Q207 CFO Presentation

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Q2 2007 TELUS investor conference call
Robert McFarlane EVP Chief Financial
Officer August 3, 2007
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Wireless segment Q2 2007 financial results
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1 EBITDA includes non-cash charge of 1.8M in
Q2-07 for net cash settlement feature of options
granted prior to 2005. Excluding this charge
EBITDA (as adjusted) increased by 2.7
Higher COA retention costs related to WNP
impacted EBITDA while EVDO Rev A investments
contribute to capex increase
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WNP update
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1 Based on Q2-07 wireless results from Rogers,
Bell, and TELUS
Results reflect first full quarter of WNP
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Wireless EBITDA normalization
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1 Excludes non-cash charge of 1.8M in Q2-07 for
net cash settlement feature of options granted
prior to 2005.
With advent of WNP, higher COA and COR
significantly affected EBITDA growth
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5
Ampd Mobile Canada Update

• Parent Ampd Mobile, Inc. entered bankruptcy in
  U.S. in June
• Disruptions of Ampd Live content expected -
  Ampd Mobile sales discontinued in Canada
• Voice and basic messaging services continue for
  Ampd clients
• Migration of Ampd Canada subscribers now
  underway
• No notable impact expected on reported revenue or
  subscribers
• Impact of writedowns on Q2-07 results
• 11.8M write-off in other expenses for Ampd US
  venture capital investment
• Approx. 2M opex impact on EBITDA
• 5M for accelerated depreciation of assets used
  to support Ampd
• Negative EPS impact of approximately 4 cents

Ampd Mobile subscribers being migrated to TELUS
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6
Wireless subscriber results
total wireless subscribers
net additions
prepaid
1.0M
128K
124K
postpaid
Prepaid 20
77
83
Postpaid 80
4.2M
Q2-06
Q2-07
5.3 million
Continued strong net additions
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Wireless ARPU growth
Data ARPU
63.65
63.18
Voice
6.58
4.45
58.73
57.07
Q2-07
Q2-06
48 increase in data more than offsetting voice
decline
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Q2 2007 wireless churn ()
2.7
2.6
1.8
1.6
1.6
1.45
1.3
Source Company reports, analyst reports. Sprint
Nextel and T-Mobile USA Q1-07. TELUS estimates
for Rogers blended churn not including 90K TDMA
subscriber write down in Q2-07
Churn remains at best in class levels
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Wireline segment Q2 2007 financial results
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Results impacted by implementation of new
wireline billing and client care system in Alberta
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Wireline revenue profile
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Continued solid data growth offsets local and LD
erosion
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Long distance revenue normalized
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Flat to positive wireline revenue growth adjusted
for system implementation impact
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Wireline EBITDA normalization
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System implementation significantly impacted
wireline EBITDA
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High-speed Internet subscribers
Internet subscribers
High-speed Internet net additions
172K
Dial-up 15
29K
14K
High-speed 85
963K
Q2-06
Q2-07
1.13 million total
Results reflect system implementation in
Alberta Lowering annual guidance from gt 135K to gt
125K
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Network access line results
of network access lines lost (yr. over yr.)
Q1-06
Q2-06
Q3-06
Q4-06
Q1-07
Q2-07
-2.7
-2.6
-2.8
-3.0
-2.9
-3.1
Stable overall line losses due to business line
growth
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TELUS total subscriber connections
10.9
(millions)
10.4
9.9
Res NALs
Bus NALs
Dial-up Internet
High-speed Internet
Wireless
Q2-07
Q2-06
Q2-05
Connections increasing with wireless and Internet
growth
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Consolidated Q2 2007 financial results
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1 EBITDA includes non-cash charge of 1.8M in
2007 for net cash settlement feature of options
granted prior to 2005. Excluding this charge
EBITDA (as adjusted) decreased by 1.2
Increased expenses related to WNP, new system
implementation Ampd affected results
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EPS continuity
1.03
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0.31
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0.13
0.05
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0.14
0.76
0.06
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0.08
0.04
Q2-06
Q2-07
Other (incl. lower avg o/s shares)
Net tax related adjustments
Billing client care system
Ampd write-down
COA COR
Normalized EBITDA1
Restructuring costs
1 Normalized to exclude billing system,
restructuring, acquisition retention, and AMPd
impacts
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Share buy backs 3rd Normal Course Issuer Bid
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Outstanding shares already 2 lower than at 2006
year end
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Strong record of returning capital
per share
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3.73
3.43
Share repurchases
3.30
Dividends
3
2.23
1.11
2
2.33
2.50
1.50
0.82
1
1.10
0.60
0.80
0.22
0.60
2003
2004
2005
2006
2007E1,2
1 Annualized dividend, plus YTD NCIB share
repurchases as at June 30/07, annualized
2 See forward looking statement caution.
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Financing update

• Launched unsecured commercial paper program in Q2
• Backstopped by credit facility
• Can issue up to 800 million
• 664 million issued, as at June 30
• Successfully raised 1 billion in March at 4.8
  blended
• Redeemed 1.5 billion 7.5 Notes on June 2007
  maturity

Strong balance sheet with extended maturities and
lower interest
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TELUS debt maturity schedule (M)
Debt
Deferred FX Hedge Liability
No significant debt maturities until 2011
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2007 guidance - consolidated
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1 Confirmed August 3, 2007
2 Excludes expense of approx. 180 million in
2007 for net cash settlement feature for options.
3 Excludes an after-tax charge per share of
approx 0.33 for cash settlement feature for
options. Year over year growth rate normalized
for 0.48 of positive tax-related adjustments in
2006.
See forward looking statement caution
Original consolidated guidance reconfirmed
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Questions?
investor relations 1-800-667-4871 telus.com ir_at_tel
us.com
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Appendix Free cash flow (2007 definition)
(M)
Q2-06
Q2-07
897
885
EBITDA
(459)
(482)
Capex
(271)
(213)
Interest expense paid
(0.7)
(3)
Cash income taxes and other
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15
Non-cash portion of share-based compensation
19
(7)
Restructuring payments (net of expense)
(8)
(9)
Cash related to other expenses
Free cash flow (before cash settled option pmt)
186
191
Cash settled options paid
(24)
-
Free cash flow
191
162
0.2
Share Issuance (non-public)
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(249)
(170)
Purchase of shares for cancellation (NCIB)
(95)
(125)
Dividends
135
350
Accounts Receivable Securitization
(2)
68
Working capital other
(8)
286
Funds avail. for debt redemption
(817)
(10)
Net debt issuance / (repayment)
(18)
(532)
Net change in cash
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Appendix - definitions

• EBITDA Earnings, after restructuring and
  workforce reduction costs, before interest,
  taxes, depreciation and amortization
• Capital intensity capex divided by total revenue
• Cash flow EBITDA less capex
• Free cash flow EBITDA, adding Restructuring and
  workforce reduction costs, cash interest received
  and excess of share compensation expense over
  share compensation payments, subtracting cash
  interest paid, cash taxes, capital expenditures,
  cash restructuring payments, and cash related to
  Other expenses such as charitable donations and
  securitization fees
• Cost of retention (COR) total costs to retain
  existing subscribers, often presented as a
  percentage of network revenue

TELUS definitions for non-GAAP measures