Q2 2024 TELUS Corporation Earnings Call

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Operator: The conference is now being recorded. Good day.

The conference is now being recorded.

Okay.

Operator: Welcome to the Telus 2024 Q2 earnings conference call. I would like to introduce your speaker, Mr. Robert Mitchell. Please go ahead.

Speaker Change: Good day and welcome to the <unk> 'twenty 'twenty four Q2 earnings conference call I would like to introduce your speaker Mr. Robert Mitchell. Please go ahead.

Robert Mitchell: Hello, everyone. Thank you for joining us today. Our second quarter of 2024 results, news release, MD&A, and financial statements and detailed supplemental investor information were posted to our website earlier this morning. On our call today, we'll begin with remarks from Darren and Doug. For the Q&A portion, we'll be joined by other members of our leadership team. In brief, prepared remarks, slides, and answers to questions contain forward-looking statements. However, actual results could vary materially from these statements.

Robert Mitchell: Hello, everyone. Thank you for joining us today, our second quarter 2024 results news release, MD&A and financial statements and detailed supplemental investor information are posted to our website earlier this morning.

Speaker Change: On our call today will begin with remarks by Darren and Don for the Q&A portion will be joined by other members of our leadership team.

Darren: Briefly prepared remarks slides and answers to questions contain forward looking statements actual results could vary materially from these statements the assumptions on which they are based and the material risks that could cause them to differ are outlined in our public filings with securities commissions in Canada, and U S, including second quarter 2024, and annual 2023, MD&A with that over to you Darren.

Robert Mitchell: The assumptions on which they're based and the material risks that could cause them to differ are outlined in our public filings with securities commissions in Canada and the U.S., including second quarter 2024 and annual 2023 MD&A. With that, over to you, Darren. Thank you, Ringo.

Darren Entwistle: And, hello, everyone. In the second quarter, our team built upon our track record of execution excellence to drive industry-leading customer growth and strong financial results, leveraging our premier portfolio of assets, coupled with a relentless pursuit to drive cost efficiency and effectiveness. Our results clearly demonstrate how we are delivering sustainable, profitable growth, underpinned by our consistent strategic focus on margin and creative customer expansion, our globally leading broadband networks, and, of course, our customer-centric culture. This enabled a record second quarter with total customer net additions of $332,000, up 13% on a year-over-year basis.

Darren: Thank you <unk> and Hello, everyone.

The second quarter, our team built upon our track record of execution excellence to drive industry, leading customer growth and strong financial results leveraging our premier portfolio of assets, coupled with our relentless pursuit to drive cost efficiency and effectiveness.

Darren: Our results clearly demonstrate how we are delivering sustainable profitable growth underpinned by our consistent strategic focus on margin accretive customer expansion, our globally, leading broadband networks and of course, our customer centric culture.

Darren: This enabled our record second quarter with total customer net additions of 332000 up 13% on a year over year basis.

Darren Entwistle: This included healthy mobile phone net additions and record second quarter customer growth for both connected devices and total fixed net additions. Our team's passion for delivering customer service excellence once again contributed to leading loyalty results across our key product lines. Notably, post-paid mobile phone churn was again below 1% alongside pure fiber churn of circa 1%.

Darren: This included healthy mobile phone net additions and record second quarter customer growth for both connected devices and total fixed net additions.

Darren: <unk> passion for delivering customer service excellence once again contributed to a leading loyalty results across our key product lines.

Darren: Notably postpaid mobile phone churn was again below 1% alongside pure fiber churn of circa 1%. These showcases the consistent potency of our unmatched bundled product offerings across mobile at home and our leading customer experience over our industry best pure fiber and wireless.

Darren Entwistle: This showcases the consistent potency of our unmatched bundled product offerings across mobile and home and our leading customer experience over our industry-best pure fiber and wireless broadband network. For the second quarter, Telus achieved resilient EBITDA growth of 5.6% and margin expansion of 170 basis points. These results reflect the progression of our ongoing transformational efficiency programs that are clearly bearing fruit. Let's turn now and take a look at our T-TECH mobile results. Telus realized second-quarter customer growth of 262,000 net additions, its strongest second-quarter on record.

Darren: Its broadband networks.

Speaker Change: For the second quarter intelligent G. Brazilian EBITDA growth of five 6% and margin expansion of 170 basis points.

Speaker Change: These results reflect the progression of our ongoing transformational efficiency programs that are clearly bearing fruit.

Speaker Change: Let's turn now and take a look at our T Chek mobile results.

Speaker Change: Telus realized second quarter customer growth of 262000 net additions our strongest second quarter on record this.

Darren Entwistle: This included robust mobile phone net additions of 101,000, driven alongside our continued focus on profitable margin-accretive customer growth. Indeed, we are doubling down on our disciplined focus on profitability as we progress through the remainder of 2024 and beyond. Our efforts will ensure our mobile customer growth drives sustainable EBITDA and cash flow accretion for our business and our investors. Mobile subscriber growth also included record second quarter connected device net additions of 161,000, which represents a 30% increase on a year-over-year basis.

Speaker Change: As included robust mobile phone net additions of 101000.

Speaker Change: Driven alongside our continued focus unprofitable margin accretive customer growth.

Speaker Change: Indeed, we are doubling down on our disciplined focus on profitability as we progress through the remainder of 2024 and beyond.

Speaker Change: Our efforts will ensure a mobile customer growth drive sustainable EBITDA and cash flow accretion for our business and our investors.

Speaker Change: Mobile subscriber growth also included record second quarter connected device net additions of 161000, which represents a 30% increase on a year over year basis.

Darren Entwistle: This reflects continued strong momentum with respect to our 5G and our IoT B2B solutions. Additionally, our team delivered another quarter of leading loyalty results, which of course continues to be a hallmark of our Telus team. Blended mobile phone churn of 1.07% was up against the backdrop of elevated competitive activity relative to seasonal trends. Whilst this is not a level with which our team is content, it once again represented an industry-best result by a substantial margin versus our peer group.

Speaker Change: This reflects continued strong momentum with respect to our five G and our Iot b to B solution.

Speaker Change: Importantly, our team delivered another quarter of leading loyalty results, which of course continues to be a hallmark of our Telus team.

Speaker Change: Blended mobile phone churn of one debt zero, 7% was up against the backdrop of elevated competitive activity relative to seasonal trends.

Speaker Change: Well this is not a level of which our team is content. It. Once again represented an industry best result by a substantial margin versus our peer group.

Darren Entwistle: Notably, postpaid mobile phone churn was 0.89% in the quarter as we progressed through our 11th consecutive year with a churn rate below 1%. This is an outstanding result on a global basis and reflective of the industry-best customer experience our Telus team delivers time and time again. The close on mobile second quarter ARPU of $58.49 was down year over year.

Speaker Change: Notably postpaid mobile phone churn was zero dot eight 9% in the quarter as we progressed through our 11th consecutive year with the churn rate below 1%.

Speaker Change: This is an outstanding result on a global basis and reflective of the industry best customer experience, our Telus team deliver us time and time again.

Speaker Change: The closeout mobile second quarter, our pool of $58.49.

Speaker Change: Was down year over year.

Darren Entwistle: This was the result of continued intense promotional market activity and heightened competition. Notwithstanding the competitive pressures, our team is distinctly dissatisfied with our ARPU results, and we remain focused on driving a better outcome through multiple levers prospectively. These include enhancing our premium bundled offers across mobility and fixed and driving unmatched product development, differentiation, and intensity, all while maintaining strategic focus on profitable growth and sustainable economics. Our flanker brands offer strong customer value in key growth segments, some with lower associated ARPU, but notably compelling AMPU attributes.

Speaker Change: This was a result of continued intense promotional market activity and heightened competition.

Speaker Change: Notwithstanding the competitive pressures are team is distinctly dissatisfied with their ARPA result, and we remain focused on driving a better outcome through multiple leavers prospectively.

Speaker Change: These include enhancing our premium bundled offers across mobility and fixed and driving unmatched product development differentiation and intensity all swab, maintaining strategic focus on profitable growth and sustainable economics.

Speaker Change: Our flanker brands offer strong customer value in key growth segments, some with lower associated <unk>, but notably cannot Kelly Ann Pooh attributes.

Darren Entwistle: Through digital transformation, we are meaningfully lowering our cost to serve across the board, inclusive of supporting an attractive AMPU for BYOD and Flanker activities. Furthermore, our growing product intensity increases both average revenue and average margin per home, whilst reducing churn. Thus, we see sequential benefits as we layer more fixed and mobility products, significantly enhancing lifetime revenue and the associated economics. These efforts will continue to be supported by our team's passion for winning and retaining profitable customers, whilst remaining highly disciplined in respect of device subsidies. Furthermore, we continue to expect connected devices and IoT to increasingly contribute to network revenue, network ARPU, and AMPU, and to see that growth grow at a level of materiality prospectively.

Speaker Change: Through digital transformation, we're meaningfully lowering our cost to serve across the board inclusive of supporting an attractive Abu for B Y O D and flanker activity.

Speaker Change: Furthermore, our growing product intensity increases both average revenue and average margin per home, whilst reducing churn.

Speaker Change: Thus, we see sequential benefits as we layer more fixed and mobility products significantly enhancing lifetime revenue and the associated economics.

Speaker Change: These efforts will continue to be supported by our team's passion for winning and retaining profitable customers whilst remaining highly disciplined in respect of device subsidies.

Speaker Change: Furthermore, we continue to expect connected devices and Iot to increasingly contribute to network revenue networks, <unk> and <unk> and seeing that growth grow at a level of materiality prospectively.

Darren Entwistle: Importantly, our industry-leading customer loyalty and focus on profitable growth allow us to continue delivering industry-best mobile phone lifetime revenue, which consistently exceeds our national peers by a considerable margin of up to 38% in the second quarter alone. Now, let's take a look at our T-TECH Fixed Operating Results, where Telus delivered another quarter of industry-best total wireline customer growth. Indeed, our team achieved robust and industry-leading second quarter internet net additions of $33,000, similar to the prior year and up slightly versus the first quarter of 2024.

Speaker Change: Importantly, our industry, leading customer loyalty and focus on profitable growth allow us to continue delivering industry best mobile phone lifetime revenue, which consistently exceeds our national peers by a considerable margin of up to 38% in the second quarter alone.

Speaker Change: Now, let's take a look at our T chek fixed operating results, where Telus delivered another quarter of industry best total wireline customer growth.

Speaker Change: Indeed, our team achieved robust and industry, leading second quarter Internet net additions of 33000 similar to the prior year and up slightly versus the first quarter of 2024.

Darren Entwistle: Importantly, consumers in the West are choosing Telus for our pure fiber superiority, coupled with our customer service excellence, which is sustaining strong growth on a year-over-year basis. We're also continuing to drive healthy growth in our TV product line, with industry-leading net additions of $25,000, up 47% on a year-over-year basis. Additionally, modest residential voice losses of 8,000 were flat over last year and again represented an industry-best result compared to our national peers by a notably wide margin.

Speaker Change: Importantly, consumers in the west are choosing tell us for our pure fiber superiority, coupled with our customer service excellence, which is sustaining strong growth on a year over year basis.

Speaker Change: We are also continuing to drive healthy growth in our TV product line with industry, leading net addition of 25000 up 47% on a year over year basis.

Speaker Change: Additionally, modest residential voice losses of 8000 were flat over last year and again represented an industry best result, compared to our national peers by notably wide margin.

Darren Entwistle: Strong and leading security net additions of 20,000 were up 33% and reflect our successful multi-product penetration strategy as well as the distinctive performance on premium versus our peers. Overall, our industry-leading external fixed net additions of $70,000 again represented a record second quarter result for the Telus organization. This demonstrates the strength of our unique and highly attractive bundled offers across our unmatched portfolio of products and services in combination with our superior customer experience over our ever-expanding PureFibre network.

Speaker Change: Strong and leading security net additions of 20000 were up 33% and reflect our successful multi product penetration strategy as well as the distinctive performance on premium versus our peers.

Overall, our industry, leading external Vic net additions of 70000 again represented a record second quarter result for the Telus organization.

Speaker Change: This demonstrates the strength of our unique and highly attractive bundled offers across our unmatched portfolio of products and services in combination with our superior customer experience over our ever expanding pure fiber network. It.

Darren Entwistle: It's terrific to be able to deliver that magnitude of net fixed results for this organization in terms of getting an ROI on the billions of dollars that we've invested in pure fiber connectivity. These particular strengths will be further enhanced by continued significant innovation on our differentiated product roadmap, where we will be delivering a series of new products in the months and quarters to come. In this regard, Telus has built the first device-agnostic smart home platform, leveraging new IoT services in close partnership with AWS, as well as the development talent and capacity of our Telus digital experience team, formerly Telus International.

Speaker Change: It's terrific to be able to deliver that magnitude of net fixed results for this organization in terms of getting an ROI on the billions of dollars that we've invested in pure fiber connectivity.

Speaker Change: These particular strengths will be further enhanced by continued significant innovation on our differentiated product roadmap, where we will be delivering a series of new products in the months and quarters to come.

Speaker Change: In this regard <unk> built the first device agnostic smart home platform, leveraging new Iot services in close partnership with AWS as well as the development talent and capacity of our tellers digital experience team, formerly Telus International.

Darren Entwistle: This platform will enable us to enter many new verticals, such as energy management, which we launched earlier this week. Furthermore, it will enable the enhanced integration of existing capabilities, such as health and wellness, whilst at the same time driving cost-to-serve improvements at a material level and driving as well licensing savings within our core business operations. It's really the embodiment of what we did with Ampu on the wireless front being driven into the wireline side of our business.

Speaker Change: This platform will enable us to enter many new verticals, such as energy management, which we launched earlier this week.

Speaker Change: More of that will enable enable the enhanced integration of existing capabilities, such as health and wellness whilst at the same time driving cost deserve improvement at a material level and driving as well licensing savings within our core business operations, it's really.

Speaker Change: The embodiment of what we did on Amp, who on the wireless Brian being driven into the wireline side of our business our product development differentiated service portfolio and product intensity, driven by leading data and AI capabilities not only positions us for growth that helps <unk>.

Darren Entwistle: Our product development, differentiated service portfolio, and product intensity, driven by leading data and AI capabilities, not only positions us for growth but helps Canadians save money in an affordability-challenged environment. Looking forward, this integrated product platform will deliver a multitude of innovative products, which will further solidify our product intensity leadership and present new revenue sources in the quarters to come that are completely differentiated from our competitive peer groups. Let's turn now and look at Telus Business Solutions, or TBS, which once again delivered a robust order of growth across all areas of the business.

Speaker Change: <unk> saved money in an affordability challenged environment.

Speaker Change: Looking forward the integrated product platform will deliver a multitude of innovative products, which will further solidify our product intensity leadership and present, new revenue sources in the quarters to come that are completely differentiated from our competitive peer group.

Speaker Change: Let's turn now and look at <unk> business solutions, or TBS, which once again delivered a robust quarter of growth across all areas of the business.

Darren Entwistle: Our focus in B2B continues to be on accelerating profitable growth. And in this regard, notably, in the second quarter, TBS achieved strong cash flow growth of 8% on a year-over-year basis, reflective of our strong customer-first culture, global best networks, digital capabilities, and, of course, focused execution.

Speaker Change: Our focus in <unk> continues to be on accelerating profitable growth and in this regard, notably in the second quarter GBS achieved strong cash flow growth of 8% on a year over year basis.

Speaker Change: Reflective of our strong customer first culture global best networks digital capabilities and of course focused execution <unk> business drove industry, leading loyalty results in Q2, our lead we've maintained now for nine consecutive quarters.

Darren Entwistle: Telus business drove industry-leading loyalty results in Q2, a lead we've maintained now for nine consecutive quarters. Our Business Solutions team continues securing significant wins and strategic renewals in the commercial and public sector space. This included an eight-figure deal to deploy Telus's leading next-generation video security services for a high-profile client with a roadmap to expand with our video analytics, IoT, and automation solutions.

Speaker Change: Our business solutions team continued securing significant wins and strategic renewals in the commercial and public sector space.

Speaker Change: This included an eight figure deal to deploy <unk>, leading next generation video security services for a high profile client with a roadmap to expand with our video analytics Iot and automation solutions.

Darren Entwistle: We also secured a new strategic partnership that will see TELUS supporting thousands of Canadian vehicles with their industry-leading IoT services. This win builds on our multi-year collaboration with GM to provide connected car technology for its Canadian customers, and Telus Health. We are pleased with the solid performance, returning to positive top-line growth of 4% as investments in our product, sales capacity, and distribution channels deliver strong momentum across multiple lines of service. This includes MyCare, Pharmacy Management Systems, Virtual Pharmacy, Retirement Benefit Solutions, Health Benefits Management, our Precision Health, and our Employee Assistance Program.

Speaker Change: We also secured a new strategic partnership that will see tellers supporting thousands of Canadian vehicles, with our industry, leading Iot services.

Speaker Change: This win builds on our multi year collaboration with GM to provide connected car technology for its Canadian customers.

Speaker Change: And Telus health, we are pleased with the solid performance returning to positive top line growth of 4% as investments in our products.

Speaker Change: <unk> capacity and distribution channels delivered strong momentum across multiple lines of service. This.

Speaker Change: This includes my care Pharmacy management systems virtual pharmacy retirement benefit solutions health benefits management, our precision health and our employee assistance programs.

Darren Entwistle: The performance at Telus Health has been strong across all of our product and business lines. And, notably, we expect this positive momentum to continue in the quarters ahead. Furthermore, our Telus Health team delivered over 33% adjusted EBITDA contribution growth in the second quarter of 2024, and this was supported by accelerated revenue growth alongside the continued progression of our Synergy Program at Telus Health. Notably, on the synergy front, we achieved $297 million in combined annualized synergies since acquiring LifeWorks back in 2022, including an increase of $46 million in the past quarter alone.

Speaker Change: Performance at Telus Health has been strong across all of our product and business lines and notably we expect this positive momentum to continue in the quarters ahead.

Speaker Change: Furthermore, our Telus health team delivered over 33% adjusted EBITDA contribution growth in the second quarter of 2024, and this was supported by accelerated revenue growth alongside the continued progression of our synergy program at Telus health, notably on the synergy front, we achieved.

Speaker Change: $297 million in combined annualized synergies since acquiring <unk> back in 2022, including an increase of $46 million in the past quarter alone.

Darren Entwistle: Since the acquisition, we've driven $248 million in cost synergies, along with $49 million in cross-selling, as we work towards our overall objective of $427 million by the end of 2025. This means we've got about 130 million synergies left to go, and about $80 million are going to come from the cost side, and $50 million as it relates to cross-selling. Moreover, in the second quarter, we saw a 10% year-over-year increase in the number of lives covered by Telus Health to now stand at more than $75 million.

Speaker Change: Since the acquisition, we've driven $248 million in cost synergies, along with $49 million in cross selling as we work towards our overall objective of $427 million by the end of 2025.

Speaker Change: This means we've got about $130 million synergies left to go and about $80 million are going to come from the cost side and $50 million as it relates to cross selling.

Speaker Change: Moreover, in the second quarter, we saw a 10% year over year increase in our global lives covered by Telus health to now stand at more than $75 million.

Darren Entwistle: Similarly, within Telus Agriculture and Consumer Goods, or TAC, we are yielding positive outcomes as we strengthen our market position, delivering strong second quarter revenue growth of more than 15%. This reflects some inorganic growth from tuck-in acquisitions and, as well, improving organic revenue performance in our consumer goods, precision agronomy, and animal agriculture businesses. Furthermore, it comes on the heels of continuing strong sales performance quarter to quarter to quarter where we now Realize, in terms of our performance, we've more than doubled our year-to-date sales bookings versus this time last year.

Speaker Change: Similarly, with Intel is agriculture, and consumer goods or Tac, we are yielding positive outcome as we strengthen our market position delivering strong second quarter revenue growth of more than 15%.

Speaker Change: This reflects some inorganic growth from tuck in acquisitions, and as well improving organic revenue performance in our consumer goods precision agronomy and animal agriculture businesses.

Speaker Change: Furthermore, it comes on the heels of continuing strong sales performance quarter to quarter to quarter, where we have now realized in terms of our performance we more than doubled our year to date sales bookings versus this time last year nice to see that doubling of our year to date sales.

Darren Entwistle: It's nice to see that doubling of our year-to-date sales bookings in terms of our performance in 2024 versus 2023. And as a result of all of these factors, we expect positive organic growth intact in the quarters ahead. Our commitment to amplifying the substantial growth potential of our distinctive global health and agriculture businesses includes capitalizing on significant cross-selling opportunities throughout all of our businesses, showcasing the collective talent and effectiveness of our team in propelling our success. Watch for more in that space in the quarters to come.

Speaker Change: Bookings in terms of our performance in 2024 versus 2023.

Speaker Change: And as a result of all of these factors, we expect positive organic growth intact in the quarters ahead.

Speaker Change: Our commitment to amplifying the substantial growth potential of our distinctive global health and agriculture businesses includes capitalizing on significant cross selling opportunities throughout all of our businesses showcasing the collective talent and effectiveness of our team and propelling our success.

Speaker Change: Watch for more in that space in the quarters to come.

Darren Entwistle: Turning to TELUS International, which will formally complete its rebranding to TELUS Digital Experience in the third quarter, TELUS Digital's second quarter results reflect a macroeconomic and operating environment that remains distinctly challenged. Whilst we are obviously not pleased with this performance, our confidence in the business and assets remains steadfast, and our team is committed to proving this throughout. Strong execution and exceptional service delivery starting in the second half of 2024 and building momentum for a much more successful 2025 and beyond.

Speaker Change: Turning to Telus International which will formally complete its rebrand named Intel's digital experience in the third quarter <unk> Digital's second quarter results reflect the macroeconomic and operating environment that remains distinctly challenged.

Speaker Change: Whilst we are obviously not pleased with this performance our confidence in the business and assets remained steadfast and our team is committed to proving this throughout strong execution and exceptional service delivery starting in the second half of 2024 and.

Speaker Change: Building momentum for a much more successful 2025 and beyond.

Darren Entwistle: This is going to be achieved by reinvesting Telus Digital's strong cash flow generation back into the business to support the reacceleration of top-line profitable growth, along with the ongoing and extensive focus on cost efficiencies and digital transformation initiatives that will improve not just our cost base but the operational tempo of this organization. In that regard, Telus Digital's promising capabilities in data and IR services, as well as its early success with Fuel iX, are capturing customer demand, as demonstrated by the double-digit revenue growth within its AI data solutions line of service in the first half of this year.

Speaker Change: This is going to be achieved by reinvesting <unk> digital's strong cash flow generation back into the business to support the Reacceleration of top line profitable growth along with the ongoing and extensive focused stop focus on cost efficiencies and digital transformation initiatives.

Speaker Change: <unk> that will improve not just our cost base, but the operational tempo of this organization.

Speaker Change: In that regard <unk> digital's, promising capabilities and data and IR services as well as their early success with <unk> is capturing customer demand as demonstrated by the double digit revenue growth within its AIA data solutions line of service in the first half of this year.

Darren Entwistle: And that growth is indeed encouraging. Furthermore, our relationship with Telus Digital offers a unique competitive advantage as the strength of the Gen-AI fueled solutions created for and tested at Telus helps strengthen their go-to-market efforts with other external clients.

And that growth is indeed, encouraging. Furthermore, our relationship with <unk> digital offers a unique competitive advantage as the strength of the Gen. AI fueled solutions created for and tested at tell us fortify their go to market efforts with other external client.

Speaker Change: <unk>.

Darren Entwistle: Whilst we are encouraged by these positive indicators of longer-term significant growth potential, the challenges Telus Digital is facing impact the expected levels of revenue and profit for 2024, as seen in their revised outlook for the full year. It's clear that Telus Digital must execute on its strategy to deliver the financial results that our investors expect and that we know that we can achieve given the quality of the asset base. In a moment, Doug will provide further commentary on both T-Check and Telus Digital's results.

Speaker Change: Whilst we are encouraged by these positive indicators of longer term significant growth potential the challenges <unk> digital is facing impact the expected levels of revenue and profit for 2024 as seen in our revised outlook for the full year.

Speaker Change: It's clear that <unk> digital must execute on its strategy to deliver the financial results that our investors expect and that we know that we can achieve given the quality of the asset base.

Darren Entwistle: In closing, the record customer growth we continue to report is underpinned by our dedicated team who are indeed passionate about delivering superior service offerings and digital capabilities over our world-leading wireless and broadband fiber networks. The significant broadband network investments we have made are enabling our resilient EBITDA growth, ongoing monetization of pure fiber and 5G, the financial and strategic benefits of copper decommissioning, intense strategic focus on efficiency enhancement, and notable revenue and profit progression in Telus Health and Telus Agriculture and Consumer Goods. That's quite a combination.

