Investor Luncheon

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Investor Luncheon

• December 11, 2001
• Montreal

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Forward Looking Legal Disclaimer
This presentation contains forward-looking
statements about expected future events and
financial and operating results that are subject
to risks and uncertainties. TELUS actual
results, performance, or achievement could differ
materially from those expressed or implied by
such statements. For additional information on
potential risk factors, see TELUS Annual
Information Form for 2000 and other filings with
securities commissions in Canada and the United
States. TELUS disclaims any intention or
obligation to update or revise any
forward-looking statements, whether as a result
of new information, future events or otherwise.
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Special Thanks to our Hosts
Jeremy Burge
Stuart Isherwood
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TELUS Executives

• Darren Entwistle President CEO
• Robert McFarlane Exec. Vice President CFO
• George Cope President CEO, TELUS Mobility
• Hugues St-Pierre President CEO, TELUS Québec

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Darren EntwistleMember of Team TELUS
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Six Strategic Imperatives

• Offer integrated solutions
• Build national capabilities
• Partner, acquire divest
• Focus on data, IP wireless
• Attack the market as a united team
• Invest in internal capabilities

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Build National Capabilities

• Lit cross-Canada IP backbone Mar-01

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Build National Capabilities
Expanding nationally through acquisition
greenfield investments in high-growth areas

• Lit cross-Canada IP backbone Mar-01
• Integrating Clearnet QuébecTel acquisitions
• Launched wireless services in Winnipeg Aug-01
• Ontario Québec expansion
• Opened Toronto data centre Jul-01
• Metro fibre builds Toronto, Montreal, Ottawa,
  Québec City
• Organic growth
• Selective acquisitions of data IP assets

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Partner, Acquire Divest

• Partner
• Verizon Genuity
• Acquire
• Completed NWD, Columbus, Williams, Daedalian
  Arqana
• Purchased remaining 30 of QuébecTel
• Acquisition of PSINet - augmented TELUS leading
  web hosting capabilities
• 340M cash / 191M shares in 2001
• Divest
• 1.2B non-core divestitures YTD exceeds 1B
  target

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Focus on Data, IP Wireless
Wireless Data becoming a bigger portion of pie
Q3-01
Q3-00
LD
LD
Mobility
15
19
28
40
Mobility
35
Local Voice
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Data
Local Voice
15
Data
16
7
6
Other
Other
1.5B
1.8B
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Executing the Strategy in 2001
Done
Progress
?
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Executing the Strategy in 2001
Done
Progress
?
Accelerate ADSL Internet build-out
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Robert McFarlaneEVP Finance CFO
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Q3-01 Operating Highlights

• Change
• Reported Reported Pro forma1
• Revenue 1,850M ? 19.6 ? 9.2
• EBITDA 699M ? 14.6 ? 20.9
• Capex 587M ? 56.9 ? 21.6

1 Includes Clearnet in Q3-00
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2001 Guidance - Continuing Operations
1 Previously adjusted for divestitures of TELUS
Advertising Services and Telecom Leasing Canada
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2002 Regulatory Contribution Impact

• Compared to 2001, EBITDA one-time impact expected
  to be approx. 240M
• Efficiency improvement program mid-June
• End Q4-01 with improved run rate
• Process system improvement initiatives
• Realize significant efficiency gains over medium
  term

Excluding 2002 Contribution impact, expected
underlying EBITDA growth remains strong
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Dividend Reduction

• Dividend reduced to 0.15 per quarter from 0.35
• Effective January 1, 2002
• Aligns with growth strategy
• Consistent with wireless non-ILEC growth
  business profiles
• Strengthens free cash flow balance sheet
• Credit enhancing
• Change made from position of financial strength
• Market reacted positively

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Cash Tax Savings

• Legal reorganizations underway allowing Q3 tax
  savings of approx. 250M
• Utilizes Clearnets non-capital losses
• Gains on two divestitures sheltered from cash
  taxes
• Expect gt1B cash tax savings from corporate
  reorg.
• NPV of remaining cash tax savings 500-600M

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Non-ILEC Progress Nationally
Non-ILEC1
(M)
1 Includes CLEC activities in Ontario Quebec
(pro forma), Ontario-based acquisitions of
Williams, Daedalian Arqana
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Valuation Considerations
2001E
Metric
Sum
of Parts Components
Multiple1
2,335M
EBITDA
Wireline-ILEC
5 to 5.5x
12 to 16x 2.5 to 3.5x
340 1,600M
EBITDA Network Rev.
Wireless
Additional Information3 Net Debt 8.4B
NPV Tax Shield 500 to 600M Shares
outstanding 300M

