revenue growth was driven by higher mobile network revenue; increased internet and data service revenues; growth in agriculture service revenues; and growth in health services revenues. Increased DLCX revenues resulted from organic growth from both expanded services for existing clients and growth from new clients. See First Quarter 2022 Operating Highlights within this news release for a discussion on TTech and DLCX results.

“Our team once again achieved strong operational and financial results in the first quarter of 2022,” said Darren Entwistle, President and CEO. “TELUS’ ongoing execution excellence continues to be characterized by the consistent combination of industry-leading and profitable customer growth, yielding strong financial results across our business. Impressively, since the beginning of 2020 and the pandemic period, TELUS has driven leading cumulative revenue and EBITDA growth over the pre-pandemic baseline of over $4 billion and close to $600 million, respectively. Our robust performance reflects the effectiveness of our globally leading customer-centric culture and broadband networks, which enabled record first quarter total customer net additions of 148,000. This included strong mobile phone net additions of 46,000, the best first quarter result since 2010; industry-leading internet net additions of 30,000; and record first quarter security net additions of 26,000. Notably, since the beginning of 2020, we have welcomed an industry-leading 1.9 million net new customers, including 1.3 million mobile and more than 550,000 fixed net additions. Our leading customer growth is buttressed by industry-best client loyalty across our key mobile and fixed product lines. Notably, again this quarter, blended mobile phone, PureFibre internet, Optik TV, Security and voice churn were all below one per cent. Moreover, postpaid mobile phone churn of 0.63 per cent represented a 9 basis point improvement over 2021, and puts us in our ninth year of postpaid churn below one per cent.”

“Our results are backed by our highly differentiated and potent asset mix geared towards high-growth, technology-oriented verticals,” continued Darren. “Earlier today,TELUS International (TI) announced strong double-digit revenue, Adjusted EBITDA, and free cash flow growth for the first quarter. TI’s continued robust results demonstrate its consistent execution, attractive end-to-end digital capabilities, and position as a leading partner of choice for premier digital customer experiences and IT services for its enviable list of clients around the world. Notably, our TI team provides highly differentiated service offerings such as content moderation and artificial intelligence solutions. At TELUS Health, our team once again drove double-digit year-over-year health services revenue growth, while continuing to meaningfully scale our health operations as we improve health outcomes for citizens through access to better health information. This includes our healthcare programs covering 22 million lives, an increase of over 25 per cent on a year-over-year basis, along with executing 140 million digital health transactions during the quarter, up 5 per cent over last year, and earning 1.3 million new virtual healthcare members in the last 12 months, increasing our virtual healthcare members to 3.3 million, up 65 per cent over the prior year. Today, we are introducing expanded disclosure for TELUS Agriculture, with agriculture services revenue, which was up 37 per cent over the same period last year, as a result of our team’s ongoing efforts to integrate and grow this unique global business. This result is illustrative of the significant value we are creating as the leading provider of agriculture and consumer goods technology solutions around the world, where we are advancing the sector’s efficiency and effectiveness, and food quality production, through data analytics. We are confident that our expanding disclosure further illustrates the value and asset of consequence we are creating in this important area.”

“Our consistently strong financial and operating performance is underpinned by our highly engaged team who are passionate about delivering superior service offerings and digital capabilities over our world-leading wireless and PureFibre broadband networks. More than ever, Canadians value a fast, reliable connection, and the consistent recognition from independent, third-party organizations reinforces the superiority of TELUS’ world-leading networks. During the quarter, independent UK-based Opensignal named TELUS #1 in respect of the fastest 5G download speed in Canada for the third consecutive time. Impressively, Opensignal confirmed that TELUS consistently has, “the fastest 5G download speeds of any Operator since Opensignal started reporting on the 5G mobile experience in Canada.” In addition, U.S.-based Ookla once again named TELUS the fastest mobile operator in the first quarter, confirming that TELUS has ranked first in every quarter of Ookla’s Speedtest since the third quarter of 2020. Moreover, TELUS placed first in respect of 5G performance for the first time, according to Ookla's Speedtest. TELUS intends to continue extending this global leadership position as we advance the development, coverage and commercialization of our 5G network and its inherent functionalities. The numerous network awards our dedicated team has earned from independent, third-party organizations reinforce TELUS’ leadership in terms of offering customers the fastest, most expansive service in Canada across both our wireless and PureFibre networks. Moreover, this recognition of the superiority of TELUS’ national broadband networks underscores the value of our significant generational investments in world-leading network technologies, including our ongoing accelerated broadband expansion program through 2022, which together will drive extensive socio-economic benefits to Canadians from coast-to-coast.”