Speaker Change: In closing the record customer growth. We continue to report is underpinned by our dedicated team who are indeed passionate about delivering superior service offerings and digital capabilities over our world, leading wireless and broadband fiber networks. This.

Speaker Change: This significant broadband network investments, we have made are enabling our resilient EBITDA growth ongoing monetization of pure fiber and <unk>, the financial and strategic benefits of copper decommissioning and 10 strategic focus on efficiency enhancement and notable revenue.

Speaker Change: Q and profit progression and Telus health and tell us agriculture and consumer goods.

Speaker Change: That's quite the combination.

Darren Entwistle: Together, this combination of factors solidly positions TELUS to focus on what's next, and you will see this organization doubling down in these areas and evolving our product roadmap and customer-centric offerings in the weeks and months ahead in a way that will drive further significant differentiation and profitable and material revenue growth opportunities, which will be exemplified in terms of cross-selling and improved multiproduct penetration, or what we call product intensity. Finally, I'd like to take a moment to acknowledge the wildfires that devastated the beautiful community of Jasper last week.

Speaker Change: Together this combination of factors solidly positions tell us they're focused on what's next and you will see this organization doubling down in these areas and evolving our product roadmap and customer centric offerings in the weeks and months ahead in a way that will draw.

Speaker Change: <unk> further significant differentiation and profitable and material revenue growth opportunities.

Speaker Change: That will be exemplified in terms of cross selling and improved multi product penetration or what we call product intensity.

Speaker Change: This supports the continued advancement of our financial and operational performance, which is the bedrock of the long term sustainability of our industry, leading dividend growth program.

Speaker Change: Finally, I'd like to take a moment to acknowledge the wildfires that devastated the beautiful community of Jasper last week, the thoughts of our entire Telus team are with all those impacted by the fire.

Darren Entwistle: The thoughts of our entire Telus team are with all those impacted by the fire. To support the community through this extremely challenging time, Telus has committed over $100,000 and is growing to assist with the vital rebuilding effort. Moreover, our team members worked around the clock to support evacuees and local authorities and first responders, leveraging our technology to keep everyone connected when it mattered most. In addition, we've provided care kits and a free 50 gigabit day to top up for those tragically forced from their homes as a result of the wildfire. As a further demonstration of our support, we activated a free community crisis hotline through TELUS Health, offering professional emotional support to anyone affected.

Speaker Change: To support the community through this extremely challenging time tell us has committed over $100000 and growing to assist with the vital rebuilding efforts.

Speaker Change: Moreover, our team members worked around the clock to support evacuees and local authorities and first responders leveraging our technology to keep everyone connected when it mattered. Most in addition, we provided care kit and a 350 gigabit data top up for those tragically displaced from their homes.

Speaker Change: As a result of the wildfires.

Speaker Change: As a further demonstration of our support reactivated a free community crisis hotline through Telus health offering professional emotional support to any one affected.

Darren Entwistle: I am, and the entire team is, sincerely grateful to the countless team members who continue to demonstrate that when things are at their worst, our TELUS team is at their very best. Indeed, I can think of no better exemplification of putting our customers first than by putting our citizens in need first. Such is the symbiotic relationship between customers and community. And before handing off to Doug, I'd like to take this opportunity to express my immense gratitude and appreciation to Jeff Puritt for his innumerable and important contributions to Telus Digital over the past two decades and almost a quarter of a century as a Telus team member.

Speaker Change: I am and the entire team is sincerely grateful to the countless team members, who continue to demonstrate that when things are at their worst our Telus team is at their very best and.

Speaker Change: Indeed, I can think of no better exemplification of putting our customers first then by putting our citizens in need first such as the symbiotic relationship between customers and communities.

Darren Entwistle: Jeff will retire as President and CEO of Telus Digital, effective on the 3rd of September, and he will assume his new role as Executive Vice-Chair of Telus Digital and join the Board of Directors at that same time.

And before handing off to Doug I'd like to take this opportunity to express my immense gratitude and appreciation to Jeff <unk> for his innumerable an important contributions to <unk> digital over the past two decades, and almost a quarter of a century as at Telus team member <unk>.

Speaker Change: Jeff will retire as president and CEO of <unk> digital effective on the third of September and he will assume his new role as executive Vice chair of tell us digital and joined the board of directors at that same time.

Darren Entwistle: As you know, Jeff has played a pivotal role in leading and shaping our Telus digital business since its inception. From a single delivery center in the Philippines, with fewer than 2,000 team members back in 2005, to an integrated global provider of AI, digital, and customer experience services, with over 75,000 employees now serving more than 650 clients from 32 countries around the world. Supported by robust senior leadership talent succession and in alignment with the company's strategy of bringing the best of technology to enable excellence in customer service, we are extremely pleased to welcome Jason McDonnell as CEO of Telus Digital and President of Telus Digital Customer Experience.

As you know Jeff has played a pivotal role in leading and shaping our tailored digital business since its inception from a single delivery center in the Philippines with fewer than 2000 team members back in 2005 to an integrated global provider of AI Digi.

Speaker Change: And customer experience services with over 75000 employees now serving more than 650 clients from 32 countries around the world.

Speaker Change: Supported by robust senior leadership talent succession and in alignment with the company's strategy of bringing the best technology to enable excellence in customer service. We are extremely pleased to welcome Jason Mcdonell as CEO of <unk> digital and president of <unk> digital customer experience.

Darren Entwistle: Jason is a 20-year-old member of our TELUS senior leadership team with a proven track record of bringing the capabilities that TELUS has developed to lead its industry in client care, loyalty, cost efficiency, and digital transformation excellence, bringing these capabilities to all the business verticals that TELUS Digital addresses with external clients. In addition, Tobias Dengel, founder and president of Willitree, will take on the elevated role of president of digital solutions at Telus Digital Solutions.

Speaker Change: Jason is a 20 year tenured member of our tellers senior leadership team with a proven track record of bringing the capabilities that <unk> has developed to Lee in its industry and client care, leading and loyalty leading cost efficiency and leading in digital transformation excellence, bringing these capabilities.

Speaker Change: <unk> to all the business verticals that tell us digital addresses with external clients.

Ba's dango: In addition to Ba's dango, founder and President of military will take on the elevated role of President of digital solutions at Telus Digital solutions.

Darren Entwistle: Tobias is both an industry-leading expert, he's got the experience, he's got the credentials, and he's got the entrepreneurial acumen and drive needed to ensure we continuously deliver best-in-class solutions across our digital, gen-AI, and AI modeling businesses. Both Jason and Tobias will work with me closely and report directly to the Telus Digital Board of Directors. And we are eager to see the significant leadership contribution and impact that they are going to have and make in returning Telus Digital to material, profitable growth. And on that note, I'll turn the call over to Doug. Thank you, Darren. And hello, everyone.

Speaker Change: <unk> is both the industry leading expertise he's got the experience he's got the credentials and he's got the entrepreneurial acumen and drive needed to ensure we continuously deliver best in class solutions across our digital Gen AI and AI <unk>.

Speaker Change: Milling businesses.

Speaker Change: Both Jason and <unk> will work with me closely and report directly to the <unk> Digital board of directors and we are eager to see the significant leadership contribution and impact that they are going to have and make and returning <unk> digital to material.

Speaker Change: Profitable growth and on that note I will turn the call over to Doug.

Doug French: Mobile phone and connected device subscriber additions drove network revenue growth of 0.9 percent, partially offset by lower mobile phone ARPU, which declined by 3.4 percent. The ARPU reflects the ongoing impact of the competitive pricing environment with customers optimizing their rate plans as well as declining contribution from overage and roaming. This is partially offset by higher IoT revenue. As we progress through the second half of the year, we expect the highly competitive environment to continue.

Doug: Thank you Darren and Hello, everyone mobile phones and connected device subscriber additions drove network revenue growth of zero doubt, 9%, partially offset by lower mobile phone <unk>.

Doug: Which declined by three 4%.

Doug: <unk> reflects the ongoing impact from the competitive pricing environment with customers optimizing their rate plans as well as declining contribution from overage and roaming this was partially offset by higher Iot revenue.

Doug: As we progress through the back half of the year, we expect a highly competitive environment to continue.

Doug French: Importantly, we continue our intense focus on AMPU and bundling to drive the right economic outcome. This is supported by our continued focus to drive lower cost to serve, as well as leverage our significant digital capability. This is further bolstered by Telus Digital, the key enabler to our customer experience leadership. Our significant and ongoing focus on cost efficiency is helping us offset top-line competitive pricing pressures, allowing us to invest in new product development that will support sustainable EBITDA growth and margin accretion.

Doug: Importantly, we continue our intense focus on <unk> and bundling to drive the right economic outcomes.

Doug: This is supported by our continued focus to drive lower cost to serve as well as leverage our significant digital capabilities. This is further bolstered by <unk> digital a key enabler to our customer experience leadership.

Doug: Our significant and ongoing focus on cost efficiency is helping us offset the top line competitive pricing pressures, allowing us to invest in new product development that will support sustainable EBITDA growth and margin accretion.

Doug French: Fixed data services revenue grew by 1% year over year, driven by strong customer net additions of $78,000 across internet security and TV, as well as B2B growth, including cybersecurity and cloud services. Despite the competitive landscape, the solid growth demonstrates our superiority of our pure fiber network and growing product intensity. Internet ARPU in the quarter was stable due to our successful base management, while our TV revenue for house home was lower as customers continue to evolve their entertainment packages along with technological substitutions.

Doug: Fixed data services revenue grew by 1% year over year, driven by strong customer net additions of 78000 across Internet security and TV as well as <unk> growth, including cyber security and cloud services <unk>.

Doug: Despite the competitive landscape the solid growth demonstrates our superiority of our pure fiber network and growing product intensity into.

Doug: Internet <unk> in the quarter was stable due to our successful base management.

Doug: While our TV revenue per household was lower as customers continued to evolve their entertainment packages along with technological substitution.

Doug French: This includes positive growth from the continued strong adoption of our StreamPlus offering featuring a bundle of leading OTT content made available nationally through TELUS and KUDO. At the segment level, T-TEC operating revenues were up 0.5% driven by mobile network and fixed data services, as well as positive health and ag services revenue growth, as Darren highlighted. This was partially offset by lower equipment revenue.

Doug: This includes positive growth from the continued strong adoption of our stream plus offering featured a bundle of featuring a bundle of leading OTT content made available nationally for Telus and cuda.

Darren: At the segment level <unk> operating revenues were up <unk>, 5%, driven by mobile network and fixed data services as well as positive health and AG services revenue growth as Darren highlighted.

Doug: This was partially offset by lower equipment revenue.

Doug French: Other revenue includes real estate and copper gains driven by our leading pure fiber deployment, which is enabling our copper decommissioning program and monetizing of targeted central offices for redevelopment. Today, we have completed copper retirement initiatives in 18 targeted CO offices and sites, which are aligned to our real estate development opportunities. We expect these opportunities to grow and continue for years to come as we develop a diversified mix of real estate assets and continue monetizing copper from the active decommissioning program, while also realizing the operational benefits of fiber. P-TECH adjusted EBITDA growth increased by 5.1%, and its adjusted EBITDA margin expanded 150 basis points over 38%. The strong growth reflects a 9.2% decline in employee benefits expense driven by our cost efficiency programs.

Doug: Other revenue includes real estate and copper gains driven by our leading pure fiber deployment, which is enabling our copper decommissioning program and monetizing of targeted central offices for redevelopment.

Doug: We have completed copper retirement initiatives and 18 targeted co offices in sites, which is aligned to our real estate development opportunities.

Doug: We expect these opportunities to grow and continue for years to come as we develop a diversified mix of real estate assets and continue monetizing copper from the act of decommissioning program. While also realizing the operational benefits of fiber.

Doug: <unk> adjusted EBITDA growth increased by five 1% and adjusted EBITDA margin expanded 150 basis points.

Doug: Over.

Doug: Over 38%.

Doug: This strong growth reflects a nine 2% decline in employee benefits expense driven by our cost efficiency programs.

Doug French: This reflects a net reduction of $87 million after annual increases, as the cost savings from the programs we announced in last August have reached full run rate, which will continue, and we continue to invest in incremental efficiency and effectiveness opportunities, including digitization. We have increased our outlook for restructuring from $300 million to $400 million for 2024 accordingly. In the Telus digital experience, external operating revenues declined by 7.9% year-over-year.

Doug: <unk>, a net reduction of $87 million after annual increases as the cost savings from the programs. We announced in last August have reached full run rate, which will continue and while we continue to invest in incremental efficiency and effectiveness opportunities, including Digitization we have.

Doug: <unk> increased our outlook for restructuring from 300 million to $400 million for 2024 Accordingly.

Doug: And tell us digital experience external operating revenues declined by seven 9% year over year, <unk>, primarily driven by unfavorable year over year revenue.

Doug French: This was primarily driven by an unfavorable year-over-year revenue comparison from a leading social media client, although we are seeing signs of stabilization in that regard, along with the broader impact from the challenging macroeconomic environment, the industry, and industry competitive conditions. This is partially offset by volumes and expansion of services provided from existing customers, including Google, in particular driven by the continued momentum of digital AI services, new clients over the last 12 months, and some favorable foreign exchange. However, when including the intersegment revenue from Telus, external operating revenues were essentially flat.

Doug: Comparison from a leading social media client, although we are seeing signs of stabilization in that regard along with the broader impact from challenging macroeconomic environment the industry.

And industry competitive conditions. This was partially offset in volumes and expansion of services, providing from existing customers, including Google in particular, driven by the continued momentum of digital AI services, new clients out over that over the last 12 months and some favorable foreign exchange when including the <unk>.

<unk> segment Intersegment revenue from tell us external operating revenues were essentially flat.

Doug French: The growing contribution from TELUS to TELUS Digital showcases our strong and unique partnership, which is creating mutual benefit opportunities and underscores the critical role in driving our customer experience and digital transformation. This includes the implementation of Gen-AI applications across levels of the organization, driving further efficiencies and effectiveness opportunities. Telus Digital's adjusted EBITDA was up 18% or down 11% when excluding $43 million earn-out in the adjusted number from WillowTree. Other income associated with others was lapping share-based compensation from the prior year.

Speaker Change: The growing contribution from Telus to <unk> digital showcases our strong and unique partnership which is creating mutual benefit opportunities.

Speaker Change: And underscores the critical role in driving our customer experience and digital transformation.

Speaker Change: This includes the implementation of Gen AI applications across levels of our organization driving further efficiencies and effectiveness opportunities.

Speaker Change: <unk> digital adjusted EBITDA was up 18% or down 11% when excluding 43 million earn out in the adjusted number from Willow tree other income associated with others was lapping share based compensation from the prior year.

Doug French: As discussed earlier today, Telus Digital revised its 2024 targets. Importantly, the updated outlook implies stable to slightly improving revenue in the second half of the year relative to the first half and stable margins aligned with the second quarter while normalizing for the willow tree earn out. Overall, Telus Consolidated Operating revenues decreased by 0.7% year-over-year, while adjusted EBITDA increased by 5.6%, improving from the 4.3% in the first quarter. EBITDA margins expanded by 170 basis points year-over-year, driven by a 6.1% decline in employee benefits expense.

Speaker Change: As discussed earlier today <unk> staging a revised 2024 targets importantly, the updated outlook implies.

Speaker Change: Stable to slightly improving revenue in the second half of the year relative to the first half and stable margins in line with the second quarter, while normalizing for the Willow tree earn out.

Speaker Change: Overall, <unk> consolidated operating revenues decreased by <unk>, 7% year over year, while adjusted EBITDA increased by five 6% improving from the Florida three in the first quarter EBITDA margins expanded by 170 basis points year over year, driven by a six 1% decline in employee benefits.

Doug French: Consolidated net income increased by 13% year-over-year, while basic EPS was higher by 7.1. On an adjusted basis, net income and EPS were higher by 34% and 32%, respectively. This strong growth was driven by higher EBITDA and the flow through from our cost efficiency programs in addition to stable depreciation and amortization. Free cash flow of $478 million was higher by $199 million, driven by lower capital expenditures and higher EBITDA. CapEx declined by $116 million, or 14%, driven by our planned capital reduction.

Speaker Change: Consolidated net income increased by 13% year over year, while basic EPS was higher by 71 on an adjusted basis net income and EPS were higher by 34% and 32% respectively.

Speaker Change: This growth this strong growth was driven by higher EBITDA and the flow through from our cost efficiency programs. In addition to stay of all depreciation and amortization free.

Speaker Change: Free cash flow of $478 million was higher by $199 million, driven by lower capital expenditures and higher EBITDA.

Speaker Change: Capex gallant declined by $116 million or 14% driven by our planned capital reductions.

Doug French: Consolidated capital intensity was 13%, down 300 basis points over Q2 last year. Looking ahead, we are confirming our T-TEC revenue and EBITDA guidance, although trending to the lower end of our 2024 target. We remain confident in our commitment to driving strong, sustainable, and margin-accretive growth while maintaining a focus on lowering our cost to serve with profitable customer loading. Our consolidated free cash flow is being updated to approximately $2.1 billion due entirely to the flow-through of Telus Digital's revised EBITDA Outlook as announced today. The $100 million of incremental restructuring investments is being offset by lower taxes and handset investments. Our annual target for consolidated capital expenditures remains unchanged at $2.6 billion.

Speaker Change: Holidayed capital intensity was down <unk>, 13% down 300 basis points over Q2 last year.

Speaker Change: Looking ahead, we are confirming our key tech revenue and EBITDA guidance, however, trending to the lower end of our 2024 targets. We remain confident in our commitment to driving strong sustainable and margin accretive growth while maintaining focus.

Speaker Change: On lowering our cost to serve with profitable customer loading.

Speaker Change: Our consolidated free cash flow has been updated to approximately $2 1 billion due entirely to the flow through of <unk> Digital's revised EBITDA EBITDA outlook as announced today the.

Speaker Change: $100 million of incremental restructuring investments is being offset by lower taxes in handset investments.

Speaker Change: On annual our annual target for consolidated capital expenditures remains unchanged at $2 6 billion.

Doug French: Overall, we remain confident in our ability to continue generating strong and growing cash flows for years ahead, driven by our ongoing strong EBITDA growth and moderating capital intensity towards 10%. This will support maintaining a strong balance sheet to provide us with ample flexibility to support growth, our growth ambitions, and shareholder returns. As we enter the back half, our financial position remains strong. At the end of the second quarter, we had approximately $2.5 billion of available liquidity.

Speaker Change: Overall, we remain confident in our ability to continue generating strong and growing cash flows for years ahead, driven by our ongoing strong EBITDA growth and moderating capital.

Speaker Change: Intensity towards 10% level. This romaine this will support maintaining a strong balance sheet to provide us with ample flexibility to support growth our growth ambitions and shareholder returns.

Speaker Change: As we enter the back half our financial position remains strong at the end of the second quarter, we have approximately $2 5 billion of available liquidity our costs. Our average cost of long term debt is 44, 2% and our average term to maturity is over 11 years with our debt net debt to EBITDA of three five times.

Doug French: Our average cost of long-term debt is $4.42%, and our average term to maturity is over 11 years, with our net debt debited at $3.85 times. The acquisition of wireless licenses in recent years has increased that ratio by 0.56 times. This includes payments for our 3800 MHz spectrum auction and obtaining the use of AWS for spectrum in the second quarter alone. As we progress through 2024 and into future years, we anticipate our leverage ratio to improve as we work towards our target ratio through continued IbaDiego, declining capital intensity, and ongoing free cash flow expansion. Robert, it's over to you. Thanks, Doug. Karl, we're ready for questions, please.

Speaker Change: The acquisition of wireless licenses in the recent years is increase that ratio by zero dock five six times. This.

This includes payments of our <unk> are 3800 megahertz spectrum auction and obtaining the use of AWS four spectrum in the second quarter alone.

Robert Mitchell: As we progressed through 2024 into future years, we anticipate our leverage ratio to improve as we work towards our target ratio through continued EBITDA growth declining capital intensity and ongoing free cash flow expansion Robert over to you. Thanks.

Robert Mitchell: Thanks, Doug Carl we're ready for questions. Please.

Operator: Certainly. The first question is from Vince Valentini from RTD Securities. Yeah, thanks very much. I'm going to try to sneak into one.

Speaker Change: Certainly.

Robert Mitchell: The first question is from Vince Valentini from TD Securities. Please go ahead Vince.

Vince Valentini: But you talk about record sub-advertisements, and it just isn't translating into much revenue growth. In fact, your fixed data revenue was lower in the second quarter than the first quarter by a million dollars, despite net subs being up 70,000. So what have you talked a little bit about?

Vince Valentini: Yeah, Thanks very much.

Vince Valentini: I'm going to try to sneak into one.

Speaker Change: You talk about record sub adds.

Yeah.

Speaker Change: Just isn't translating into much revenue growth in fact gear fixed data revenue was lower.

Second quarter than the first quarter by $1 million, despite net subs being up 70000. So what if you can talk a little bit about are you happy with this.

Vince Valentini: Are you happy with this? Do you need to be a bit more of a balance between pricing and volume in your mind? Are you looking to try to take advantage of higher pricing in any areas in the next few months to try to get that revenue growth up? And second, I'm sure you'll get this from others in a different way.

Speaker Change: A bit more of a balance between.

Speaker Change: <unk> volume in your mind are you.

Speaker Change: Let me try to take advantage of higher pricing and any areas in the next few months to try to get that revenue growth up and second I'm sure you'll get this from others in a different way, but given what we've seen telus international or or tell us digital today.

Vince Valentini: But given what we've seen at Telus International or Telus Digital today, does this make it more likely that you need to consider privatizing that company? Or is that on your radar as the share price and valuation get lower given that you still see positive on the long term outlook there? Thanks. Okay, I'll let Zainul kick off the first part of the question, Vince, and let Doug maybe provide any editorializing that he would like to do on that, and then I'll answer the second part. Zainul, over to you.

Speaker Change: Does this make it more likely that you would need to consider prioritizing that company or is that on your radar as as the share price and valuation gets lower given that you're still seeing positive on that on the long term outlook there. Thanks.

Speaker Change: Okay.

Zane: Zane I'll kick off the <unk>.

Vince Valentini: First part of the question Vince.

Doug maybe provide any editorializing that he would like to do on that and then I'll answer the second part.

Doug Carl: And over to you.

Zainul Mawji: Thank you Darren. Thanks Vince for the question. I think to be clear in terms of suggesting whether we are satisfied with this performance, the clear answer to that would be no. We are not satisfied with the level of performance we've seen in this very competitive environment. I think one of the things that is very clear to us, though, is that we have and will always be focused on economic and profitable loading at the household level.

Vince Valentini: Thank you Darren Thanks for the question I think to be clear in terms of suggesting are we satisfied with this performance that a clear answer to that would be no.

Doug Carl: We are not satisfied with the level of performance we've seen in this very competitive environment.

Doug Carl: One of the things that is very clear to us, though is that we have and will always be focused on economic and profitable loading at the household level.

Zainul Mawji: You can see that in terms of many characteristics of our performance. For example, our mobile and home additions have increased significantly year over year. Our product intensity on a per household basis for fiber households is over 3.2 now, which is significant.

Doug Carl: You can see that in terms of.

Doug Carl: Many characteristics of our.

Doug Carl: Of our performance our mobile in home additions have increased significantly year over year, our product intensity on a per household basis for fiber households at over $3 two now.

Doug Carl: <unk> is significant and we are consistently driving cost reduction in a very competitively intense environment, we've seen about a 6% year over year cost to serve improvement just in the consumer business.

Zainul Mawji: And we are consistently driving cost reduction in a very competitively intense environment. So we've seen about a 6% year over year cost to serve improvement just in the consumer business. That said, we're leaning into our product roadmap. Darren highlighted a number of elements of our product roadmap to continue driving intensity and to drive new revenue streams that our competitors are differentiated from. And we are going to continue to find levers to improve our AMPU performance and continue driving better overall retention outcomes in doing so.

Doug Carl: That said, we're leaning into our product roadmap Darren highlighted a number of elements of our product roadmap to continue driving intensity can drive new revenue streams that our competitors are differentiated from and we are going to continue to find leave.

Speaker Change: First to improve our AMT.

Speaker Change: <unk> performance.

Speaker Change: <unk>.

Speaker Change: Can you driving better overall retention outcomes in doing so we're a company that has always been focused on ensuring that we support the retention.

Zainul Mawji: We're a company that has always been focused on ensuring that we support the retention of our customers and drive overall customer lifetime value at the household level. This competitive dynamic is not one that we created, and it is one that we are going to continue to persevere through with those levers as stated.

