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CFO's letter

Strong financial management

TELUS has considerable financial strength and a demonstrated commitment to transparency and adherence to prudent financial policies and guidelines. These have guided our actions successfully over the past decade as we executed our operational strategy while building financial strength and thereby earned the confidence of investors. Our track record is also reflected in the strong investment grade credit ratings we maintain, BBB+ to A– with a stable trend, which have enabled us to have ready access to capital markets.

We continued in 2010 to refinance and early redeem U.S. debt due in June 2011 carrying an effective interest rate of 8.5 per cent. In July, we successfully raised $1 billion of 10-year debt with a 5.05 per cent coupon. This mirrored the same amount and coupon of a December 2009 debt issue. The combined impact of these two bond issues would be to lower annual interest costs by more than $65 million, which will positively impact future earnings and cash flow. Importantly, these debt issues also reduced our refinancing risk and extended our debt maturity profile by almost two-thirds of a year to 5.7 years.

Our good standing and ready access to capital markets provide a competitive advantage in our ever-changing, technology- driven and capital-intensive industry. This is increasingly important as we continue to invest in new network infrastructure and innovative solutions.

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