Q1 2022 Telus Corp Earnings Call

May 6, 2022

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The conference is now being recorded.

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Good morning, everyone welcome to the Telus 'twenty 'twenty to Q1 earnings conference call.

I would like to introduce your speaker Mr. Robert Mitchell. Please go ahead.

Hello, everyone and thank you for joining our call today, our first quarter of 2022 results news release, MD&A and financial statements and detailed supplemental supplemental investor information with posted on our website. This morning at Telus Dot Com slash investors on our call today, we will have remarks by Darren.

John <unk> President of our Agriculture business. Doug. In addition for the Q&A portion I recall will be joined by <unk> <unk>, who runs our consumer business, Jim Senko, who leads our mobility solutions business now being Aurora, who leads our business solutions.

Tony <unk>, our Chief operations Officer.

Briefly on slide two this presentation and answers to questions contain forward looking statements that are subject to risks and uncertainties and made based on certain assumptions. Accordingly actual performance could differ from statements made today. So we ask that you do not place undue reliance on them, we disclaim any obligation to update forward looking statements, except as required by law and we refer you to the risks and assumptions as outlined in our public.

Including our first quarter of 2022, MTA, our annual 2021, MD&A and filings with Securities commissions in Canada, and the U S with that over to you Darren.

Thanks, Ricardo and Hello, everyone.

Telus team once again achieved strong operational and financial results in the first quarter of 2022.

Our ongoing execution excellence continues to be characterized but its consistent combination of industry meeting and profitable customer growth, yielding strong financial results across the totality of our business.

Industry, leading told total mobile and fixed customer growth of 148000 represented the strongest first quarter on record for our company.

This reflects robust demand for our superior bundled offerings and customer service over our world leading broadband networks.

Moreover, our leading customer growth was underpinned by industry best client loyalty across our key mobile and fixed product lines.

Notably again this quarter and for five of the last eight quarters.

Mobile phone pure fiber internet optic TV security and voice churn were all below 1%.

Furthermore, since the onset of the pandemic at the beginning of 2020, we've welcomed an industry, leading one 9 million net new customers.

<unk> achieved strong first quarter consolidated revenue and organic EBITDA growth of six 4% and seven 6% respectively.

Strength in our core telecom operations continues to be complemented by a highly differentiated and potent access mix geared towards high growth technology oriented vertical.

Notably comparing the first quarter of 2022 with that of 2019 prior to the pandemic total revenue grew by a leading 22% while EBITDA grew by 14%.

Moreover, since the beginning of 2020 and the pandemic period, Telus has driven leading cumulative revenue and EBITDA growth of over $4 billion and close to $600 million respectively.

Let's turn now to take a look at our mobile operating results.

Telus achieved industry, leading customer growth of 92000 net additions. This included 46000 connected device net additions as well as 46000 net new mobile phone customers up 48% increase over last year and the best Q1 on record since 2010.

Notably this brings the sum total to an industry, leading one 3 million net new mobile phone subscribers and connected devices achieved since the beginning of 2020 any onset of the pandemic.

Importantly, our team yet again delivered another quarter of industry best loyalty results, which of course as you well know is the hallmark of intelligent organization and our performance culture and customers first attitude.

Blended mobile phone churn with zero down eight 1%, representing an eight basis point improvement from this time last year. The best Q1 on record and only one basis point off our all time lowest churn ever clear.

Clearly something that we need to fix in Q2 coming forward.

Rover postpaid mobile phone churn of <unk> six 3% represented a nine basis point improvement over 2021 and puts US now in our ninth year of postpaid churn below 1% well below 1%.

This consistently strong performance is backed by our highly engaged team who are passionate about delivering outstanding customer experiences in combination with superior service offering and digital capabilities over our world, leading wireless and pure fiber broadband networks.

More than ever Canadians value of fast.

<unk> connection and the consistent recognition from independent third party organization reinforces the superiority of <unk> Global Best network.

During the quarter independent UK based open signal named tell US number one in respect to the fastest by downloads been in Canada for the third consecutive time.

Impressively open signal confirm that tell us consistently has and I quote the fastest <unk> download speeds of any operator since open signal started reporting on the <unk> mobile experience in Canada close quote and.

In addition, U S phase II once again named the fastest mobile operator in the first quarter confirming that intelligence ranked first in every quarter <unk> had since Q3 of 2020.

Moreover, <unk> placed first in respect of <unk> performance for the first time according to <unk> B test.

<unk> intends to continue extending this global leadership position as we advance the development coverage and commercialization of our <unk> network and its inherent functionality.

The numerous network awards that our dedicated team has earned and boy have they earned it reinforces tells US leadership in terms of offering customers. The fastest most expensive service in Canada across both our wireless and pure fiber networks and of course they are integrated.

Furthermore, this recognition of the superiority of <unk> national broadband networks underscores the value of our significant generational investments in our world, leading network technology and infrastructure.

In addition to sustainable strong performance at alongside our ongoing accelerated broadband expansion program through 2022, our network technologies will drive extensive long term socio economic benefits to all Canadians.

Yeah.

To close on mobile first quarter ARPA.

It was up zero at that 6% on a year over year basis.

It was supported by higher roaming revenues.

Still distinctly below seasonal pre pandemic level.

Notably mobile phone lifetime revenue of close to $7000 was up to 44% higher than our major peers.

Is reflective of our consistent focus on high quality customer growth and leading client loyalty.

Let's turn now and take a look at our fixed operating results.

Telus delivered another quarter of industry best wireline customer growth.

We achieved industry, leading first quarter Internet net additions of 30000, albeit down slightly due to the modestly higher churn as compared to the very low rate, we saw earlier independent make period.

Strong security net additions of 26000 were up 9000 up 53% increase over the previous year, representing our best first quarter on record a terrific performance from that team and indeed with respect to security in March brand spark named <unk>.

This smart home security as the most trusted alarm service in Canada.

We come a long way on the security front, and it's potent in and of itself, but it is especially effective within our fsh bundle.

This reflects the strength of our industry best portfolio of products and services, leading customer centric culture as well as our strong and differentiated social capitalism back brand.

We continue to drive healthy growth in TB with net additions of $10000, which was essentially flat over the prior year.

Furthermore, residential voice line losses of 10000 or steady on a year over year basis.

Overall industry, leading total external fixed net addition of 56000 were up 10% on a year over year basis, driven by our unique and highly attractive bundled offers across our superior product portfolio as well as our leading customer loyalty and those two.

Things are great in combination.

Notably since the beginning of 2020 independent make period, we have welcomed a leading 551.

Big customer additions.

Indeed, our robust wireline customer growth continues to be enhanced by the significant investments that we're making in our <unk> and fiber technologies, including our important accelerated broadband expansion program and our digital program, which we are embracing across tell us as it really.

<unk> to our go to market operations, and our efficiencies within our back office operation.

These generational investments will in concert fuel enhanced customer growth and operating efficiencies in combination.

At the same time, our investments will also drive positive cash flow benefits as we complete our expedited broadband build largely finished our copper to fiber migrations by year end and continue retiring our remaining copper infrastructure all the while engine.

<unk> strong EBITDA expansion.

Fortunately.

And I think this is key for investors, we expect our pure fiber network assets to have light spans of 60 years or more.

In addition to significant social and economic benefits for all Canadians. This long term infrastructure and technology will continue to drive material cash flow for decades to come.

Now, let's take a look at Telus health.

Our team once again drove double digit year over year health services revenue growth, whilst continuing to meaningfully scale our health operations.

This scaling includes our health care programs, covering 22 million lives in Canada, an increase of more than 25% on a year over year basis.

This scale. It includes executing 148 million digital health transactions during the quarter up 5% over last year, and an enclosed earning $1 3 million net new virtual health care members in the last 12 months, increasing our membership that $3 3 million, which.

<unk>, a 65% year over year increase.

We continue to leverage our leading position in healthcare technology solutions to deliver improved health outcomes for employees and citizen delight through access to better health information, which of course has never been more critical.

Turning to agriculture.

They were introducing expanded disclosure for <unk> agriculture.

Notably Agriculture services revenue was up 37% in the first quarter on a year over year basis, driven by our team's ongoing efforts to integrate and grow this unique and differentiated global business.

This performance is illustrative of the significant value we are trading as the leading provider of agriculture, and consumer goods technology and data analytics around the world.

Importantly, we are back in the sectors efficiency and effectiveness and food quality production through data analytics and technology solutions. We are confident that our expanding disclosure further illustrates the value and asset of consequence, we are creating in this important.

Area.

And just a moment Jon range is going to have an opportunity to provide further color on this exciting business and its exciting growth prospects.

Let's turn now and take a look at Telus International.

Earlier today, intelligent international announced strong double digit revenue EBITDA and free cash flow growth for the first quarter.

Continued robust results demonstrate consistent execution attractive end to end digital capabilities and position as a leading partner of choice for Premier digital customer experiences and it services with its enviable list of clients on a global basis.

This highly differentiated offering notably includes content moderation data annotation and artificial intelligence solutions.

And it's great to see the growth coming from Ti on a revenue EBITDA and free cash flow basis, when its organic growth that we're reporting again.

Doug just going to have an opportunity to provide further commentary on both our Telus International and key tech financials shortly.

Importantly, our ongoing investments in technology infrastructure data analytics and growth markets enable the continued advancement of our strong operational and financial performance strengthening our confidence in the robust outlook for our business and the long term sustainability of our industry.

<unk> leading dividend growth.

Today, we announced for the fourth time since 2021, the extension of our industry best dividend growth program.

<unk> again targeting 7% to 10% annual growth for 2023 through 2025 supported by our positive business outlook.

And accelerating free cash flow growth story, clearly, we're entering an era, where the sources of cash are going to chronically exceed the uses.

Notably the seven 1% dividend increase we announced today represents the 22nd semiannual increase over the full course of our multiyear dividend growth program. Originally introduced at the AGM in May of 2011.

Indeed since 2004 through April of 2020 to Telus has returned more than $21 billion to shareholders, including over $16 billion in dividends, representing more than $15 per share with of course the shares having split twice.

Further dividend growth and affordability will be supported by a strong EBITDA growth outlook in our telecom and data services portfolio complemented by significant value creation in our Ti health and agriculture businesses. What has differentiated story that is for this organization.

It will be further bolstered by our lower future capital expenditures and our cost reduction program.