Speaker Change: <unk> of our customers and drive overall customer lifetime value at the household level. This competitive dynamic is not one that we created and it is one that we're going to continue to persevere through with those leavers as stated.

Zainul Mawji: I think our internet ARPU, as I highlighted, was flat, quarter over quarter. So again, managing the value prop that that brings, and with the EBITDA growth at 5.1%, I think it reinforces Zainul's comment on our focus on AMPU and generating economic value. The second part of the question, Vince, you know, whilst we obviously have a fiduciary obligation to keep all of our options open explicitly, it is not our intention to privatize Telus Digital.

Speaker Change: I think maybe that's the correct, Bob I think our Internet ARPA as I highlighted it was flat.

Bob: Quarter over quarter, so again managing.

Bob: The value prop that that brings and with EBITDA growth of five 1% I think it reinforces <unk>.

Speaker Change: Comment on our focus on <unk> and generating economic value.

Speaker Change: The second part of the question Vince whilst we obviously have a fiduciary obligation to keep all of our options open.

Speaker Change: Politically.

Speaker Change: It is not our intention.

Speaker Change: Privatize tell is digital.

Zainul Mawji: We still believe in the assets that we have and the potential in terms of the value that they can generate going forward and how well they are positioned to leverage developments that are taking place in the industry in data, data analytics, and AI from legacy to the next generation. I think you can draw inferences from the structure that we have put in place.

Speaker Change: We still believe.

Speaker Change: And the assets that we have and the potential in terms of the value that they can generate going forward and how well they are positioned to leverage developments that are taking place in the industry at the data.

Speaker Change: Data analytics and AI from legacy to Gen AI basis.

Speaker Change: I think you can draw inference from the structure that we have put in place.

Darren Entwistle: This is not going to be the long-term structure for Telus Digital, but it is the right structure for right now. And I think this structure is going to be excellent in driving the recovery and growth program over the next 18 months. And you can expect tremendous consistency in that regard.

Speaker Change: This is not going to be the long term structure for Telus digital.

Speaker Change: But it is the right structure for right now.

Speaker Change: And I think the structure is going to be excellent in driving the recovery and growth program over the next 18 months.

Speaker Change: Expect tremendous consistency in that regard the other attribute of the structure that I think is good for investors to focus on.

Darren Entwistle: The other attribute of the structure that I think is good for investors to focus on is that it provides an explicit focus and accountability on the two major components of our business, which, of course, is driving the considerable potential as it relates to digital AI, for which we are very well positioned, and Tobias has that remit. And then, of course, the other area is driving remediation, growth, and digital transformation in the CX part of our business, and leveraging the Telus case study in that regard.

Speaker Change: Is that it provides an explicit focus and accountability on the two major components of our business, which of course is driving the considerable potential as it relates to digital AI for which we are very well positioned and to be at.

Speaker Change: Has that remit and then of course, the other area is driving remediation growth and digital transformation in the CX apart.

Speaker Change: Our business and leveraging the <unk> case study in that regard along the way and Jason's credentials to do that given what he has delivered at the Telus organization.

Darren Entwistle: And Jason's credentials to do that, given what he's delivered at the Telus organization, are second to none. Both Tobias and Jason know each other very well, so I would expect this to be a very strong partnership between the two.

Speaker Change: To none.

Jason Mcdonell: To be as <unk>, Jason know each other very well so I would expect.

Jason Mcdonell: This to be a very strong partnership between the two.

Darren Entwistle: And both of them are smack dab in their areas of expertise, where they've got a proven track record, credentials, and experience to deliver on the objectives that we have here and drive that recovery and growth program extremely successfully. And I've got a lot of confidence that we're going to do exactly that. Next, Vince.

And both of them are smack Dab in their areas of expertise, where they've got a proven track record credentials and experience to deliver on the objectives that we have here and drive that recovery and growth program extremely successfully and I've got a lot of confidence that we're going to do exactly.

Operator: Carl, next question, please. The next question is from Drew McReynolds from RBC. Please go ahead. Thanks very much. I'll try and squeeze in myself.

Vince Valentini: Thanks, Vince Karl next question please.

Speaker Change: The next question is from drew Mcreynolds. Please go from RBC. Please go ahead drew.

Drew Mcreynolds: First, a clarification, just to make sure I'm looking at it the right way. With wireless ARPU, and I will get in my second one to network revenue with growth, which is kind of the more important KPI. But on wireless ARPU, you're down, 3.4%. But you've stated last year's and, you know, if you were to kind of do an apples to apples comparison with Rogers or BC, they'd be down kind of one and a half to maybe 3%, respectively. I just want to confirm, I guess with you, Doug, that that's the right way to look at it in terms of how you're reporting. Absolutely, that's the right way to look at it.

Drew Mcreynolds: Thanks very much.

Drew Mcreynolds: I'll try and squeeze in to myself.

Drew Mcreynolds: First a clarification.

Drew Mcreynolds: Just to make sure I'm looking at it the right way with wireless <unk> and I will get my second one can network revenue.

Speaker Change: Growth, which is kind of the more important kpis.

Drew Mcreynolds: Ireland.

You're down.

Drew Mcreynolds: 4%, but <unk> stated last year.

Speaker Change: Or would it kind of do an apples to apples comparison, but with Rogers R. R. BCE they'd be down kind of one and ask to maybe 3% respectively. I just wanted to confirm I guess with you Doug.

Doug Carl: That's the right way to look at it in terms of in terms of how you reported.

Doug Carl: Absolutely that's the right way to look at it.

Drew Mcreynolds: Okay, and then just shifting, more important network revenue growth in the prepared remarks, you know, your commentary on IoT and that kind of bucket of revenues, beginning or continuing to build, just can you help us just understand the relative size or contribution of that bucket? I think everybody's assumption here is that on the B2C side within wireless, there'll continue to be some, you know, kind of pressure or commoditization. So just wondering how that mix kind of flows through, looking into next year, and the extent to which you can kind of rebuild the 1% network revenue growth that you're currently generating. Thank you.

Doug Carl: Okay.

Speaker Change: Then just shifting more important network revenue growth in the prepared remarks.

Speaker Change: Commentary on Iot and that kind of bucket of revenues.

Beginning or continuing to build just can you can you help us just understand the relative size of our contribution of that bucket I think everybody's assumption here is on the BDC side within wireless still continue to be some.

Speaker Change: Pressure commoditization. So just wondering how that mix kind of flows through looking into next year.

Speaker Change: And the extent to which you can kind of rebuild the 1% network revenue growth that Youre currently generating thank you.

Zainul Mawji: And I think maybe we'll hand that to Zainul again on some of the ARPU initiatives. Maybe one thing leading to the ARPU trajectory and the profitability that we talked about in the 5.1, if you think about confirming the bottom end of our guidance, what that means for our growth rates as well in the back half of the year, is that our growth rates will continue to accelerate above six for the next six months.

Zane: And I think maybe we'll hand that Zane I'll again on on some of the <unk> initiatives.

Speaker Change: Maybe one thing leading to the <unk>.

Speaker Change: Trajectory and the profitability that we talked about on the $5 one.

Speaker Change: If you think through confirming the bottom end of our guidance, whether it means to our growth rates as well in the back half of the year as our growth rates will continue to accelerate above six.

Zeno: For the next six months and again that is leveraging all the tools that Zeno is talking about in addition to our efficiency effectiveness and our growth engines that of <unk>.

Zainul Mawji: And again, that is leveraging all the tools that Zainul was talking about in addition to our efficiency, effectiveness, and our growth engines of health and agriculture, as Darren highlighted in his presentation. So leveraging all the tools in our toolkit. Zainul, do you want to top up?

AG: And AG as Darren highlighted in his presentation, so leveraging all the tools in our toolkit.

Zeno: You want to top up.

Doug French: Yeah, sure. I mean, fundamentally, there are a number of initiatives that we're going to continue to drive. And, you know, you've seen us create premium capabilities and bundled capabilities across our brands. We have a differentiated suite of brands that we're leaning into more effectively that help us compete in underpenetrated segments in some areas and help us drive premium capabilities in other segments. And we've really led on that.

Speaker Change: Yeah sure I mean, I think fundamentally that there are a number of <unk> initiatives that we're going to continue to drive in.

Speaker Change: <unk> seen us create premium capabilities and bundled capabilities across our brands, we have a differentiated suite of brands that we're leaning into more effectively that help us compete in underpenetrated segments in some areas and help us drive premium capabilities in other segment and we've really.

Speaker Change: The lag on that we're leaning into our entertainment and our smart home and other differentiation to continue driving that premium opportunity and of course, there's general block and tackle in terms of the level at which we have to drive improved <unk> performance and.

Zainul Mawji: We're leaning into our entertainment and our smart home and other differentiation to continue driving that premium opportunity. And, you know, of course, there's a general block and tackle in terms of the level at which we have to drive improved ARPU performance and drive that relationship between customer renewal and churn performance, along with managing, you know, the very challenging device and promotional subsidies in our market. So, we're going to continue to lean into the brand differentiation and the product differentiation that we have. And I think the other thing to highlight is that

Speaker Change: And drive that relationship between customer renewal and churn performance along with managing it Mary.

Speaker Change: Challenging device and promotional subsidies and in our market. So we're going to continue to lean into that the brand differentiation in the product differentiation that we have I think I think the other thing to highlight is that.

Zainul Mawji: We've always been focused on economic loading and on household ARPU, and we've talked about the fact that we should transition to household ARPU over time as the most meaningful metric. And we're going to focus on economics and profitable growth across our brands. You know, I think you've seen strong performance from an EBITDA perspective, and we're going to continue to drive that performance. Thank you very much.

Speaker Change: We've always been focused on economic loading and on household ARPA. When we talked about the fact that we should transition to household RPM over time is as the most meaningful metric and we're going to focus on economics and profitable growth across our brands.

Speaker Change: I think <unk> seen strong performance from an EBITDA perspective, and we're and we're going to continue to drive that performance over time.

Speaker Change: Thank you very much.

Operator: Thanks, Drew. Next question, please, Carl. The next question is from Jerome Dubreuil from Desjardins. Hi, thanks for taking my questions. First of all, the release from Telus Digital is saying that the company is pivoting its focus to revenue growth. You know, that's what a lot of spec investors are after. But you know, historically, telecom investors have talked maybe more about pre-cash flow growth. Obviously, you're still getting a lot of pre-cash flow growth, and both revenue and pre-cash flow growth are good to see. But I'm trying to reconcile whether the telecom and tech objectives are aligned.

Thanks <unk> next question please.

Speaker Change: The next question is from <unk> from <unk>. Please go ahead.

Speaker Change: Hi, Thanks for taking my questions first one there.

Speaker Change: Release from Intel is digital is saying that the company is pivoting its focus to revenue growth.

Speaker Change: That's what a lot of like investors are after but historically telecom investors.

Speaker Change: Maybe more about free cash flow growth. Obviously, you are still getting a lot of free cash flow growth in both revenue and free cash flow was good to see but.

Speaker Change: I'm trying to reconcile it with telecom in fact objectives.

Speaker Change: Our are aligned at this point.

Jerome Dubreuil: Jeff, do you want to take that question and talk about both what we want to achieve prospectively in terms of EBITDA growth driven by top-line revenue and where you see the major opportunities prospectively in that regard as we overcome the challenges? And then maybe speak to the free cash flow potency of the business and the consistency on that front with the very low level of capex intensity. Certainly Darren, thank you, Jerome.

Speaker Change: Jeff do you want to take that question.

Jeff: And talk about both what we want to achieve prospectively on EBITDA.

Jeff: Growth driven by top line revenue and where you see the major opportunities prospectively.

Jeff: In that regard as we overcome the challenges.

Speaker Change: And then maybe speak to the free cash flow potency of of the business and the consistency on that front with the very low level of Capex intensity.

Jeffrey Puritt: We absolutely believe that the revenue growth potential of Telus Digital is just in the early days, and we have not executed as well as we should have or could have, and you will have seen and heard from me and the team earlier today a more detailed discussion on the efforts underway to try and get back to achieving that level of growth that we believe is possible given the asset mix that we enjoy today, particularly around not just the legacy of customer experience excellence but particularly around technology-enable The upside opportunity for this business, we believe, is significant, and we just need to do a better job of marshalling these resources and leveraging these assets to achieve high single-digit revenue growth potential. Along the way, the legacy pedigree of the Telus family in focusing on profitable growth has informed our approach to the market.

Certainly darrin thank you Jerome.

Speaker Change: Absolutely.

Darrin: The revenue growth potential of digital is just.

Darrin: Early days and we have not executed as well as we should have or could have and you will have seen and heard from me and the team earlier today.

Speaker Change: A more detailed discussion on the efforts underway to try and get back to achieving that level of growth that we believe is possible given the asset mix that we enjoy today, particularly around not just the legacy of <unk>.

Speaker Change: Customer experience excellence, but particularly around technology enabled gene AI enabled capabilities.

Speaker Change: The upside opportunity for this business, we believe is significant.

Speaker Change: We just need to do a better job of marshaling These resources and leveraging these assets to achieve high.

Speaker Change: High single digit revenue growth potential along the way.

Speaker Change: Legacy pedigree heritage of the Telus family and focusing on profitable growth.

Jeffrey Puritt: And I think a few years ago, we were able to enjoy outsized margin yield because of our superior and differentiated service level performance. However, the appetite for customers changing to more and better for less has really forced us to revisit that profile only in the near term.

Speaker Change: Informed our approach to the market.

Speaker Change: I think a few years ago, we were able to enjoy outsized margin yield because of our superior differentiated service level performance.

Speaker Change: Appetite for customer changing to more and better for us has really forced us to revisit that profile only in the near term and we absolutely expect that Doug will improve in the months years ahead as we continue to demonstrate the capabilities of helping our customers themselves to do more.

Operator: And we absolutely expect that that will improve in the months and years ahead as we continue to demonstrate the capabilities of helping our customers themselves to do more and better with less leverage on our support. Along the way, you will have seen that the focus on cash flow yield at 15% year over year, year to date, has, I think, continued to distinguish us, and that has enabled us to continue to reinvest in the business to ensure that we can get back to that level of growth and profitability that we've enjoyed historically. Thank you. This is Jerome.

Speaker Change: With less leveraging our support along the way you will have seen that the <unk>.

Speaker Change: On cash flow yield at 16% year over year.

Speaker Change: Year to date.

Speaker Change: I think continued to distinguish us and that has enabled us to continue to reinvest in the business to ensure that we can get back to that level of growth in <unk>.

Speaker Change: Profitability that we've enjoyed historically.

Speaker Change: Thank you.

Carla: Thanks, Sharon Carla's question. Please.

Operator: Call the next question, please. The next question is... Stephanie Price from CABC, please go ahead. Good afternoon.

Speaker Change: The next question is from Stephanie price from CIBC. Please go ahead Stephanie.

Stephanie Price: Good afternoon.

Stephanie Price: Congratulations on the revenue and EBITDA growth at Telus Health in the quarter. I just wanted to focus in on the growth businesses. I'm curious if you still envision a monetization event for Telus Health in kind of the near to mid-term, and how you're thinking about the growth businesses, or if you're thinking about the growth businesses differently than you have in the past. All right, I'll take this one.

Stephanie Price: Congratulations on the on the revenue and EBITDA growth at Telus health in the quarter just wanted to focus in on the growth businesses. I'm curious if you still envision a monetization event for Telus health and kind of the near to midterm and how do you think about the growth businesses or as you're thinking about the gross change cannot with seamless tell us much at all.

I'll take this one.

Speaker Change: The short answer to your question is yes, we are.

Darren Entwistle: The short answer to your question is yes, we still do envisage a monetization opportunity that relates to our emerging businesses, where I would say Telus Health is in the leading position in that regard. However, I would be more medium term rather than near term in terms of its orientation. The manifestation of that monetization may be something that is synonymous with what we did historically back in 2016 and thereafter on the IPO front with Telus Digital.

Speaker Change: Still do envisage.

Speaker Change: A monetization opportunity.

Speaker Change: Relates to our emerging businesses, where I would say.

Speaker Change: Tell us help us in the leading position in that regard I would be more medium term than near term in terms of its orientation.

Speaker Change: The manifestation of that monetization may be something that is synonymous with what we did historically back in 2016 and thereafter on the IPO front with.

Speaker Change: With with Telus digital so it's not just looking at going public but also looking at partnership opportunities along the way.

Darren Entwistle: So it's not just looking at going public but also looking at partnership opportunities along the way. But we are very clear in terms of things like a pre-IPO checklist that we have to earn our way to that monetization event through the organic performance of the business because we have to have that strong organic performance delivered on a consistent basis to support the premium valuation because it's not about the repatriation of money but it's a monetization event to establish a transaction currency so that we can expand the addressable market of inorganic opportunities to complement what we're earning in terms of the organic performance of that business.

But we are very clear in terms of things like a pre IPO checklist that.

Speaker Change: We have to earn our way.

Speaker Change: Two that monetization event through the organic performance of the business.

Speaker Change: Because we have to have that strong organic performance delivered on a consistent basis to support the premium valuation because it's not about the repatriation of money, but its a monetization event to establish a transaction currency. So that we can expand the addressable market of inorganic opportunities.

Speaker Change: To complement what we're earning in terms of the organic performance of that business.

Darren Entwistle: I think it's encouraging to see this quarter the improved performance of Telus Health. We've experienced some macroeconomic impacts within that business, but clearly, the business is on the right track with the return to mid-single-digit revenue growth and an EBITDA contribution of north of 30%, which has been the case now for well over a year on a quarter-to-quarter-to-quarter basis. And the quality of the contribution within Telus Health, I think is indicative.

Speaker Change: I think it's encouraging to see this quarter the improved performance of Telus health.

Speaker Change: We've experienced some macroeconomic impacts within that business, but.

Speaker Change: Clearly the business is on the right track with the return to mid single digit revenue growth.

Speaker Change: And an EBITDA contribution of north of 30%, which has been the case now for well over a year on a quarter to quarter to quarter basis.

Speaker Change: And the quality of the contribution within Telus Health I think is indicative within my remarks, I made the comment that the performance is not coming from a single product or agency within Dell itself, but across the totality.

Darren Entwistle: Within my remarks, I made the comment that the performance is not coming from a single product or agency within Telus Health but across the totality of the business asset mix that we have. Like our agriculture business, we're seeing strong accretion within the sales funnel at Telus Health, which bodes well for continued strong organic performance of the business. I think we're a little bit over $300 million in total contract value improvements on a year-over-year basis in terms of year-to-date sales strength within the Telus Health organization, and I think that is an attractive attribute.

Speaker Change: The business asset mix that we have.

Speaker Change: Like our agriculture business.

Speaker Change: We're seeing a strong accretion.

Speaker Change: Within the sales funnel.

Speaker Change: <unk> itself, which bodes well for continued strong organic performance of the business.

Speaker Change: I think we're a little bit over $300 million in total contract value improvement on a year over year basis in terms of year to date sales strength within the <unk> itself the organization.

Speaker Change: I think that is an attractive attribute.

Darren Entwistle: We made a commitment to you when we bought Lifeworks a couple of years ago in terms of synergies realization, and I think we have made strong progress in that regard, bumping up against $300 million at this juncture in terms of synergies being realized, the preponderance of which has come from efficiency measures on the cost-synergy side.

We made a commitment to you when we bought <unk>.

Speaker Change: <unk> works.

Speaker Change: A couple of years ago.

Speaker Change: In terms of synergy realization and I think we have made strong progress in that regard bumping up against $300 million at this juncture.

Speaker Change: Synergies being realized the preponderance of which has come from efficiency measures on the on the cost synergy side, we've got about $130 million of synergies left to go to meet.

Darren Entwistle: We have about $130 million of synergies left to go to meet the expectation that we set with you to be realized by the end of 2025, and as I indicated earlier, the split on the $130 million is around $80 million on the cost front and $50 million on the revenue-synergy front, and I would be hopeful that we could maturely beat that $50 million revenue-synergy target given the considerable cross-sell opportunity that exists I have stated it strongly internally within Telus that within the T-Tech business, we should be able to grow EBITDA by 5% and never bring in a new logo but just sell new products to existing customers, such as the cross-sell opportunity. Fortunately, we are not restricted by that.

Speaker Change: The expectation that we set with you to be realized by the end of 2025 and as I indicated earlier the split on the one <unk> around $80 million on the cost front and $50 million.

Speaker Change: On the revenue synergy front and I would be hopeful that we could mature we beat that $50 million revenue synergy given the.

Speaker Change: Considerable cross sell opportunity that exists within the business.

Speaker Change: I've stated it strongly internally with entellus.

Speaker Change: That within the <unk> business, we should be able to grow EBITDA at 5% and never bring in a new logo.

Speaker Change: But just selling new products to existing customers such as the cross sell opportunity. Fortunately, we're not restricted by that we can do both but it is illustrative of the major opportunity there and in particular for Telus health the synergy synergistic combination of our B to B base within Telus business.

Darren Entwistle: We can do both, but it is illustrative of the major opportunity there and, in particular, for Telus Health. The synergistic combination of our B2B base within Telus Business Solutions and Telus Health is extremely strong, and every one of our clients right now wants to talk to us about employer productivity, including the health profile of their employees, and so I am excited by that particular dynamic. And then lastly, on the health front, as you It is where we started back in 2000, and we are still on that particular page today.

Speaker Change: Aleutians and Telus health is extremely strong and every one of our clients right now once that talk to us about employer productivity, including the health profile of their employees and so I'm excited by that particular dynamic and then lastly on the health front as you are.

Speaker Change: No for us.

Speaker Change: The expansion in emerging markets is all about the data play, it's where we started back in 2000, and we're still on that particular page today, leveraging data data analytics legacy AI Gen AI.

Darren Entwistle: Leveraging data, data analytics, legacy AI, and Gen AI, to couple that with network connectivity, to couple that with premium services, to be able to leverage the attributes of our business, including our sales channels and our customer base, and the digital and AI opportunity within Telus Health is absolutely huge, and Telus Health can feed off of the digital AI progression at Telus and feed off of the digital AI capability sets at Telus Digital or formerly Telus International. And what I like about it right now is that, with this performance trajectory that bodes so well for the future and is so encouraging, I don't think the business is firing on all cylinders. If I gave it an operational grade on a score of 10, I would probably give it a 5 or a 6 out of 10 right now, due to the upside opportunity.

Couple that with.

Speaker Change: Network connectivity to couple that with a premium services to be able to leverage the attributes of our business, including our sales channels and our customer base and the digital and AI opportunity within Telus health is absolutely huge.

Speaker Change: Telus health can feed off of the digital AI progression at Telus and feed off of the digital AI capability sets.

Speaker Change: <unk> digital are formally Telus international.

Speaker Change: And what I like about it right now is with this performance trajectory that bodes so well for the future and is so encouraging.

Speaker Change: I don't think the business is firing on all cylinders if.

Speaker Change: If I gave us gave it up.

Speaker Change: Operational grade on a score to 10, I would probably give it a fiber or six out of 10 right now such as the upside opportunity.

Darren Entwistle: We have more that we can do on cost efficiency. We have more that we can do in automating and digitizing the business. We can be a lot better on the customer service front, taking a page out of the Telus book. We can do a lot better on operational execution, and I've got great expectations in terms of the new leadership team that we've put in place at Telus Health. And we've got a long way to go on sales and marketing.

Speaker Change: The more that we can do on cost efficiency.

Speaker Change: We have more that we can do in automating and digitizing the business.

We can be a lot better on the customer service front taken a page out of the <unk> book and we can do a lot better on operational execution and I'm I've got great expectations in terms of the new leadership team that we've put in place at Telus health.

Speaker Change: We've got a long way to go on sales and marketing.

Darren Entwistle: You know, the opportunity to elevate our distribution strength at Telus Health is considerable. We've got a ton of products and capabilities that are sitting on a shelf and waiting for our channels to market and our distribution competencies to get properly activated. So, I like the upside opportunity there.

Speaker Change: The opportunity to elevate our distribution strength that Telus health is considerable we got a ton of products and capabilities that are sitting on a shelf and waiting for our channels to market and our distribution competencies to get properly activated so.

Speaker Change: I like the upside opportunity there in the past that tell us help goes.

Darren Entwistle: And the path that Telus Health is going, I think, blazes the trail for, you know, what's to follow on Telus agriculture and consumer goods. And at a smaller level, because it's, you know, one-fifth the size of Telus Health, but at a smaller level, Telus agriculture and consumer goods is also making excellent steps in that direction. So, we are still extremely committed to these components of our business. And the last thing I'll say about them is that these activities come with a very low CapEx intensity.

Speaker Change: I think Blazers the trail for whats the follow on Telus, agriculture and consumer goods.

