TELUS Corporation today reported for the third quarter of 2005 continued strong wireless performance at TELUS Mobility, and wireline results at TELUS Communications that reflected the impact of the labour disruption in Western Canada. Operating revenues of $2.1 billion in the quarter increased 6% from a year ago and operating earnings (EBITDA) were up 3%. Reported earnings per share (EPS) for the third quarter were 53 cents up 21% compared to 44 cents for the same period a year ago. EPS this quarter was positively affected by tax-related adjustments of five cents. Free cash flow was $581 million during the quarter, a $79 million or 16% improvement from a year ago.
Darren Entwistle, president and CEO, stated “TELUS’ third quarter results reflect continued strong, on-strategy growth. TELUS Mobility delivered another outstanding quarter with excellent subscriber growth, ARPU and churn results that resulted in wireless revenue and EBITDA increases of 16% and 28%, respectively. I am pleased that we have a tentative negotiated collective agreement that is being recommended by the TWU and currently being voted on, which benefits TELUS, our team members, customers and investors. We have an agreement that recognizes our team members’ tremendous contributions and provides TELUS with the flexibility to successfully operate in a highly competitive market. As part of our ongoing commitment and track record of returning capital to investors, we are today announcing a 37.5 percent increase to the quarterly dividend payable on January 1.”
Robert McFarlane, executive vice president and CFO, commented that “Cash flow was strong in the third quarter due to the excellent performance at TELUS Mobility and the temporary constraint on fully deploying our capital expenditure program during the labour disruption. The changes to annual 2005 guidance announced today, including a $150 million increase in cash flow, reflect the strong operational performance and resilience of TELUS regardless of whether the labour disruption continues. Consistent with the Company’s forward looking dividend payout target of 45 to 55% of sustainable net earnings and the outlook for future growth in earnings, the Board approved an increase in the TELUS quarterly dividend of 7.5 cents to 27.5 cents. This dividend increase, continued execution of our significant share repurchase program with $233 million purchased in the third quarter, lowering of our long term debt to EBITDA leverage target range and early redemption of $1.6 billion of debt this December together demonstrate the considerable financial strength of TELUS to continue to create value for our equity and debt investors. “