This is consistent with the preliminary guidance, we provided for significantly reduced capital investments of $2 5 billion, beginning in 2023, and the meaningful resulting free cash flow expansion thereafter.

The clothes and from the head and from the heart I would like to recognize the tremendous thoughtfulness of the entire <unk> team and the passion with which they give with their hearts and their hand this support communities across the globe by.

By way of but one example, but certainly an important one our team has contributed nearly $4 million in donations and in kind support thus far to assist those impacted by the tragic events in the Ukraine and eastern Europe .

Moreover, our team continues to demonstrate our social purpose in action through our Telus days of giving as we work together to create extraordinary outcomes in the global communities, where we live work and serve as citizens.

I remain exceedingly grateful to the entire Telus team for exemplifying our world leadership in social capitalism, as we strive to deliver outstanding results for all of our stakeholders and our pursuit of making the future friendly.

And on that note over to you Mr. <unk>.

Thanks, very much Darren and Hello, everyone. It's a privilege to speak with you today as I approach six months, leading till its agriculture, My gratitude goes out to Darren and the executive leadership team, our valued customers and of course, our incredible <unk> hundred team members around the world.

For their unwavering support and commitment to excellence over the last six months.

<unk> culture is much more than a production agriculture company.

Our organization spans the entire food and consumer goods value chain, which in any given year around the world is about <unk> 10 trillion dollar industry with approximately two trillion between the producer and processor and eight trillion between the processor in consumer.

The food and consumer goods value chain is woefully under digitized, including a lack of connectivity and is certainly not optimized by data, resulting in sub optimized insights and actions.

And tell US agriculture, we are the largest independent data insights and digital technology company, providing services across the value chain.

In the agriculture industry.

To further our competitive advantage, we are investing significantly in a digitized platform, our AVX or AG data exchange platform will enable us to deliver data insights and execute on data transformation from seeding prescriptions to food promotions.

Further by combining the strengths of Telus Agriculture's products and service and tell US leadership in Iot and <unk>. We believe we can deliver even greater value and accelerate business for our shared customers entellus, agriculture and tell us business.

One third of all food produced in the World is lost or wasted each year due to issues in processing transportation or planning.

When food is discarded.

All inputs used in producing processing and transporting is also wasted.

The food waste that ends up in our landfills has a significant impact on greenhouse gas emissions.

We have a massive opportunity to help the food industry battle against food waste and more importantly, food in security.

We can help grocers distributors and consumers reduce perishable waste and improve the safety quality and sustainability of our food.

We are utilizing machine learning to generate more accurate forecast combined with real time retail planning and execution.

This allows businesses to react in real time to variances in their plans and replenish or slowdown stocks to meet real time customer service levels in affordable way for producers retailers and our customers.

<unk> culture has several capabilities that allow us to digitize and optimize activities for our customers at each end of the food value chain with these anchor assets. We are now uniquely positions to optimize the supply chain by passing data not only up and down with.

And the verticals we serve.

Not only across the entire value chain.

For example, our production assets from our farm management applications to our trade promotions and retail execution capabilities through our exceed euro and Blacksmith's acquisitions will anchor the data connections that we intend to connect the producer to the retailer.

The formidable power that results from bringing these assets together through the investments in our platform is the unique value proposition that we offer in the market.

As Darin mentioned, we are proud of our 37% year over year revenue growth our penetration into over 50 countries are prestigious customer list with nine of the top 10 agricultural companies purchasing services from us.

And we're most proud of our talented <unk> hundred team members globally, who are dedicated to empowering the industry with digital technologies and data insights and ultimately, creating the best producer to consumer outcomes.

We are confident that our revenue and revenue growth is illustrative of the significant value we are creating as the leading provider of agriculture technology solutions around the world and further demonstrates the value and asset of consequences that we are creating.

With that I'll turn the call over to Doug for an update on tell US Q1 financial results Doug over to you. Thank.

Thank you John and Hello, everyone. Our Q1 results reflect a very good start to the year as we build up our strong and consistent performance over 2020, and 2021 mobile network revenue improved $4, 9% year over year or approximately 6% compared to the pre print that pre pandemic.

Q1 2019 period.

This is reflective of our consistency and resilience through unprecedented times and a clear ongoing focus on high quality customer growth and excellent customer base management, we continue to see a steady improvement in roaming revenue with the Q1 amount at circa 80% of pre pandemic levels.

This ongoing recovery will support <unk> growth as we progress through the year and into 2023.

Beyond roaming we are focused on driving sustainable our Peru improvements by executing on our <unk> monetization strategy, including our speed tier plans and the launch of stream plus a new OTT streaming bundle, but gives you new and existing or new and existing customers simplified access.

Netflix premium Apple TV, plus and discovery plus.

It's also important to clarify that when we involved our new reporting segments. In 2021, we no longer include any internal network service and our <unk> calculation.

As demonstrated again this quarter, we continue to focus on strong and profitable subscriber growth, which includes strengthening our industry leading churn profile.

Through this attractive combination and improving <unk> and leading churn in Q1, our lifetime revenue per customer was up 11% to $7000.

This result is even more impressive considering our product bundling efforts across the mobile and home.

In this regard we've seen impressive trends towards greater product intensity for example, the number of households in our.

With our four or more products is up over 11% year over year, while households, with five products is up 38% year over year.

With strong product intensity.

Trends lead to materially increases in customer lifetime value through the greater revenue per household as long as as well as strong customer loyalty.

Additionally, we continue to make meaningful investments in Digitization and simplification to drive down our cost structure, while improving the customer experience.

Fixed data revenue, which now excludes both agriculture services revenue and health services revenue grew five 2% year over year.

As a reminder, the prior year run rate also included solutions concentrate contributions from our divested financial solutions business, representing an impact of our quarterly growth of approximately one 1%.

Underlying our fixed data growth as a result of our residential internet growth, which grew an impressive 14% year over year as we continue to drive market share gains as well as higher ARPA as customers continue to move to higher speeds and recognize the value of our superior fiber in bundle.

Those offerings.

On the <unk> front inclusive of both mobile and fixed services, we saw positive trends continue and revenue and EBITDA on a year over year basis.

Additionally, our three infotech businesses Gi health and Agriculture also showed attractive growth once again combined revenue in these three areas grew circa 20% year over year, reflecting high growth nature of our unique data centric asset mix, which again sets us apart from our global peers.

At the segment level <unk> revenue was up four 2% or 6% when excluding the low margin mobile equipment revenue, which declined from consumer behavior towards longer upgrade cycles and greater.

Meanwhile, <unk> adjusted EBITDA grew by 1% year over year or 6% on an organic basis, excluding the delayed net dilutive impact of J curve M&A in the financial services divestiture.

As Jeff and Vanessa discussed in the Ti earnings call earlier today <unk> continues to drive strong results for the Telus organization and the relationship between Ti and Telus remains as strong as ever and continues to grow.

<unk> revenue was up 19% adjusted EBITDA up 25% and margins improved 120 basis points year over year.

Importantly, ti reaffirmed it.

Full year guidance and the team remains on track for another strong year of double digit growth and attractive margin profile overall.

Overall, our consolidated revenue grew six 4% year over year or eight 2% when excluding the mobile equipment revenues.

Consolidated adjusted EBITDA grew 7% year over year or 67, 6% on an organic basis, we anticipate our growth to continue to grow for the remainder of the year.

This growth is going to come from our <unk> improvements as we progress through our <unk> monetization strategy in bromine recovery.

Improving <unk> trends from scaling our Iot business driving product intensity nationally and offering the best digital solutions to businesses of all sizes.

Ongoing efficiency benefits for multiple programs, including our copper to fiber program and ongoing Digitization efforts continued Scott subscriber growth as we expand our broadband coverage and more if we're more communities as our accelerated spend continues on capital and we continue to drive more.

Our product intensity and lastly, the integration of our M&A activities to drive more efficiency and effectiveness.

Based on these factors, we reaffirmed all of our financial targets for 2022.

Consolidated net income was up 21% year over year, while adjusted EPS grew 11% free cash flow of $415 million in Q1 increased $94 million over last year, largely from higher EBITDA lower cash taxes, lower handset upgrade volumes and partially offset by.

Our accelerated capital expenditure program.

For 2022, we are currently we currently continue to target free cash flow of $1 2 billion, assuming the volumes of upgrades return in the back half of the year.

Our balance sheet also remains very healthy, including total liquidity of over $2 6 billion and a weighted average pretax interest rate of $3 seven 5% down from $3, 88% last year, and we have minimal debt maturities until 2024.

Our net debt to EBITDA leverage ended the quarter at $3, one eight times, notably excluding the impact of acquiring spectrum licenses, our net debt to EBITDA leverage ratio at the end of the quarter would have been $2 seven X.

Our defined pension plan is stronger than ever with an average solvency position at the end of the first quarter estimated to be at 118%.

Moreover, <unk> has been in a contribution holiday for some of the registry registered funded defined benefit plan since 2018, while our forecasted employer contributions for 2022 are estimated at $32 million down almost $20 million over 2021.

Importantly, our healthy balance sheet positive outlook on our business and attractive fleet free cash flow generation, we extended our long standing dividend program.

We also remain committed to our payout of our dividend payout guideline of $60 to 75% on a prospective basis.

Notably, excluding our accelerated capital expenditure programs, our dividend payout ratio at the end of Q1 was 63% in line with that guideline.

To conclude our Q1 results reflect our consistent execution and operational excellence to drive sustainable value creation for all stakeholders I am confident that we will further extend this proven track record through the remainder of 2022 and in 2023, Robert back to you. Thanks, Doug Mihai can we proceeded.

Your question please.

Yes of course.

Our first question comes from.

Bryan from.

Sorry.

Please go ahead.

Yes. Thank you for taking my questions. The first question is on.

On the pure fiber lifespan of six year or more maybe this wasn't the filing but I haven't seen it yet is this whats being used currently for a further depreciation and second question is on is on the healthcare.

Division pretty decent set of Kpis that you have reported.

My view good to see amid the reopening and definitely clashes with public valuations have done recently and that's like there I'm wondering if you expect.

Growth, we're seeing in virtual care member and over our lives covered to be sustained for a while.

Okay on your first question.

Our depreciation lives for our county are actually 30 years. So we are more conservative on that front and.

It aligns more with.