Speaker Change: And at a smaller level because it's.

Speaker Change: One fifth the size of Telus health, but at a smaller level <unk> agriculture, and consumer goods is also making excellent steps in that direction. So we are still extremely committed to these components of our business and the last thing I'll say about them is these activities come.

Speaker Change: With very low capex intensity.

Darren Entwistle: Our solutions on the product front are SaaS-based solutions. So, our ability to take revenue to EBITDA to cash generation is extremely strong. And, of course, we're not looking at just the domestic market. This is a global opportunity for us. So, the scale opportunity is something that, you know, we've never enjoyed before looking at the telecoms business historically. So, it's quite an upside. Thank you.

Speaker Change: Our solutions on the product upfront or SaaS based.

Speaker Change: Solutions, so our ability to take revenue to EBITDA to cash generation is extremely strong and of course we're.

Speaker Change: We're not looking at just the domestic market.

Speaker Change: This is a global opportunity for us so the scale opportunity is something that we've never enjoyed before looking at the telecoms.

Speaker Change: Business historically, so it's quite the upside.

Speaker Change: Okay.

Operator: Thanks, Stephanie. Next question, please. The next question is from Tim Casey from BMO. Please go ahead. Yeah, thanks. Good afternoon. A couple for me.

Speaker Change: Thanks, Stephanie next question please.

Speaker Change: The next question is from Tim Casey from BMO. Please go ahead Tim.

Tim Casey: One, Doug, can you just clarify Darren's comments with respect to an EBITDA contribution of 30% from Telus Health? Is that an EBITDA margin we're talking about, or is that a contribution to growth? And then the second one is on the fixed data line metric, which is a little under 3% in the first quarter, down to 1% in the second quarter. How should we think about that in the back half of the year? Just wondering if there's any price increases we should think about, or is it more going to be in the 1% area for the back half of the year? Thank you.

Tim Casey: Yes. Thanks, good afternoon, a couple for me.

Doug Carl: Doug can you just clarify.

Speaker Change: <unk> comments with respect to an EBITDA contribution of 30% from Telus health is that certain EBITDA margin, we're talking about or is that.

Speaker Change: Contribution to growth and then second one is on the fixed data line.

Speaker Change:

Speaker Change: Metric.

Speaker Change: It was a little under 3% in the first quarter down to 1% in the second quarter, how should we think about that in the back half of the year. Just wondering if theres any price increases we should think about or is.

Speaker Change: Is it more going to be.

Speaker Change: The 1% area for the back half of the year. Thank you.

Darren Entwistle: I'll answer the question and clarify my own comment, and then Doug can clarify my clarification if he wants. No, it's not a margin number. It's a growth number. I referenced it in my opening remarks at 33%, and I rounded it to 30 in the Q&A that just took place.

Speaker Change: I'll answer the question clarify my own comment and then Doug can clarify my clarification.

Doug Carl: If he wants.

It's not a margin number its a growth number.

Speaker Change: Reference did.

Speaker Change: Opening remarks at 33% are rounded it to 30.

Doug Carl: The Q&A that just took place that say EBITDA contribution number and it reflects year over year growth in terms of Telus health profitability.

Darren Entwistle: That's an EBITDA contribution number, and it reflects year-over-year growth in terms of Telus Health profitability. The other element of it that I alluded to, but to give you greater specificity, from the 11% EBITDA contribution that we achieved in Q2 of 2023 on a year-over-year basis, since that particular juncture, in every quarter that has followed right through to now, Q2 of 2024, we've been in the 11% to 20% to now 30% EBITDA contribution coming on the Telus Health side.

Speaker Change: The other element of it that I alluded to but they give you greater specificity.

Speaker Change: The 11% EBITDA contribution that we achieved in Q2 of 2023 on a year over year basis since that particular juncture in every quarter that it's followed right through to now Q2 of 2024, we've been in the 11% to 20% to now 30%.

Speaker Change: EBITDA contribution coming on the Telus health side, the preponderance of that obviously, given my synergy comment is coming from the cost synergies that we're realizing but now in Q2 of 2024, we're starting to see the increased contribution at the EBITDA level coming from <unk>.

Darren Entwistle: The preponderance of that, obviously, given my synergies comments, is coming from the cost synergies that we're realizing, but now in Q2 of 2024, we're starting to see increased contribution at the EBITDA level coming from profitable revenue growth. Thank you.

Speaker Change: Profitable revenue growth.

Speaker Change: Thank you.

Doug French: And maybe just a quick thought about health margins. We've talked about them for many of a day, and margins are still below 20. With the opportunity that we desire to get them well above 20, as Darren highlighted with some of the staff services, cost reductions, and complimentary bundling. So there's still room to go significantly on margin enhancement on that end. And on fixed data, we haven't given forward looking on the component side.

Speaker Change: And maybe just a quick.

Speaker Change #100: Health margins, we've talked about from an EBITDA margin still below 20% with the opportunity that we desire to get them well above 20, as Darren highlighted with some of the SaaS services cost reductions and complementary bundling so theres still room to go.

Speaker Change #101: Secondly, our margin enhancement on that end.

Speaker Change #102: And on fixed data, we haven't given.

Speaker Change #101: Forward looking on.

Speaker Change #103: On the component side that being said, obviously there has been some give and takes within that number but focusing on margins really what matters. So within that light at nine am I highlighted that television revenue was actually down yet the margin on television we would be managing through the different programs were operating including the national.

Doug French: That being said, obviously, there's been some give and take within that number, but focusing on margins is really what matters. So within that light item, I highlighted that TV revenue was actually down. Yet the margin on TV would we would be managing through the different programs we're operating, including the national Call It Light program that Zainul referred to. And so I think there's a lot of give and take in there.

sandal: Call It light program that sandal referred to.

Speaker Change #105: So I think theres a lot of given taken their highlighted are our <unk> on the internet remains flat so that the growth coming from that would be obviously positive growth.

Speaker Change #105: <unk> business also included in that number as their business components so ill at.

Speaker Change #106: I'd, just say that our objective as we are to take it back up and continue the growth.

Speaker Change #106: <unk> well above.

Speaker Change #107: The one.

Speaker Change #107: But I think there'll be some give and takes along the way depending on product set and however, they will focusing on margin and <unk>.

Maybe just to top up sorry, I wanted to highlight.

Speaker Change #107: We're going to we've shown and demonstrated that we lean into product superiority and differentiation. So you would've seen us drive that.

Speaker Change #108: <unk> five gig program for Internet in the last week.

Speaker Change #108: We've seen actually to <unk> point on the <unk> front, we've seen even in a very competitive.

Zainul Mawji: Highlighted is our ARPU on the internet remains flat. So the growth coming from that would be obviously positive growth. And Biz is also included in that number as their business component. So our objective is to take it back up and continue the growth on well above one. But I think there'll be some give and takes along the way, depending on the product set.

Speaker Change #108: <unk> highly pressurized environment, both with respect to competition and Canadians driving their desire to.

Zainul Mawji: And, however, though, focusing on margin and impact. And maybe just to top it all off, sorry, I wanted to highlight, you know, we're going to, we've shown and demonstrated that we lean into product superiority and differentiation. So you would have seen us drive the 5GIG program for the internet in the last week. We've seen, actually, to Doug's point on the ARPU front, we've seen, even in a very competitive and highly pressurized environment, both with respect to competition and Canadians driving their desire to, you know, reduce costs and lean into affordability, that our step-ups on the internet have been very strong as well. And there are some downgrades, of course.

Reduce costs and lean into affordability.

Speaker Change #108: That are step ups on Internet has been very strong as well and there are some downgrades of course.

Speaker Change #108: But at the same time, we have a healthy volume of step up opportunity and we also have some areas, where we are quite underpenetrated at worse than where we would like to be in our fiber footprint and we've demonstrated success and strengthen.

Zainul Mawji: But at the same time, we have a healthy volume of step-up opportunity, and we also have some areas where we are quite underpenetrated than where we would like to be in our fiber footprint. And we've demonstrated success and strength in driving growth and subscriber growth in those areas. So we're going to continue to lean into that in terms of ensuring that our fixed data continues to be positive. Thanks, Tim. Karl, we have time for two more questions, please. The next question is Maher Yaghi from Scotiabank. Please go ahead.

Speaker Change #108: Driving growth in subscriber growth in those areas. So we're going to continue to lean into that in terms of ensuring that our fixed data continues positive momentum.

Speaker Change #108: Thanks, Tim Carl we have time for two more questions. Please.

Speaker Change #109: Certainly the next question is from Mayer Yaghi from Scotiabank. Please go ahead.

Maher Yaghi: Great. Thank you for taking my question. I wanted to just, I'm sorry, but I have to ask this question.

Mayer Yaghi: Great. Thank you for taking my question.

Mayer Yaghi: Wanted to just I'm.

Mayer Yaghi: I'm, sorry, because I have to ask this question I mean, when we look at the fixed data.

Mayer Yaghi:

Maher Yaghi: I mean, when we look at the fixed data, you have a very low video component there compared to cable companies in Canada. And the growth rate, I would have thought, you know, given that transcribed by https://otter.ai of the repricing we've seen already and how much is left before we reprice the base on the security of some of the video components and maybe the broadband side. I'm just trying to figure out how much more pressure we should expect before we see growth again. And the second question I had was about wireless.

Speaker Change #111: You have a very low video component in there compare to cable companies in Canada.

Speaker Change #112: The growth rate I would've thought.

Speaker Change #113: Given that.

Speaker Change #114: The split you would show.

<unk> growth than than other cable companies and obviously, we're seeing repricing in your page you also talk about.

Speaker Change #114: In your MD&A that Youre seeing repricing in the securities business security business.

Speaker Change #115: Can you discuss how much.

Speaker Change #116: Of the repricing, we've seen already and how much is left.

Speaker Change #117: Before we repriced the base on the security on.

Speaker Change #117: Some of the video component.

Speaker Change #118: And maybe the broadband side, just trying to figure out how much more pressure should we expect before we see the growth again.

Speaker Change #118: The second question I had is on wireless.

Speaker Change #119: Public mobile offering <unk>.

Maher Yaghi: Is that a, when you think about the value and the benefit of subscriber loading on public mobile, is there an opportunity maybe to price 5G services at a premium than 4G and then continue to offer it as is right now? Thank you. That's a great question. I really like that one.

Speaker Change #119: Is that a.

Speaker Change #121: When you think about the value and the benefit on the subscriber loading on public mobile.

Is there an opportunity maybe to price <unk> services at a premium than towards <unk>, and then continuing to operate.

Speaker Change #122: As as of right now thank you.

Zainul Mawji: Zainul, why don't you take a shot at answering that? I really like that question. Yes, I know you do.

Dan: That's a great question really like that one Dan why don't you take a shot at answering that.

Zainul Mawji: So the answer on the public side is yes. I think the key thing is that we haven't been satisfied with the roadmap of capabilities we have on public. It's got a digital first capability.

Dan: Really like that question, Yes, I know you do so the answer on the public side, yes.

Dan: I think the key thing is that we haven't been satisfied with the roadmap of capabilities we have.

Zainul Mawji: We like the customer base that it's attracting, and we like the positioning of the improvement in ARPU relative to where that brand had sat before. But there is absolute upside in differentiation, and we're going to drive that with some unique channel and roadmap strategies. So there's still to come on that.

Dan: On public it's got a digital first capabilities and we like the we like the customer base that its attracting and we like the positioning of the improvement in <unk> relative to where that brand headset sat before but there is absolutely upside in differentiation and.

Dan: We're going to drive that with some unique channel and roadmap strategy to.

Dan: So still to come on that not not satisfied I think on the fixed side, what I would say is that.

Zainul Mawji: I think on the fixed side, what I would say is that we can't predict the competitive environment. We're going to take a long-term view, as I highlighted in terms of household economics and household customer lifetime value. But where we're going to lean in on the two areas that you highlighted with respect to entertainment and security is counter the cord shaving behavior that we're seeing from our customer base with differentiated products and services.

Dan: I can't we can't predict the competitive environment.

Dan: Where we're going to take a long term view is that as I highlighted in terms of household economics and household customer lifetime value, but we're.

Dan: We're going to lean in both on the two areas that you highlighted with respect to entertainment and security is countered the cord shaving behavior that we're seeing from our customer base with differentiated products and services. So as customers are continuing to cord shave some of their linear prada.

Zainul Mawji: So as customers are continuing to cord-shave some of their linear products and services on the entertainment side, we're continuing to lean into OTT and becoming a real leader in our integration of OTT and linear and giving customers different kinds of video and value bundles, which we can only do because we've built our own platform to do so. So we're going to continue to drive outcomes based on differentiating value in a way that's meaningful to customers.

Dan: And services on the entertainment side, we're continuing to lean into OTT, and becoming a real leader a real leader in our integration of OTT and linear and giving customers different kinds of video and value bundles, which we can only do because we've built our own platform to do so so we're going to.

Continue to drive the outcomes based on differentiating value in a way that's meaningful to customers and I would say that we're just on the cusp in both energy and security of being able to realize that upside, but we can't control sort of what the competitive dynamic will bring we want to be immune to it.

Zainul Mawji: And I would say that we're just on the cusp in both entertainment and security of being able to realize that upside. But we can't control sort of what the competitive dynamic will bring. We want to be immune to it.

Darren Entwistle: I think also, importantly, Just to take people up to the top floor again. As it relates to absorbing the re-rate on fixed and mobile, we're postulating an H2 in terms of our guidance that sees us at 6% profitability at an EBITDA level, or better, absorbing the re-rate along the way. And so as that re-rate moderates and that pressure reduces, the profitability upside for our organization is extremely attractive, and it's also complemented by something else that keeps getting left off the discussion, a CapEx intensity measure that is 13% today, drifting to the low end on the double-digit side of things in the 10% zone.

Dan: I think also importantly.

Speaker Change #124: Just to take people up to the top floor again.

Speaker Change #124: As it relates to absorbing re rate.

Speaker Change #124: On fixed and mobile we're postulating a H two in terms of our guidance that sees us.

Speaker Change #124: 6% profitability at an EBITDA level or better absorbing.

Speaker Change #124: The re rate along the way and so as that re rate.

Speaker Change #124: Moderates.

Speaker Change #124:

Speaker Change #124: That pressure reduces the.

Speaker Change #124: The profitability upside for our organization.

Is extremely attractive and it's also complemented by something else that keeps getting left off the discussion a capex intensity measure that is 13% today.

Speaker Change #124: Drifting to the low end on the double digit side of things on the 10% zone. So in terms of both absorption a re rate working our way through that challenges leveraging in.

Darren Entwistle: So in terms of both absorption of re-rate, working our way through that challenge is leveraging, in the future, the profitable asset mix that we have, aided and abetted by new products coming online that shouldn't experience the same degree of profit or price, rather, commoditization, because they are completely differentiated from the product portfolio of our competitors. Thank you. Thanks, Mayor. Carl, we'll take our last question, please. And the last question is from Simon Flannery.

Speaker Change #124: In the future the profitable asset mix that we have aided and abetted by new products coming online that shouldnt experience. The same degree of profit or price rather commoditization because they are completely differentiated from the product portfolio of our competitors and to complement that.

Speaker Change #124: With a lower level of capex intensity that seems to bode well for a sustainable free cash flow story.

Speaker Change #124: Thank you thanks, Craig Thanks.

Karl: Thanks, Amir Karl we'll take our last question. Please.

Speaker Change #126: The last question is from Simon Flannery from Morgan Stanley. Please go ahead Simon.

Operator: Great, thank you very much. Doug, I wonder if you could expand a little bit on the copper retirement opportunity in the sense that, I think you mentioned 18 markets, but what sort of percentage are we through this? And I don't know if you can put some parameters around the financial benefits from that. You talked about freeing up real estate, but what are your latest findings in terms of OPEC savings, maintenance savings, and the overall impact on the business? Maybe I'll take it off Simon; I'll hand it over to Doug.

Simon Flannery: Great. Thank you very much.

Simon Flannery: I Wonder if you could expand a little bit on the copper copper retirement opportunity our sense. I think you mentioned 18 markets. That's what sort of percentage are we through this scenario.

Speaker Change #128: Don't know if you can put some parameters around the financial benefits from that you talked about freeing up real estate, but what are your latest findings in terms of opex savings maintenance savings and.

Speaker Change #129: Overall impact on the business.

Doug Carl: Maybe I'll kick it off Simon I'll hand, it over to Doug.

Speaker Change #129: Im.

Simon Flannery: In terms of the program, as we're decommissioning a quarter of a million copper lines on the run, we would expect to have, by the end of this year, so in the next few months, 36 central offices that have been decommissioned, which I think would put us in a global leadership position in that regard. In terms of the economics of it, on the copper front, we see the gross opportunity here being upwards of a billion dollars, and at a net level, somewhere between $400 million and $500 million on that front.

Doug Carl: In terms of.

Doug Carl: The program.

Doug Carl: And as we are.

Doug Carl: Decommissioning a quarter of a million.

Doug Carl: Copper lines on the run.

Doug Carl: We would expect to have by the end of this year. So over the next few months.

Doug Carl: 36 central offices.

Doug Carl: That have that have been decommissioned.

Doug Carl: Which I think would put us in a global leadership position in.

Doug Carl: In that regard.

Doug Carl: In terms of the economics of it.

Doug Carl: On the copper front, we see the growth opportunity here of being upwards of $1 billion and at a net level somewhere between four and $500 million.

Doug Carl: On that front.

Simon Flannery: The real estate opportunity that accompanies it, which Doug can speak to in terms of our long-term recurring strategy and the opportunity there. In terms of the performance of our business, as we go from a heterogeneous network environment with fiber and copper to a pure play fiber, which may be complemented by fixed wireless access, the opportunity on this front is huge. We see cost reductions in the range of 25% to 30% on cost to serve, and these are now hard numbers. They're not speculations because we've been at this for well over a decade.

Doug Carl: The real estate opportunity that accompanies that Doug can speak to in terms of our long term recurring strategy and the opportunity there.

Doug Carl: In terms of the performance of our business.

Doug Carl: As we go from a heterogeneous network environment with.

Doug Carl: Fiber and copper too.

Doug Carl: Peer play fiber may be complemented by fixed wireless access.

Doug Carl: The the opportunity.

Doug Carl: On this front is huge.

Doug Carl: We see.

Doug Carl: Cost reductions in the range of 25 to.

Doug Carl: 30% done on cost to serve and these are now hard numbers are not speculations because we've been at this for well over a decade.

Darren Entwistle: We see churn improvement in the zone of 20% to 25%. We see the average revenue per household going up by roughly 15%. We see the products per household, or product intensity, banging away right now at 3.3%, up from what was the low twos historically on the copper front, which is extremely attractive. It allows us to be much more efficient with our field force.

Doug Carl: We see churn improvement.

Doug Carl: In the zone of 20% to 25%.

Doug Carl: We see the average revenue per household going up by roughly <unk>.

Doug Carl: 15%, we see the products per household or product intensity.

Doug Carl: Banging away right now of $3 three up from what was the low twos historically on on the copper front, which is extremely attractive.

Doug Carl: Allows us to be much more efficient with their field force.

Darren Entwistle: When you've got a level of two-thirds reductions in truck rolls, you've got quite the story from cost efficiency to reducing your environmental footprint. Those will be huge benefits for us in terms of positioning us for the future economically, allowing us to do everything from absorb re-rate from competitive activity. But the cost of launching new products when you've got fiber ubiquity, on top of all the comments that I've just made, everything going forward is now soft provisioning. You can soft provision a customer from an install base.

Doug Carl: When you've got a.

Doug Carl: A level of two third reduction in truck rolls.

Doug Carl: You've got quite the story from cost efficiency to reducing your environmental footprint and those will be huge benefits for us in terms of.

Doug Carl: Positioning us for the for.

Doug Carl: For the future economically.

Speaker Change #130: Mowing is to do everything from on the hygiene front absorb re rate from competitive activity, but the cost of launching new products when you've got fiber ubiquity on top of all the comments that I've just made.

Speaker Change #131: Everything going forward is now soft provisioning.

Speaker Change #131: So you can soft provision a customer from an installed basis, you can change their products and their value proposition on a virtual basis or you can let the customer do it themselves.

Darren Entwistle: You can change their products and their value proposition on a virtual basis, or you can let the customer do it themselves along the way. Lastly, the economy is a scope given the limitless bandwidth opportunities on fiber second to none, which improves the economics on an accretive basis for every new product that you bring to market along the way. And so I think it's a very attractive composition of benefits, and maybe Doug can top it off and then maybe make a specific comment in terms of monetizing the real estate opportunity. Yeah, so the exciting part about this, as you're well aware, is that it's the gift that keeps on giving.

Speaker Change #131: The way.

Speaker Change #131: And then lastly, the economies of scope given the limitless bandwidth opportunities on fiber is second to none which improves the economics on an accretive basis for every new product that you bring to market along the way and so I think it is.

Speaker Change #131: A very attractive composition of benefits and maybe Doug can talk top up on that and then maybe make a specific comment in terms of monetizing the real estate opportunity.

Speaker Change #131: Yes.

Doug Carl: As exciting part of our business you are well aware that the gift that keeps on giving so.

Darren Entwistle: So, you know, we built an asset with over a 60-year life, so monetizing it isn't for the short term. And it's a superior asset to our competitors' offerings. And you heard all the operational benefits that Darren highlighted. On copper decommissioning specifically, of the 100% that Darren referred to at the billion level on gross, we're in low single digits by the end of 2024, so well below 5% monetized. So there is significant upside over the next, you know, two to five years.

Doug Carl: You know, where we fill that asset with over 60 year life. So monetizing it isn't a short term and it is a superior asset to our competitors' offerings and you heard all the operational benefits of Darren highlighted on copper decommissioning specifically.

Darin: The 100% of Darin referred to at the $1 billion level on gross we're low single digits by the end of 2024, so well below 5% monetize so there's significant upside over the next.

Speaker Change #132: Two to five years, we then started to move.

Darren Entwistle: We then started moving into land monetization, where we put the land into partnerships with development opportunities, where we put in the land, and the developer would put in cash to get the projects off the ground. And so you're seeing land opportunities now moving into permitting and development. And as Darren highlighted, you know, we're up to well over 30 now of those that have been decommissioned and opportunities. We are building on collectively three to four as we speak, and 15 are in permitting. And so, you know, we expect to have over 250 homes available for rental through Nanaimo and Sechelt by 2026. We'll have over 1,500 in the next three to five years.

Speaker Change #132: Moving into land monetization, where we're putting the land into partnerships with development opportunities, where we put in the land and the developer would putting cash to get the projects off the ground.

Speaker Change #132: So youre seeing.

Speaker Change #132: Land opportunities now moving into permitting and development and as Darren highlighted.

Darren: We're up to the well over 30 now are those that have been decommissioned in opportunities. We were building on collectively three to four as we speak and <unk> are and permitting.

And so we expect to have by 2026 over 250 homes available for rental for <unk> and <unk> will have over 1500 in the next three to five years and we have a commercial building thats launching in the fall of 2024, so to the development opportunity there is multiple layers.

Doug French: And we have a commercial building that's launching in the fall of 2024. So this development opportunity has multiple layers, and this isn't just one time. So you're going to see these kind of benefits coming through from us for the years to come and continuing then to build on that momentum. All right, thanks a lot.

Darren: And these aren't one time, so youre going to see these kind of benefits coming through from us for the years to come.

Darren: And kantar.

Darren: Continuing then to build on that momentum.

Speaker Change #134: Alright, Thanks, a lot.

Operator: Thanks, Simon, and thank you, everyone, for joining us today, and please feel free to reach out to the IR team if you have any follow-ups or questions. This concludes the Telus 2024 Q2 Earnings Conference Call. Thank you for your participation, and have a nice day. Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music Music, Good day.

Speaker Change #135: Thanks, Simon and thank you everyone for joining us today and please feel free to reach out to the IR team. If you have any follow up to your questions.

Operator: Welcome to the Telus 2024 Q2 earnings conference call. I would like to introduce your speaker, Mr. Robert Mitchell. Please go ahead.

Speaker Change #136: This concludes until 2024 Q2 earnings conference call. Thank you for your participation and have a nice day.

Speaker Change #136: Okay.

Speaker Change #136: Yes.

Speaker Change #136: [music].

Speaker Change #137: Good day and welcome to the <unk> 'twenty 'twenty four Q2 earnings conference call I would like to introduce your speaker Mr. Robert Mitchell. Please go ahead.

Robert Mitchell: Hello, everyone. Thank you for joining us today. Our second quarter of 2024 results, news release, MD&A, and financial statements and detailed supplemental investor information were posted to our website earlier this morning. On our call today, we'll begin with remarks from Darren and Doug. For the Q&A portion, we'll be joined by other members of our leadership team. In brief, prepared remarks, slides, and answers to questions contain forward-looking statements. However, actual results could vary materially from these statements.

