NYSE:TU TELUS Q4 2024 Earnings Report $15.04 -0.06 (-0.40%) As of 03:59 PM Eastern Earnings HistoryForecast TELUS EPS ResultsActual EPSN/AConsensus EPS $0.15Beat/MissN/AOne Year Ago EPSN/ATELUS Revenue ResultsActual RevenueN/AExpected Revenue$3.66 billionBeat/MissN/AYoY Revenue GrowthN/ATELUS Announcement DetailsQuarterQ4 2024Date2/14/2025TimeBefore Market OpensConference Call DateThursday, February 13, 2025Conference Call Time12:30PM ETConference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress ReleaseEarnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by TELUS Q4 2024 Earnings Call TranscriptProvided by QuartrFebruary 13, 2025 ShareLink copied to clipboard.PresentationSkip to Participants Operator00:00:00Good day. Welcome to TELUS twenty twenty four Q4 Earnings Conference Call. I'd like to introduce your speaker, Mr. Robert Mitchell. Please go ahead. Robert MitchellHead, IR at TELUS00:00:08Hello, everyone. Thank you for joining us today. Our fourth quarter twenty twenty four results, news release, MD and A financial statements and detailed supplemental investor information were Robert MitchellHead, IR at TELUS00:00:17posted through our website earlier this morning. Robert MitchellHead, IR at TELUS00:00:20Our call today will begin with remarks by Darren and Doug. For the Q and A portion, we will be joined by Zainal, Navin, Jason and Tobias. Briefly, prepared remarks, slides and answers to questions contain forward looking statements. Actual results could vary 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. Robert MitchellHead, IR at TELUS00:00:42S, including fourth quarter and annual 2024 MD and A. With that, over to you, Darren. Darren EntwistlePresident and CEO at TELUS00:00:49Thanks, Ragnar. Hello, everyone. And in the fourth quarter and for 2024, our team's relentless pursuit of operational excellence continued to differentiate the TELUS organization, driving significant customer growth and robust financial results. Through our premier asset portfolio and unwavering commitment to cost efficiency, we delivered strong profitable growth to close out 2024, momentum that we intend to build upon in 2025 and beyond. Our focus on margin accretive customer expansion, globally leading broadband networks and a customer centric culture culminated in our third consecutive year of surpassing 1,000,000 mobility and fixed customer additions. Darren EntwistlePresident and CEO at TELUS00:01:38Once again, TELUS led the industry with more than 1,200,000 telecom net new customer additions in 2024. This performance is a testament to our unmatched bundled product offerings across mobile and home. Indeed, our team's passion for delivering customer service excellence again contributed to continued strong loyalty across our key product lines. Notably postpaid mobile phone churn of 0.99% for the full year marks the eleventh consecutive year at less than 1%. Despite a challenging competitive regulatory and macroeconomic landscape, Telus drove 5.5% key tech EBITDA growth for 2024 meeting the target range that we set at the beginning of 2024. Darren EntwistlePresident and CEO at TELUS00:02:32This included strong TTEC EBITDA growth of 7% in the fourth quarter. Our team once again achieved industry best total customer telecom net additions of 328,000 for the quarter. In mobile, we drove leading total net additions of 264,000 including healthy mobile phone net additions of 70,000 and strong connected device net additions of 194,000. This was supported by our ongoing intense focus on economic margin accretive customer growth, which is evidenced by our consistent industry leading lifetime revenue, buttressed by our industry best churn and superior customer experience. Let's turn now and take a look at our wireline business. Darren EntwistlePresident and CEO at TELUS00:03:26TELUS delivered another quarter of industry leading total wireline customer growth, including industry best fourth quarter intranet net additions of 37,000. Notably, this drove industry leading fixed data services revenue growth of 3.5%. Furthermore, in the fourth quarter, we drove continued strong momentum in our unique and highly differentiated data centric growth businesses. Our TELUS Health team achieved accelerated revenue growth in the quarter of 10% alongside 20% growth in its EBITDA contribution. Since acquiring LifeWorks in 2022, we've achieved $355,000,000 in combined annualized synergies, including $294,000,000 in cost synergies and $61,000,000 in cross selling. Darren EntwistlePresident and CEO at TELUS00:04:24Importantly, we remain on track to deliver our goal of $427,000,000 by year end. Moreover, we drove a 10% year over year increase in global lives covered to over $76,000,000 a 16% increase in virtual care members and a 7% increase in digital health transactions. Likewise, our team achieved robust performance in TELUS agriculture and consumer goods with revenue growth of 16% on the back of eight consecutive quarters of record sales performance driving increasing profitability and margin contributions. We look forward to continuing the momentum in these emerging growth areas in 2025 and beyond. The strategic investments that we've made in our leading broadband networks alongside our customer experience leadership underpin the continued advancement and sustainability of our strong financial and operational performance. Darren EntwistlePresident and CEO at TELUS00:05:31This gives us confidence in the robust outlook for consistent long term profitable growth and our ability to deliver on the annual targets