The industry practice, so similar to copper.

Amortization LIFO accounting was much shorter than the actual utilization of that asset.

In terms of the health care question.

I see significant opportunity to continue to scale that business.

We see significant opportunity to scale the business on a direct to consumer basis, with our Medicare offering which is doing extremely well.

Of course, it fits very well with our home bundle.

As it relates to our data services right up to security home automation and the like health fits elegantly within that portfolio.

Not only does it have nice attributes in and of itself in terms of serving the health needs of the household but it helps drive better economics of the bundle in terms of the revenue per home, but also critically a lower churn rate because we get better stickiness with that service huge opportunity on employer based health care solutions.

<unk> to continue to drive this capability set with our virtual care capabilities.

Significant upside and if you think about all the business relationships that <unk> and his team have across Canada.

This market penetration is huge what I really like about it is that our virtual care capabilities fit within the enterprise market General business services up market mid market right down to the small business market. So the.

The ability to hit all of those sectors I think is.

Tantalizing for this organization in terms of upside growth potential and then there is also scope economies because it's not just the virtual care capability, we're adding products and applications onto it all the time, including our.

<unk> into the.

Market, what we're doing with our virtual pharmacy capabilities, where I think there is huge upside within the virtual pharmacy capability set that would be extremely interesting and then folding in additional services synergize in if you will our virtual care capability with our EMR.

<unk> are with our clinical environment, and so I think that's tremendously exciting and even within the clinical environment to be able to go to the.

Almost 30000 doctor relationships that we have across Canada, and say, here's where you can take a virtual capability and married up with the physical interface that you have with their patients.

In terms of bringing new services to bear within our existing EMR relationship. So I'm very bullish on these capabilities going forward.

I think there's even opportunities eventually for international expansion on that front as well.

Great. Thank you that's helpful.

Thanks, Rob next question please.

Of course next question comes from Golar.

Good luck with the year from Canaccord. Please go ahead.

Good morning, Thanks for taking my question. The first one is on <unk>.

The monetization around <unk> on the consumer side, I think Darren you talked about that a little.

As you think about pushing that to the next step.

Kicked off sort of the spirit speed tier model and it seems like some of the others are adopted as well what are your thoughts on sort of monetizing our investments in <unk> on the consumer side are you seeing.

Newer ideas in terms of the way you want to sort of.

Set up the pricing of used cases, and so forth. So that's the first question and then secondly.

With respect to tell us help just to kind of push a little bit on that on your comments earlier is it your intent to sort of move down more of a push.

We grow faster on the virtual care and connected care side of things or do you sort of want.

Lean more towards the higher margin <unk> type.

Type segments, especially as you think about a potential spin out down the road as well.

Just wanted to get your thoughts on those.

Okay I think what we'll do is we'll kick it off with Jim to talk about <unk> monetization and consumer.

I'll ask after Jim Nadeem, just to have a very short piece on the monetization opportunities of <unk> on <unk>, because I think those two bookends are important then you need to look at by monetization.

<unk> and then I'll close it out in terms of my health ranking.

Uh huh.

Thanks for the question, we're excited about the <unk> monetization and consumer.

We implemented two core parts of our consumer strategy in Q1, the implementation of speed tiers going to 100 Megabits per second in flanker 250 for five and up to one gig for <unk> plus <unk>.

And I think what goes hand in hand, with that is creating compelling reasons or <unk> speed tiers.

And unlimited plans and to that end.

Doug mentioned this week we.

We launched <unk> plus or <unk>.

New plus.

The first of its kind over the top bundle of Netflix Apple TV and discovery, we saw extremely.

Extremely encouraging demand out of the gate customer feedback has been very strong and sales rep feedback out of the gate.

As well as very strong loading.

And it also creates more product in intensity nationally, including with our eastern customers, which will drive lower churn.

Yes, so were progressing and does looks very.

Very very strong.

Okay.

Yes, Thanks, Jim I'll, just talk up a bit on the <unk> side.

So <unk> is a very exciting area of development for us and as we've said on previous calls <unk> is more of a marathon than it is a sprint.

To give you a little bit of context Iot enabled by <unk> is a nine figure business for us and it's driving double digit digit growth for <unk>.

For Telus and its a tremendous area of opportunity and an important part of our EBITDA acceleration strategy.

And allows us to continue to outrun legacy declines and BBB.

Just a few.

Examples so.

Our immediate focus is on expanding <unk> connectivity through various solutions such as fixed.

Fixed wireless HSI, a monetizing mobile edge computing network slicing.

Private <unk> networks basic connectivity of devices, working with Oems and both basic and advanced fleet solutions and then beyond connectivity. We're also building out our ecosystem of integrated Iot and SaaS solutions that address.

Key challenges in specific verticals and Horizontals all at once again enabled by our <unk> network. So a couple quick examples on how we're commercializing and monetizing <unk> and Iot. So first in Q1, we signed our largest enterprise deal for connected worker solution.

Thats really focused on improving employee safety and productivity and that was one deal for over 500 employees.

Also this past quarter, we began rolling out new public safety solutions, and our smart city portfolio, So, including next generation 911, and mission critical push to X solution. So both first of their kind in Canada, allowing for greater information and accuracy to respond to emergency.

Please.

And then one last example in agriculture, we're growing our focus on farms and ranches in Canada building on the momentum of our decisive and farm at hand acquisitions to offer a broader set of.

Iot enabled solutions and improved connectivity.

And actually I'll do one more in health, we're actually piloting connected ambulance solutions to improve real time communication and collaboration between paramedics and health providers. So so we're really excited by the quality of the use cases that <unk>.

We will provide to.

To really drive that strong commercialization and monetization and we are quite pleased with the foundation, we've built and the growth that we're driving off that foundation.

So just to bring it home on the on the health front.

I'll give you two cuts it did.

Terms of how we look at the health business. So on the HBM front, you can look at that as the mature part of our health business.

The EMR component you can look at as.

Foundational an anchor with growth attributes.

And the virtual care and virtual care plus as.

As a significant growth engine opportunity so to use your vernacular.

<unk> would devalue EMR with deep value with growth and DC would be a growth story virtual care plus in that regard. The reason for that is the opportunity is so significant on virtual care to be able to hit the consumer market and all of the business market and to do it on an integrated.

<unk> with our telecommunications services and all the channels that we have to deliver that and support that.

A pretty potent opportunity also in the virtual care front the opportunity the opportunity keep bolting on additional applications and features and products some of which I've already articulated.

It gives us both scale economies and scope economies.

That are tremendously exciting and then the thing about virtual care is that it's so easily integrates.

So when you've got a virtual care relationship whether its business or consumer you've got an easy step to virtual pharmacy, and what we want to do to scale that part of our business. It's easy to inculcate the EMR component on that front as it relates to virtual care EAP offerings, it's great.

To be able to fold in our 16 clinics across Canada in terms of the physicality of those services and even on a regulatory basis.

Need to have both physical clinics combined with virtual care is really truly a way of the future and you can see that regulatory assistance already in place in certain regions within within Canada.

Also on the teller working side of things. If you think about our D to BD strategy and what Tony is building on five <unk> and fiber to the extent to which the.

The working topology post the pandemic is going to be different than what it was before with more people working from home to be able to deliver our health solutions into the home environment are Virtualized health solutions into the home environment is another fantastic attribute of what we're doing.

And so there's just so many angles on the growth that frontier I think I would say, yes, we have a bias to that particular product line.

That's really helpful. Thank you I'll pass the line.

Thank you.

Thanks next question please.

Yes next question comes from David Joyce from Barclays Capital. Please go ahead.

Thank you.

Two questions. Please first I was wondering how we should think about the cadence of subscriber net addition trends this year.

Granted there were no kind of lapping some of the Covid impacts you still have very strong.

Stronger than expected net adds in the first quarter, but there was a deceleration. So I'm just wondering what sort of seasonality, we should be thinking about this year.

And then separately I know.

On your footprint your.

Our focus in the immediate term is to migrate off of copper but.

What could the expansion possibilities.

And the jets beyond Europe .

Current footprint.

Economically make sense either funded on your own or with various government programs. Thank you.

Great. Thanks for the question much appreciated.

I'll ask Jim <unk> to comment on the net adds front prospectively in terms of what they're seeing.

And then Tony can talk about where we're going.

On the technology front.

The growth related technology and decommissioning the legacy.

Thanks, I mean, we achieved another quarter.

<unk>.

Outstanding performance, driven by maintaining focus on sustainable and high quality of loading.

And some of the drivers behind that.

Having a lot of success with our mobile in home playbook.

We are getting better and better targeted marketing and channel programs.

We tend to be maybe a little bit more counter cyclical in our loading.

Getting loading during low.

Lowest periods versus highest in periods.

Which is all very encouraging.

When you look at the competitive environment I would characterize Q1 stable disciplined.

And there was some regression in flanker, but overall.

A pretty normal cable cut environment.

<unk>.

And we're seeing traffic returning tourist stores, which is good but the really interesting thing is is we're also seeing growth in digital so the progress and the gains that we've made on digital are carrying through even with their stores.

Accelerating and.

And so.

We feel really bullish about the subscriber loading and feel very good about where it's going.

On the fixed side casino will top up.

I think what we're seeing is.

Monthly sort of.

Churn impacts on things like moving and a higher degree of mobility with respect to some of our customers in the wireline side, but our focus is always been an expansion and acceleration of our pure fiber footprint driving penetration and on product intensity and so can you.

To Jim's comment on the mobile and home front, we're seeing a great opportunity to continue expanding our mobile in home based as well as product intensity beyond that.

In Q1, you saw a very strong.

Performance on Smart home security and we will continue to drive product intensity through that vehicle as well as continue to scale our health offerings.

In the BDC space and it's the contribution of all of those activities as well as the continued desire for customers to want to get the capacity speed reliability of pure fiber that we feel is a very sustainable trend into the longer term. So I think we will see some mild.

Sure.

Different is in churn behavior on a month to month basis, but from a sustainable standpoint, we feel very confident in our plan and confident in that product intensity focus that we have.

Thanks <unk>.

Thank you David one other thing I think thats.

Important to understand from the <unk> approach is we've been very successful working with federal and provincial government.

Our capital tool to work with subsidy from the government to build efficiently on time to budget with better committed achievement on outcomes. These remote and rural communities. We've had 100% success rate over the last year and a half of achieving.