Robert Mitchell: Well everyone. Thank you for joining us today, our second quarter 2024 results news release, MD&A and financial statements and detailed supplemental investor information are posted to our website earlier this morning.

Speaker Change #138: On our call today will begin with remarks by Darren and Doug for the Q&A portion will be joined by other members of our leadership team.

Darren: Recently prepared remarks slides and answers to questions contain forward looking statements actual results could vary materially from these statements the assumptions on which they are based and the material risks that could cause them to differ are outlined in our public filings with securities commissions in Canada, and the U S, including second quarter 2024, and annual 2023, MD&A with that over to you Darren.

Robert Mitchell: The assumptions on which they're based and the material risks that could cause them to differ are outlined in our public filings to securities commissions in Canada and the U.S., including second quarter 2024 and annual 2023 MV&A. With that, over to you, Darren. Thank you, Ringo.

Darren Entwistle: And, hello, everyone. In the second quarter, our team built upon our track record of execution excellence to drive industry-leading customer growth and strong financial results, leveraging our premier portfolio of assets, coupled with a relentless pursuit to drive cost efficiency and effectiveness. Our results clearly demonstrate how we are delivering sustainable profitable growth underpinned by our consistent strategic focus on margin-accretive customer expansion, our globally leading broadband networks, and, of course, our customer-centric culture. This enabled a record second quarter with total customer net additions of $332,000, up 13% on a year-over-year basis.

Darren: Thank you <unk> and Hello, everyone.

Darren: In the second quarter, our team built upon our track record of execution excellence to drive industry, leading customer growth and strong financial results leveraging our premier portfolio of assets, coupled with our relentless pursuit to drive cost efficiency and effectiveness.

Darren: Our results clearly demonstrate how we are delivering sustainable profitable growth underpinned by our consistent strategic focus on margin accretive customer expansion, our globally, leading broadband networks and of course, our customer centric culture.

Darren: This enabled our record second quarter with total customer net additions of 332000 up 13% on a year over year basis. This.

Darren Entwistle: This included healthy mobile phone net additions and record second quarter customer growth for both connected devices and total fixed net additions. Our team's passion for delivering customer service excellence once again contributed to leading loyalty results across our key product lines. Notably, post-paid mobile phone churn was again below 1% alongside pure fiber churn of circa 1%.

Darren: This included healthy mobile phone net additions and record second quarter customer growth for both connected devices and total fixed net additions.

Darren: Our team's passion for delivering customer service excellence once again contributed to a leading loyalty results across our key product lines.

Darren: Notably postpaid mobile phone churn was again below 1% alongside pure fiber churn of circa 1%. This showcases the consistent potency of our unmatched bundled product offerings across mobile at home and our leading customer experience over our industry best pure fiber and wireless.

Darren Entwistle: This showcases the consistent potency of our unmatched bundled product offerings across mobile and home and our leading customer experience over our industry-best pure fiber and wireless broadband network. For the second quarter, Telus achieved resilient EBITDA growth of 5.6% and margin expansion of 170 basis points. These results reflect the progression of our ongoing transformational efficiency programs that are clearly bearing fruit. Let's turn now and take a look at our T-Check mobile results.

Speaker Change #139: Bad networks.

Speaker Change #140: For the second quarter, <unk> achieved resilient EBITDA growth of five 6% and margin expansion of 170 basis points.

Speaker Change #140: These results reflect the progression of our ongoing transformational efficiency programs that are clearly bearing fruit.

Speaker Change #141: Let's turn now and take a look at our T Chek mobile results.

Darren Entwistle: Telus realized second-quarter customer growth of 262,000 net additions, its strongest second-quarter on record. This included robust mobile phone net additions of 101,000, driven alongside our continued focus on profitable margin-accretive customer growth. Indeed, we are doubling down on our disciplined focus on profitability as we progress through the remainder of 2024 and beyond. Our efforts will ensure that mobile customer growth drives sustainable EBITDA and cash flow accretion for our business and our investors. Mobile subscriber growth also included record second quarter connected device net additions of 161,000, which represents a 30% increase on a year over year basis.

Telus: Telus realized second quarter customer growth of 262000 net additions our strongest second quarter on record. This included robust mobile phone net additions of 101000, driven alongside our continued focus on profitable margin accretive customer growth.

Telus: Indeed, we are doubling down on our disciplined focus on profitability as we progress through the remainder of 2024 and beyond.

Telus: Our efforts will ensure our mobile customer growth drive sustainable EBITDA and cash flow accretion for our business and our investors.

Telus: Mobile subscriber growth also included record second quarter connected device net additions of 161000, which represents a 30% increase on a year over year basis.

Darren Entwistle: This reflects continued strong momentum with respect to our 5G and our IoT B2B solution. Additionally, our team delivered another quarter of leading loyalty results, which of course continues to be a hallmark of our Telus team. Blended mobile phone churn of 1.07% was up against the backdrop of elevated competitive activity relative to seasonal trends. Whilst this is not a level with which our team is content, it once again represented an industry-best result by a substantial margin versus our peer group.

Telus: This reflects continued strong momentum with respect to our <unk> and our Iot <unk> solution.

Telus: Importantly, our team delivered another quarter of leading loyalty results, which of course continues to be a hallmark of our Telus team.

Telus: Blended mobile phone churn of one debt zero, 7% was up against the backdrop of elevated competitive activity relative to seasonal trends.

Telus: <unk>. This is not a level of which our team is content. It. Once again represented an industry best result by a substantial margin versus our peer group.

Darren Entwistle: Notably, post-paid mobile phone churn was 0.89% in the quarter as we progressed through our 11th consecutive year with a churn rate below 1%. This is an outstanding result on a global basis and reflective of the industry-best customer experience our Telus team delivers time and time again. The close on mobile second quarter ARPU of $58.49 was down year over year.

Telus: Notably postpaid mobile phone churn was zero dot eight 9% in the quarter as we progressed through our 11th consecutive year with the churn rate below 1%.

This is an outstanding result on a global basis and reflective of the industry best customer experience, our Telus team deliver us time and time again.

Telus: The closeout mobile second quarter <unk> of $58 49.

Telus: Was down year over year.

Darren Entwistle: This was the result of continued intense promotional market activity and heightened competition. Notwithstanding the competitive pressures, our team is distinctly dissatisfied with our ARPU results, and we remain focused on driving a better outcome through multiple levers prospectively. These include enhancing our premium bundled offers across mobility and fixed and driving unmatched product development, differentiation, and intensity, all while maintaining strategic focus on profitable growth and sustainable economics. Our flanker brands offer strong customer value in key growth segments, some with lower associated ARPU, but notably compelling AMPU attributes.

Telus: This was a result of continued intense promotional market activity and heightened competition.

Telus: Notwithstanding the competitive pressures are team is distinctly dissatisfied with our <unk> results and we remain focused on driving a better outcome through multiple levers prospectively.

Telus: These include enhancing our premium bundled offers across mobility and fixed and driving unmatched product development differentiation and intensity all swab, maintaining strategic focus on profitable growth and sustainable economics.

Kelly Ann: Our flanker brands offer strong customer value in key growth segments, some with lower associated <unk>, but notably cannot Kelly Ann who attributes.

Darren Entwistle: Through digital transformation, we are meaningfully lowering our cost to serve across the board, inclusive of supporting an attractive AMPU for BYOD and flanker activity. Furthermore, our growing product intensity increases both average revenue and average margin per home, whilst reducing churn. Thus, we see sequential benefits as we layer more fixed and mobility products, significantly enhancing lifetime revenue and the associated economics. These efforts will continue to be supported by our team's passion for winning and retaining profitable customers, whilst remaining highly disciplined in respect of device subsidies. Furthermore, we continue to expect connected devices and IoT to increasingly contribute to network revenue, network ARPU, and AMPU, and to see that growth grow at a level of materiality prospectively.

Kelly Ann: Through digital transformation, we're meaningfully lowering our cost to serve across the board inclusive of supporting an attractive Abu for BYOB and flanked our activity.

Kelly Ann: Furthermore, our growing product intensity increases both average revenue and average margin per home, whilst reducing churn.

Kelly Ann: Thus, we see sequential benefits as we layer more fixed and mobility products significantly enhancing lifetime revenue and the associated economics.

Kelly Ann: These efforts will continue to be supported by our team's passion for winning and retaining profitable customers whilst remaining highly disciplined in respect of device subsidies.

Speaker Change #144: Furthermore, we continue to expect connected devices and Iot to increasingly contribute to network revenue network, <unk> and <unk> and seeing that growth grow at a level of materiality prospectively.

Darren Entwistle: Importantly, our industry-leading customer loyalty and focus on profitable growth allow us to continue delivering industry-best mobile phone lifetime revenue, which consistently exceeds our national peers by a considerable margin of up to 38% in the second quarter alone. Now, let's take a look at our T-TECH Fixed Operating Results, where Telus delivered another quarter of industry-best total wireline customer growth. Indeed, our team achieved robust and industry-leading second quarter internet net additions of $33,000, similar to the prior year and up slightly versus the first quarter of 2024.

Speaker Change #144: Importantly, our industry, leading customer loyalty and focus on profitable growth allow us to continue delivering industry best mobile phone lifetime revenue, which consistently exceeds our national peers by a considerable margin of up to 38% in the second quarter alone.

Speaker Change #144: <unk>.

Speaker Change #144: Now, let's take a look at our fixed operating results, where Telus delivered another quarter of industry best total wireline customer growth.

Speaker Change #144: Indeed, our team achieved robust and industry, leading second quarter Internet net additions of 33000 similar to the prior year and up slightly versus the first quarter of 2024.

Darren Entwistle: Importantly, consumers in the West are choosing Telus for our pure fiber superiority, coupled with our customer service excellence, which is sustaining strong growth on a year-over-year basis. We're also continuing to drive healthy growth in our TV product line, with industry-leading net additions of $25,000, up 47% on a year-over-year basis. Additionally, modest residential voice losses of 8,000 were flat over last year and again represented an industry-best result compared to our national peers by a notably wide margin.

Speaker Change #144: Importantly, consumers in the west are choosing tell us for our pure fiber superiority, coupled with our customer service excellence, which is sustaining strong growth on a year over year basis.

Speaker Change #144: We are also continuing to drive healthy growth in our TV product line with industry, leading net addition of 25000 up 47% on a year over year basis.

Speaker Change #144: Additionally, modest residential voice losses of 8000 were flat over last year and again represented an industry best result, compared to our national peers by notably wide margin.

Darren Entwistle: Strong and leading security net additions of 20,000 were up 33% and reflect our successful multi-product penetration strategy as well as the distinctive performance on premium versus our peers. Overall, our industry-leading external fixed net additions of $70,000 again represented a record second quarter result for the Telus organization. This demonstrates the strength of our unique and highly attractive bundled offers across our unmatched portfolio of products and services in combination with our superior customer experience over our ever-expanding PureFibre network.

Speaker Change #144: Strong and leading security net additions of 20000 were up 33% and reflect our successful multi product penetration strategy as well as the distinctive performance on premium versus our peers.

Speaker Change #144: Overall, our industry, leading external fixed net addition of 70000 again represented a record second quarter result for the Telus organization.

Speaker Change #144: This demonstrates the strength of our unique and highly attractive bundled offers across our unmatched portfolio of products and services in combination with our superior customer experience over our ever expanding pure fiber network.

Darren Entwistle: It's terrific to be able to deliver that magnitude of net fixed results for this organization in terms of getting an ROI on the billions of dollars that we've invested in pure fiber connectivity. These particular strengths will be further enhanced by continued significant innovation on our differentiated product roadmap, where we will be delivering a series of new products in the months and quarters to come. In this regard, Telus has built the first device-agnostic smart home platform leveraging new IoT services in close partnership with AWS, as well as the development talent and capacity of our Telus digital experience team, formerly Telus International.

Speaker Change #144: It's terrific to be able to deliver that magnitude of net fixed results for this organization in terms of getting an ROI on the billions of dollars that we've invested in pure fiber connectivity.

Speaker Change #144: These particular strengths will be further enhanced by continued significant innovation on our differentiated product roadmap, where we will be delivering a series of new products in the months and quarters to come.

Speaker Change #145: In this regard <unk> built the first device agnostic smart home platform, leveraging new Iot services in close partnership with AWS as well as the development talent and capacity of our tellers digital experience team, formerly Telus International.

Darren Entwistle: This platform will enable us to enter many new verticals, such as energy management, which we launched earlier this week. Furthermore, it will enable the enhanced integration of existing capabilities, such as health and wellness, whilst at the same time driving cost to serve improvements at a material level and driving as well licensing savings within our core business operations. It's really the embodiment of what we did with Ampu on the wireless front being driven into the wireline side of our business.

Speaker Change #145: This platform will enable us to enter many new verticals, such as energy management, which we launched earlier this week.

Speaker Change #145: Furthermore, that will enable enable the enhanced integration of existing capabilities, such as health and wellness whilst at the same time driving cost deserve improvement at a material level and driving as well licensing savings within our core business operations, it's really.

Speaker Change #145: The embodiment of what we did on <unk> on the wireless front being driven into the wireline side of our business our product development.

Darren Entwistle: Our product development, differentiated service portfolio, and product intensity, driven by leading data and AI capabilities, not only positions us for growth but helps Canadians save money in an affordability-challenged environment. Looking forward, this integrated product platform will deliver a multitude of innovative products, which will further solidify our product intensity leadership and present new revenue sources in the quarters to come that are completely differentiated from our competitive peer groups. Let's turn now and look at Telus Business Solutions, or TBS, which once again delivered a robust quarter of growth across all areas of the business.

Speaker Change #145: <unk> differentiated service portfolio and product intensity, driven by leading data and AI capabilities not only positions us for growth that helps Canadians saved money in an affordability challenged environment.

Speaker Change #145: Looking forward this integrated product platform will deliver a multitude of innovative products, which will further solidify our product intensity leadership and present, new revenue sources in the quarters to come that are completely differentiated from our competitive peer group.

Speaker Change #145: Let's turn now and look at <unk> business solutions, or TBS, which once again delivered a robust quarter of growth across all areas of the business.

Darren Entwistle: Our focus in B2B continues to be on accelerating profitable growth. And in this regard, notably, in the second quarter, TBS achieved strong cash flow growth of 8% on a year-over-year basis, reflective of our strong customer-first culture, global best networks, digital capabilities, and, of course, focused execution. Telus' business drove industry-leading loyalty results in Q2, a lead we've maintained now for nine consecutive quarters. Our Business Solutions team continues securing significant wins and strategic renewals in the commercial and public sector. This included an eight-figure deal to deploy TELUS' leading next-generation video security services for a high-profile client with a roadmap to expand with our video analytics, IoT, and automation solutions.

Our focus in <unk> continues to be on accelerating profitable growth and in this regard, notably in the second quarter GBS achieved strong cash flow growth of 8% on a year over year basis.

Speaker Change #145: Reflective of our strong customer first culture global best networks digital capabilities and of course focused execution <unk> business drove industry, leading loyalty results in Q2, our lead we've maintained now for nine consecutive quarters.

Speaker Change #145: Our business solutions team continued securing significant wins and strategic renewals in the commercial and public sector space.

Speaker Change #145: This included an eight figure deal to deploy <unk>, leading next generation video security services for a high profile client with a roadmap to expand with our video analytics Iot and automation solutions.

Darren Entwistle: We also secured a new strategic partnership that will see TELUS supporting thousands of Canadian vehicles with its industry-leading IoT services. This win builds on our multi-year collaboration with GM to provide connected car technology for its Canadian customers, and with Telus Health. We are pleased with the solid performance, returning to positive top-line growth of 4% as a result of investments in our product. Sales capacity and distribution channels deliver strong momentum across multiple lines of service. This includes MyCare, Pharmacy Management Systems, Virtual Pharmacy, Retirement Benefit Solutions, Health Benefits Management, our Precision Health, and our Employee Assistance Program.

Speaker Change #145: We also secured a new strategic partnership that will see tellers supporting thousands of Canadian vehicles, with our industry, leading Iot services.

This win builds on our multi year collaboration with GM to provide connected car technology for its Canadian customers.

Speaker Change #145: And Telus health, we are pleased with the solid performance returning to positive top line growth of 4% as investments in our products.

Speaker Change #145: <unk> capacity and distribution channels delivered strong momentum across multiple lines of service. This.

This includes my care Pharmacy management systems virtual pharmacy retirement benefit solutions health benefits management, our precision health and our employee assistance programs the <unk>.

Darren Entwistle: The performance at Telus Health has been strong across all of our product and business lines. And, notably, we expect this positive momentum to continue in the quarters ahead. Furthermore, our Telus Health team delivered over 33% adjusted EBITDA contribution growth in the second quarter of 2024, and this was supported by accelerated revenue growth alongside the continued progression of our Synergy Program at Telus Health. Notably, on the synergy front, we achieved $297 million in combined annualized synergies since acquiring LifeWorks back in 2022, including an increase of $46 million in the past quarter alone.

Speaker Change #145: <unk> that tells US help has been strong across all of our product and business lines and notably we expect this positive momentum to continue in the quarters ahead.

Speaker Change #145: Furthermore, our Telus health team delivered over 33% adjusted EBITDA contribution growth in the second quarter of 2024, and this was supported by accelerated revenue growth alongside the continued progression of our synergy program at Telus health, notably on the synergy front, we achieved.

Speaker Change #145: $297 million in combined annualized synergies since acquiring <unk> back in 2022, including an increase of $46 million in the past quarter alone.

Darren Entwistle: Since the acquisition, we've driven $248 million in cost synergies, along with $49 million in cross-selling, as we work towards our overall objective of $427 million by the end of 2025. This means we've got about 130 million synergies left to go, and about $80 million are going to come from the cost side, and $50 million as it relates to cross-selling. Moreover, in the second quarter, we saw a 10% year-over-year increase in the number of lives covered by Telus Health to now stand at more than $75 million.

Speaker Change #145: Since the acquisition, we've driven $248 million in cost synergies, along with $49 million in cross selling as we work towards our overall objective of $427 million by the end of 2025.

Speaker Change #145: This means we've got about $130 million synergies left to go and about $80 million are going to come from the cost side and $50 million as it relates to cross selling.

Speaker Change #145: Moreover, in the second quarter, we saw a 10% year over year increase in our global lives covered by Telus health to now stand at more than $75 million.

Darren Entwistle: Similarly, within Telus Agriculture and Consumer Goods, or TAC, we are yielding positive outcomes as we strengthen our market position, delivering strong second quarter revenue growth of more than 15%. This reflects some inorganic growth from tuck-in acquisitions and, as well, improving organic revenue performance in our consumer goods, precision agronomy, and animal agriculture businesses. Furthermore, it comes on the heels of continuing strong sales performance, quarter to quarter to quarter, as we have now.

Speaker Change #146: Similarly, with Intel is agriculture, and consumer goods or Tac, we are yielding positive outcome as we strengthen our market position delivering strong second quarter revenue growth of more than 15%.

Speaker Change #146: This reflects some inorganic growth from tuck in acquisitions, and as well improving organic revenue performance in our consumer goods precision agronomy and animal agriculture businesses.

Speaker Change #146: Furthermore, it comes on the heels of continuing strong sales performance quarter to quarter to quarter, where we have now realized in terms of our performance we've more than doubled our year to date sales bookings versus this time last year nice to see that doubling of our year to date sales.

Darren Entwistle: Realize, in terms of our performance, we've more than doubled our year-to-date sales bookings versus this time last year. It will be nice to see that doubling of our year-to-date sales bookings in terms of our performance in 2024 versus 2023. And as a result of all of these factors, we expect positive organic growth intact in the quarters ahead. Our commitment to amplifying the substantial growth potential of our distinctive global health and agriculture businesses includes capitalizing on significant cross-selling opportunities throughout all of our businesses, showcasing the collective talent and effectiveness of our team in propelling our success. Watch for more in that space in the quarters to come.

Speaker Change #146: Bookings in terms of our performance in 2024 versus 2023.

Speaker Change #146: And as a result of all of these factors, we expect positive organic growth intact in the quarters ahead.

Speaker Change #147: Our commitment to amplifying the substantial growth potential of our distinctive global health and agriculture businesses includes capitalizing on significant cross selling opportunities throughout all of our businesses showcasing the collective talent and effectiveness of our team and propelling our success.

Speaker Change #147: Watch for more in that space in the quarters to come.

Darren Entwistle: Turning to TELUS International, which will formally complete its rebranding to TELUS Digital Experience in the third quarter, TELUS Digital's second quarter results reflect a macroeconomic and operating environment that remains distinctly challenged. Whilst we are obviously not pleased with this performance, our confidence in the business and assets remains steadfast, and our team is committed to proving this throughout, with strong execution and exceptional service delivery starting in the second half of 2024 and building momentum for a much more successful 2025 and beyond.

Speaker Change #148: Turning to Telus International which will formally complete its rebrand named <unk> digital experience in the third quarter <unk> Digital's second quarter results reflect the macroeconomic and operating environment that remains distinctly challenged.

Speaker Change #148: Whilst we are obviously not pleased with this performance our confidence in the business and assets remained steadfast and our team is committed to proving this throughout strong execution and exceptional service delivery starting in the second half of 2024 and.

Speaker Change #148: Building momentum for a much more successful 2025 and beyond.

Darren Entwistle: This is going to be achieved by reinvesting Telus Digital's strong cash flow generation back into the business to support the reacceleration of top-line profitable growth, along with the ongoing and extensive focus on cost efficiencies and digital transformation initiatives that will improve not just our cost base but the operational tempo of this organization. In that regard, Telus Digital's promising capabilities in data and IR services, as well as its early success with Fuel iX, are capturing customer demand, as demonstrated by the double-digit revenue growth within its AI data solutions line of service in the first half of this year.

Speaker Change #148: This is going to be achieved by reinvesting <unk> digital's strong cash flow generation back into the business to support the Reacceleration of top line profitable growth along with the ongoing and extensive focus focus on cost efficiencies and digital transformation initiatives.

Speaker Change #148: <unk> that will improve not just our cost base, but the operational tempo of this organization.

Darren Entwistle: And that growth is indeed encouraging. Furthermore, our relationship with Telus Digital offers a unique competitive advantage as the strength of the Gen AI-fueled solutions created for and tested at Telus helps strengthen their go-to-market efforts with other external clients.

Speaker Change #148: In that regard <unk> digital's, promising capabilities and data and IR services as well as the early success with <unk> is capturing customer demand as demonstrated by the double digit revenue growth within its AIA data solutions line of service in the first half of this year.

Speaker Change #148: And that growth is indeed, encouraging. Furthermore, our relationship with Telus digital offers a unique competitive advantage as the strength of the Gen. AI fueled solutions created for and tested at tell us fortify their go to market efforts with other external client.

Speaker Change #148: <unk>.

Darren Entwistle: Whilst we are encouraged by these positive indicators of longer-term significant growth potential, the challenges Telus Digital is facing impact the expected levels of revenue and profit for 2024, as seen in their revised outlook for the full year. It's clear that Telus Digital must execute on its strategy to deliver the financial results that our investors expect and that we know that we can achieve given the quality of the asset base. In a moment, Doug will provide further commentary on both T-TEC and Telus Digital's results.

Whilst we are encouraged by these positive indicators of longer term significant growth potential the challenges <unk> digital is facing impact the expected levels of revenue and profit for 2024 as seen in our revised outlook for the full year.

Speaker Change #149: It's clear that tell us digital must execute on its strategy to deliver the financial results that our investors expect and that we know that we can achieve given the quality of the asset base.

In a moment, Doug will provide further commentary on both T Chek and Telus Digital's results.

Darren Entwistle: In closing, the record customer growth we continue to report is underpinned by our dedicated team who are indeed passionate about delivering superior service offerings and digital capabilities over our world-leading wireless and broadband fiber networks. The significant broadband network investments we have made are enabling our resilient FIBA DOT growth, ongoing monetization of pure fiber and 5G, the financial and strategic benefits of copper decommissioning, intense strategic focus on efficiency enhancement, and notable revenue and profit progression in Telus health, Telus agriculture, and consumer goods. That's quite a combination.

Speaker Change #150: In closing the record customer growth. We continue to report is underpinned by our dedicated team who are indeed passionate about delivering superior service offerings and digital capabilities over our world, leading wireless and broadband fiber networks.

Speaker Change #150: This significant broadband network investments, we have made are enabling our resilient EBITDA growth ongoing monetization of pure fiber and <unk>, the financial and strategic benefits of copper decommissioning and 10 strategic focus on efficiency enhancement and notable revenue.

