TELUS Corporation today released its unaudited results for the first quarter of 2025. Effective with our first quarter 2025 results, we have evolved our reporting structure, and introduced a TELUS health reportable segment (TELUS Health). Our TELUS Health results were previously included with the TELUS technology solutions segment (TTech) results. The new TELUS Health segment will now be reported alongside our existing TTech segment, which now excludes TELUS Health, as well as our TELUS digital experience segment (TELUS Digital). Consolidated operating revenues and other income increased by 3 per cent over the same period a year ago to $5.1 billion. This growth was driven by higher service revenues in our TTech and TELUS Health reportable segments, as well as higher external revenues in our TELUS Digital segment. See First Quarter 2025 Operating Highlights within this news release for a discussion on TTech, TELUS Health and TELUS Digital results.

"In the first quarter of 2025, our team's unwavering commitment to operational excellence and cost efficiency has empowered TELUS to deliver another quarter of industry-leading customer growth and strong financial performance," said Darren Entwistle, President and CEO. "These results were achieved within a dynamic operating environment, demonstrating the resiliency of our business and strength of our leading portfolio of services. Our mobile and fixed customer growth underscores the strong demand for TELUS' bundled services and leading broadband networks. Notably, we achieved total mobile and fixed customer growth of 218,000, driven by mobile phone and connected device additions of 168,000, alongside fixed customer additions of 50,000. This performance highlights the strength of our bundled product offerings across Mobile and Home, powered by our leading PureFibre and wireless broadband networks. The dedication and passion of our team in delivering customer service excellence contributed to continued strong loyalty across our key product lines, once again this quarter. Notably, postpaid mobile phone churn was 0.84 per cent, as we begin the twelfth consecutive year below the one per cent level."

"Our technology-centric growth businesses continue to demonstrate impressive momentum. TELUS Health achieved revenue and Adjusted EBITDA growth of 12 and 30 per cent, respectively, and drove a 7 per cent year-over-year increase in global lives covered to 76.5 million. This was fueled by strategic investments, product enhancements, expanding sales channels, and effective cost management through technology optimization and synergy optimization - underpinned by a deeply rooted dedication to putting customers first. We are excited to maintain and build on this momentum throughout 2025 and beyond. Notably, since acquiring LifeWorks, we have realized $376 million in combined annualized synergies - $306 million from cost efficiencies and $70 million from successful cross-selling strategies. We remain on track to meet our goal of $427 million by the end of 2025. In May, TELUS acquired Workplace Options, a leading global provider of integrated employee wellbeing solutions, with 88 million employees served across 200 countries and territories. Together, we will offer the most comprehensive suite of health and wellbeing solutions globally, powered by innovative technology and delivered with unmatched service excellence. Furthermore, this acquisition will be made in partnership with a leading private equity investor within the healthcare vertical, with deep expertise across the healthcare landscape who will be a value-added partner, supporting our efforts to accelerate growth. Moreover, within TELUS Agriculture & Consumer Goods, our team demonstrated strong performance, with a 20 per cent revenue increase supported by enhanced profitability and margin improvements. The results we are achieving in these businesses reflect our dedicated efforts to deliver outstanding customer experiences, maximizing shareholder value and driving our initiatives in social capitalism."

Darren further commented, "The consistency of our results are underpinned by our dedicated team who are passionate about delivering superior customer experiences over our world-leading wireless and PureFibre broadband networks. In addition to driving extensive socio-economic benefits for Canadians in communities from coast-to-coast, for decades to come, the significant broadband network investments we have made enable the continued advancement of our operational, financial and customer experience performance, and the long-term sustainability of our industry-leading dividend growth program. Today, we are announcing a 7 per cent dividend increase, reflecting our unwavering commitment to delivering superior value to our shareholders and building on our consistent track record of delivering on our multi-year dividend growth program established in 2011. Furthermore, we announced today, for the fifth time, the extension of our industry-best dividend growth program targeting 3 to 8 per cent annual growth for 2026 through 2028. Dividend growth and affordability will be supported by a strong EBITDA growth outlook in combination with moderating capex, yielding a meaningful resulting free cash flow expansion. This is augmented by significant value creation in our emerging growth businesses and a succession of asset monetization opportunities that will reduce TELUS' leverage and interest outlays."