All of the subsidy allocations that we've submitted a bid on.

And that in part as part of our success story in terms of how we execute on the deliverable. Additionally, when we look at the opportunity to expand to adjacent areas our existing fiber footprint.

Quite often with the population pop.

Population growth, we can see new opportunities that will present, a few years ago that allow us to extend that fiber footprint and with the new technology of <unk> fixed wireless we are able to look at effective alternative solutions, which would be hastened if there were smaller public policy on spectrum.

We could actually deploy.

Getting solutions to those remote rural communities on a much faster basis, but collectively we're really excited by the opportunity. Our current footprint represents to continue to build out and if you looked at our current penetration of built properties too.

Subscribe as you can see it's nearly 50% and if you think about the time it takes to build into.

Our newbuild footprint to get penetration that would give you an indicator of where we are a more mature markets and that really is.

Future opportunity for us to really continue that success and drive great customer growth on a continued basis.

Great. Thank you very much. Thank you David next question. Please.

Of course.

And just to remind everyone to ask a question. Please press star one to get in the queue and the next question comes from Stephanie price from CIBC. Please go ahead.

Hi, good afternoon.

Two questions as well the first would be just a congratulations Anthony described within the business and also on the.

This quarter I'm, hoping you could talk.

A little bit about the drivers.

But the trajectory going forward.

Alright, and then my second question would be on churn, so Q1 churn numbers.

Gross adds in <unk>, Kentucky market activity.

This harvesting, but it does churn rate.

Alright, great.

Thanks, so much.

Thanks, Stephanie John why don't you talk to the growth drivers and the potential for the asset a consequence on the AG front.

Absolutely. Thanks for the question so well.

One of the first places I'll start us off with food beverage and consumer goods.

The third largest in the world as we as we think about food promotion and demand fulfillment, our technology and insights is really leading a tremendous amount of growth in that area and not only does that fuel our year over year growth, but it also creates an opportunity to then feed information back across.

Horizontally to the food value chain in terms of supply planning demand planning demand forecasting, creating tremendous value more predictive analytics more prospective value than we have today or have seen in the past in that in that supply chain. If you go to the other end.

Our growth also extends into AG retail as well as AG manufacturing, where we're helping fill demand for growers.

On the products that they buy through retail from manufacturers as well as fulfilling agronomy based services like seat scripting and fertility scripting. So these are both big areas of growth and then the key for US is our <unk> platform and the way we're building out technology to really build in between those two and feed inform.

Nation. So we can effectuate that 10 trillion dollar industry.

In terms of churn.

I don't think the recipe here is a well kept secret. So I'll just highlight Stephanie the components. Because this really is a huge part of the tell a story on a global basis.

So I'll start given we're a technology company with technology.

When you consistently have the best broadband networks in the world.

And we do.

That makes a huge difference to customers.

From the speed at.

In components and latency considerations, but also expansiveness reach and the robustness of the service from a reliability point of view.

And we are always in the top three year in and year out on a global basis in terms of network quality excellence across both wireless and wireline secondly, we've been a customers first the organization now for 14 straight years.

It is the consistency of that focus and the application of the execution across the totality of this organization.

Made that that difference we provide the best customer service of any telco on the planet and it's completely embedded in the ideology and the culture of this organization is our people that make the difference are higher levels of engagement directly signed typically translate into better customer serve.

As outcomes, which translates into not just lower churn, but their propensity to buy additional services from US which leads me to the next point, we have an organization that launched the first strategic imperative back in 2000, and this is now 22 years old which is to offer integrated solutions across.

Our wireline and wireless operations that differentiate us from the competition in a word we are bundling bundle. There is a quality products, where it's not just the product in and of itself, but how those products co exist and how they are interoperable to create that stickiness and that value proposition that we deliver for the <unk>.

And we are very good at doing that from product development to channel delivery in terms of our bundling thesis.

Number four we eat our own gourmet cooking. So you hear John talking about data analytics year, our strep health strategy in terms of data analytics, where we do data analytics when it comes to customer service.

And there's no one that's better than not that predictive churn models and responses.

The light so we do the math and that guides our actions because their scientific and those actions are more efficient and effective as.

As a result.

We don't just put customers first we put community's first we are the world leader in social capitalism that drives a higher level of engagement and performance mentality within our culture, because we have a higher calling we have a better intimate more emotional connectivity with our communities and people know that when they give their business that tell us.

Because of our social purpose thesis that money is going to come back into their community and be put to work in terms of better health outcomes better educational outcomes better educational environmental outcomes and also passionately we're bridging geographic device. So there's not one growth on the digital front within the urban construct.

But digital extends from urban to rural and we're also bridging digital device on the socio economic front. So that we don't have a society of haves and have not everyone gets a chance to realize their full potential because we arm them with the technology to do exactly that and when you have that level of affinity and intimacy with the community.

Across all those various components people want to stay with us they want to do business with us because at the end of the day they get the why of the Telus organization not just what we do but why do we do it and an excellent isn't a nonrecurring event, it's something that you need to demonstrate year in and year out look at the loan.

<unk> of our performance as it relates to world, leading churn. It's nine years now where we've been sub 1% people never thought that we would get blended churn below 1% only postpaid and look at what we've done not just on longevity, but dual horizontal cross section where five of the lab.

Eight quarters, we've been below 1% on mobile on Internet on TB on security and on voice services. So we've done it from new growth services to anchor services to legacy services, all below 1% to me that speak to the consistency, but those aforementioned parameters are.

The reason why we deliver that result in I think it portends well.

For our positioning in the future and the comments that Jim made and then I'll make in terms of our ability to continue to grow at the net adds at level and also as it relates to value because the people that are sticky clients with us are high value clients.

That's great color. Thanks, so much.

Thanks, Stephanie we will take our next question. Please.

Yes of course, our next question comes from Vince Valentini from TD Securities. Please go ahead.

Yes, thanks, very much two questions on mobile <unk> first to bit of a clarification you talked a couple of times about the stream plus offering.

Sure. It's clear if somebody starts paying you for Netflix and other streaming services through their <unk>.

Our phone connection youre going to count that as mobile service <unk>.

I'll take it yes.

Yes go ahead, Jim Okay. So.

Sure.

We are reallocated to actually home solutions.

So it's not impacting <unk> I think the thing that is driving our proof from stream plus.

Is the connection to our speed tiers, and so what we're seeing with stream plus customers are they're taking our five <unk> plus plants and thats exactly what we want because this is driving that escalator.

<unk> up to bigger data bucket unlimited plans with higher speed profiles and in our first two weeks that's exactly what we're seeing.

And.

And the take up of demand is double what we had expected out of the case so were.

We're very excited about that and you know events.

There are few things on <unk>.

I would like to say.

We realized nearly 6% revenue growth versus Q1 2019, we've had four straight quarters of year over year revenue growth. Our Q1 exit ARPA growth from March was one 7% and were seeing that carrying into Q2. So we're feeling very bullish.

The current rate plan value step up.

Is up across Activations renewals and re plan changes all up year over year and month over month, and we are seeing steady recovery on roaming and the price increases that have been mentioned on roaming are starting to flow through in Q2.

And we're seeing the early success from speed tiers and stream plus so when we look prospectively.

We're feeling very good about where this is going.

Thanks, Jim Iot operations Yeah.

Yes, thanks for that clarification.

That's why I thought you would've reported anything we're just we're.

We're just confusing the way <unk> presented the first the other question.

It was directly to what you were just saying.

I totally understand the two year growth comparisons that your peers had much bigger drops early on in the pandemic. So they may be having just easier comps and bouncing back. So you are very valid and playing that out but I'm looking at the absolute dollar of <unk> give me honest I'm confused because I know you guys are focused on quad.

The loading I look at Q1 last year Youre your blended ARPA of $56 10.

50 to 90.

Higher than the other two national carriers and now this year in Q1, you're sort of that much lower than the other two so theres been a big swing just on the absolute dollar of RP would forgetting about the one year or two year growth percentages is there something weird going on here the timing of.

When <unk> 15 hits or something to do with the prepaid postpaid mix or something else I'm not sure why the absolute dollar <unk> tell us would not be lower.

Yes, so I'll start Joe.

On the one so two things that come to play as one there's mix issues between obviously, our organization and others on the prepaid mix versus postpaid when we changed our segmentation in 2022 interim.

Intercompany revenue also is now eliminated zero inter company in <unk> within our organization.

Then there is and Jim can highlight the promotional activity and how <unk> <unk> Lone drew why don't you take that Ken.

A couple of things one I think there is an equipment margin.

Dynamic.

That is.

That kind of clouds the comparative.

And that drives an amortization impact that could be.

You know a few dollars actually so.

That's one aspect of it.

And Vince look ARPA is also not the only metric we're focused on revenue flow through to EBITDA and lifetime value are also critical.

<unk>.

We're really happy with what's happening on both of those measures channel digital simplicity.

Grams, driven significant cost reductions for us in some hardware and some.

Some part examples are digital and direct transition transactions are up 104% versus 2019, we've taken out 20% of all of our mobility calls.

Which have been offloaded from our call centers and yet our service levels have improved and our physical channel loading is increasing and then when you look at lifetime value.

As Darin had mentioned before we're up to 45% higher on lifetime value than our major national peers, and our industry, leading mobile postpaid churn of <unk> six 3% I don't think youre going to find better results than that and thats coming from bundling and it's coming from our focus on.

On high value customers and so when you take those three metrics together.

They are driving.

Really good revenue to EBITDA flow through outcomes for us and I think that's where the money is and that's.

That's a great outcome for us.

Vince to Jim's point on the IRS 15 amortization the sooner you move to more disciplined on subsidy.

Sooner Europe amortization periods. So the fact that we were early in the stage of being.

More upscale upticks on our rate plans and more high value loading the amortization impact will be different as that two year runway comes to an end.

Okay. Thank you.

Thanks, Vince I mean, how do we have time for one more question. Please yes of course last question comes from drew Mcreynolds from RBC capital markets. Please go ahead.

Yes, thanks, very much and good afternoon, two for me, maybe starting with you Doug just to level set expectations here I think we all knew.

The gate here.

Relative to your full year guidance, we're going to get lower year over year growth rate slightly just wondering how that.

At the moment, you see that kind of building through 2022 in terms of cadence.

And then secondly.