Speaker Change #151: New and profit progression and Telus health and tell us agriculture and consumer goods.

Speaker Change #151: Quite the combination.

Darren Entwistle: Together, this combination of factors, solidly positioned, tells us the focus on what's next. And you will see this organization doubling down in these areas and evolving our product roadmap and customer-centric offerings in the weeks and months ahead in a way that will drive further significant differentiation and profitable and material revenue growth opportunities, that will be exemplified in terms of cross-selling and improved multi-product penetration, or what we call product intensity. Finally, I'd like to take a moment to acknowledge the wildfires that devastated the beautiful community of Jasper last week.

Speaker Change #151: Together this combination of factors solidly positions tell us they're focused on what's next and you will see this organization doubling down in these areas and evolving our product roadmap and customer centric offerings in the weeks and months ahead in a way that will draw.

Speaker Change #151: <unk> further significant differentiation and profitable and material revenue growth opportunities that will be exemplified in terms of cross selling and improved multi product penetration or what we call product intensity.

Speaker Change #151: This supports the continued advancement of our financial and operational performance, which is the bedrock of the long term sustainability of our industry, leading dividend growth program.

Speaker Change #153: Finally, I'd like to take a moment to acknowledge the wildfires that devastated the beautiful community of Jasper last week, the thoughts of our entire Telus team are with all those impacted by the fire.

Darren Entwistle: The thoughts of our entire TELUS team are with all those impacted by the fire. To support the community through this extremely challenging time, Telus has committed over $100,000 and is growing to assist with the vital rebuilding effort. Moreover, our team members worked around the clock to support evacuees and local authorities and first responders, leveraging our technology to keep everyone connected when it mattered most. In addition, we've provided care kits and a free 50 gigabit day to top up for those tragically displaced from their homes as a result of the wildfire. As a further demonstration of our support, we activated a free community crisis hotline through Telus Health, offering professional emotional support to anyone affected.

Speaker Change #153: To support the community through this extremely challenging time tell us has committed over $100000 and growing to assist with the vital rebuilding efforts.

Speaker Change #153: Moreover, our team members worked around the clock to support evacuees and local authorities and first responders leveraging our technology to keep everyone connected when it mattered. Most in addition, we provided care kits and a $3 50 gigabit data top up for those tragically displaced from their homes.

Speaker Change #153: As a result of the wildfires.

Speaker Change #153: As a further demonstration of our support reactivated a free community crisis hotline through Telus health offering professional emotional support to any one affected.

Darren Entwistle: I am, and the entire team is, sincerely grateful to the countless team members who continue to demonstrate that when things are at their worst, our Telus team is at their very best. Indeed, I can think of no better exemplification of putting our customers first than by putting our citizens in need first. Such is the symbiotic relationship between customers and communities. And before handing off to Doug, I'd like to take this opportunity to express my immense gratitude and appreciation to Jeff Puritt for his innumerable and important contributions to Telus Digital over the past two decades and almost a quarter of a century as a Telus team member.

Speaker Change #154: I am and the entire team is sincerely grateful to the countless team members, who continue to demonstrate that when things are at their worst our telus team is that they're very best and.

Indeed, I can think of no better exemplification of putting our customers first then by putting our citizens in need first such as the symbiotic relationship between customers and communities.

Doug Carl: And before handing off to Doug I'd like to take this opportunity to express my immense gratitude and appreciation to Jeff <unk> for his innumerable an important contributions to tell this digital over the past two decades and almost a quarter of a century as at Telus team member <unk>.

Darren Entwistle: Jeff will retire as President and CEO of Telus Digital, effective on the 3rd of September, and he will assume his new role as Executive Vice-Chair of Telus Digital and join the Board of Directors at that same time.

Doug Carl: Jeff will retire as president and CEO of <unk> digital effective on the third of September and he will assume his new role as executive Vice chair of tell us digital and joined the board of directors at that same time.

Darren Entwistle: As you know, Jeff has played a pivotal role in leading and shaping our Telus digital business since its inception. From a single delivery center in the Philippines, with fewer than 2,000 team members back in 2005, to an integrated global provider of AI, digital, and customer experience services, with over 75,000 employees now serving more than 650 clients from 32 countries around the world. Supported by robust senior leadership talent succession and in alignment with the company's strategy of bringing the best of technology to enable excellence in customer service, we are extremely pleased to welcome Jason McDonnell as CEO of Telus Digital and President of Telus Digital Customer Experience.

Speaker Change #155: As you know Jeff has played a pivotal role in leading and shaping our tellers digital business since its inception from a single delivery center in the Philippines with fewer than 2000 team members back in 2005 to an integrated global provider of AI Digi.

Speaker Change #155: And customer experience services with over 75000 employees now serving more than 650 clients from 32 countries around the world.

Speaker Change #156: Supported by robust senior leadership talent succession and in alignment with the company's strategy of bringing the best technology to enable excellence in customer service. We are extremely pleased to welcome Jason Mcdonell as CEO of <unk> digital and president of <unk> digital customer experience.

Darren Entwistle: Jason is a 20-year-old member of our TELUS senior leadership team with a proven track record of bringing the capabilities that TELUS has developed to lead in its industry and client care, leading in loyalty, leading in cost efficiency, and leading in digital transformation excellence, bringing these capabilities to all the business verticals that TELUS Digital addresses with external clients. In addition, Tobias Dengel, Founder and President of WillowTree, will take on the elevated role of President of Digital Solutions at Telus Digital Solutions.

Speaker Change #157: Jason is a 20 year tenured member of <unk> senior leadership team with a proven track record of bringing the capabilities that <unk> has developed to Lee in its industry and client care, leading loyalty, leading cost efficiency and leading in digital transformation excellence, bringing these capabilities.

Speaker Change #157: <unk> to all the business verticals that tell us digital addresses with external clients.

Ba's dango: In addition to Ba's dango, founder and President of military will take on the elevated role of President of digital solutions at Telus Digital solutions.

Darren Entwistle: Tobias is both an industry leading expert, he's got the experience, he's got the credentials, and he's got the entrepreneurial acumen and drive needed to ensure we continuously deliver best-in-class solutions across our digital, gen-AI, and AI modeling businesses. Both Jason and Tobias will work with me closely and report directly to the Telus Digital Board of Directors. And we are eager to see the significant leadership contribution and impact that they are going to have and make in returning Telus Digital to material, profitable growth. And on that note, I'll turn the call over to Doug.

<unk> is both the industry leading expertise he's got the experience he's got the credentials and he's got the entrepreneurial acumen and drive needed to ensure we continuously deliver best in class solutions across our digital Gen AI and AI <unk>.

Speaker Change #158: Milling businesses.

Both Jason and to be it will work with me closely and report directly to the tell US digital board of directors and we are eager to see the significant leadership contribution and impact that they are going to have and make and returning <unk> digital to material.

Speaker Change #158: Profitable growth and on that note I will turn the call over to Doug.

Doug French: Thank you, Darren, and hello everyone. Mobile phone and connected device subscriber additions drove network revenue growth of 0.9%, partially offset by lower mobile phone ARPU, which declined by 3.4%. The ARPU reflects the ongoing impact of the competitive pricing environment with customers optimizing their rate plans as well as declining contribution from overage and roaming, although this is partially offset by higher IoT revenue. As we progress through the second half of the year, we expect the highly competitive environment to continue.

Thank you Darren and Hello, everyone mobile phone and connected device subscriber additions drove network revenue growth of zero, 9%, partially offset by lower overall ARPA.

Doug Carl: Which declined by three 4%.

Doug Carl: <unk> reflects the ongoing impact from a competitive pricing environment with customers optimizing their rate plans as well as declining contribution from overage and roaming this was partially offset by higher Iot revenue.

Doug Carl: As we progress through the back half of the year, we expect the highly competitive environment to continue.

Doug French: Importantly, we continue our intense focus on AMPU and bundling to drive the right economic outcome. This is supported by our continued focus to drive lower costs to serve, as well as leverage our significant digital capabilities. This is further bolstered by Telus Digital, the key enabler to our customer experience leadership. Our significant and ongoing focus on cost efficiency is helping us offset the top line competitive pricing pressures, allowing us to invest in new product development that will support sustainable EVA-DA growth and margin accretion.

Importantly, we continue our intense focus on <unk> and bundling to drive the right economic outcomes.

Doug Carl: This is supported by our continued focus to drive lower cost to serve as well as leverage our significant digital capabilities. This is further bolstered by Telus digital a key enabler to our customer experienced leadership.

Doug Carl: Our significant and ongoing focus on cost efficiency is helping us offset the top line competitive pricing pressures, allowing us to invest in new product development that will support sustainable EBITDA growth and margin accretion.

Doug French: Fixed data services revenue grew by 1% year over year, driven by strong customer net additions of $78,000 across internet security and TV, as well as B2B growth, including cybersecurity and cloud services. Despite the competitive landscape, the solid growth demonstrates our superiority of our pure fiber network and growing product intensity. Internet ARPU in the quarter was stable due to our successful base management, while our TV revenue for house home was lower as customers continue to evolve their entertainment packages along with technological substitutions.

Doug Carl: Fixed data services revenue grew by 1% year over year, driven by strong customer net additions of 78000 across Internet security and TV as well as <unk> growth, including cyber security and cloud services.

Speaker Change #159: Fight the competitive landscape the solid growth demonstrates our superiority of our pure fiber network and growing product intensity.

Speaker Change #159: Internet <unk> in the quarter was stable due to our successful base management, while our TV revenue per host home was lower as customers continued to evolve their entertainment packages along with technological substitution.

Speaker Change #159: This includes positive growth from the continued strong adoption of our stream plus offering featured a bundle featuring a bundle of leading OTT content made available nationally for Telus and cuda.

Doug French: This includes positive growth from the continued strong adoption of our StreamPlus offering, featuring a bundle of leading OTT content made available nationally through TELUS and KUDO. At the segment level, T-TEC operating revenues were up 0.5%, driven by mobile network and fixed data services, as well as positive health and ag services revenue growth, as Darren highlighted. This was partially offset by lower equipment revenue.

Speaker Change #160: At the segment level <unk> operating revenues were up zero down, 5% driven by mobile network and fixed data services as well as positive health and AG services' revenue growth as Darren highlighted.

Speaker Change #160: This was partially offset by lower equipment revenue.

Doug French: Other revenue includes real estate and copper gains driven by our leading pure fiber deployment, which is enabling our copper decommissioning program and monetizing of targeted central offices for redevelopment. To date, we have completed copper retirement initiatives in 18 targeted CO offices and sites, which is aligned to our real estate development opportunities. We expect these opportunities to grow and continue for years to come as we develop a diversified mix of real estate assets and continue monetizing copper from the active decommissioning program while also realizing the operational benefits of fiber. P-TECH adjusted EBITDA growth increased by 5.1%, and its adjusted EBITDA margin expanded 150 basis points over 38%. The strong growth reflects a 9.2% decline in employee benefits expense driven by our cost efficiency programs.

Speaker Change #160: Other revenue includes real estate and copper gains driven by our leading pure fiber deployment, which is enabling our copper decommissioning program and monetizing of targeted central offices for redevelopment.

Speaker Change #160: We have completed copper retirement initiatives and 18 targeted Seo offices in sites, which is aligned to our real estate development opportunities.

Speaker Change #160: We expect these opportunities to grow and continue for years to come as we develop a diversified mix of real estate assets and continue monetizing copper from the act of decommissioning program. While also realizing the operational benefits of fiber.

Speaker Change #160: <unk> adjusted EBITDA growth increased by five 1% and adjusted EBITDA margin expanded 150 basis points.

Speaker Change #160: Over.

Speaker Change #160: Over 38%.

Speaker Change #161: Our strong growth reflects a nine 2% decline in employee benefits expense driven by our cost efficiency programs. This retroactive and net reduction of $87 million after annual increases as a cost savings from the programs we announced in last August have reached full run.

Doug French: This reflects a net reduction of $87 million after annual increases as the cost savings from the programs we announced in last August have reached full run rate, which will continue, and we continue to invest in incremental efficiency and effectiveness opportunities, including digitization. We have increased our outlook for restructuring from $300 million to $400 million for 2024 accordingly. In the Telus digital experience, external operating revenues declined by 7.9% year-over-year.

Speaker Change #162: Right, which will continue and while we continue to invest in incremental efficiency and effectiveness opportunities, including Digitization. We have increased our outlook for restructuring from 300 million to $400 million for 2024 Accordingly.

Speaker Change #162: And tell us digital experience external operating revenues declined by seven 9% year over year, primarily driven by unfavorable year over year revenue.

Doug French: This was primarily driven by an unfavorable year-over-year revenue comparison from a leading social media client, although we are seeing signs of stabilization in that regard, along with the broader impact from the challenging macroeconomic environment, the industry, and industry competitive conditions. This is partially offset by volumes and expansion of services provided from existing customers, including Google, in particular, driven by the continued momentum of digital AI services, new clients over the last 12 months, and some favorable foreign exchange. However, when including the intersegment revenue from Telus, external operating revenues were essentially flat.

Speaker Change #162: Comparison from a leading social media client, although we are seeing signs of stabilization in that regard along with the broader impact from challenging macroeconomic environment the industry.

Speaker Change #162: And the industry competitive conditions, this was partially offset and volumes and expansion of services, providing from existing customers, including Google in particular, driven by the continued momentum of digital AI services, new clients added over the last 12 months and some favorable foreign exchange when including the <unk>.

Speaker Change #163: <unk> segment Intersegment revenue from tell us external operating revenues were essentially flat.

Doug French: The growing contribution from TELUS to TELUS Digital showcases our strong and unique partnership, which is creating mutual benefit opportunities and underscores the critical role in driving our customer experience and digital transformation. This includes the implementation of Gen-AI applications across levels of the organization, driving further efficiencies and effectiveness opportunities. Telus digital-adjusted EBITDA was up 18% or down 11% when excluding $43 million earn-out in the adjusted number from WillowTree. Other income associated with others was lapping share-based compensation from the prior year.

Speaker Change #164: The growing contribution from Telus to <unk> digital showcases our strong and unique partnership which is creating mutual benefit opportunities.

Speaker Change #164: And underscores the critical role in driving our customer experience and digital transformation.

Speaker Change #164: This includes the implementation of Gen AI applications across levels of our organization driving further efficiencies and effectiveness opportunities.

Speaker Change #165: <unk> digital adjusted EBITDA was up 18% or down 11% when excluding 43 million earn out in the adjusted number from Willow tree other income associated with others was lapping share based compensation from the prior year.

Doug French: As discussed earlier today, Telus Digital revised its 2024 targets. Importantly, the updated outlook implies stable to slightly improving revenue in the second half of the year relative to the first half and stable margins aligned with the second quarter while normalizing for the willow tree earn out. Overall, Telus Consolidated Operating revenues decreased by 0.7% year-over-year, while Adjusted EBITDA increased by 5.6%, improving from the 4.3% in the first quarter. EBITDA margins expanded by 170 basis points year-over-year, driven by a 6.1% decline in employee benefits expense.

Speaker Change #165: As discussed earlier today I will schedule, a revised 2024 targets importantly, the updated outlook implies.

Speaker Change #165: Stable to slightly improving revenue in the second half of the year relative to the first half and stable margins in line with the second quarter, while normalizing for the Willow tree earn out.

Speaker Change #166: Overall, <unk> consolidated operating revenues decreased by zero down 7% year over year, while adjusted EBITDA increased by five 6% improving from the $4 three in the first quarter EBITDA margins expanded by 170 basis points year over year, driven by a six 1% decline in employee benefits.

Doug French: Consolidated net income increased by 13% year-over-year, while basic EPS was higher by 7.1. On an adjusted basis, net income and EPS were higher by 34% and 32%, respectively. This strong growth was driven by higher EBITDA and the flow through from our cost efficiency programs in addition to stable depreciation and amortization. Free cash flow of $478 million was higher by $199 million, driven by lower capital expenditures and higher EBITDA. CapEx declined by $116 million, or 14%, driven by our planned capital reduction.

Speaker Change #166: Consolidated net income increased by 13% year over year, while basic EPS was higher by $7 one on.

Speaker Change #166: On an adjusted basis, net income and EPS were higher by 34% and 32% respectively.

Speaker Change #166: This growth this strong growth was driven by higher EBITDA and the flow through from our cost efficiency programs. In addition to stay above depreciation and amortization free.

Speaker Change #166: Free cash flow of $478 million was higher by $199 million, driven by lower capital expenditures and higher EBITDA.

Speaker Change #166: Capex gallant declined by $116 million or 14% driven by our planned capital reductions.

Doug French: Consolidated capital intensity was 13%, down 300 basis points over Q2 last year. Looking ahead, we are confirming our T-TEC revenue and EBITDA guidance, although trending to the lower end of our 2024 target. We remain confident in our commitment to driving strong, sustainable and margin-accretive growth while maintaining focus and lowering our cost to serve with profitable customer loading. Our consolidated free cash flow is being updated to approximately $2.1 billion due entirely to the flow-through of Telus Digital's revised EBITDA outlook as announced today. The $100 million of incremental restructuring investments is being offset by lower taxes and handset investments. Our annual target for consolidated capital expenditures remains unchanged at $2.6 billion.

Holidayed capital intensity was down <unk>, 13% down 300 basis points over Q2 last year looking ahead, we're confirming our key tech revenue and EBITDA guidance, however, trending to the lower end of our 2024 targets, we remain confident in our commitment to driving strong sustainable in March.

<unk> accretive growth, while maintaining focus.

Speaker Change #166: On lowering our cost to serve with profitable customer loading.

Speaker Change #166: Our consolidated free cash flow has been updated to approximately $2 1 billion due entirely to the flow through of <unk> Digital's revised EBITDA EBITDA outlook as announced today the.

Speaker Change #166: $100 million of incremental restructuring investments is being offset by lower taxes in handset investments.

Speaker Change #166: On annual our annual target for consolidated capital expenditures remains unchanged at $2 6 billion.

Doug French: Overall, we remain confident in our ability to continue generating strong and growing cash flows for years ahead, driven by our ongoing strong EBITDA growth and moderating capital intensity towards 10%. This will support maintaining a strong balance sheet to provide us with ample flexibility to support growth, our growth ambitions, and shareholder returns. As we enter the back half, our financial position remains strong. At the end of the second quarter, we had approximately $2.5 billion of available liquidity.

Overall, we remain confident in our ability to continue generating strong and growing cash flows for years ahead, driven by our ongoing strong EBITDA growth and moderating capital.

Speaker Change #166: Intensity towards 10% level. This romaine this will support maintaining a strong balance sheet to provide us with ample flexibility to support growth our growth ambitions and shareholder returns.

Speaker Change #166: As we enter the back half our financial position remains strong at the end of the second quarter. We have approximately $2 5 billion of available liquidity our cost our average cost of long term debt is 44, 2% and our average term to maturity is over 11 years with our debt net debt to EBITDA of <unk> five times.

Doug French: Our average cost of long-term debt is $4.42%, and our average term to maturity is over 11 years, with our net debt to EBITDA of $3.85 times. The acquisition of wireless licenses in recent years has increased that ratio by 0.56 times.

Speaker Change #166: The acquisition of wireless licenses in the recent years is increase that ratio by zero about five six times. This.

Doug French: This includes payments for our 3,800 MHz spectrum auction and obtaining the use of AWS4 spectrum in the second quarter alone. As we progress through 2024 and into future years, we anticipate our leverage ratio to improve as we work towards our target ratio through continued EBITDA growth, declining capital intensity, and ongoing free cash flow expansion. Robert, over to you.

Speaker Change #166: This includes payments of our <unk> are 3800 megahertz spectrum auction and obtaining the use of AWS four spectrum in the second quarter alone.

Robert Mitchell: As we progressed through 2024 into future years, we anticipate our leverage ratio to improve as we work towards our target ratio through continued EBITDA growth declining capital intensity and ongoing free cash flow expansion Robert over to you. Thanks.

Robert Mitchell: Thanks, Doug. Karl, we're ready for questions, please. Certainly. The first question is from Vince Valentini from TD Securities. Yeah, thanks very much. I'm going to try to sneak into one.

Robert Mitchell: Thanks, Doug Carl we're ready for questions. Please.

Speaker Change #166: Certainly.

Robert Mitchell: The first question is from Vince Valentini from TD Securities. Please go ahead Vince.

Vince Valentini: But you talk about record subs, and it just isn't translating into much revenue growth. In fact, your fixed data revenue was lower in the second quarter than the first quarter by a million dollars, despite net subs being up 70,000. So what are you talking a little bit about?

Yeah, Thanks very much.

Vince: I'm going to try to sneak into one.

Speaker Change #168: You talk about record sub adds.

Vince: <unk>.

Speaker Change #169: Just isn't translating into much revenue growth in fact gear fixed data revenue was lower.

Speaker Change #170: Second quarter than the first quarter by $1 million, despite net subs being up 70000. So what if you can talk a little bit about are you happy with this.

Vince Valentini: Are you happy with this? Do you need to be a bit more of a balance between pricing and volume in your mind? Are you looking to try to take advantage of higher pricing in any areas and in the next few months to try to get that revenue growth up? And second, I'm sure you'll get this from others in a different way.

Speaker Change #171: A bit more of a balance between.

Speaker Change #172: <unk> and volume in your mind are you looking at.

Speaker Change #173: We tried to take advantage of higher pricing in any areas.

Speaker Change #173: In the next few months to try to get that revenue growth up.

Speaker Change #174: Second I'm sure you'll get this from others in a different way, but given what we've seen here tell us.

Speaker Change #174: Actual or or tell us digital today.

Vince Valentini: But given what we've seen at Telus International or Telus Digital today, does this make it more likely that you need to consider privatizing that company? Or is that on your radar as the share price and valuation get lower given that you still seem positive about the long-term outlook there? Thanks. Okay, I'll let Zainul kick off the first part of the question, Vince, and let Doug maybe provide any editorializing that he would like to do on that, and then I'll answer the second part. Zainul, over to you.

Speaker Change #175: Does this make it more likely that you would need to consider privatizing that company or is that on your radar as as the share price and valuation gets lower given that you're still seeing positive on that on the long term outlook there. Thanks.

Zane: Okay, I'll, let zane.

Zane: Zane I'll kick off the.

Zane: First part of the question Vince.

Zane: But Doug maybe provide any editorializing that he would like to do on that and then I'll answer the second part.

Zane: And over to you.

Zainul Mawji: Thank you Darren. Thanks Vince for the question. I think to be clear in terms of suggesting whether we are satisfied with this performance, the clear answer to that would be no. We are not satisfied with the level of performance we've seen in this very competitive environment. I think one of the things that is very clear to us, though, is that we have and will always be focused on economic and profitable loading at the household level.

Zane: Thank you Darren Thanks, Vince for the question I think to be clear in terms of suggesting are we satisfied with this performance that a clear answer to that would be no. We are not satisfied with the level of performance. We've seen in this very competitive environment.

Zane: Think one of the things that is very clear to us, though is that we have and will always be focused on economic and profitable loading at the household level you.

Zainul Mawji: You can see that in terms of many characteristics of our performance. For example, our mobile and home additions have increased significantly year over year. Our product intensity on a per household basis for fiber households is over 3.2 now, which is significant.

Zane: You can see that in terms of.

Zane: Many characteristics of our.

Zane: Of our performance our mobile in home additions have increased significantly year over year, our product intensity on a per household basis for fiber households is over $3. Two now which is significant and we are consistently driving cost reduction.

Zainul Mawji: And we are consistently driving cost reduction in a very competitively intense environment. We've seen about a 6% year over year cost to serve improvement just in the consumer business. That said, we're leaning into our product roadmap. Darren highlighted a number of elements of our product roadmap to continue driving intensity and to drive new revenue streams that our competitors are differentiated from. And we are going to continue to find levers to improve our AMPU performance and continue driving better overall retention outcomes in doing so.

In a very competitively intense environment, we've seen about a 6% year over year cost to serve improvement just in the consumer business.

Speaker Change #176: That said we're at <unk>.

Speaker Change #176: Leaning into our product roadmap Darren highlighted a number of elements of our product roadmap.

Speaker Change #176: We continue driving intensity can drive new revenue streams that our competitors are differentiated from.

Speaker Change #176: And we are going to continue to find levers to improve our <unk>.

Speaker Change #176: <unk> performance.

Speaker Change #176: And continue driving better overall retention outcomes in doing so we're a company that has always been focused on ensuring that we support the retention of our of our customers and drive overall customer lifetime value at the household level. This competitive dynamic is not one that we created.

Zainul Mawji: We're a company that has always been focused on ensuring that we support the retention of our customers and drive overall customer lifetime value at the household level. This competitive dynamic is not one that we created, and it is one that we are going to continue to persevere through with those levers as stated. I think maybe just a quick top up; I think our internet ARPU, as I highlighted, was flat, quarter over quarter.