"Reflecting our TELUS team's long-standing dedication to putting our customers and communities first, this month we will celebrate our 20th annual TELUS Days of Giving in 33 countries," continued Darren. "Over the past two decades, thanks to the support of our valued clients, we have led our corporate peers globally by contributing 2.4 million volunteer days in the communities where we live and workâ?¦striving to make the future friendly for all," concluded Darren.

Doug French, Executive Vice-president and CFO said, "Our first quarter results in 2025 are a testament to our disciplined operational execution and cost management amidst a dynamic competitive landscape and macroeconomic environment. Within TTech, including our new TELUS Health reportable segment, Operating Revenues increased by 3 per cent and Adjusted EBITDA was higher by 4 per cent. These results were driven by our consistent emphasis on profitable customer growth, the benefits from our ongoing focus on cost efficiency and effectiveness, gains from asset divestitures, as well as our real estate and copper monetization program, as well as increasing margin contribution from TELUS Health and TELUS Agriculture & Consumer Goods. Additionally, our robust free cash flow generation of 22 per cent, alongside 13 per cent growth in cash from operations, underscores our solid financial foundation and our ability to continue investing in strategic growth initiatives."

"Additionally, our financial position remains robust and as we progress through 2025 and beyond, we are committed to improving our leverage ratio, targeting a net debt to EBITDA ratio of 3-times by 2027, alongside removing the discount associated with our dividend reinvestment program. In April, we successfully raised $1.6 billion in hybrid debt securities, with the net proceeds being entirely directed to debt repayment, and 50 per cent of the proceeds receiving equity credit treatment by credit rating agencies, further demonstrating our commitment to deleveraging our balance sheet. On a pro-forma basis, when including the benefit of our hybrid offering, leverage at the end of the quarter would be approximately 3.8-times. Our efforts to strengthen our balance sheet will be further supported by sustained organic operational growth, including continued EBITDA growth, declining capital intensity and free cash flow expansion. Furthermore, ongoing monetization initiatives, including the divestiture of non-core assets, as well as continued real estate and copper monetization, coupled with other key strategic levers actively being considered, including the potential monetization of wireless towers, will further enhance our efforts to strengthen our balance sheet. Deleveraging will be done alongside reducing the dividend reinvestment plan discount from the current 2 per cent by half a percentage point in each of 2026 and 2027, before removing it completely at the end of 2027."

"As we progress through the remainder of 2025, we are well-positioned to drive strong, sustainable growth. Our leading asset mix and robust business strategy underpin our confidence in achieving our full year financial targets that we reiterated today. We continue to leverage our formidable strengths to deliver unparalleled value and performance for our stakeholders, firmly positioning TELUS as an industry leader in operational excellence and financial resilience," concluded Doug.

As compared to the same period a year ago, net income in the quarter of $301 million was up 115 per cent and Basic earnings per share (EPS) of $0.21 increased by 133 per cent. These increases were driven by the after-tax impacts of growth in Operating Income and a decrease in Financing costs, largely driven by the reclassification of unrealized changes in the forward element of virtual power purchase agreements from Financing costs to Other comprehensive income. As it relates to EPS, the increase also reflects the effect of a higher number of Common Shares outstanding. When excluding certain costs and other adjustments (see 'Reconciliation of adjusted Net income' in this news release), adjusted net income of $388 million and adjusted basic EPS of $0.26 were flat over the same period last year. Adjusted net income is a non-GAAP financial measure and adjusted basic EPS is a non-GAAP ratio. For further explanation of these measures, see 'Non-GAAP and other specified financial measures' in this news release.