that we've set out for 2025. These include industry leading TTEC operating revenue and adjusted EBITDA growth of up to 45% respectively and consolidated free cash flow of approximately $2,150,000,000 supported by continued moderated capital expenditures of approximately $2,500,000,000 representing an industry best capital intensity. Our team's track record for execution excellence alongside an attractive long term free cash flow growth outlook underpin our sustainable and leading multi year dividend growth program now in its fifteenth year. Needless to say, we remain disappointed in our share price performance over the past year in spite of significantly outperforming the majority of our national and global peers across a wide range of operational and financial metrics. This is frustrating for our management team in the context of our robust and profitable customer growth, which drove leading fourth quarter telecom EBITDA growth of seven percent and five point five percent for the year, not to mention our dividend yield of 8% coupled with TELUS' potent defensive characteristics in a volatile macroeconomic environment. Darren EntwistlePresident and CEO at TELUS00:07:21Furthermore, our leading and differentiated asset mix underpins the significant value that we have created, including our pervasive pure fiber network with world's best KPIs as reflected in recent U. S. Fiber transactions. It includes our differentiated TELUS Health and TELUS Agriculture and Consumer Goods businesses with their attractive growth and valuation multiple characteristics. And it includes the best telecom asset in the business with a reliable execution track record. Darren EntwistlePresident and CEO at TELUS00:08:02Going forward, this management team remains laser focused on building on the strong operational and financial performance momentum with which we exited 2024. We remain focused on achieving our robust targets for 2025 and we remain focused on delivering sustainable free cash flow expansion year in and year out for the foreseeable future. This is buttressed by one of the lowest capital intensity ratios globally alongside compelling monetization opportunities that we anticipate supporting meaningful deleveraging also a key area of focus for 2025 and beyond. TELUS is targeting to achieve a net debt to EBITDA ratio of approximately three times in 2027 in conjunction with the contemporaneous removal of the discounted dividend reinvestment plan preceded by a ratcheting down of the plan in 2026. In May, per our established cycle, we will provide an update on our dividend growth program for 2026 through 2028 and more generally for the return of capital to our shareholders. Darren EntwistlePresident and CEO at TELUS00:09:30In closing, I'd like to express my gratitude to our team for their efforts, their expertise and frankly in the environment, their grit in executing on our consistent winning strategy to meet our commitments to all of our stakeholders. And on that note, let me turn the call over now to Uncle Doug. Doug FrenchExecutive VP & CFO at TELUS00:09:52Thank you, Darren, and hi, everyone. Mobile network revenue was flat as profitable mobile loading and connected device additions were offset by lower mobile phone ARPU, which declined 3.6%. The decline in ARPU, although reflective of the ongoing competitive pressures in the market, remained relatively stable as compared to the previous few quarters. Double digit IoT revenue growth partially mitigated this impact. Fixed data services revenue grew 3.5% year over year driven by strong customer growth across our leading product portfolio of pure fiber Internet, TV, security and home automation as well as B2B growth. Doug FrenchExecutive VP & CFO at TELUS00:10:36At the segment level, TTEC operating revenues were up 4.1% driven primarily by mobile equipment, fixed data services as well as strong growth in health and agriculture as Darren highlighted. Other income of $52,000,000 in the quarter increased by $37,000,000 over last year, largely due to gains recognized on our real estate and copper monetization programs. We anticipate these programs to continue in 2025 as we execute against these initiatives. Notably, TTEC adjusted EBITDA increased by 7% in the fourth quarter and 5.5% for the full year, achieving the low end of our target range alongside margin expansion of 110 basis points to 38.2% demonstrating an unparalleled track record of execution excellence in a highly dynamic operating environment. These results were driven by our consistent emphasis on profitable revenue growth or customer growth and the benefits from our ongoing focus on cost efficiency and effectiveness, gains from our real estate and copper monetization programs, as well as increasing margin contribution from TELUS Health and TELUS Agriculture and Consumer Goods. Doug FrenchExecutive VP & CFO at TELUS00:11:56Looking at our TELUS Digital segment, operating revenues and adjusted EBITDA for the fourth quarter continued to reflect stabilization and performance, both improving on a sequential quarterly basis. The team continues to manage their cost structure while focusing on revenue generation. Please refer to TELUS Digital's quarterly conference call earlier today. On a consolidated basis, net income increased by 3.2% year over year, while basic EPS was higher by 20%. On an adjusted basis, net income and EPS were higher by eleven percent and four point two percent respectively. Doug FrenchExecutive VP & CFO at TELUS00:12:33This growth was driven by the after tax impacts of