And it is one that we are going to continue to persevere through with those leavers as stated.

Speaker Change #177: I think maybe just a quick top I think our internet <unk>, who as I highlighted it was flat.

Zainul Mawji: So again, managing the value prop that that brings, and with the EBITDA growth at 5.1%, I think it reinforces Zainul's comment on our focus on AMPU and generating economic value. The second part of the question, Vince, you know, whilst we obviously have a fiduciary obligation to keep all of our options open explicitly, it is not our intention to privatize Telus Digital. We still believe in the assets that we have and the potential in terms of the value that they can generate going forward and how well they are positioned to leverage developments that are taking place in the industry in data, data analytics, and AI from legacy to the next generation. I think you can draw inferences from the structure that we have put in place.

Speaker Change #177: Quarter over quarter, so again managing.

Speaker Change #177: The value prop that that brings.

Speaker Change #178: And with EBITDA growth of five 1% I think it reinforces <unk>.

Speaker Change #178: Comment on our focus on <unk> and generating economic value.

Speaker Change #178: The second part of the question Vince whilst we obviously have a fiduciary.

Vince: Gerry obligation to keep all of our options open.

Speaker Change #179: Explicitly it is not our intention to privatize tell is digital.

Speaker Change #179: We still believe in.

Speaker Change #179: And the assets that we have and the potential in terms of the value that they can generate going forward and how well they are positioned to leverage developments that are taking place in the industry at the data.

Speaker Change #179: Data analytics and AI from legacy to Gen AI basis.

Speaker Change #179: I think you can draw inference from the structure that we have put in place.

Darren Entwistle: This is not going to be the long-term structure for Telus Digital, but it is the right structure for right now, and I think this structure is going to be excellent in driving the recovery and growth program over the next 18 months. And you can expect tremendous consistency in that regard. The other attribute of the structure that I think is good for investors to focus on is that it provides an explicit focus and accountability on the two major components of our business, which, of course, is driving the considerable potential as it relates to digital AI for which we are very well positioned. And Tobias has that remit.

Speaker Change #181: This is not going to be the long term structure for <unk> digital.

Speaker Change #181: But it is the right structure for right now.

Speaker Change #181: And I think the structure is going to be excellent in driving the recovery and growth program over the next 18 months and you can expect tremendous consistency in that regard the other attribute of the structure that I think is good for investors to focus on.

Speaker Change #181: It provides an explicit focus and accountability on the two major components of our business, which of course is driving the considerable potential as it relates to digital AI for which we are very well positioned.

Speaker Change #181: And to be as has that remit and then of course, the other area is driving remediation growth and digital transformation in the CX part.

Darren Entwistle: And then, of course, the other area is driving remediation, growth, and digital transformation in the CX part of our business and leveraging the Telus case study in that regard along the way. And Jason's credentials to do that, given what he's delivered at the Telus organization, are second to none. Both Tobias and Jason know each other very well, so I would expect this to be a very strong partnership between the two.

Speaker Change #181: Our business and leveraging the <unk> case study in that regard along the way and Jason's credentials to do that given what he has delivered at the Telus organization are second to none.

Jason Mcdonell: To be as <unk>, Jason know each other very well so I would expect.

Jason Mcdonell: This to be a very strong partnership between the two.

Darren Entwistle: And both of them are smack dab in their areas of expertise, where they've got a proven track record, credentials, and experience to deliver on the objectives that we have here and drive that recovery and growth program extremely successfully. And I've got a lot of confidence that we're going to do exactly that. Carl, next question, please. The next question is from Drew McReynolds from RBC. Please go ahead. Thanks very much. I'll try and squeeze it into myself.

And both of them are smack Dab in their areas of expertise, where they've got a proven track record credentials and experience to deliver on the objectives that we have here and drive that recovery and growth program extremely successfully and I've got a lot of confidence that we're going to do exactly.

Vince: Thanks, Vince Karl next question please.

Speaker Change #182: The next question is from drew Mcreynolds. Please go from RBC. Please go ahead drew.

Drew Mcreynolds: Thanks very much.

Drew Mcreynolds: I'll try and squeeze in to myself.

Drew Mcreynolds: First, a clarification, just to make sure I'm looking at it the right way. With wireless ARPU, and I will get in my second one to network revenue with growth, which is kind of the more important KPI. But on wireless ARPU, you're down, 3.4%.

Drew Mcreynolds: First a clarification.

Drew Mcreynolds: Just to make sure Im looking at it the right way.

Speaker Change #183: With wireless <unk> and I will get on my second one can network revenue.

Speaker Change #183: Growth, which is kind of the more important kpis on wireless <unk>.

Drew Mcreynolds: But you've stated last year's and, you know, if you were to kind of do an apples to apples comparison with Rogers or BC, they'd be down kind of one and a half to maybe 3% respectively. I just want to confirm, I guess with you, Doug, that that's the right way to look at it in terms of how you're reporting. Absolutely, that's the right way to look at it. Okay.

Speaker Change #183: <unk>.

Speaker Change #184: Three 4%.

Speaker Change #184: But you have restated last year's.

Speaker Change #186: It kind of do an apples to apples comparison, but with Rogers R. R. BCE that'd be down kind of wanted to ask maybe 3% respectively. I just wanted to confirm I guess like you've done that.

Speaker Change #187: That's the right way to look at it in terms of in terms of how you are reporting.

Speaker Change #187: Absolutely that's the right way to look at it.

Zainul Mawji: And then just shifting, more important to network revenue growth, in the preparatory remarks, you know, your commentary on IoT and that kind of bucket of revenues beginning or continuing to build, can you help us just understand the relative size or contribution of that bucket? I think everybody's assumption here is that on the B2C side within wireless, there'll continue to be some, you know, kind of pressure or commoditization. So just wondering how that mix kind of flows through, looking into next year, and the extent to which you can kind of rebuild the 1% network revenue growth that you're currently generating. And I think maybe we'll hand that to Zainul again on some of the ARPU initiatives.

Speaker Change #187: Okay.

Speaker Change #189: And then just shifting more important network revenue growth in the prepared remarks Carl.

Speaker Change #190: Commentary on Iot.

Speaker Change #191: That kind of bucket of revenues.

Carl: Beginning or continuing to build just can you can you help us just understand the relative size of our contribution of that bucket I think everybody's assumption here is on the BDC side within wireless still continue to be some.

Pressure commoditization. So just wondering how that mix kind of flows through looking into next year.

Speaker Change #193: And the extent to which you can kind of rebuild the 1% network revenue growth that Youre currently generating thank you.

Zane: And I think maybe ill hand that Zane I'll again on on some of the <unk> initiatives.

Doug French: Maybe one thing leading to the ARPU trajectory and the profitability that we talked about in the 5.1, if you think about confirming the bottom end of our guidance, what that means for our growth rates as well in the back half of the year, is that our growth rates will continue to accelerate above six for the next six months. And again, that is leveraging all the tools that Zainul was talking about in addition to our efficiency, effectiveness, and our growth engines of health and agriculture, as Darren highlighted in his presentation. So leveraging all the tools in our toolkit. Zainul, do you want to top up?

Speaker Change #194: Maybe one thing leading to the <unk> trajectory.

Speaker Change #194: Trajectory and the profitability that we talked about on the <unk> dot one.

If you think through confirming the bottom end of our guidance by that means to our growth rates as well in the back half of the year as our growth rates will continue to accelerate above six.

Speaker Change #194: For the next six months and again that is leveraging all the tools that Zeno was talking about in addition to our efficiency effectiveness and our growth engines that of <unk>.

Speaker Change #194: Health and AG as Darren highlighted in his presentation, so leveraging all the tools in our toolkit.

I know you want to top up.

Zainul Mawji: Yeah, sure. I mean, fundamentally, there are a number of initiatives that we're going to continue to drive. And, you know, you've seen us create premium capabilities and bundled capabilities across our brands. We have a differentiated suite of brands that we're leaning into more effectively that help us compete in underpenetrated segments in some areas and help us drive premium capabilities in other segments. And we've really led on that.

Speaker Change #195: Yeah sure I mean, I think fundamentally that there are a number of <unk> initiatives that we're going to continue to drive and you've seen us create premium capabilities and bundled capabilities across our brands. We have a differentiated suite of brands that we are leaning into more effectively that help us.

Speaker Change #195: We compete in Underpenetrated segments in some areas and help us drive premium capabilities in other segment and we've really led on that we're leaning into our entertainment and our smart home and other differentiation to continue driving that premium opportunity and of course there is.

Zainul Mawji: We're leaning into our entertainment and our smart home and other differentiation to continue driving that premium opportunity. And, you know, of course, there's a general block and tackle in terms of the level at which we have to drive improved ARPU performance and drive that relationship between customer renewal and churn performance, along with managing, you know, the very challenging device and promotional subsidies in our market. So we're going to continue to lean into the brand differentiation and the product differentiation that we have.

Speaker Change #196: Block and tackle in terms of the level at which we have to drive improved <unk> performance and drive that relationship between customer renewal and churn performance along with managing it Barry.

Speaker Change #196: Very challenging device and promotional subsidies in our market. So we're going to continue to lean into that the brand differentiation in the product differentiation that we have I think I think the other thing to highlight is that.

Zainul Mawji: I think the other thing to highlight is that we've always been focused on economic loading and on household ARPU, and we've talked about the fact that we should transition to household ARPU over time as the most meaningful metric. And we're going to focus on economics and profitable growth across our brands. You know, I think you've seen strong performance from an EBITDA perspective, and we're going to continue to drive that performance. Thank you very much.

Speaker Change #196: We've always been focused on economic loading and on household ARPA and we've talked about the fact that we should transition to household ARPA over time as the most meaningful metric and we're going to focus on economics and profitable growth across our brands.

Speaker Change #196: I think you've seen strong performance from an EBITDA perspective, and we are and we're going to continue to drive that performance over time.

Speaker Change #197: Thank you very much.

Operator: Thanks, Drew. Next question, please, Carl. The next question is from Jerome Dubreuil from Desjardins. Hi, thanks for taking my questions. First of all, the release from Telus Digital is saying that the company is pivoting its focus to revenue growth. You know, that's what a lot of spec investors are after. But you know, historically, telecom investors have talked maybe more about pre-cash flow growth. Obviously, you're still getting a lot of pre-cash flow growth, and both revenue and pre-cash flow growth are good to see. But I'm trying to reconcile whether the telecom and tech objectives are aligned.

Speaker Change #197: Thanks, Andrew next question please.

Rajeev <unk>: The next question is from Rajeev <unk> from Zelman. Please go ahead.

Rajeev <unk>: Hi, Thanks for taking my questions first one there.

Speaker Change #199: We released from tell US digital is saying that the company is pivoting its focus to revenue growth.

Speaker Change #200: That's what a lot of like investors are after but historically telecom investors.

Maybe more about free cash flow growth. Obviously, you are still getting a lot of free cash flow growth in both revenue and free cash flow growth are going to see but.

Speaker Change #201: Im trying to reconcile it with telecom in fact objectives.

Speaker Change #200: Our our lineup at this point.

Jerome Dubreuil: Jeff, do you want to take that question and talk about both what we want to achieve prospectively in terms of EBITDA growth driven by top-line revenue and where you see the major opportunities prospectively in that regard as we overcome the challenges? And then maybe speak to the free cash flow potency of the business and the consistency on that front with the very low level of capex intensity. Certainly, Darren. Thank you, Jerome.

Speaker Change #200: Jeff do you want to take that question.

Jeff: <unk> talked about both what we want to achieve prospectively on EBITDA.

Speaker Change #204: Growth driven by top line revenue and where you see the major opportunities prospectively in that regard as we overcome the challenges.

Speaker Change #202: And then maybe speak to the free cash flow potency of the business and the consistency on that front with the very low level of Capex intensity.

Jeffrey Puritt: We absolutely believe that the revenue growth potential of Telus Digital is just at the early days, and we have not executed as well as we should have or could have. And you will have seen and heard from me and the team earlier today a more detailed discussion on the efforts underway to try and get back to achieving that level of growth that we believe is possible, given the asset mix that we enjoy today, particularly around not just a legacy of customer experience excellence but particularly around technology-enabled gen AI enabled capabilities.

Speaker Change #202: Certainly there and thank you Jerome.

Jerome: We absolutely believe that the revenue growth potential of digital is.

Jerome: Early days and we have not executed as well as we should have or could have and you will have seen and heard from me and the team earlier today.

Jerome: More detailed discussion on the efforts underway to try and get back to achieving that level of growth that we believe is possible given the asset mix that we enjoy today, particularly around not just the legacy of customer experience excellence, but particularly around technology enabled gene AI enabled capabilities.

Jeffrey Puritt: The upside opportunity for this business, we believe is significant, and we just need to do a better job of marshalling these resources and leveraging these assets to achieve high single-digit revenue growth potential. Along the way, the heritage pedigree of the Telus family in focusing on profitable growth has informed our approach to the market. And I think a few years ago, we were able to enjoy outsized margin yield because of our superior and differentiated service level performance. However, the appetite for customers changing to more and better for less has really forced us to revisit that profile only in the near term.

Jerome: Upside opportunity for this business. We believe is significant and we just need to do a better job of marshaling. These resources and leveraging these assets to achieve.

Jerome: High single digit revenue growth potential along the way.

Jerome: Legacy pedigree heritage of the Telus family and focusing on profitable growth.

Jerome: Informed our approach to the market.

Jerome: A few years ago, we were able to enjoy outsized margin yield because of our superior differentiated service level performance.

Jerome: Appetite for customer changing to more and better for us has really forced us to revisit that profile only in the near term and we absolutely expect that Doug will improve in the months years ahead as we continue to demonstrate the capabilities of helping our customers themselves to do more.

Jeffrey Puritt: And we absolutely expect that that will improve in the months and years ahead as we continue to demonstrate the capabilities of helping our customers themselves to do more and better with less leverage on our support. Along the way, you will have seen that our focus on cash flow yield at 15% year over year, year to date has, I think, continued to distinguish us, and that has enabled us to continue to reinvest in the business to ensure that we can get back to that level of growth and profitability that we've enjoyed historically. Thank you. Jerome, call next question please. The next question is... Stephanie Price from CIBC. Please go ahead. Good afternoon,

Speaker Change #205: With less leveraging our support along the way you will have seen that the focus on cash flow yield of 15% year over year.

Jerome: To date.

Jerome: Think continued to distinguish us and that has enabled us to continue to reinvest in the business to ensure that we can get back to that level of growth.

Jerome: <unk> ability that we've enjoyed historically.

Jerome: Thank you.

Carla: Thanks, Sharon Carla's question. Please.

Speaker Change #206: The next question is from Stephanie price from CIBC. Please go ahead Stephanie.

Stephanie Price: Good afternoon congrats.

Stephanie Price: Congratulations on the revenue and EBITDA growth at Telus Health in the quarter. I just wanted to focus on the growth businesses. I'm curious if you still envision a monetization event for Telus Health in kind of the near to midterm, and how you're thinking about the growth businesses, or if you're thinking about the growth businesses differently than what we've seen with Telus Digital. All right, I'll take this one.

Stephanie Price: Congratulations on the revenue and EBITDA growth at Telus health in the quarter just wanted to focus in on the growth businesses. I'm curious if you still envision a monetization event for Telus health and kind of the near to midterm and how you think about the growth businesses or if you're thinking about the growth businesses has changed from what we've seen with Telus switch at all.

Speaker Change #207: Alright, I'll take this one.

Speaker Change #208: The short answer to your question is yes, we are.

Darren Entwistle: The short answer to your question is, yes, we still do envisage a monetization opportunity that relates to our emerging businesses, where I would say Telus Health is in the leading position in that regard. However, I would be more medium-term than near-term in terms of its orientation. The manifestation of that monetization may be something that is synonymous with what we did historically back in 2016 and thereafter on the IPO front with Telus Digital. So it's not just looking at going public but also looking at partnership opportunities along the way.

Speaker Change #209: Still do envisage.

Speaker Change #210: <unk> monetization opportunity.

Relates to our emerging businesses, where I would say.

Speaker Change #210: Tell us help us in the leading position in that regard I would be more medium term than near term in terms of its orientation.

Speaker Change #210: The manifestation of that monetization, maybe something that is synonymous with what we did historically back in 2016 and thereafter on the IPO front with.

Speaker Change #210: With <unk> digital so it's not just looking at going public but also looking at partnership opportunities along the way.

Darren Entwistle: But we are very clear in terms of things like a pre-IPO checklist that we have to earn our way to that monetization event through the organic performance of the business, because we have to have that strong organic performance delivered on a consistent basis to support the premium valuation, because it's not about the repatriation of money, but it's a monetization event to establish a transaction currency so that we can expand the addressable market of inorganic opportunities to complement what we're earning in terms of the organic performance of that business.

Speaker Change #210: But we are very clear in terms of things like a pre IPO checklist that.

Speaker Change #210: We have to earn our way.

Speaker Change #210: Two that monetization event through the organic performance of the business.

Speaker Change #210: Because we have to have that strong organic performance delivered on a consistent basis to support the premium valuation because it's not about the repatriation of money, but its a monetization event to establish a transaction currency. So that we can expand the addressable market of inorganic opportunities.

Speaker Change #210: To complement what we're earning in terms of the organic performance of that business.

Darren Entwistle: I think it's encouraging to see this quarter the improved performance of Telus Health. We've experienced some macroeconomic impacts within that business, but clearly, the business is on the right track with the return to mid-single-digit revenue growth and an EBITDA contribution of north of 30%, which has been the case now for well over a year on a quarter-to-quarter-to-quarter basis. And the quality of the contribution within Telus Health, I think is indicative.

Speaker Change #211: I think it's encouraging to see this quarter the improved performance of Telus health.

Speaker Change #211: We've experienced some macroeconomic impacts within that business, but.

Speaker Change #211: Clearly the business is on the right track with the return to mid single digit revenue growth.

Speaker Change #211: On an EBITDA contribution of north of 30%, which has been the case now for well over a year on a quarter to quarter to quarter basis.

Speaker Change #211: And the quality of the contribution within Telus Health I think is indicative within my remarks, I made the comment that the performance is not coming from a single product or agency within Dell itself, but across the totality of the.

Darren Entwistle: Within my remarks, I made the comment that the performance is not coming from a single product or agency within Telus Health but across the totality of the business asset mix that we have. Like our agriculture business, we're seeing a strong accretion within the sales funnel at Telus Health, which boasts the wealth for continued strong organic performance of the business. I think we're a little bit over $300 million in total contract value improvements on a year-over-year basis in terms of year-to-date sales strength within the Telus Health organization, and I think that is an attractive attribute.

Speaker Change #211: The business asset mix that we have.

Speaker Change #211: Our agriculture business.

Speaker Change #211: We're seeing a strong accretion.

Speaker Change #211: The sales funnel.

Speaker Change #211: Thats held which bodes well for continued strong organic performance of the business.

Speaker Change #212: I think we're a little bit over $300 million in total contract value improvement on a year over year basis in terms of year to date sales strength within the <unk> itself the organization.

Speaker Change #212: Think that is an attractive attribute.

Darren Entwistle: We made a commitment to you when we bought Lifeworks a couple of years ago in terms of synergies realization, and I think we have made strong progress in that regard, bumping up against $300 million at this juncture in terms of synergies being realized, the preponderance of which has come from efficiency measures on the cost-synergy side. We've got about $130 million of synergies left to go to meet the expectation that we set with you to be realized by the end of 2025, and as I indicated earlier, the split on the $130s, around $80 million on the cost front and $50 million on the revenue synergy front, and I would be hopeful that we could maturely beat that $50 million revenue synergy given the considerable cross-sell opportunity that exists within the business

Speaker Change #212: We made a commitment to you when we bought <unk>.

Speaker Change #212: <unk> works.

Speaker Change #212: A couple of years ago.

Speaker Change #212: In terms of synergy realization and I think we have made strong progress in that regard bumping up against $300 million at this juncture.

Speaker Change #213: Synergies being realized the preponderance of which has come from efficiency measures on the on the cost synergy side, we've got about $130 million of synergies left to go to meet.

Speaker Change #213: The expectation that we set with you to be realized by the end of 2025 and as I indicated earlier the split on the one <unk> around $80 million on the cost front and $50 million.

Speaker Change #213: On the revenue synergy front and I would be hopeful that we could materially beat that $50 million revenue synergy given the.

Speaker Change #213: The considerable cross sell opportunity that exists within the business.

Darren Entwistle: I've stated it strongly internally within Telus that within the T-Tech business, we should be able to grow EBITDA at 5% and never bring in a new logo, but just selling new products to existing customers. Such is the cross-sell opportunity. Fortunately, we're not restricted by that.

Speaker Change #214: I've stated it strongly internally with entellus.

Speaker Change #214: That within the <unk> business, we should be able to grow EBITDA at 5% and never bring in a new logo.

Speaker Change #214: But just selling new products to existing customers such as the cross sell opportunity. Fortunately, we're not restricted by that we can do both but it is illustrative of the major opportunity there and in particular for Telus health the synergy synergistic combination of our B to B base within <unk> business.

Darren Entwistle: We can do both, but it is illustrative of the major opportunity there, and in particular for Telus Health. The synergistic combination of our B2B base within Telus Business Solutions and Telus Health is extremely strong, and every one of our clients right now wants to talk to us about employer productivity, including the health profile of their employees, and so I'm excited by that particular dynamic. And then lastly, on the health front, as you all know, for us, expansion and emerging markets are all about data play.

Speaker Change #215: Aleutians and tell US help is extremely strong and every one of our clients right now once that talk to us about employee productivity, including the health profile of their employees and so I'm excited by that particular dynamic and then lastly on the health front as you are.

Speaker Change #215: No for us.

Speaker Change #217: The expansion in emerging markets is all about the data play, it's where we started back in 2000, and we're still on that particular page today.

Darren Entwistle: It's where we started back in 2000, and we're still on that particular page today, leveraging data, data analytics, legacy AI, and generation AI, to couple that with network connectivity, to couple that with premium services, to be able to leverage the attributes of our business, including our sales channels and our customer base, and the digital and AI opportunity within Telus Health is absolutely huge, and Telus Health can feed off of the digital AI progression at Telus and And what I like about it right now is that, with this performance trajectory that bodes so well for the future and is so encouraging, I don't think the business is firing on all cylinders. If I gave it an operational grade on a score of 10, I would probably give it a 5 or a 6 out of 10 right now, due to the upside opportunity.

Speaker Change #217: Leveraging data data analytics legacy AI Gen AI.

Speaker Change #217: Couple that with.

Speaker Change #217: Network connectivity to coupled up with premium services to be able to leverage the attributes of our business, including our sales channels and our customer base and the digital and AI opportunity within Telus health is absolutely huge.

Speaker Change #218: Tell us how it can feed off of the digital AI progression at Telus and feed off of the digital AI capability set at tells us digital or formerly Telus International.

Speaker Change #218: And what I like.

Speaker Change #220: <unk> right now is with this performance trajectory that bodes so well for the future and is so encouraging.

Speaker Change #220: I don't think the business is firing on all cylinders if.

Speaker Change #221: If I gave you gave it.

Operational great on a score to 10, I would probably give it a fiber or six out of 10 right now such as the upside opportunity.

Darren Entwistle: We have more that we can do on cost efficiency. We have more that we can do in automating and digitizing the business. We can be a lot better on the customer service front, taking a page out of the Telus book. We can do a lot better on operational execution, and I've got great expectations in terms of the new leadership team that we've put in place at Telus Health. And we've got a long way to go on sales and marketing.

Speaker Change #221: More that we can do on cost efficiency.

Speaker Change #221: We have more that we can do in automating and digitizing the business.

Speaker Change #221: We can be a lot better on the customer service front, taking a page out of the <unk> book and we can do a lot better on operational execution and I'm I've got great expectations in terms of the new leadership team that we've put in place at Telus health.

Speaker Change #221: We've got a long way to go on sales and marketing.

Darren Entwistle: The opportunity to increase our distribution strength at Telus Health is considerable. We've got a ton of products and capabilities that are sitting on the shelf and waiting for our channels to market and our distribution competencies to get properly activated. So I like the upside opportunity there, and the path that Telus Health is going down, I think blazes the trail for what's to follow on Telus agriculture and consumer goods. And at a smaller level, because it's one-fifth the size of Telus Health, but at a smaller level, Telus agriculture and consumer goods is also making excellent steps in that direction. So we are still extremely committed to these components of our business, and the last thing I'll say about them is that these activities come with a very low CapEx intensity.

Speaker Change #221: The.