Compared to the same period last year, consolidated EBITDA increased by 6 per cent to over $1.7 billion and reflects lower restructuring and other costs, related to prior year investments in cost efficiency and effectiveness programs, including real estate rationalization. Adjusted EBITDA decreased modestly by 1 per cent to more than $1.8 billion. This decline reflects varied results across our reportable segments. TELUS Digital Adjusted EBITDA decreased by 38 per cent, primarily due to lower net reversals of provisions related to business combinations and higher investments in corporate initiatives. These initiatives included the expansion of its commercial sales team and operational effectiveness programs. TTech, however, saw a 3 per cent growth in Adjusted EBITDA. This growth was driven by several factors: (i) cost reduction efforts, including workforce reductions and increased leveraging of TELUS Digital resulting in competitive benefits given the lower cost structure in TELUS Digital, as well as savings in administrative and marketing costs; (ii) mobile, residential internet, security and automation, and TV subscriber growth; (iii) higher net gains from the divestiture of non-core assets as planned; (iv) higher agriculture and consumer goods margins; and (v) higher Other income. These factors were partially offset by: (i) lower mobile ARPU; (ii) lower mobile equipment margins; (iii) an increase in bad debt expense; (iv) declining fixed legacy voice and TV margins; (v) higher network operations costs; and (vi) increased costs of subscription-based licenses and cloud usage. Lastly, TELUS Health experienced a 30 per cent increase in Adjusted EBITDA driven by organic growth across multiple revenue streams.

In the first quarter of 2025, we added 218,000 net customer additions, up 9,000 over the same period last year, and inclusive of 20,000 mobile phones and 148,000 connected devices, in addition to 21,000 internet, 27,000 TV and 15,000 security and automation customer connections. This was partly offset by residential voice losses of 13,000. Our total TTech subscriber base of 20.3 million is up 6 per cent over the last twelve months, reflecting a 3 per cent increase in our mobile phones subscriber base to over 10.1 million and a 21 per cent increase in our connected devices subscriber base to approximately 3.9 million. Additionally, our internet connections grew by 2 per cent over the last twelve months to over 2.7 million customer connections, our TV connections grew by 8 per cent over the last twelve months to over 1.4 million customer connections, and our security and automation subscriber base increased by 5 per cent to more than 1.1 million customer connections. Our residential voice subscriber base declined slightly by 4 per cent to more than 1.0 million.

In TELUS Health, as of the end of the first quarter of 2025, healthcare lives covered were 76.5 million, up 7 per cent over the past twelve months.

Cash provided by operating activities of $1.1 billion increased by 13 per cent in the first quarter of 2025, primarily driven by EBITDA growth and other working capital changes, partially offset by increased income taxes paid and increased interest paid. Free cash flow of $488 million increased by 22 per cent compared to the same period a year ago reflecting lower capital expenditures and higher EBITDA. These factors were partially offset by higher income taxes paid and increased interest paid.

Consolidated capital expenditures of $587 million, decreased by $138 million or 19 per cent in the first quarter of 2025. The decrease primarily reflects: (i) TTech operations capital expenditures of $507 million, which decreased by $142 million in the first quarter of 2025, as a result of prioritization and deferral of projects, the planned slowdown of our fibre and wireless network builds, and the evolution of our brownfield and new growth market fibre builds under a partner-build model; and (ii) TTech real estate development capital expenditures of $8 million, which decreased by $6 million in the first quarter of 2025, driven by the completion of one of our commercial buildings, in addition to the completion of major procurements for our upcoming commercial buildings. TELUS Health capital expenditures were unchanged in the first quarter of 2025 at $44 million. This was partially offset by TELUS Digital capital expenditures of $41 million, which increased by $15 million in the first quarter of 2025, primarily driven by the build out of facilities in Asia, Africa and Europe, to implement strategic customer experience capacity expansion and higher investments for the development of Fuel iX and AI platforms.

As at March 31, 2025, our 5G network covered approximately 32.4 million Canadians, representing over 87 per cent of the population.

Consolidated Financial Highlights

First Quarter 2025 Operating Highlights

TELUS technology solutions (TTech)

Mobile products and services

Fixed products and services

Agriculture and consumer goods services

TELUS Health

TELUS Digital

Dividend Declaration

The TELUS Board of Directors declared a quarterly dividend of $0.4163 per share on the issued and outstanding Common Shares of the Company payable on July 2, 2025 to holders of record at the close of business on June 10, 2025. This quarterly dividend reflects an increase of 7 per cent from the $0.3891 per share dividend declared one year earlier and consistent with our multi-year dividend growth program. When a dividend payment date falls on a weekend or holiday, the payment shall be made on the next succeeding day that is a business day.