higher operating income, partially offset by higher financing costs, mainly reflecting the impact of unrealized changes in the forward element of our virtual power purchase agreements, as well as higher interest costs associated with our increased long term debt and higher interest rates. For the full year, CapEx excluding real estate declined by $294,000,000 or 11% driven by our planned slowdown of our fiber and wireless asset bills as we approach their completions. Consolidated capital intensity of 12% was down 200 basis points year over last year. For the full year, free cash flow of approximately $2,000,000,000 came in slightly below our target of $2,100,000,000 This was primarily due to higher than expected cash impact effects of contract assets and device financing associated with the higher contracted devices in Q4 as promotions were heavily focused on device subsidies throughout Black Friday and the holiday selling period. Free cash flow was also impacted by slightly higher restructuring from our ongoing cost efficiency programs. Doug FrenchExecutive VP & CFO at TELUS00:13:46These factors were partially offset by lower capital expenditures. Looking ahead, our financial targets for 2025 build off our leading growth profile and operating execution excellence. Our financial targets include TTEC operating revenue growth of 2% to 4% and TTEC adjusted EBITDA growth of 3% to 5%. Consolidated capital expenditures, excluding real estate, are targeted to remain at approximately $2,500,000,000 We also set aside $100,000,000 in capital for real estate development initiatives similar to 2024. Lastly, free cash flow for 2025 is forecasted to be approximately $2,150,000,000 driven by higher EBITDA and disciplined capital management. Doug FrenchExecutive VP & CFO at TELUS00:14:32Our outlook for free cash flow includes an increase to cash taxes due to higher installments related to higher taxable income. Additionally, there'll be a catch up tax payment in 2025 related to 2024 for the increase on our earnings before tax as well as a step down in the amount of tax depreciation Telus can claim under the accelerated investment incentive program. For 2025, we also anticipate slightly higher interest paid. The effects of asset sorry, the contract assets and device financing as well as cash restructuring payments both anticipated to be flat in 2024. A detailed list of our assumptions for 2025 are set out in our annual MD and A release today. Doug FrenchExecutive VP & CFO at TELUS00:15:20As it relates to our balance sheet, the average turn to maturity of our long term debt stands at over ten years and our average cost of debt is 4.37%. Our leverage ratio at the end of twenty twenty four is at 3.9 times Doug FrenchExecutive VP & CFO at TELUS00:15:33and Doug FrenchExecutive VP & CFO at TELUS00:15:33we remain committed to delevering our balance sheet with the execution of the plan in place towards the net debt to EBITDA leverage of approximately three times in 2027. The plan includes EBITDA growth and cash flow expansion alongside a reducing capital intensity, as well as the continuing of programs such as real estate and copper initiatives, partner opportunities within our growth businesses, divestiture of non core assets and surfacing or some value servicing value in our infrastructure where appropriate. Furthermore, as Darren outlined, we expect to achieve this target leverage ratio alongside our plans to reduce the discount associated with our dividend reinvestment plan in 2026 with the intention of removing it in 2027. Overall, we look forward to the new year. We remain highly confident in our ability to build on a track record of execution excellence underpinned by our leading asset mix and resilient business strategy. Doug FrenchExecutive VP & CFO at TELUS00:16:37This will be supported by our focus on de levering as we ensure we are well equipped to deliver strong sustainable growth into the future. With that, back to you, Robert. Robert MitchellHead, IR at TELUS00:16:48Carl, we're ready for questions, please. Operator00:17:00The first question is from Jerome Dubreuil from Desjardins. Please go ahead. Jerome Dubreuil.VP & Research Analyst - Telecom, Media & Technology at Desjardins Group00:17:06Thanks for taking my questions. A couple for me. First topic is on your target of three times leverage in 2027. I think that was very interesting. How much asset divestiture does that include? Jerome Dubreuil.VP & Research Analyst - Telecom, Media & Technology at Desjardins Group00:17:19And can we infer from this that you are happy with your current portfolio of assets going forward? And then the second topic for me, in light of the high dividend yield, if you can maybe elaborate on the merits of having a long term dividend plan in general, the competitive environment evolves, investment opportunities arise and interest rate changes in three years just seemed like a very long time. So if you can talk about these things. Doug FrenchExecutive VP & CFO at TELUS00:17:52Okay. I'll start. So on the assets going forward, so that question, we have a placeholder in our plan. We've been open on that of approximately $500,000,000 and that is included in our three year plan going forward that we will continue to do appropriate divestitures as we seem appropriate or acquisitions as we seem appropriate. On the delevering side of assets as highlighted, we're obviously leveraging up our free cash flow and capital intensity reductions. Doug FrenchExecutive VP & CFO at TELUS00:18:26We have a three year plan that