No need to drill down too much on this but.

Obviously certain center in this kind of market and environment.

Inflation, and then kind of cyclicality of recession.

And I think a lot of us on this call I haven't really seen.

<unk> go through much of any of that so just at the high level.

Would appear these assets.

Suddenly should prove resilient for a number of reasons, but just wanted to get some high level thoughts there. Thank you.

Yes, so on that trajectory and we expect continuous improvement as we go throughout the year.

On our overall.

Progression on EBITDA growth when you think through the <unk> initiatives that we just talked about we think about the continuation of copper to fiber migrations in the loading trajectory that we had.

<unk> margin improvement as the year progresses, and then AG and health margins as we integrate and grow.

Those portfolios all of them are on the upward trajectory.

As we look we look forward, so I'd say, it's going to be steady throughout the year and youre going to see that progression on a quarter over quarter basis.

From Jeff's call. This morning on the Ti call, Jeff had a very good.

Good answer too I recommend you listen to the recession side of Ti.

When you think through that what Ti has to offer.

They are actually enabling organizations, even such as tell us during a recession period with digitization with <unk>.

Team members that actually help them significantly through a recession. So the customers they have and the diversity they've built within the organization actually lend us very well to be an enabler and helping organizations through that period and yes, it's not quite recession proof, but the diversity as well as the.

Enablement definitely.

Gives them a leg up on a an opportunity front.

Darren do you want to take.

No I think Thats, well said, Doug in terms of.

And how I don't think and I think as inflation proof, but I think these are resilient businesses for us given the essential service nature of these businesses.

And how people behave within the digital economy.

Digital society, so the necessity on health necessity on food.

It gives us a strong level of resiliency. The other thing that I think John range would say.

When your data analytics thesis is driving better efficiency within the sectors that you are seeking to serve that played very well during an inflationary period.

The other thing that I think is interesting of hotels is that we have such a diversity of our asset mix from what we're doing within our core telecoms portfolio on data services in our evolving that so what we're doing on Ti how AG and alike, I think that level of diversification gives us a better.

<unk> backbone of resiliency, whether it's inflation or supply chain pressures that we're dealing up simultaneously and then you have to respond proactively and I don't think very many organizations have managed exogenous events over the past 22 years are better than what we've done.

Whether it's equity market meltdowns, our credit crunches, a regulatory decisions were inflationary periods, we seem to navigate that turbulence very well and I think that's down to the quality of the team and then we have a pretty resilient strategy here. So I think we're the most progressed in terms of our digital capability.

That that can really help us when we are experiencing wage pressures from inflation.

Drive that digital thesis.

We have the benefit of being able to access labor arbitrage.

So yes, we've got pressure they've got pressure, but to the extent to which we can use the ti asset to support buttress. The economics of <unk> Corporation I think all the better and then we got to keep being more and more efficient all the time to make some difficult decisions as it relates to cost reduction programs, but I can tell you one thing.

As an organization that really centers on the thesis of bundling if you our product intensity centric I think you'll do better during inflationary period, youll experienced bumps, but youll manage them better along the way.

Excellent. Thank you.

Thanks drew and thank you everyone for joining us today, please feel free to reach out to the IR team with any follow ups, Okay take care everyone.

This concludes the teleconference.

22, Q1 earnings call. Thank you for your participation and have an understanding.

Are your luxury at Harvard business.

[music].

Good morning, everyone and welcome to the Telus 'twenty 'twenty to Q1 earnings conference call.

I would like to introduce your speaker Mr. Robert Mitchell. Please go ahead.

Hello, everyone and thank you for joining our call today, our first quarter 2022 results news release, MD&A and financial statements and detailed supplemental supplemental investor information, we posted on our website. This morning at Telus Dot Com slash investors on our call today, we will have remarks by Darren.

John <unk> President of our Agriculture business Dove. In addition for the Q&A portion of our call will be joined by <unk> <unk>, who runs our consumer business, Jim Senko, who leads our mobility solutions business now being Aurora, who leads our business solutions and Tony <unk>, Our Chief operations Officer.

Briefly on slide two this presentation and answers to questions contain forward looking statements are subject to risks and uncertainties and made based on certain assumptions. Accordingly actual performance could differ from statements made today. So we ask that you do not place undue reliance on them, we disclaim any obligation to update forward looking statements, except as required by law and we refer you to the risks and assumptions as outlined in our public.

Closures, including our first quarter of 2022, MGA, our annual 2021, MD&A and filings with Securities commissions in Canada, and the U S with that over to you Jeff.

Thanks, Ricardo and Hello, everyone.

Telus once again achieved strong operational and financial results in the first quarter of 2022.

Our ongoing execution excellence continues to be characterized but its consistent combination of industry, leading and profitable customer growth, yielding strong financial results across the totality of our business.

Industry, leading told total mobile and fixed customer growth of 148000 represents the strongest first quarter on record for our company.

This reflects robust demand for our superior bundled offerings and customer service over our world leading broadband networks.

Moreover, our leading customer growth was underpinned by industry best client loyalty across our key mobile and fixed product lines.

Notably again this quarter and for five of the last eight quarters blended mobile phone pure fiber internet optic TV security and voice churn were all below 1%.

Furthermore, since the onset of the pandemic at the beginning of 2020, we've welcomed an industry, leading one 9 million net new customers.

Telus achieved strong first quarter consolidated revenue and organic EBITDA growth of six 4% and seven 6% respectively.

Strength in our core telecom operations continues to be complemented by a highly differentiated and potent access mix geared towards high growth technology oriented vertical.

Notably comparing the first quarter of 2022 with that of 2019 prior to the pandemic total revenue grew by a leading 22% while EBITDA grew by 14%.

Moreover, since the beginning of 2020 and the pandemic period, <unk>, driven leading cumulative revenue and EBITDA growth of over $4 billion and close to $600 million risk.

Respectively.

Let's turn now to take a look at our mobile operating results.

Notably this brings the sum total to an industry, leading $1 3 million net new mobile phone subscribers and connected devices achieved since the beginning of 2020 and the onset of the pandemic.

Blended mobile phone churn was 081 percent representing an eight basis point improvement from this time last year. The best Q1 on record and only one basis point off our all time lowest churn ever.

Clearly something that we need to fix in Q2 coming forward.

Moreover, postpaid mobile phone churn of zero down six 3% represented a nine basis point improvement over 2021 and puts US now in our ninth year of postpaid churn below 1% well below 1%.

This consistently strong performance is backed by our highly engaged teams who are passionate about delivering outstanding customer experiences in combination with superior service offerings and digital capabilities over our world, leading wireless and pure fiber broadband networks.

More than ever.

Indian value of fast.

Reliable connection and the consistent recognition from independent third party organizations reinforces the superiority of <unk> Global network.

During the quarter independent UK based open signal named tell US number one in respect to the fastest <unk> download speed in Canada for the third consecutive time.

Impressively open signal confirm that tell us consistently had and I quote the fastest <unk> download speeds of any operator since open signal started reporting on the <unk> mobile experience in Canada close quote.

In addition, U S based <unk> once again named talent the fastest mobile operator in the first quarter confirming that intelligence ranked first in every quarter <unk> had since Q3 of 2020.

Moreover, Intel has placed first in respective by GE performance for the first time according to <unk> B test.

<unk> intends to continue extending this global leadership position as we advance the development coverage and commercialization of our <unk> network and its inherent functionality.

To close on mobile first quarter or.

It was up zero debt, 6% on a year over year basis.

It was supported by higher roaming revenues.

Still distinctly below seasonal pre pandemic level.

Notably mobile phone lifetime revenue of close to $7000 was up to 44% higher than our major peers.

This is reflective of our consistent focus on high quality customer growth and leading client loyalty.

Let's turn now and take a look at our fixed operating results.

Telus delivered another quarter of industry best wireline customer growth.

We achieved industry, leading first quarter Internet net additions of 30000, albeit down slightly due to the modestly higher churn as compared to the very low rate. We saw earlier in the pandemic period.

Strong security net additions of 26000 were up 9000, or 53% increase over the previous year, representing our best first quarter on record a terrific performance from that team and indeed with respect to security in March brand spark named <unk>.

This smart home security as the most trusted alarm service in Canada.

We come a long way on the security front and it potent in and of itself, but it is especially effective within our fsh bundle.

This reflects the strength of our industry best portfolio of products and services, leading customer centric culture as well as our strong and differentiated social capitalism backed brand.

We continue to drive healthy growth in TB with net additions of 10000, which was essentially flat over the prior year.

Furthermore, residential voice line losses of 10000 or steady on a year over year basis.

Overall industry, leading total external fixed net additions of 56000 were up 10% on a year over year basis, driven by our unique and highly attractive bundled offers across our superior product portfolio as well as our leading customer loyalty and those two.

Things are great in combination.

Notably since the beginning of 2020 independent make period, we have welcomed a leading 551 big.

<unk> customer additions.

<unk> to our go to market operations, and our efficiencies within our back office operation.

These generational investments will and concert fuel enhanced customer growth and operating efficiencies in combination.

At the same time, our investments will also drive positive cash flow benefit as we complete our expedited broadband build largely finished our copper to fiber migrations by year end and continue retiring our remaining copper infrastructure all the while enjoying.

Strong EBITDA expansion.

Importantly, and I think this is key for investors, we expect our pure fiber network assets to have light spans of 60 years or more.

In addition, as significant social and economic benefits for all Canadians. This long term infrastructure and technology will continue to drive material cash flow for decades to come.

Now, let's take a look at Telus health.

Our team once again drove double digit year over year health services revenue growth, whilst continuing to meaningfully scale our health operations.

This scaling includes our healthcare programs covering 22 million lives in Canada, an increase of more than 25% on a year over year basis.

This scaling includes executing 148 million digital health transactions during the quarter up 5% over last year, and an enclosed earning $1 3 million net new virtual health care members in the last 12 months, increasing our membership that $3 3 million, which.

<unk>, a 65% year over year increase.

We continue to leverage our leading position in healthcare technology solutions to deliver improved health outcomes for employees and citizens delight through access to better health information, which of course has never been more critical.

Turning to agriculture.

They were introducing expanded disclosure <unk> agriculture.

Notably agriculture and services revenue was up 37% in the first quarter on a year over year basis, driven by our team's ongoing efforts to integrate and grow this unique and differentiated global business.