Corporate Highlights

TELUS makes significant contributions and investments in the communities where team members live, work and serve and to the Canadian economy on behalf of customers, shareholders and team members. These include:

Community HighlightsEmpowering Canadians with Connectivity

Giving Back to Our Communities

Leading in ESG and Sustainability

Global Awards and Third Party Recognition

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 the investor webcast call, supplementary financial information at telus.com/investors.

TELUS' first quarter 2025 conference call is scheduled for Friday, May 9, 2025 at 1:30 pm ET (10:30 am PT) 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. An audio recording will be available approximately 60 minutes after the call until June 9, 2025 at 1-855-201-2300. Please quote conference access code 47116# and playback access code 47116#. 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.

Caution regarding forward-looking statements

This news release contains forward-looking statements about expected events and the financial and operating performance of TELUS Corporation. The terms TELUS, the Company, we, us and our refer to TELUS Corporation and, where the context of the narrative permits or requires, its subsidiaries.

Forward-looking statements include any statements that do not refer to historical facts. They include, but are not limited to, statements relating to our objectives and our strategies to achieve those objectives, our expectations regarding trends in the telecommunications industry (including demand for data and ongoing subscriber base growth), and our financing plans (including our planned leverage ratio in 2027, our multi-year dividend growth program and our approach to reducing the discount offered under our dividend re-investment plan). Forward-looking statements are typically identified by the words assumption, goal, guidance, objective, outlook, strategy, target and other similar expressions, or future or conditional verbs such as aim, anticipate, believe, could, expect, intend, may, plan, predict, seek, should, strive and will. These statements are made pursuant to the "safe harbour" provisions of applicable securities laws in Canada and the United States Private Securities Litigation Reform Act of 1995.

By their nature, forward-looking statements are subject to inherent risks and uncertainties and are based on assumptions, including assumptions about future economic conditions and courses of action. These assumptions may ultimately prove to have been inaccurate and, as a result, our actual results or events may differ materially from expectations expressed in or implied by the forward-looking statements. The assumptions for our 2025 outlook, as described in Section 9 in our 2024 annual MD&A, remain the same, except for the following:

The extent to which the economic growth estimates affect us and the timing of their impact will depend upon the actual experience of specific sectors of the Canadian economy.

Risks and uncertainties that could cause actual performance or events to differ materially from the forward-looking statements made herein and in other TELUS filings include, but are not limited to, the following:

The assumptions underlying our forward-looking statements are described in additional detail in Section 9 General trends, outlook and assumptions, and regulatory developments and proceedings and Section 10 Risks and risk management in our 2024 annual MD&A. Those descriptions are incorporated by reference in this cautionary statement. Updates to the assumptions on which our 2025 outlook is based are presented in Section 9 Update to general trends, outlook and assumptions, and regulatory developments and proceedings in our first quarter 2025 MD&A.

Additional risks and uncertainties that are not currently known to us or that we currently deem to be immaterial may also have a material adverse effect on our financial position, financial performance, cash flows, business or reputation. Except as otherwise indicated in this document, the forward-looking statements made herein do not reflect the potential impact of any non-recurring or special items or any mergers, acquisitions, dispositions or other business combinations or transactions that may be announced or that may occur after the date of this document.

Readers are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements in this document describe our expectations, and are based on our assumptions, as at the date of this document and are subject to change after this date. We disclaim any intention or obligation

to update or revise any forward-looking statements except as required by law.

This cautionary statement qualifies all of the forward-looking statements in this document.

Non-GAAP and other specified financial measures

We have issued guidance on and report certain non-GAAP measures that are used to evaluate the performance of TELUS, as well as to determine compliance with debt covenants and to manage our capital structure. As non-GAAP measures generally do not have a standardized meaning, they may not be comparable to similar measures presented by other issuers. For certain financial metrics, there are definitional differences between TELUS and TELUS Digital Experience reporting. These differences largely arise from TELUS Digital adopting definitions consistent with practice in its industry. Securities regulations require such measures to be clearly defined, qualified and reconciled with their nearest GAAP measure. Certain of the metrics do not have generally accepted industry definitions.