Speaker Change #221: <unk> to elevate our distribution strength that Telus health is considerable we got a ton of products and capabilities that are sitting on a shelf and waiting for our channels to market and our distribution competencies to get properly activated so I like the.

Speaker Change #221: Upside opportunity there.

Speaker Change #221: The path that Telus health goes.

Think blazing the trail for whats the follow on tell us agriculture and consumer goods.

Speaker Change #221: And at a smaller level because it's one fifth the size of Telus health, but at a smaller level tell us agriculture and consumer goods is also making excellent steps in that direction. So we are still extremely committed to these components of our business.

Speaker Change #221: The last thing I'll say about them is these activities come with very low capex intensity.

Darren Entwistle: Our solutions on the product front are SaaS-based solutions, so our ability to take revenue to EBITDA to cash generation is extremely strong, and of course, we're not looking at just the domestic market. This is a global opportunity for us, so the scale opportunity is something that we've never enjoyed before looking at the telecoms business historically, so it's quite an upside. Thanks, Stephanie.

Speaker Change #221: Our solutions on the product upfront, our SaaS based solutions.

Speaker Change #221: Solutions, so our ability to take revenue to EBITDA at the cash generation is extremely strong and of course.

Speaker Change #221: We're not looking at just the domestic market.

Speaker Change #221: As the global opportunity for us so the scale opportunity is something that we've never enjoyed before looking at the telecoms biz.

Speaker Change #221: Business historically, so it's quite the upside.

Speaker Change #222: Thank you.

Speaker Change #221: Thanks, Stephanie next question please.

Darren Entwistle: Next question, please. The next question is from Tim Casey from BMO. Please go ahead. Yeah, thanks. Good afternoon. A couple for me.

Speaker Change #221: The next question is from Tim Casey from BMO. Please go ahead Tim.

Tim Casey: One, Doug, can you just clarify Darren's comments with respect to an EBITDA contribution of 30% from Telus Health? Is that an EBITDA margin we're talking about, or is that a contribution to growth? And then the second one is on the fixed data line metric; it was a little under 3% in the first quarter, down to 1% in the second quarter. How should we think about that in the back half of the year? Just wondering if there's any price increases we should think about, or is it more going to be in the 1% area for the back half of the year? Thank you.

Tim Casey: Yes. Thanks, good afternoon, a couple for me.

Doug Carl: Doug can you just clarify.

Speaker Change #223: <unk> comments with respect to an EBITDA contribution of 30% from Telus health is that EBITDA.

Speaker Change #223: EBITDA margin, we're talking about or is that.

Speaker Change #225: Contribution to growth and then second one is on the fixed data line.

Speaker Change #225: Metric.

Speaker Change #226: It was little under 3% in the first quarter down to 1% in the second quarter, how should we think about that in the back half of the year. Just wondering if theres any price increases we should think about or.

Speaker Change #226: Is it more going to be.

Speaker Change #228: The 1% area for the back half of the year. Thank you.

Darren Entwistle: I'll answer the question and clarify my own comment, and then Doug can clarify my clarification if he wants. No, it's not a margin number; it's a growth number. I referenced it in my opening remarks at 33%, and I rounded it to 30 in the Q&A that just took place.

Speaker Change #228: All answer the question clarify my my own comment and then Doug can clarify my clarification.

Doug Carl: If he wants.

Speaker Change #229: No it's not a margin.

Speaker Change #229: It's a growth number.

Speaker Change #229: Our reference did.

Speaker Change #231: In my opening remarks at 33% I rounded it to the 30 in the Q&A that just took place.

Darren Entwistle: That's an EBITDA contribution number, and it reflects year-over-year growth in terms of Telus Health profitability. The other element of it that I alluded to, but to give you greater specificity, from the 11% EBITDA contribution that we achieved in Q2 of 2023 on a year-over-year basis, since that particular juncture, in every quarter that has followed right through to now, Q2 of 2024, we've been in the 11% to 20% to now 30% EBITDA contribution coming on the Telus Health side.

Speaker Change #231: <unk> EBITDA contribution number and it reflects year over year growth in terms of Telus health of profitability.

Speaker Change #231: The other element of it that I alluded to but to give you greater specificity.

Speaker Change #231: From the 11% EBITDA contribution that we achieved in Q2 of 2023 on a year over year basis since that particular juncture in every quarter that it's followed right through to now Q2 of 2024, we've been in the 11% to 20% to now 30%.

Speaker Change #231: EBITDA.

Speaker Change #231: Contribution coming on the Telus health side, the preponderance of that obviously, given my synergy comment is coming from the cost synergies that we're realizing but now in Q2 of 2024, we're starting to see the increased contribution at the EBITDA level coming from profitable revenue growth.

Darren Entwistle: The preponderance of that, obviously, given my synergies comments, is coming from the cost synergies that we're realizing, but now in Q2 of 2024, we're starting to see increased contribution at the EBITDA level coming from profitable revenue growth. Thank you.

Speaker Change #232: Thank you.

Doug French: And maybe just a quick thought about health margins. We've talked about them for many of a day, margins are still below 20 with the opportunity that we desire to get them well above 20, as Darren highlighted, with some of the staff services, cost reductions, and complementary bundling. So there's still room to go significantly on margin enhancement on that end. And on fixed data, we haven't given forward-looking on the component side.

Speaker Change #233: And maybe just a quick.

Speaker Change #234: Health margins, we've talked about from an EBITDA margin still below 20% with the opportunity that we desire to get them well above 20, as Darren highlighted with some of the SaaS services cost reductions and complementary bundling so theres still room to go.

Speaker Change #235: Significantly our margin enhancement on that end.

Speaker Change #236: And on fixed data, we haven't given.

Speaker Change #235: Forward looking.

Speaker Change #237: On the component side that being said, obviously there has been some give and takes within that number but focusing on margins really what matters. So within that light at nine am I highlighted the TV revenue was actually down yet the margin on television we would be managing through the different programs were operating including the national.

Doug French: That being said, obviously, there's been some give-and-takes within that number, but focusing on margin is really what matters. So within that highlighted item, I highlighted that TV revenue was actually down, yet the margin on TV we would be managing through the different programs we're offering, including the national Call It Light program that Zainul referred to. And so I think there's a lot of give-and-take in there.

sandal: Call It light program that sandal referred to.

And so I think theres a lot of given taken their highlighted are our <unk> on the internet remains flat so that the growth coming from that would be obviously positive growth.

Zainul Mawji: As highlighted, our ARPU on the internet remains flat, so the growth coming from that would obviously be positive growth. And biz is also included in that number as their business component. So I'll just say our objective is to take it back up and continue the growth well above the 1, but I think there'll be some give-and-takes along the way, depending on product set and, however, though, focusing on margin and impact.

Speaker Change #239: And business also included in that number as their business components. So I'll I'll just say that.

Speaker Change #239: Our objective as we are to take it back up and continue the growth.

Speaker Change #239: On well above.

Speaker Change #240: The one.

But I think there'll be some give and takes along the way depending on product set and however that we're focusing on margin and <unk>.

Zainul Mawji: And maybe just to top it off, sorry, I wanted to highlight, you know, we're going to, we've shown and demonstrated that we lean into product superiority and differentiation. So you would have seen us drive the 5GIG program for the internet in the last week. We've seen, actually, to Doug's point on the ARPU front, we've seen even in a very competitive and highly pressurized environment, both with respect to competition and Canadians driving their desire to, you know, reduce costs and lean into affordability, that our step-ups on the internet have been very strong as well. And there are some downgrades, of course.

Speaker Change #240: Okay.

Speaker Change #241: Maybe just to top up sorry, I wanted to highlight.

Speaker Change #240: We're going to leave.

Speaker Change #240: Shown and demonstrated that we lean into product superiority and differentiation. So you would have seen us drive that five gig program for Internet in the last week.

Speaker Change #240: We've seen actually to <unk> point on the <unk> front, we've seen even in a very competitive.

Speaker Change #240: <unk> highly pressurized environment, both with respect to competition and Canadians driving their desire to.

Reduce costs and lean into affordability.

Speaker Change #240: That are step ups on Internet had been very strong as well and there are some downgrades of course.

Zainul Mawji: But at the same time, we have a healthy volume of step-up opportunity, and we also have some areas where we are quite under penetrated, then where we would like to be in our fiber footprint. And we've demonstrated success and strength in driving growth and subscriber growth in those areas. So we're going to continue to lean into that in terms of ensuring that our fixed data continues to have positive momentum. Thanks, Tim.

But at the same time, we have a healthy volume of step up opportunity and we also have some areas, where we are quite underpenetrated at worse than where we would like to be in our fiber footprint and we've demonstrated success and strengthen.

Speaker Change #240: Driving growth in subscriber growth in those areas. So we're going to continue to lean into that in terms of ensuring that our fixed data continues positive momentum.

Operator: Karl, we have time for two more questions, please. The next question: Maher Yaghi from Scotiabank, please go ahead. Great, thank you for taking my question. I wanted to just, I'm sorry, but I have to ask this question.

Thanks, Tim Carl we have time for two more questions. Please.

Speaker Change #242: Certainly the next question is from Mayer Yaghi from Scotiabank. Please go ahead.

Maher Yaghi: I mean, when we look at the fixed data, you have a very low video component there compared to cable companies in Canada. And the growth rate, I would have thought, you know, given that [inaudible] of the repricing we've seen already and how much is left before we reprice the base on the security of some of the video components and maybe the broadband side. I'm just trying to figure out how much more pressure we should expect before we see growth again. And the second question I had was about wireless.

Mayer Yaghi: Great. Thank you for taking my question.

Mayer Yaghi: Wanted to just.

Speaker Change #243: Alright, because that.

Mayer Yaghi: I have to ask this question I mean, when we look at the fixed data.

Speaker Change #244: You have a very low video component in there compared to cable companies in Canada, and the growth rate I would have thought give.

Speaker Change #244: Given that.

Speaker Change #245: The split you would show.

Speaker Change #246: <unk> growth than other cable companies and obviously, we're seeing repricing in your page you also talk about.

Speaker Change #247: In your MD&A that Youre seeing repricing in the securities business security business can.

Can you discuss how much.

Speaker Change #248: Of the repricing, we've seen already and how much is left.

Speaker Change #249: Before we repriced the base on the security on.

Speaker Change #249: Some of the video component.

Speaker Change #250: And maybe the broadband side, just trying to figure out how much more pressure should we expect before we see the growth again.

Speaker Change #250: The second question I have is on wireless.

Speaker Change #251: Public mobile offering <unk>.

Maher Yaghi: Is there an opportunity to price 5G services at a premium over 4G and then continue to offer them as is right now? That's a great question. I really like that one.

Speaker Change #252: Is that a.

Speaker Change #252: When you think about the value.

Speaker Change #253: The benefit on the subscriber loading on public mobile.

Speaker Change #254: Is there an opportunity maybe to <unk>.

Speaker Change #254: <unk> services at a premium than <unk>, and then continuing to offer it.

Speaker Change #255: As of right now thank you.

Zainul Mawji: Zainul, why don't you take a shot at answering that? I really like that question. Yes, I know you do.

Dan: Thats a great question really like that one Dan why don't you take a shot at answering that.

Zainul Mawji: So the answer on the public side is yes. I think the key thing is that we haven't been satisfied with the roadmap of capabilities we have on public. It's got a digital first capability.

Dan: Really like that question, Yes, I know you do so the answer on the public side, yes.

Dan: I think the key thing is that we haven't been satisfied with the roadmap of capabilities we have.

Zainul Mawji: We like the customer base that it's attracting, and we like the positioning of the improvement in ARPU relative to where that brand had sat before. But there is absolute upside in differentiation, and we're going to drive that with some unique channel and roadmap strategies. So still to come on that. Not satisfied

On public it's got a digital first capability and we like that.

Dan: The customer base that its attracting and we like the positioning of the improvement in <unk> relative to where that brand headset sat before but there is absolutely upside and differentiation.

Dan: We're going to drive that with some unique channel and roadmap strategy still to come on that not not satisfied I think on the fixed side, what I would say is that.

Zainul Mawji: I think on the fixed side, what I would say is that we can't predict the competitive environment. We're going to take a long-term view, as I highlighted in terms of household economics and household customer lifetime value. But where we're going to lean in on the two areas that you highlighted with respect to entertainment and security is counter the cord shaving behavior that we're seeing from our customer base with differentiated products and services.

Dan: I can't we can't predict the competitive environment.

Dan: We're going to take a long term view is that as I highlighted in terms of household economics and household customer lifetime value, but where we're going to lean in both on the two areas that you highlighted with respect to entertainment and security is countered the cord shaving behavior that we're seeing.

Our customer base with differentiated products and services. So as customers are continuing to core achieve some of their linear products and services on the entertainment side, we're continuing to lean into OTT and becoming a real leader a real leader in our integration of OTT and linear.

Zainul Mawji: So as customers are continuing to cord-shave some of their linear products and services on the entertainment side, we're continuing to lean into OTT and becoming a real leader in our integration of OTT and linear and giving customers different kinds of video and value bundles, which we can only do because we've built our own platform to do so.

Dan: Here, and giving customers different kinds of video and value bundles, which we can only do because we've built our own platform to do so so we're going to continue to drive.

Dan: The outcomes based on differentiating value in a way that's meaningful to customers and I would say that we're just on the cost in both energy and security of being able to realize that upside.

Zainul Mawji: So we're going to continue to drive outcomes based on differentiating value in a way that's meaningful to customers. And I would say that we're just on the cusp of both entertainment and security of being able to realize that upside. But we can't control sort of what the competitive dynamic will bring. We want to be immune to it.

Dan: But we can't control sort of what the competitive dynamic will bring we want to be immune to it.

Darren Entwistle: I think also, importantly, Just to take people up to the top floor again. As it relates to absorbing the re-rate on fixed and mobile, we're postingulating an H2 in terms of our guidance that sees us at 6% profitability at an EBITDA level or better absorbing the re-rate along the way. And so as that re-rate moderates and that pressure reduces, the profitability upside for our organization is extremely attractive, and it's also complemented by something else that keeps getting left off the discussion, a CapEx intensity measure that is 13% today drifting to the low end on the double digit side of things in the 10% zone.

Dan: I think also importantly.

Speaker Change #256: Just to take people up to the top floor again.

Speaker Change #256: As it relates to absorbing re rate.

Speaker Change #257: On fixed and mobile we're postulating a H two in terms of our guidance that <unk> set.

Speaker Change #257: 6% profitability at an EBITDA level or better absorbing.

Speaker Change #257: The re rate along the way and so as that re rate.

Moderate moderates.

Speaker Change #257: And.

Speaker Change #257: That pressure reduces the.

Speaker Change #257: Profitability upside for our organization.

Speaker Change #257: Is extremely attractive and it's also complemented by something else that keeps getting left off the discussion a capex intensity measure that is 13% today.

Speaker Change #257: Drifting to the low end on the double digit side of things on the 10% zone. So in terms of both absorption a re rate working our way through that challenges leveraging in.

Darren Entwistle: So in terms of both absorption of re-rate, working our way through that challenge is leveraging in the future the profitable asset mix that we have aided and abetted by new products coming online that shouldn't experience the same degree of profit or price commoditization because they are completely differentiated from the product portfolio of our competitors, and to complement that with a lowered level of CapEx intensity, that seems to bode well for a sustainable Thank you. Thanks, Mayor.

Speaker Change #257: In the future the profitable asset mix that we have aided and abetted by new products coming online that should not experience. The same degree of profit or price rather commoditization because they are completely differentiated from the product portfolio of our competitors and to complement that.

Speaker Change #257: With a lower level of capex intensity that seems to bode well for a sustainable free cash flow story.

Speaker Change #257: Thank you. Thanks, Craig Thanks, Amir Karl we'll take our last question. Please.

Operator: Carl, we'll take our last question, please. This last question is from Simon Flannery. Great, thank you very much.

Speaker Change #258: The last question is from Simon Flannery from Morgan Stanley. Please go ahead Simon.

Simon Flannery: Doug, I wonder if you could expand a little bit on the copper retirement opportunity. I think you mentioned 18 markets, but what sort of percentage are we through this? And I don't know if you can put some parameters around the financial benefits from that. You talked about freeing up real estate, but what are your latest findings in terms of OPEC savings, maintenance savings, and the overall impact on the business? Maybe I'll take it off Simon; I'll hand it over to Doug.

Simon Flannery: Great. Thank you very much.

Simon Flannery: I Wonder if you could expand a little bit on the copper copper retirement opportunity a sense I think you mentioned 18 markets, but what sort of percentage are we through this I don't know if you can.

Speaker Change #259: <unk> put some parameters around the financial benefits from that you've talked about freeing up real estate.

Speaker Change #260: What are your latest findings in terms of Opex savings maintenance savings and.

Speaker Change #259: Yes.

Speaker Change #261: The overall impact on the business.

Doug Carl: Maybe I'll kick it off Simon I'll hand, it over to Doug.

Speaker Change #261: Yes.

Darren Entwistle: In terms of the program, as we're decommissioning a quarter of a million copper lines on the run, we would expect to have by the end of this year, so in the next few months, 36 central offices that have been decommissioned, which I think would put us in a global leadership position in that regard. In terms of the economics of it, on the copper front, we see the gross opportunity here being upwards of a billion dollars, and at a net level, somewhere between four and five hundred million on that front.

Doug Carl: In terms of.

Doug Carl: The program.

Doug Carl: As we are.

Doug Carl: Decommissioning a quarter of a million.

Doug Carl: Copper lines on the run.

Doug Carl: We would expect to have by the end of this year. So over the next few months.

Doug Carl: 36 central offices.

Doug Carl: That have.

Doug Carl: That had been decommissioned.

Doug Carl: Which I think would put us in a global leadership position.

Doug Carl: In that regard.

Doug Carl: In terms of the economics of it.

Doug Carl: On the copper front, we see the growth opportunity here of being upwards of one.

Doug Carl: $1 billion and at a net level somewhere between four and $500 million.

Doug Carl: On that front.

Darren Entwistle: The real estate opportunity that accompanies it, which Doug can speak to in terms of our long-term recurring strategy and the opportunity there. In terms of the performance of our business, as we go from a heterogeneous network environment with fiber and copper to a pure-play fiber, maybe complemented by fixed wireless access, the opportunity on this front is huge. We see cost reductions in the range of 25% to 30% on cost to serve, and these are now hard numbers. They're not speculations because we've been at this for well over a decade.

Doug Carl: The real estate opportunity that accompanies that Doug can speak to in terms of our long term recurring strategy and the opportunity there.

Doug Carl: In terms of the performance of our business.

Doug Carl: As we go from a heterogeneous network environment with.

Doug Carl: Fiber and copper too.

Doug Carl: Pure play fiber may be complemented by fixed wireless access.

Doug Carl: The the opportunity.

Doug Carl: This front is huge.

Doug Carl: And we see.

Doug Carl: Cost reductions in the range of 25% to 30% done on cost to serve and these are now hard numbers theyre not speculations because we've been at this for.

Doug Carl: Well over a decade.

Darren Entwistle: We see churn improvement in the zone of 20% to 25%. Additionally, we see the average revenue per household going up by roughly 15%. We see the products per household or product intensity banging away right now at 3.3%, up from what was the low twos historically on the copper front, which is extremely attractive. It allows us to be much more efficient with our field force. When you've got a level of two-thirds reduction in truck regulations, you've got quite a story from cost efficiency to reducing your environmental footprint.

Doug Carl: We see churn improvement.

Doug Carl: In the zone of 20% to 25%.

Doug Carl: We see the average revenue per household.

Doug Carl: Up by roughly <unk>.

Doug Carl: 15%, we see the products per household of product intensity.

Doug Carl: Banging away right now at $3 three up from what was the low twos historically.

Doug Carl: On the copper front, which is extremely attractive.

Doug Carl: Allows us to be much more efficient with their field force.

Doug Carl: When you've got a.

Doug Carl: A level of two third reduction in truck rolls.

Speaker Change #262: <unk> got quite the story from cost efficiency to reducing your environmental footprint and those will be huge benefits for us in terms of.

Darren Entwistle: And those will be huge benefits for us in terms of positioning us for the future economically, allowing us to do everything from, on the hygiene front, absorb re-rate from competitive activity. But the cost of launching new products when you've got fiber ubiquity, on top of all the comments that I've just made, everything going forward is now soft provisioning. You can soft provision a customer from an install basis; you can change their product and their value proposition on a virtual basis, or you can let the customer do it themselves along the way.

Speaker Change #262: Positioning us for the for.

Speaker Change #262: For the future economically.

Speaker Change #262: Mowing is to do everything from on the hygiene front absorb re rate from competitive activity, but the cost of launching new products. When you've got fiber ubiquity on top of all of the comments that I've just made.

Speaker Change #262: Everything going forward is now soft provisioning.

Speaker Change #262: So you can soft provision a customer from an installed basis, you can change their products and their value proposition on a virtual basis.

Speaker Change #262: You can let the customer do it themselves.

Speaker Change #262: Long the way.

Darren Entwistle: And then lastly, the economies of scope, given the limitless bandwidth opportunities on fiber second to none, which improves the economics on an accretive basis for every new product that you bring to market along the way. And so I think it's a very attractive composition of benefits, and maybe Doug can add to that and then maybe make a specific comment in terms of monetizing the real estate opportunity. Yeah, so the exciting part about this, as you're well aware, is that it's the gift that keeps on giving.

Speaker Change #262: And then lastly, the economies of scope given the limitless bandwidth opportunities on fiber is second to none which improves the economics on an accretive basis for every new product that you bring to market along the way and so I think it is.

Speaker Change #262: Very attractive composition of benefits and maybe Doug can talk top up on that and then maybe make a specific comment in terms of monetizing the real estate opportunity.

Doug Carl: So as exciting part about this as Youre well aware is that it's the gift that keeps on giving so.

Darren Entwistle: So, you know, we built an asset with over a 60-year life, so monetizing it isn't for the short term, and it's a superior asset to our competitors' offerings. And you heard all the operational benefits that Darren highlighted. On copper decommissioning specifically, of the 100% that Darren referred to at the billion level on gross, we're in low single digits by the end of 2024, so well below 5% monetized, so there's a significant upside over the next, you know, two to five years.

Doug Carl: You know, where we felt that asset with over 60 year life. So monetizing it isn't a short term and it's a superior asset to our competitors' offerings and you heard all the operational benefits of Darren highlighted on copper decommissioning specifically.

Darin: The 100% of Darin referred to at the $1 billion level on gross we're low single digits by the end of 2024, so well below 5% monetize so there's significant upside over the next.

Speaker Change #263: Two to five years, we then started to move.

Darren Entwistle: We then started moving into land monetization, where we put the land into partnerships with development opportunities, where we put in the land, and the developer would put in cash to get the projects off the ground. And so you're seeing land opportunities now moving into permitting and development, and as Darren highlighted, you know, we're up to well over 30 now with those that have been decommissioned and opportunities. We are building on, collectively, three to four as we speak, and 15 are in the permitting process.

Speaker Change #264: Moving into land monetization, where we're putting the land into partnerships with development opportunities, where we put in the land and the developer would putting cash to get the projects off the ground.

Speaker Change #264: And so youre seeing land opportunities now moving into permitting and development and as Darren highlighted.

Darren: We are up to well over 30 now with those that have been decommissioned in opportunities. We were building on collectively three to four as we speak and 15 are and permitting.

Darren Entwistle: And so, you know, we expect to have, by 2026, over 250 homes available for rental in Nanaimo and Sechelt. We'll have over 1,500 in the next three to five years, and we have a commercial building that's launching in the fall of 2024. So to the development opportunity, there are multiple layers, and these aren't one time only. So you're going to see these kind of benefits coming through from us for the years to come and continuing then to build on that momentum.

Speaker Change #265: And so we expect to have by 2026 over 250 homes available for rental through <unk> and <unk> will have over 500 in the next three to five years and we have a commercial building thats launching in the fall of 2024, so to the development opportunity there is multiple layers.

Speaker Change #265: And these aren't one time, so youre going to see these kind of benefits coming through from us for the years to come.

Speaker Change #265: And <unk>.

Speaker Change #265: Continuing then to build on that momentum.

Darren Entwistle: Great. Thanks a lot. Thanks, Simon, and thank you, everyone, for joining us today, and please feel free to reach out to the IR team if you have any follow-ups or questions. This concludes the Telus 2024 Q2 Earnings Conference Call.

Speaker Change #266: Alright, Thanks, a lot.

Speaker Change #267: Thanks, Simon and thank you everyone for joining us today and please feel free to reach out to the IR team. If you have any follow up to your questions.

Speaker Change #268: This concludes the tale of 2024, our Q2 earnings conference call. Thank you for your participation and have a nice day.