This performance is illustrative of the significant value we are trading as the leading provider of agriculture, and consumer goods technology and data analytics around the world.

Importantly, we are advanced in this sector as the efficiency and effectiveness and food quality production through data analytics and technology solutions. We are confident that our expanding disclosure further illustrates the value and asset of consequence, we are creating in this important.

Area.

And just a moment Jon range is going to have an opportunity to provide further color on this exciting business and its exciting growth prospects.

Let's turn now and take a look at Telus International.

Earlier today, <unk> International announced strong double digit revenue EBITDA and free cash flow growth for the first quarter.

Continued robust results demonstrate consistent execution attractive end to end digital capabilities and position as a leading partner of choice for Premier digital customer experiences and services with an enviable list of clients on a global basis.

This highly differentiated offering notably includes content moderation data annotation and artificial intelligence solutions.

And it's great to see the growth coming from Ti on a revenue EBITDA and free cash flow basis, when its organic growth that we're reporting again.

Doug is going to have an opportunity to provide further commentary on both our intelligent international and key tack financial shortly.

<unk> leading dividend growth.

Today, we announced for the fourth time since 2021, the extension of our industry best dividend growth program.

Telus is again targeting 7% to 10% annual growth for 2023 through 2025 supported by our positive business outlook and accelerating free cash flow growth story, clearly, we're entering an era, where the sources of cash are going to chronically.

<unk> exceed the uses.

Further dividend growth and affordability will be supported by a strong EBITDA growth outlook in our telecom data services portfolio complemented by significant value creation in our Ti health and agriculture businesses. What has differentiated story that is for this organization.

It will be further bolstered by our lower future capital expenditures and our cost reduction program.

The clothes and from the head and from the heart I'd like to recognize the tremendous thoughtfulness of the entire <unk> team and the passion with which they give with their hearts and their hand, this supporting communities across the globe by.

And on that note over to you Mr. <unk>.

Thanks, very much Darren and Hello, everyone. It's a privilege to speak with you today.

I approached six months, leading until its agriculture, my gratitude goes out to Darren and the executive leadership team, our valued customers and of course, our incredible <unk> hundred team members around the world.

For their unwavering support and commitment to excellence over the last six months.

<unk> culture is much more than a production agriculture company.

The food and consumer goods value chain is woefully under digitized, including a lack of connectivity and it's certainly not optimized by data, resulting in sub optimized insights and actions at.

And tell US agriculture, we are the largest independent data insights and digital technology company.

Providing service across the value chain in the agriculture industry.

To further our competitive advantage, we are investing significantly in a digitized platform.

AVX or AG data exchange platform will enable us to deliver data insights and execute on data transformation from seeding prescriptions to food promotions.

By combining the strengths of Telus Agriculture's products and service and tell US leadership in Iot and <unk>. We believe we can deliver even greater value and accelerate business for our shared customers and telos agriculture and tell us business.

One third of all food produced in the World is lost or wasted each year due to issues in processing transportation or planning.

When food is discarded.

All inputs used in producing processing and transporting is also wasted.

The food waste that ends up in our landfills has a significant impact on greenhouse gas emissions.

We have a massive opportunity to help the food industry battle against food waste and more importantly, food in security.

We can help grocers distributors and consumers reduce perishable waste and improve the safety quality and sustainability of our food.

We are utilizing machine learning to generate more accurate forecast combined with real time retail planning and execution.

Tell us agriculture has several capabilities that allow us to digitize and optimize activities for our customers at each end of the food value chain with these anchor assets. We are now uniquely positions to optimize the supply chain by passing data not only up and down with.

And the verticals, we serve look horizontally across the entire value chain.

The formidable power that results from bringing these assets together through the investments in our platform is the unique value proposition that we offer in the market.

Hundred team members globally, who are dedicated to empowering the industry with digital technologies and data insights and ultimately, creating the best producer to consumer outcomes.

With that I'll turn the call over to Doug for an update on tell US Q1 financial results Doug over to you.

Q1 2019 period.

This ongoing recovery will support <unk> growth as we progress through the year and into 2023.

On roaming we are focused on driving sustainable our Peru improvements by executing on our five <unk> monetization strategy, including our speed tier plans and the launch of stream plus a new OTT streaming bundle, but gives you new and existing or new and existing tells customers simplified access to net.

<unk> premium.

Apple TV plus add discovery plus.

It's also important to clarify that when we involved our new reporting segments. In 2021, we no longer include any internal network service and our <unk> calculation.

As demonstrated again this quarter, we continue to focus on strong and profitable subscriber growth, which includes strengthening our industry leading churn profile.

Through this attractive combination and improving <unk> and leading churn in Q1, our lifetime revenue per customer was up 11% to $7 yes.

This result is even more impressive considering our product bundling efforts across the mobile and home.

In this regard we have seen impressive trends towards greater product intensity for example, the number of households in our.

With our four or more products is up over 11% year over year, while households, with five products is up 38% year over year.

This strong product intensity.

Trends lead to materially increases in customer lifetime value through the greater revenue per household as long as as well as strong customer loyalty.

Additionally, we continue to make meaningful investments in Digitization and simplification to drive down our cost structure, while improving the customer experience.

Fixed data revenue, which now excludes both agriculture services revenue and health services revenue grew five 2% year over year.

Underlying our fixed data growth.

As a result of our residential internet growth, which grew an impressive 14% year over year as we continue to drive market share gains as well as higher <unk> as customers continue to move to higher speeds and recognize the value of our superior fiber and bundled offerings.

On the <unk> front inclusive of both mobile and fixed services, we saw positive trends continue and revenue and EBITDA on a year over year basis.

At the segment level <unk> revenue was up four 2% or 6% when excluding the low margin mobile equipment revenue, which declined from consumer behavior towards longer upgrade cycles and greater.

Meanwhile, <unk> adjusted EBITDA grew by 1% year over year or 6% on an organic basis, excluding the delayed net dilutive impact of J curve M&A in the financial services divestiture.

<unk> revenue was up 19% adjusted EBITDA up 25% and margins improved 120 basis points year over year.

Importantly, <unk> reaffirmed its full.

<unk> full year guidance and the team remains on track for another strong year of double digit growth and attractive margin profile overall.

Overall, our consolidated revenue grew six 4% year over year or eight dot, 2% when excluding the mobile equipment revenues.

Consolidated adjusted EBITDA grew 7% year over year or seven 6% on an organic basis, we anticipate our growth to continue to grow for the remainder of the year.

This growth is going to come from our <unk> improvements as we progress through our <unk> monetization strategy in bromine recovery.

Improving <unk> trends from scaling our Iot business driving product intensity nationally and offering the best digital solutions to businesses of all sizes.

Ongoing efficiency benefits for multiple programs, including our copper to fiber program and ongoing Digitization efforts continued subscriber growth as we expand our broadband coverage and more if we're more communities as our accelerated spend continues on capital and we continue to drive more.

More product intensity and lastly, the integration of our M&A activities to drive more efficiency and effectiveness.

Based on these factors, we reaffirmed all of our financial targets for 2022.

Our accelerated capital expenditure program.

For 2022, we are currently we currently continue to target free cash flow of $1 2 billion, assuming the volumes of upgrades return in the back half of the year.

Our balance sheet also remains very healthy, including total liquidity of over $2 6 billion and a weighted average pretax interest rate of $3 seven 5% down from 388% last year, and we have minimal debt maturities until 2024.

Our net debt to EBITDA leverage ended the quarter at three eight times, notably excluding the impact of acquiring spectrum licenses, our net debt to EBITDA leverage ratio at the end of the quarter would've been $2 seven X.

Our defined pension plan is stronger than ever with an average solvency position at the end of the first quarter estimated to be at 118%. Moreover, tell us has been in a contribution holiday for some of the registry registered funded defined benefit plan since 2018, while our forecasts and employer contributions for 2022.

Two are estimated at $32 million down almost $20 million over 2021.

Importantly, our healthy balance sheet positive outlook on our business and attractive fleet free cash flow generation, we extended our long standing dividend program.

We also remain committed to our payout of our dividend payout guideline of $60 to 75% on a prospective basis.

Notably, excluding our accelerated capital expenditure programs, our dividend payout ratio at the end of Q1 was 63% in line with that guideline.

To conclude our Q1 results reflect our consistent execution and operational excellence to drive sustainable value creation for all stakeholders I am confident that we will further extend his proven track record through the remainder of 2022 and in 2023 Robert back to you. Thanks, Doug Mihai can we proceed.

Your question please.

Yes of course.

Our first question comes from.

Brian from theirs.

Sorry.

Please go ahead.

Yes. Thank you for taking my questions. The first question is on.

On the pure fiber lifespan of six year or more maybe this wasn't the filing but haven't seen yet is this whats being used currently for further depreciation and second question is on is on the health care.

<unk> pretty decent set of Kpis that you have reported.

My view good to see amid the reopening and definitely clashes with public valuations have done recently and Thats like there I'm wondering if you expect.

Growth, we're seeing in virtual care member and over our lives covered to be sustained for a while.

Okay on your first question.

Our depreciation lives for accounting or actually 30 years. So we are more conservative on that front.

And aligned more with.

The industry practice, so somewhere to copper the amortization LIFO accounting was much shorter than the actual utilization of that asset.

In terms of the health care question, Yes.

See significant opportunity to continue to scale that business.

We see significant opportunity to scale the business on a direct to consumer basis, with our Medicare offering which is doing extremely well.

Of course, it fits very well with our home bundle as it relates to our data services right up to security home automation and alike health fits elegantly within that portfolio and not only does it have nice attributes in and of itself in terms of serving the health needs of the household but it help.

Drive better economics of the bundle in terms of the revenue per home, but also critically a lower churn rate because we get better stickiness with that service huge opportunity on employer based health care solutions to continue to drive this capability set with our virtual care capabilities.

Significant upside and if you think about all the business relationships that Nadine and his team have across Canada.

This market penetration is huge.

I really like about it is that our virtual care capabilities fit within the enterprise market General business services up market mid market right down to the small business market. So the.

The ability to hit all of those sectors I think is.

Doing with our virtual pharmacy capabilities, where I think there is huge upside within the virtual pharmacy capability set that would be extremely interesting and then folding in additional services synergize. If you will our virtual care capability with our EMR environment or with our <unk>.