includes the divestiture of some of the non core assets. We haven't disclosed exactly the amount with that, But I think with the initiatives over the next little bit, you'll see some coming to fruition within 2025. And we'll continue to update on our progression on that, but I'm not going to give an exact number on those divestitures today. And on the growth plan, Aaron, I'll pass it back to you. Darren EntwistlePresident and CEO at TELUS00:18:58So I think over the past fifteen years, the dividend growth model has served investors extremely well at this organization. Secondly, I think we've been pretty clear in respect of the pecking order for our capital allocation, Party number one for the benefit of all securities holders is to drive improvements in our balance sheet. And you've heard us this morning come out with a public target in that regard and ancillary considerations around it, including ratcheting down and removing the D DRIP along the way. We think we've got the latitude to continue invest prudently in the growth of the business. And then thirdly, to return cash to shareholders where the primary, but not the exclusive vehicle has been our dividend growth model. Darren EntwistlePresident and CEO at TELUS00:19:53When I look at the future prospects of this organization from EBITDA growth to operating efficiency to the emerging growth opportunities within health and TELUS agriculture and consumer goods. When I look at a capital appetite that's moderating with a goal to get down to a CapEx intensity level of circa 10%, I foresee a very strong and sustainable free cash flow story for this organization prospectively. And that strong free cash flow generation on that longitudinal basis with that parameter of sustainability supports the affordability of the dividend growth model, both in terms of magnitude and longevity. Having said that, as I have said over and over and over again, the dividend remains the quarterly provenance of the board to adjudicate upon factoring in multiple considerations. And if there is undue volatility of some sort, we always have that lever to be adjusted smartly appropriately according to those conditions. Darren EntwistlePresident and CEO at TELUS00:21:23But when I normalize for anomalies of that nature, I think the growth trajectory of this organization at the cash flow level for the reasons that I've just decided supports the type of continuity as it relates to returning cash to shareholders in a fashion that's both meaningful and differentiated from our peer group. Robert MitchellHead, IR at TELUS00:21:48Thank you. Thanks, Jerome. Carl, next question please. Operator00:21:53The next question is from Maher Yaghi from Scotiabank. Please go ahead. Maher YaghiManaging Director at Scotiabank00:21:58Great. Thank you for taking my question. Good morning. First, I would like to ask you on your fixed data services and fixed service revenue service revenue in general. This is the second quarter that we see an acceleration and growth on both metrics, quite a feat I see in the current environment. Maher YaghiManaging Director at Scotiabank00:22:21Can you discuss the underlying KPIs that is supporting this improvement? And it seems to me it's coming from pricing and customer intensity. Can you confirm that? And Maher YaghiManaging Director at Scotiabank00:22:37is this the Maher YaghiManaging Director at Scotiabank00:22:37when you look at the pricing in general, can you comment a little bit about the pricing in your marketplace? Thank you. Darren EntwistlePresident and CEO at TELUS00:22:45Okay. I don't think it's quite a feat. I think it's a satisfactory achievement. And Zanna, why don't you speak to your satisfactory achievement? Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:22:54Always striving for better. So I think it's a great question. I think that what you should see from our fixed data growth is that, first of all, it is based on a foundation of volume and significant quarter over quarter, year over year growth in our fixed customer base. The second thing that I would highlight is that we're always driving for profitable growth across our regions. And so while we have access to new markets and territories, we're always going to do that in a profitable way. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:23:32So that's the volume side. The other piece that's very important is that we have a diversified and growing portfolio of services that are dependent and driven and driving the fixed growth. And then I think it's really important to look at the characteristics that Darren alluded to on the fiber side with respect to the percentage of customers that are taking higher speeds and continue to be pushed up the speed curve and want to take those higher levels of the portfolio that we offer as well as the product intensity that we offer in terms of the incremental products and services. So we have significant opportunity to continue growing that market and we are seeing a strong take rate of our services over time. And of course, we're going to be supporting the idea that as we grow and ensure that we provide better reliability, better capacity of our networks that the pricing dynamic keeps pace with that. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:24:38So those are all the kinds of things that we will look to. I think over time as well when you look at there are some policy and other elements in terms of our pricing strategy that still have accretion opportunity for us and we're going to continue to be mining those. So I think our overall strategy is going to be product diversification and growth and we're always going to see that profitably and you see that in our results. Darren EntwistlePresident and CEO at TELUS00:25:04One of the areas where we've again delivered differentiated results on this exact front is within the B2B side of our business. Navin, would you please provide a short top up to Zainal's excellent comments? Nazim BenhadidChief Technology Officer at TELUS00:25:23Yes, for sure, Darren. And yes, just as a top up to Zainal's comments, we're seeing very strong volume growth and growth of share on the fixed data services side. And quite frankly, in B2B and specifically SMB, we had room to grow share in our ILEC territory and obviously, the opportunity in our non ILEC Eastern territories. So that is an area that we've been very focused on and have seen good success in terms of driving good volume and market share penetration. We've also have a good opportunity that we've made progress on, but still have lots more to go in terms of product intensity, especially in the SMB space and we'll continue to focus on that. Nazim BenhadidChief Technology Officer at TELUS00:26:23And then lastly, we continue to look at our product depth and breadth and look to drive product expansion that then also drives improved revenues. So back to you, Darren. Darren EntwistlePresident and CEO at TELUS00:26:37Thanks. Maher YaghiManaging Director at Scotiabank00:26:38Thank you. Darren EntwistlePresident and CEO at TELUS00:26:39Thanks, Meyer. Next question please, Karl. Operator00:26:42The next question is from Stephanie Price from CIBC. Please go ahead. Stephanie PriceEquity Research Analyst - Software & Services at CIBC World Markets00:26:47Good morning. On the drip removal, can you talk a little bit about how you're thinking about the payout ratio by 2027, excluding the drip? And then maybe you can talk more broadly about kind of that term ratcheting down the drip in 2026 and what that implies in terms of magnitude? Doug FrenchExecutive VP & CFO at TELUS00:27:05Yes. So we expect our ratio to be within our payout ratio that we have actually put out. So that up to 75% to 50% to 75% or sorry, 60% to 75%. That ratio is one we'd expect to be in 2027, even with all the moving parts that we've just talked about. Darren EntwistlePresident and CEO at TELUS00:27:29And in terms of the 2026 ratchet down component, we've not provided that specificity. We will do so in May. But I think a good operating assumption would be that we would make half a step in the ultimate direction that we want to achieve in 2027. So a move halfway there, I think is a good modeling assumption. Stephanie PriceEquity Research Analyst - Software & Services at CIBC World Markets00:27:51Perfect. Thank you. And then Zainal, you mentioned the answer to the last question about moving into new territories and fixed data in a profitable way. Just curious if you can expand a little bit on the move into the Ontario Internet market, what the strategy is there and what you're seeing so far in terms of uptake? Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:28:07Sure, Stephanie. So I think the key thing is that it's not a new move, right? So we have been acquiring assets and making sure that we look at the market in terms of what the customer behavior and customer desires are. We've had Kudo Internet in market for a period of time and we're seeing good bifurcation in terms of product intensity from a Kudo Internet perspective in terms of the take rate for that demographic of the market. And when we bundle in elements like Stream Plus and other offers, there's a really great value proposition for our customers there. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:28:49And I think that as it relates to PureFibre Internet, this is a marathon. It's not a sprint. We've always talked about smart economics and leveraging new products. And so we have areas where we have consumers that are taking our security services that want our view and our responsibility and reliability on their Wi Fi and their Internet. And so those are the kinds of areas that we're going to grow in profitably, where we can provide a value added service and an end to end opportunity for our customers to experience both our wireless, wireline and our value added products. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:29:35So when we look at this, we have to look at it from that lens. And we're not running to the market and doing dilutive offers, but we're really finding the niches where our customers want those bundles and products and growing profitably from that perspective. Stephanie PriceEquity Research Analyst - Software & Services at CIBC World Markets00:29:54Thank you for the color. Robert MitchellHead, IR at TELUS00:29:57Thanks, Stephanie. Next question please, Carl. Operator00:30:00The next question is from Drew McReynolds from RBC. Please go ahead. Maher YaghiManaging Director at Scotiabank00:30:05Yes. Thanks very much. Drew McReynoldsManaging Director - Global Research, Telecommunications & Media at RBC Capital Markets00:30:07A couple for me. Just first on, I guess, the revenue growth guidance. We've heard from some of your competitors just in terms of population growth assumptions or more broadly wireless market expansion assumptions. Just wondering what you're thinking on the volume side for wireless in 2025? And then secondly, just back to the earlier question on TPIA and whether there will or won't be a big three band out of footprint. Drew McReynoldsManaging Director - Global Research, Telecommunications & Media at RBC Capital Markets00:30:40Just wondering from a TELUS perspective, again with reference to perhaps the 2025 guidance, if you're unable to tap TPIA in the East, just wondering what other kind of growth opportunities you would have or whether that materially changed the growth outlook here for TELUS short and medium term? Thank you. Darren EntwistlePresident and CEO at TELUS00:31:04You want to take the first part of that question, Zainal? Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:31:08Sure. On the volume side, so I will say that Darren reminds me daily of the comments that he's made for several consecutive quarters on the fact that our EBITDA growth could be at its at the high end of guidance on the back of leveraging our existing customers and ensuring that we provide continue to provide great service, continue to drive product intensity and continue to improve on our churn and other economics. So I think that we're really focused on what we can do with the capabilities that we have. We have a breadth of a product portfolio that is unmatched domestically and we have the opportunity to continue to leverage that differentiation to grow our business. And we're going to be focused regardless of the macroeconomics and the macro environment on driving that level of product intensity. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:32:11So we are absolutely seeing some shifts and we're seeing some areas of decline. I think that we're all managing through that and our approach is to be as disciplined as we possibly can and continue to grow profitably off this opportunity size that we already have that we can continue to mature. Darren EntwistlePresident and CEO at TELUS00:32:33Again, given that the differentiated success on the B2B front, particularly as it relates to national expansion and the growth opportunities within the small medium business side are considerable. Navin, would you top up on Sanil's response as well please? And then I'll close it out for Drew. Nazim BenhadidChief Technology Officer at TELUS00:32:58Yes, thanks Darren. So just as an example, we saw 6% revenue growth in our SMB segment in the fourth quarter And we continue to see double digit growth in our five gs IoT portfolio, which all continue to contribute positively to the B2B growth story. And so when we look at 2025 wireless specifically, yes, there's some headwinds that will continue, but we feel very confident in our ability to drive the volume growth, the new product growth. The opportunity to monetize data is nascent at this point and a very good opportunity for us to continue to grow on that front as well. So the SMB opportunity on a national basis continues to be an area of strong growth for us. Darren EntwistlePresident and CEO at TELUS00:34:05Finally, Drew, I could reiterate the comment that I made last time, which I still feel strongly about, which is the significant growth opportunity that exists within our existing client base in terms of the upside of product intensity that would give us volume loading growth and extremely attractive economics associated with that because it would be economic quality loading that would be that we would be affecting. And to be quite clear about that, that's really a four point game because not only do we get economically accretive loading, but we improve the product intensity, which lowers the turn rate, which gives us a better overall lifetime value. So that's at the backbone of everything that we're doing right now. But when you think about the question you're asking on third party access in whatever guys, I guess the best way I could answer it is we're going to make the bold assumption that regulatory decisions pronounced by the CRTC after a comprehensive and rigorous and exhaustive process where the diversity of voices was consulted in terms of all stakeholder constituency groups, where the documentation of the decision was highly exacting, where the decision was confirmed twice over from interim to final, where the decision was twice vetted and approved by the Competition Bureau. Darren EntwistlePresident and CEO at TELUS00:35:55And also a decision that's I think consistent on a contemporary basis with Canada wanting to remove not increase international trade barriers given some of the challenges that may confront us prospectively at the international level, we will expect that particular decision to stand and we will adjudicate accordingly in terms of our go to market activities. I think that decision and our response from a go to market perspective is in the best interest conclusively of Canadian consumers and Canadian businesses, particularly small businesses accretive to the welfare of consumers or the productivity of businesses. Drew McReynoldsManaging Director - Global Research, Telecommunications & Media at RBC Capital Markets00:37:01Understood. Thank you, Bowen. Robert MitchellHead, IR at TELUS00:37:04Thanks, Drew. Next question please, Carl. Operator00:37:13The The next question is from Sebastien Opete from JPMorgan. Please go ahead. Sebastiano PettiSenior Research Analyst at JP Morgan00:37:19Thank you for taking the question. Just maybe following up on Jerome's question and just about the leverage target. Darren, you did mention surfacing value in your infrastructure assets and Aetna, a comment reiterated or echoed by your telco peer there. Any examples of perhaps what you're exploring? Obviously Rogers is going down a path with some unclear on how that will result, but you have