Adjusted Net income and adjusted basic earnings per share (EPS): These are non-GAAP measures that do not have any standardized meaning prescribed by IFRS Accounting Standards and are therefore unlikely to be comparable to similar measures presented by other issuers. Adjusted Net income excludes the effects of restructuring and other costs, income tax-related adjustments, long-term debt prepayment premium and other adjustments (identified in the following tables). Adjusted basic EPS is calculated as adjusted net income divided by basic weighted-average common shares outstanding. These measures are used to evaluate performance at a consolidated level and exclude items that, in management's view, may obscure underlying trends in business performance or items of an unusual nature that do not reflect our ongoing operations. They should not be considered alternatives to Net income and basic EPS in measuring TELUS' performance.

Reconciliation of adjusted Net income

Reconciliation of adjusted basic EPS

EBITDA (earnings before interest, income taxes, depreciation and amortization): We have issued guidance on and report EBITDA because it is a key measure used to evaluate performance at a consolidated level. EBITDA is commonly reported and widely used by investors and lending institutions as an indicator of a company's operating performance and ability to incur and service debt, and as a valuation metric. EBITDA should not be considered an alternative to Net income in measuring TELUS' performance, nor should it be used as a measure of cash flow. EBITDA as calculated by TELUS is equivalent to Operating revenues and other income less the total of Goods and services purchased expense and Employee benefits expense.

We also calculate Adjusted EBITDA to exclude items of an unusual nature that do not reflect our ongoing operations and should not, in our opinion, be considered in a long-term valuation metric or should not be included in an assessment of our ability to service or incur debt.

Adjusted EBITDA less capital expenditures is calculated for our reportable segments, as it represents a performance measure that may be more comparable to similar measures presented by other issuers.

(1)    TTech results for 2024 have been restated to conform with our new segmented reporting structure.

Free cash flow: We report this measure as a supplementary indicator of our operating performance, and there is no generally accepted industry definition of free cash flow. It should not be considered as an alternative to the measures in the condensed interim consolidated statements of cash flows. Free cash flow excludes certain working capital changes (such as trade receivables and trade payables), proceeds from divested assets and other sources and uses of cash, as reported in the condensed interim consolidated statements of cash flows. It provides an indication of how much cash generated by operations is available after capital expenditures that may be used to, among other things, pay dividends, repay debt, purchase shares or make other investments. We exclude impacts of accounting standards that do not impact cash, such as IFRS 15 and IFRS 16. Free cash flow may be supplemented from time to time by proceeds from divested assets or financing activities.

 

Mobile phone average revenue per subscriber per month (ARPU) is calculated as network revenue derived from monthly service plan, roaming and usage charges; divided by the average number of mobile phone subscribers on the network during the period, and is expressed as a rate per month.

Appendix

Operating revenues and other income â?? TTech segment

Operating revenues and other income â?? TELUS health segment

Operating revenues and other income â?? TELUS digital experience segment

About TELUS

TELUS (TSX: T, NYSE: TU) is a world-leading communications technology company, generating over $20 billion in annual revenue with more than 20 million customer connections through our advanced suite of broadband services for consumers, businesses and the public sector. We are committed to leveraging our technology to enable remarkable human outcomes. TELUS is passionate about putting our customers and communities first, leading the way globally in client service excellence and social capitalism. Our TELUS Health business is enhancing more than 76 million lives worldwide through innovative preventive medicine and well-being technologies. Our TELUS Agriculture & Consumer Goods business utilizes digital technologies and data insights to optimize the connection between producers and consumers. Guided by our enduring 'give where we live' philosophy, TELUS, our team members and retirees have contributed $1.8 billion in cash, in-kind contributions, time and programs including 2.4 million days of service since 2000, earning us the distinction of the world's most giving company. For more information, visit telus.com or follow @TELUSNews on X and @Darren_Entwistle on Instagram.

Investor RelationsRobert Mitchellir@telus.com

Media RelationsSteve BeisswangerSteve.Beisswanger@telus.com

SOURCE TELUS Corporation

SOURCE: TELUS Corporation

SOURCE: TELUS Communications Inc.

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