<unk> environment, and so I think that's tremendously exciting and even within the clinical environment to be able to go to the.

Almost 30000 doctor relationships that we have across Canada, and say, here's where you can take a virtual capability and married up with the physical interface that you have with their patients in terms of bringing new services to bear within our existing EMR relationships. So I'm very bullish.

On these capabilities going forward.

I think there's even opportunities eventually for international expansion on that front as well.

Great. Thank you that's helpful.

Thanks, Rob next question please.

Of course next question comes from Robyn <unk> from Canaccord. Please go ahead.

Good morning, Thanks for taking my question. The first one is on.

The monetization around five G on the consumer side I think Darren you talked about that a little.

But as you think about pushing that to the next step.

Kicked off sort of the spirit speed tier model and it seems like some of the others have adopted as well what are your thoughts on sort of monetizing our investments in <unk> on the consumer side are you seeing.

New ideas in terms of the way you want instead of.

Set up the pricing of used cases, and so forth. So that's the first question and then secondly.

With respect to Telus health, just to kind of push a little bit on that on your comments earlier is it your intent to sort of move down more.

Maybe grow faster on the virtual care connected care side of things.

Or do you sort of want it.

Lean more towards the higher margin <unk> type.

Type segments, especially as you think about a potential spin out down the road as well.

Just wanted to get your thoughts on those.

Okay I think what we'll do is we'll kick it off with Jim.

Talk about <unk> monetization and consumer I'll ask after Jim Devine just to have a very short piece on the monetization opportunities are by E. On <unk> because I think those two bookends are important then you need to look at monetization Holistically and then I'll close it out in terms of.

My health ranking.

Thanks for the question, we're excited about the <unk> monetization and consumer we implemented two core parts of our consumer strategy in Q1, the implementation of speed tiers going to 100 Megabits per second in flanker 250 for <unk> and up to a gig for <unk>.

<unk>.

And I think what goes hand in hand with us.

Is creating compelling reasons or <unk> speed tiers.

And unlimited plans and to that end.

And Doug mentioned this week, we launched stream plus or on new.

<unk> plus.

The first of its kind over the top bundle of Netflix Apple TV and discovery, we saw extremely.

Extremely encouraging demand out of the gate customer feedback has been very strong and sales rep feedback out of the gate.

As well as very strong loading.

And it also creates more product in intensity nationally, including with our eastern customers, which will drive lower churn.

Yes, so were progressing and does looks.

Very very strong.

Yeah. Thanks, Jim I'll, just talk a bit on the <unk> side.

So <unk> is a very exciting area of development for us and as we've said on previous calls <unk> is more of a marathon than it is a sprint.

To give you a little bit of context Iot enabled by <unk> is the nine figure business for us and it's driving double digit digit growth for.

For Telus and its a tremendous area of opportunity and an important part of our EBITDA acceleration strategy.

And allows us to continue to outrun legacy declines and BBB.

So just a few.

Zempel so.

Our immediate focus is on expanding <unk> connectivity through various solutions such as.

Fixed wireless HSI, a monetizing mobile edge computing network slicing.

And that's really focused on improving employee safety and productivity and that was one deal for over 500 employees.

Also this past quarter, we began rolling out new public safety solutions, and our smart city portfolio, So, including next generation 911, and mission critical push to ex solution. So both first of their kind in Canada, allowing for greater information and accuracy to respond to emergency.

Fees.

And then one last example in agriculture, we're growing our focus on farms and ranches in Canada building on the momentum of our decisive and farm at hand acquisitions to offer a broader set of.

Iot enabled solutions and improved connectivity.

We will provide to.

To really drive that strong commercialization and monetization and we are quite pleased with the foundation, we've built and the growth that we're driving off of that foundation.

So just to bring it home on the on the health front.

I'll give you two cuts it did.

Terms of how we look at the health business. So on the HBM front, you can look at that as the mature part of our health business.

The EMR component you can look at as foundational and anchor with growth attributes.

And the virtual care and virtual care plus.

As a significant growth engine opportunity so to use your vernacular.

M with devalue EMR with deep value with growth and DC will be a growth story virtual care plus in that regard. The reason for that is the opportunity is so significant on virtual care to be able to hit the consumer market and all of the business market and to do it on an integrated basis.

As with our telecommunications services and all the channels that we have to deliver that and support that.

That's a pretty potent opportunity also in the virtual care front the opportunity the opportunity keep bolting on additional applications and features and products some of which I've already articulated.

It gives us both scale economies and scope economies.

That are tremendously exciting and then the thing about virtual care is that it's so easily integrates.

To be able to fold in our 16 clinics across Canada in terms of the physicality of those services and even on a regulatory basis.

The need to have both physical clinics combined with virtual care is really truly a way of the future you can see that regulatory assistance already in place in certain regions within within Canada.

Also on the teller working side of things. If you think about our D to BD strategy and what Tony is building on five <unk> and fiber to the extent to which the.

And so there's just so many angles on the growth the frontier I think I would say, yes, we have a bias to that particular product line.

That's really helpful. Thank you I'll pass the line.

<unk>.

Thank you.

Thanks next question please.

Yes next question comes from David Joyce from Barclays Capital. Please go ahead.

Thank you two questions. Please first I was wondering how we should think about the cadence of subscriber net addition trends this year.

But we're now kind of lapping some of the Covid impacts you still have.

Stronger than expected net adds in the first quarter, but there was it would be acceleration. So I'm just wondering what sort of seasonality, we should be thinking about this year.

And then separately I know on.

On your <unk>.

Footprint your.

Our focus in the immediate term is to migrate off of copper.

What could the expansion possibilities.

In <unk> beyond.

Beyond Europe .

Current footprint.

Economically makes sense either funded on your own or with food.

Various government programs. Thank you.

Great. Thanks for the question much appreciated.

Jim <unk> will comment on the net adds front prospectively in terms of what they're seeing.

Then Tony can talk about where we're going on.

On the technology front.

<unk> the growth related technology and decommissioning the legacy.

Thanks, I mean, we achieved another quarter.

<unk>.

Outstanding performance, driven by maintaining focus on sustainable and high quality of loading.

And some of the drivers behind that.

And having a lot of success with our mobile in home playbook.

We are getting better and better targeted marketing and channel programs.

We tend to be maybe a little bit more counter cyclical in our loading.

Getting loading during low.

Lowest periods versus highest in periods.

Which is all very encouraging.

When you look at the competitive environment I would characterize Q1 stable disciplined.

And there was some aggression in flying curve, but overall.

A pretty normal cable cut environment.

Environments.

And we're seeing traffic returning tourist stores, which is good but the really interesting thing is is we're also seeing growth in digital so.

<unk> and the gains that we've made on digital are carrying through even with their stores.

Accelerating.

So.

We feel really bullish about the subscriber loading and feel very good about where it's going.

On the fixed side casino will top up.

I think what we're seeing is.

Monthly sort of.

Churn impacts on things like moving and a higher degree of mobility with respect to some of our customers late in the wireline side, but our focus is always been an expansion and acceleration of our pure fiber footprint driving penetration and on product intensity and so.

To Jim's comment on the mobile and home front, we're seeing a great opportunity to continue expanding our mobile in home based as well as product intensity beyond that.

In Q1, you saw a very strong.

Performance on Smart home security and we will continue to drive product intensity through that vehicle as well as continue to scale our health offerings.

In the in the BDC space and it is the contribution of all of those activities as well as the continued desire for customers to want to get the capacity speed reliability appear fiber that we feel is a very sustainable trend into the longer term. So I think we'll see some mile.

Sort of.

Differences in churn behavior on a month to month basis, but from a sustainable standpoint, we feel very confident in our plan and confident in that product intensity focus that we have.

Thanks <unk>.

Thank you David one other thing I think thats it.

Important to understand from the <unk> approach is we've been very successful working with federal and provincial government.

To put our capital to work with subsidy from the government to build efficiently on time to budget with better committed achievement on outcomes. These remote and rural communities. We've had 100% success rate over the last year and a half of achieving.

All of the <unk>.

Subsidy allocations that we've submitted a bid on and that in part is part of our success story in terms of how we execute on the deliverable. Additionally, when we look at the opportunity to expand to adjacent areas our existing fiber footprint.

It often with the population.

Population growth, we can see new opportunities that werent present, a few years ago that allow us to extend that fiber footprint and with the new technology of <unk> fixed wireless we are able to look at effective alternative solutions, which I might add would be hastened if there were smaller public policy on spectrum.

We can actually deploy.

Get solutions to those remote rural communities on a much faster basis, but collectively.

Excited by the opportunity current footprint represents to continued build out and if you look at our current penetration of built properties too.

Subscribe as you can see it's nearly 50% and if you think about the time it takes to build into.

Our newbuild footprint to get penetration that would give you an indicator of where we are a more mature markets and that really is.

Future opportunity for us to really continue that success.

Great customer growth on continued places.

Great. Thank you very much. Thank you David next question. Please.

Of course.

And just to remind everyone to ask a question. Please press star one to get in the queue and the next question comes from Stephanie price from CIBC. Please go ahead.

Hi, good afternoon.

Two questions as well the first would be just a congratulations on can you disclose within the AG business and also on the growth.

With me you could talk a little bit about the drivers.

But the trajectory.

And then my second question would be on churn so Q1 to another.

Gross Jonathan Kentucky market activity.

I wish things like it does with the churn rate.

Alright, great. Thanks.

Thanks, so much.

Thanks, Stephanie John why don't you talk to the growth drivers and the potential for the asset a consequence on the AG front.

Absolutely. Thanks for the question so.

One of the first places I'll start us off with food beverage and consumer goods.

Our growth also extends into AG retail as well as AG manufacturing, where we're helping fill demand for growers.

On the products that they buy through retail from manufacturers as well as fulfilling agronomy based services like seed scripting and fertility scripting. So these are both big areas of growth and then the key for US is our <unk> platform and the way we're building out technology to really build in between those two and Cid inform.

Patient so we can effectuate that 10 trillion dollar industry.

In terms of churn.

I don't think the recipe here is a well kept secret. So I'll just highlight Stephanie the components. Because this really is a huge part of the tell a story on a global basis.

So I'll start given we're a technology company with technology.

When you consistently have the best broadband networks in the world.

And we do.

That makes a huge difference to customers.

From the speed at.