• Source Analysts comparables per Analyst
  reports
• Annualized 3Q-01
• As at Sep 30, 2001

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George CopePresident CEOTELUS Mobility
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Canadian Wireless Industry
12 ME Q3 2001 versus 12 ME Q3 2000
Source Company reports, CWTA and TELUS Mobility
estimates
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Value Creation Strategy
Focus on profitable subscriber growth rather
than industry-leading net additions TELUS
Annual Report 2000, page 17
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How Were Doing
Competition Share of Net Adds. YTD Sep 30-01
BCE
TELUS
22
36
17
Microcell
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Rogers
Source Company Financial Results
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How Were Doing
Competition Share of Service Revenue YTD Sep
30-01
BCE
TELUS
31
32
10
27
Microcell
Rogers
Source Company Financial Results and TELUS
Mobility estimates
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How Were Doing
ARPU - Q3-01 industry results
60
49
44
44
TELUS Mobility
Bell Wireless
Rogers ATT
Microcell
Source company reports
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How Were Doing
Revenue - Q3-01 industry results (M)
508
490
426
154
TELUS Mobility
Bell Wireless
Rogers ATT
Microcell
Source company reports
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2001 YTD EBITDA Growth
143M
46M
Rogers ATT
Microcell
TELUS Mobility1
(18)M
1 As compared to pro forma 2000 Q3 YTD results
Source company reports
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Status of 2001 Targets
Q3 YTD 2001
2001 Guidance1

• Focus on network revenue growth ? 20
• EBITDA - approx. 340M (?96) 301M
• Net additions of 400 - 440K 257K
• Manage churn at lt2.0 2.0
• 700M to expand and digitize network2 439M
• Integrate national operations on-going
• New data products and services yes
• Enhance spectrum position completed
• Wireless integration synergies of 165 -
  190M approx. 135M3

1 As of Oct 25, 2001 2 Not including 356M for
wireless spectrum 3 Estimated savings from
operating capital synergies. Cash tax synergies
not included
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Bell/Aliant Roaming/Resale Agreements

• Effective Jan 1, 2002 implementation 1H02
• Reduced rates includes Bell Aliant
• Expands addressable market increase of gt 7M
  POPs
• Capex avoidance 800M over 10-year term
• 500M savings in areas formerly planning to
  build-out
• 300M avoidance related to rural areas otherwise
  uneconomical to build-out
• Allows uniform digital coverage nationally (voice
  Internet)
• Shortens timeline for introduction of digital and
  3G services

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Mobility Coverage Map
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Hugues St-PierrePresident CEOTELUS Québec
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Québec-Téléphone
Jules-A. Brillant fondateur
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Québec-Téléphone

• 75 ans dexistence
• Réputation dexcellence
  dans le service
• Réseau entièrement numérisé depuis
  1992
• Revenus annuels 400 millions
• Nombre demployés 2 300
• Plus de 300 000 lignes daccès en
  service
• Premier fournisseur dInternet dans
  son territoire

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Structure de léquipe TELUS
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Sondage sur lintégration TELUS Québec
Lappartenance à la famille TELUS me rend
optimiste face à lavenir
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Notre réseau au Québec

• Sites dhébergement Rimouski, Montreal
• 27 sites de co-location

• Parts de marché Internet HV (TELUS Québec vs.
  COGÉCO)6 villes 52 vs. 48 24 villes 100
  vs. 0

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Notre réseau au Québec
Réseau actuel

• Réseau OC48
• 3 DMS-500 commutateurs
• Fibre opt. régionale 1 482 km gaine
• Fibre opt. urbaine 785 km gaine
• ATM Principales villes du Québec
• IP Carrier Class 90 de la population
• MPLS Rimouski, Québec, Drummond-ville, Montréal

Réseau futur

• Investissements de 200 millions sur 3 ans
  (hors-territoire)
• Investissements de 150 millionssur 3 ans
  (territoire)

Commutation multiprotocole par étiquette
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Progrès hors-territoire

• Cibles stratégiques
• Données affaires et marché IP
• Gestion
• Louis Morin, v-p, Marché affaires (20 ans
  dexpérience), recruté janv. 2001
• Équipe de gestionnaires dexpérience
• Force de vente doublée en 2001

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Progrès hors-territoire

• Croissance des revenus
• Augmentation de 110 du nombre de clients depuis
  janvier 2001
• Contrats importants
• CSST Ville de Montréal Astral Média 6
  commissions scolaires Défense nationale Canam
  Manac
• Solutions daffaires TELUS
• 7e rang au Québec

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TELUS Québec le concurrent de Bellau Québec
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Questions Answers
For additional information TELUS Investor
Relations www.telus.com 1-800-667-4871