obviously telecom infrastructure assets related to your towers, other fiber. Sebastiano PettiSenior Research Analyst at JP Morgan00:37:55What is or is not on the table? And then just any other help as we kind of think about getting to that three the three turns of leverage over time. You did say EBITDA and free cash flow growth, but I think just commentary we're hearing folks perhaps struggling a little bit trying to see how the glide path gets there without perhaps meaningful asset monetization. So just maybe double clicking on that would be lovely. Thank you. Darren EntwistlePresident and CEO at TELUS00:38:21Okay. Given you asked for examples, I'll give you the recipe that we're pursuing with a requisite degree of specificity with some degree of insights needing to be assumed along the way. First and foremost, we're going to keep pushing on EBITDA growth. We think we've got attractive opportunities for cash expansion through EBITDA growth. And I think 7% EBITDA growth to exit Q4 is an excellent example in that regard. Darren EntwistlePresident and CEO at TELUS00:38:56We've been very proactive and aggressive in terms of our cost efficiency programs. And that has been a key underpinning to our go to market activities to deliver the nominal results that we are on the EBITDA side of the business. On the capital investment side, I've been quite explicit saying that the goal of this organization is to get down to 10% CapEx intensity. And it's not a fanciful goal. It's a goal that recognizes that the heavy CapEx lifts that are really characterized the decade between 2013 and 2023 are more behind us now than ahead of us because of the pervasive fiber build that we've affected and the spectrum gauntlet that we have survived through along the way. Darren EntwistlePresident and CEO at TELUS00:40:00And I think those are positive things. The other aspects that are buttressing our ability to get down to that 10% CapEx intensity level is the digital transformation of the TELUS organization aided and embedded by TELUS Digital, the cloudification of our support infrastructure and the fact that increasingly Zainal and Navin's portfolio is characterized by SaaS solutions. So I think all of those things cumulatively are quite supportive in that regard. And we're not a one trick pony in terms of where our sources of growth are coming from. We're getting it from consumer, we're getting it from business and we're getting it from our emerging growth areas, including TELUS Health and TELUS Agriculture and Consumer Goods. Darren EntwistlePresident and CEO at TELUS00:40:59As it relates to monetization programs, we have a very attractive opportunity for us on the real estate front because of the supplanting of copper with fiber and what it does in terms of yielding real estate development opportunities from our former central offices that are very attractively located. And we exited 2024, releasing about 24 central offices for real estate development. And I would expect by the end of twenty twenty five, we'll have a total of 35 to 40 central offices released for real estate development. And that's extremely attractive. And we see a real estate opportunity from a monetization perspective in the $3,000,000,000 zone, which is why we're progressing our REIT strategy with the future CEO of that business being Doug. Darren EntwistlePresident and CEO at TELUS00:42:07And he certainly has a passion to bring that to fruition. The other synergistic byproduct of fiber and the supplanting of copper is the recycling of copper, our ability to mine copper within our access infrastructure at a time when the spot price on copper is extremely attractive. And we think that there's a progressive opportunity that we're going to have like real estate on a multi year basis that is economically attractive. And the opportunity there is circa $1,000,000,000 at a gross level and post or net of recycling, maybe doing it with some interesting partners within the Canadian resource industry is probably netting out at $500,000,000 As it relates to our emerging growth businesses, both TELUS Health and TELUS Agriculture and Consumer Goods, where TELUS Health has the pole position on this front given the scale characteristics that we're now achieving and the growth and profitability characteristics that we're now achieving. We have the opportunity to look at bringing in key partners to help accelerate the growth and the value of that asset and looking at monetization opportunities within the medium term as it relates to IPO undertakings that are very, very real for the TELUS organization. Darren EntwistlePresident and CEO at TELUS00:43:38We also have some assets within the portfolio that need to be groomed because they no longer represent a productive or elegant strategic or commercial fit. There are other organizations out there externally that would covet those assets where it would be a better strategic fit for them than us. And so we will look to undertake certain divestitures in that regard. And then specifically, as it relates to telecommunications infrastructure and monetization strategies, as it relates to fiber, the answer to your question is no. And as it relates to towers, the answer to your question is maybe. Darren EntwistlePresident and CEO at TELUS00:44:26If we like the economics, if we like the deal, if we like what could be done with that particular asset post monetization, It's something that we would consider along the way and we think it is our responsibility to do exactly that. And so the laundry list goes further, but