In components and latency considerations, but also expansiveness reach and the robustness of the service from a reliability point of view.

It is the consistency of that focus and the application of the execution across the totality of this organization. That's made that that difference we provide the best customer service of any telco on the planet and it's completely embedded in the etiology and the culture of this organization is our people.

Will that make the difference are higher levels of engagement directly scientific lead translate into better customer service outcomes, which translates into not just lower churn, but their propensity to buy additional services from US which leads me to the next point, we have an organization that launch.

The first strategic imperative back in 2000, and this is now 22 years old which is to offer integrated solutions across our wireline and wireless operations that differentiate us from the competition in a word we are bundles bundlers the quality products, where it's not just the product in and of itself, but how.

Those products co exist and how they are interoperable to create that stickiness and that value proposition that we deliver for our clients and we are very good at doing that from product development to channel delivery in terms of our bundling thesis.

And there's no one better than us that predictive churn models and responses.

And the light so we do the math and that guides our actions because the scientific and those actions are more efficient and effective as as a result next we don't just put customers first we put community's first we are the world leader in social capitalism that drive the higher level of engagement and performance mentality.

Within our culture, because we have a higher calling we have a better intimate more emotional connectivity with our communities and people know that when they give their business that tell us because of our social purpose thesis that money is going to come back into their community and be put to work in terms of better health outcomes better educational outcomes better.

<unk> environmental outcomes and also passionately we're bridging geographic device.

Not one growth on the digital front within the urban construct but digital extends from urban to rural and we're also bringing digital device on the socioeconomic front. So that we don't have a society of haves and have not everyone gets a chance to realize their full potential because we arm them with the technology to do exactly that and when you have that.

Level of affinity and intimacy with the community across all those various components people want to stay with us They wanted to do business with us because at the end of the day they get the why of the Telus organization not just what we do but why do we do it and an excellent isn't a nonrecurring event, it's something that you need to.

Demonstrate year in and year out look at the longevity of our performance as it relates to world leading churn. It's nine years now where we've been sub 1% people never thought that we would get blended churn below 1% only postpaid and look at what we've done not just on longevity, but duo.

Horizontal cross section, where five of the last eight quarters, we've been below 1% on mobile on Internet on TB on security and on voice services. So we've done it from new growth services to anchor services to legacy services, all below 1% to me that speak to the <unk>.

<unk>, but those aforementioned parameters are the reason why we deliver that result in I think it portends well for our positioning in the future and the comments that Jim made at <unk> in terms of our ability to continue to grow at the net adds at level and also as it relates to value.

Because the people that are sticky clients with us are high value clients.

That's great color. Thanks, so much.

Stephanie we'll take our next question please.

Yes of course next question comes from Vince Valentini from TD Securities.

Please go ahead. Thanks.

Okay. Thanks very much.

Two questions on mobile <unk> first a bit of a clarification you talked a couple of times about the stream plus offering.

Sure. It's clear if somebody starts paying you for Netflix and other streaming services through their <unk>.

I'll phone connection youre going to count that as mobile services <unk>.

I'll take it.

Go ahead, Jim Okay. So.

We are reallocated to actually home solutions.

So it's not impacting our view I think the thing that is driving our <unk> from stream plus is the connection to our speed tiers and so what we're seeing with stream plus customers are they're taking our five <unk> plus plants and thats exactly what we want because this is driving.

That escalator ladder up to bigger data bucket unlimited plans with higher speed profiles.

And our first two weeks that's exactly what we're seeing.

Sure.

The take up of demand is double what we had expected out of the case so were.

We're very excited about that and you know events.

There are few things on <unk> I would like to say.

One we realized nearly 6% revenue growth versus Q1 2019, we've had four straight quarters of year over year revenue growth. Our Q1 exit ARPA growth from March was one 7% and we're seeing that carrying into Q2. So we're feeling very bullish.

It's about.

<unk> planned value step up is up across Activations renewals and re plan changes all up year over year and month over month, and we are seeing steady recovery on roaming and the price increases that have been mentioned.

You mentioned on roaming are starting to flow through in Q2.

And we're seeing the early success from speed tiers and stream plus so when we look prospectively.

We're feeling very good about where this is going.

Thanks, Jim Iot operations.

Yes, thanks for that clarification.

That's why I thought you would've reported anything it was just confusing the way <unk> presented the first.

Other question was directly to what you were just saying.

Totally understand the two year growth comparisons that.

<unk> had much bigger drops early on in the pandemic. So they maybe having just easier comps and bouncing back. So you are very valid and pointing that out but I'm looking at the absolute dollar of RP win to be honest I'm confused because I know you guys are focused on quality loading I look at Q1 last year Youre your blended ARPA.

$56 10.

<unk>.

<unk> <unk> to <unk>.

<unk> 90.

Higher than the other two national carriers and now this year in Q1, you're sort of that much lower than the other two so theres been a big swing just on the absolute dollars are forgetting about the one year or two year growth percentages is there something weird going on here.

Timing of.

When <unk> 15 hits or something to do with the prepaid postpaid mix or something else I'm not sure why the absolute dollar ARPA would tell us would not be lower.

Yes, so I'll start Jeff.

On the one so two things that come to play as one there's mix issues between obviously, our organization and others on the prepaid mix versus postpaid when we changed our segmentation in 2020 to.

Intercompany revenue also is now eliminated zero inter company in <unk> within our organization.

And then there is and Jim can highlight the promotional activity and how <unk> flown through.

Do you think are Ken yes.

A couple of things one I think there is an equipment margin.

Dynamic.

That is.

That kind of clouds.

The comparative.

And that drives an amortization impact that could be.

A few dollars actually so.

That's one aspect of it.

And Vince look ARPA is also not the only metric we're focused on revenue flow through to EBITDA and lifetime value are also critical.

And we're really happy with what's happening on both of those measures channel digital simplicity.

Programs have driven significant cost reductions for us since some hard.

<unk> examples are digital and direct transition transactions are up 104% versus 2019, we've taken out 20% of all of our mobility calls.

Which have been offloaded from our call centers and yet our service levels have improved and our physical channel loading is increasing and then when you look at lifetime value.

As Darin I'd mentioned before we're up to 45% higher on lifetime value than our major national tiers, and our industry, leading mobile postpaid churn of <unk> six 3% I don't think youre going to find better results than that and thats coming from bundling and it's coming from our focus on.

The high value customers and so when you take those three metrics together.

They're driving like really good revenue to EBITDA flow through outcomes for us and I think that's where the money is and that's that's that's.

That's a great outcome for us and Vince to Jim's point on the IRS 15 amortization the sooner you move to more call it disciplined on subsidy.

Sooner your offset amortization periods. So the fact that we were early in the stage of being.

More upscale upticks on our rate plans and more high value loading the amortization impact will be different as that two year runway comes to an end.

Okay. Thank you.

Thanks, Vince I mean, how do we have time for one more question. Please yes of course last question comes from drew Mcreynolds from RBC capital markets. Please go ahead.

Yes, thanks, very much and good afternoon, two for me, maybe starting with you Doug just to level set expectations here I think we all knew.

The gate here.

Relative to your full year guidance, we're going to get lower year over year growth rate slightly just wondering how that.

At the moment, you see that kind of building through 2022 in terms of cadence.

And then secondly.

No need to drill down too much on this but.

Obviously certain center in this kind of market and environment are.

Inflation, and then kind of cyclicality of recession.

I think a lot of us on this call I haven't really seen.

<unk> go through much of any of that so just at the high level.

<unk> assets.

Certainly should prove resilient for a number of reasons, but just wanted to get some high level thoughts there. Thank you.

Yes, so on that trajectory and we expect continuous improvement as we go throughout the year.

On our overall.

Progression on EBITDA growth when you think through the <unk> initiatives that we just talked about.

Think about the continuation of copper to fiber migrations in the loading trajectory that we had.

<unk> margin improvement as the year progresses, and then AG and health margins as we integrate and grow those portfolios all of them are on the upward trajectory.

As we look we look forward, so I'd say, it's going to be steady throughout the year and youre going to see that progression on a quarter over quarter basis.

From Jeff's call. This morning on the Ti call, Jeff had a very good.

Good answer too I recommend you listen to the recession side of Ti.

When you think through that what Ti has to offer.

They're actually enabling organizations, even such as tell us during a recession period with Digitization with.

Helping organizations through that period, and yes, it's not quite recession proof, but the diversity as well as the enablement definitely.

Gives them a leg up on a an opportunity front.

Darren do you want to take.

No I think Thats, well said Doug.

And how I don't think and I think as inflation proof, but I think these are resilient businesses for us given the essential service nature of these businesses.

And how people behave within the digital economy and digital society. So the necessity on health necessity on food.

It gives us a strong level of resiliency. The other thing that I think John range would say.

When your data analytics thesis is driving better efficiency within the sectors that you are seeking to serve that played very well during an inflationary period.

The other thing that I think is interesting about tell us is that we have such a diversity of our asset mix from what we're doing within our core telecoms portfolio on data services in our evolving that so what we're doing on Ti.

And the way I think that level of diversification gives us a better backbone of resiliency, whether it's inflation or supply chain pressures that we're dealing up simultaneously and then you have to respond proactively and I don't think very many organizations have managed exhort genus.

Over the past 22 years of better than what we've done.

Whether it's equity market meltdowns, our credit crunches or regulatory decisions were inflationary periods, we seem to navigate that turbulence very well and I think that's down to the quality of the team and then we have a pretty resilient strategy here. So I think we are the most progressive in terms of our digital capability.

Set that can really help us when we are experiencing wage pressures from inflation to drive that digital thesis.

We have the benefit of being able to access labor arbitrage.

So yes, we've got pressure they've got pressure, but to the extent to which we can use the ti asset to support buttress. The economics of <unk> Corporation, I think all the better.

Then.

We got to keep being more and more efficient all the time and make some difficult decisions as it relates to cost reduction programs, but I can tell you one thing as an organization that really centers on the thesis of bundling. If you our product intensity centric I think you'll do better during inflationary period, youll experienced bumps, but youll.

Manage them better along the way.

Excellent. Thank you.

Thanks drew and thank you everyone for joining us today, please feel free to reach out to the IR team with any follow ups.

Irwin.

This concludes the two.

2020, Q1 earnings call. Thank you for your participation and have an understanding.

Q1 2022 Telus Corp Earnings Call

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