CFO letter to investors

We are building outstanding value for our shareholders

Together, our team delivered strong financial results in 2017, meeting our revenue and earnings growth targets for the seventh year running, while continuing to make generational investments in our advanced broadband networks and delivering significant returns to our shareholders.


Delivering growth and shareholder value

Our financial results in 2017 reflected profitable growth across our wireless and wireline businesses. Outstanding postpaid wireless gross loading, combined with industry-leading churn, led to our best wireless customer growth since 2013. The ever-increasing demand for data services also drove another year of robust growth in average revenue per subscriber. In wireline, we balanced solid high-speed Internet and TV customer growth with consistent, positive financial performance while slowing losses in high-margin legacy network access lines. We also made strategic acquisitions to bolster our diversified TELUS Health and TELUS International businesses.

In 2017, we reached the peak of our capital investments with a record $3.1 billion invested, and we are nearing the halfway point of our fibre-optic build. We generated $966 million in free cash flow in 2017 and we are expecting an increase of more than 37 per cent in 2018, as a result of our strategic investments and efficiency initiatives, which are continuing to drive profitable growth in our key markets.

We continued our industry-leading dividend growth program, returning more than $1.1 billion in dividends during the year, with our shareholders enjoying a total annual return of 16 per cent in 2017. This is the seventh year of the past eight that TELUS has delivered a double-digit annual shareholder return, reflecting our commitment to a strategy that supports shareholder-friendly initiatives, despite economic and competitive pressures.


Leading the way

Looking ahead, we will continue delivering value to investors and supporting our targeted seven to 10 per cent annual dividend growth program through to the end of 2019 by:

  • Delivering on our profitable growth strategy

  • Maintaining our strong balance sheet and being careful stewards of capital over the long term

  • Maximizing the value of our investments to drive profitable growth and positive free cash flow

  • Continuing to implement our operational effectiveness initiatives in order to achieve an optimal cost structure.

“We continued our industry-leading dividend growth program, returning more than $1.1 billion in dividends during the year, with our shareholders enjoying a total annual return of 16 per cent in 2017.”

Corporate social responsibility is deeply embedded in our culture. We are taking an integrated approach to our strategy, operations and reporting to ensure a resilient business model that reflects the opportunities and risks posed by environmental and social issues. As a founding member of the Prince’s Accounting for Sustainability project, we are working to demonstrate the ways in which finance and business can play a role in creating a healthier and more sustainable future.

We believe that investing in customers, communities and team members is integral to our success. This commitment enables us to build on our world-class culture and support our highly engaged team members who continue to put customers first. It also helps drive sustainable financial success and value creation for our investors


Creating ongoing value

Our proven strategy to deliver the best solutions to Canadians by investing in technology, network reliability and future capabilities will continue to fuel our growth, industry leadership and best-in-class shareholder return. Building on the momentum generated in 2017, we will maintain a relentless focus on achieving our financial commitments and positioning TELUS for continued success in 2018 and beyond.

Best regards,

Doug French

Executive Vice-President and Chief Financial Officer

February 16, 2018

Consolidated 2018 targets

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$13.835 to $14.100 billion

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Adjusted EBITDA

$5.105 to $5.230 billion

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Basic earnings per share

$2.53 to $2.68




Capital expenditures (excluding spectrum licences)