“Importantly, our significant, ongoing broadband network investments further enable the continued advancement of our strong financial and operational performance, strengthening our confidence in the robust outlook for our business, and the long-term sustainability of our industry-leading dividend growth. Today, we announced, for the fourth time, the extension of our industry-best dividend growth program targeting 7 to 10 per cent annual growth for 2023 through 2025, supported by our positive business outlook and accelerating cash flow growth. Since 2004, TELUS has returned more than $21 billion to shareholders, including over $16 billion in dividends and $5.2 billion in share buybacks, representing more than $15 per share. Future dividend growth and affordability will be supported by a strong EBITDA growth outlook, as well as significant value creation in our TI, Health and Agriculture businesses, in addition to lower future capital expenditures, consistent with the preliminary guidance we have provided for significantly reduced capital investments of $2.5 billion, beginning in 2023, and the meaningful resulting free cash flow expansion.”

“The TELUS team continues to give, with their hearts and their hands, to support communities across the globe,” stated Darren. “By way of example, our team has contributed nearly $4 million in donations and in-kind support, thus far, to assist those impacted by the tragic events in Ukraine and Eastern Europe. Moreover, our team continues to demonstrate our social purpose in action through our TELUS Days of Giving. Notably, last year, more than 55,000 members of our TELUS family contributed 1.3 million volunteer hours worldwide. I invite everyone to join us for our 2022 TELUS Days of Giving as we work together to create extraordinary outcomes in the global communities where we live, work, and serve.”

Doug French, Executive Vice-president and CFO said, “Our first quarter results reflect a strong start to 2022, as we enter the final year of our accelerated capital expenditure program. Building on the momentum established over the past several years, our results demonstrate our team’s ability to successfully deliver strong operating and financial growth, including delivering industry-leading consolidated revenue growth on a consistent basis over the last 12, 24 and 36 months. This growth is being realized from our smart, generational investments, which are further advancing our network leadership and consistently supporting profitable customer growth. Importantly, our performance is made possible by our team’s deep commitment to customer service excellence, along with an organization-wide focus on cost efficiency and operational effectiveness. By leveraging our digital capabilities and simplification efforts, we are effectively navigating through the current macroeconomic environment, enabling the realization of sustainable improvements in our cost structure, while at the same time enhancing the effectiveness in the way we serve customers.”

“Reflecting our confidence to deliver on our strategy, we are reiterating our 2022 financial guidance today, targeting Operating Revenue and Adjusted EBITDA growth of 8 to 10 per cent along with free cash flow of $1 billion to $1.2 billion,” added Doug. “Looking further out, we remain excited about the future cash flow generation opportunities as we increasingly near the completion of our generational fibre build, supporting our leading and long-standing dividend growth program. Indeed, today we raised our quarterly dividend by 7.1 per cent year-over-year to $0.3386, representing the twenty-second increase since we initiated our multi-year dividend program, now in its twelfth year and today extended through 2025.”

“Backed by our diversified asset mix, our consistently strong performance underscores TELUS’ unique ability to return capital to investors through our dividend growth program, while simultaneously funding significant strategic growth investments. As we deliver on these key priorities, we also remain firmly committed to maintaining our investment grade credit ratings and strong balance sheet in order to make critical investments that further enhance the customer experience, deliver balanced long-term growth, and support our shareholder friendly initiatives,” concluded Doug.

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