growing together through economic performance

TELUS financial highlights

Operating revenues increased 6.6 per cent in 2006 to $8.7 billion, led by strong wireless growth. Operating earnings, or EBITDA (earnings before interest, taxes, depreciation and amortization), increased nine per cent, led by a 21 per cent wireless EBITDA growth. Combined data and wireless revenue were 63 per cent of total operating revenues in 2006, a 400 basis point increase from 2005. This is consistent with our continued focus on growth markets of data and wireless and contributed to healthy revenue growth.

Growth of $422 million or 60 per cent in net income was primarily a result of the strong wireless sector, but was also affected by temporary net expenses leading up to and resulting from an extended labour disruption in 2005. The trend was also affected by reductions in income tax and tax adjustments and related interest for prior periods. Cash flow, defined as EBITDA less capital expenditures, remained relatively flat from last year, due to increased capital expenditures.

Capital expenditures - TELUS' capital expenditures of $1.6 billion in 2006 increased as a result of enhanced investments in wireless and broadband networks and network access to serve strong housing growth in Western Canada, as well as deferred capital expenditures resulting from the labour disruption in 2005. Seventy-one per cent of the 2006 capital expenditure was spent in B.C. and Alberta with 28 per cent spent in Ontario and Quebec.