I think from a recipe point of view, that should give you significant insight as to just how real and concrete these activities are to assure our ability to hit the net debt to EBITDA goal that we've now gone public with and the synergistic complement on that front in terms of removing our discount dividend reinvestment plan. Sebastiano PettiSenior Research Analyst at JP Morgan00:45:15If I could quickly follow-up, that's Sebastiano PettiSenior Research Analyst at JP Morgan00:45:17a very thorough answer. I appreciate that Darren. But as you think about the real estate monetization opportunity, you have marked another $100,000,000 this year towards that program. Is that can you achieve your $3,000,000,000 monetization goal in real estate at that kind of run rate level on Sebastiano PettiSenior Research Analyst at JP Morgan00:45:33an annual basis as we kind Sebastiano PettiSenior Research Analyst at JP Morgan00:45:34of think about maybe the medium term? Thank Sebastiano PettiSenior Research Analyst at JP Morgan00:45:37you. Doug FrenchExecutive VP & CFO at TELUS00:45:38Yes. There's going to be more of a run rate similar to 2024 for the next year or so. And then there'll be a call it a lump sum monetization when you have a pool of assets that carry a magnitude of substance. So that could be two years out, give or take, or it could be sooner if we continue down the path on development we're on. Doug FrenchExecutive VP & CFO at TELUS00:45:59But I would assume for '25 is similar to '24, but there could be a lump sum within the three year planning period. Sebastiano PettiSenior Research Analyst at JP Morgan00:46:09Thank you. Robert MitchellHead, IR at TELUS00:46:10Thanks Sebastiano. Carl, we have time for one more question please. Operator00:46:15The final question is from Benjamin Swinburne from Morgan Stanley. Please go ahead. Benjamin SwinburneManaging Director at Morgan Stanley00:46:21Thank you. Good morning to you guys. I wanted to ask about the wireless marketplace and particularly around pricing environment and ARPU. I see ARPU I think mobile ARPU is down about 3.5% year on year in Q4. I think you've put in a price increase on public mobile in the first quarter. Benjamin SwinburneManaging Director at Morgan Stanley00:46:40Just wondering what you're thinking about ARPU trends in 2025 and what underpinning the guidance if you want to talk about it? And just generally the environment you think you're operating in today versus what we saw over the course of the past year? Thank you so much. Darren EntwistlePresident and CEO at TELUS00:46:56Okay. I'll ask Zanele and Navin to kick it off and then Doug and I can close as it relates to the guidance roundup. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:47:07Thank you. So I think I would say that you've seen similar ARPU performance from us from a stabilization perspective. And it is no doubt a competitive and aggressive market out there, and it's a disrupted market. So I think that we are continuing to assume that we see some of the same challenging competitive dynamics. I don't think that there's going to be a material swing. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:47:38If there is to the upside, then that will be accretive. Our guidance is based on much of the same. And I think that as we spoke earlier, we see good opportunity to continue increasing product intensity into our base. I would tell you that I'm not satisfied or happy with the ARPU performance or quite frankly with our churn performance. And I think both of those levers could be improved with respect to how we attract different demographics of the right market. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:48:10I also think there's some mix evolution. So as you highlighted with areas like public, we are we do have offerings that are attractive to different segments of the market that impact the mix. But I think the key thing here is that our guidance assumes that we're aligned to the same sort of performance dynamic that we've seen on the lower side. And on the upper side, there might be accretion opportunity from that point. Over to you, Navin. Nazim BenhadidChief Technology Officer at TELUS00:48:42Yes. Thanks, Daniel. Just a few top ups. So as Boseley and Onai have said, we still see opportunity to grow share in B2B. We still see the opportunity to drive product intensity and that has a positive impact on churn as well, of course. Nazim BenhadidChief Technology Officer at TELUS00:49:04I think on the B2B side, we have some really strong growth assets. So the IoT business is growing nicely double digit. You may have seen the press release that we just signed a private wireless network agreement with the Calgary Airport. And that's the first of its kind with potentially more to come. And so those are examples of great growth assets that are helping to offset some of the competitive intensity we're seeing. Nazim BenhadidChief Technology Officer at TELUS00:49:38The other thing I would say is, and Darren alluded to this on our cost focus, but there's a lot of digital and digitization opportunities that we're working with TELUS Digital and our internal CIO team around how we improve our AMPU. So waving with ARPU pressures, how we're maintaining and expanding our margin profile. And I think the fact that in the B2B space for a good part of the decade, the last decade, we've had the best loyalty results in the space and that continues to always be an important contributor to our ARPU as well as to our churn. Jerome Dubreuil.VP & Research Analyst - Telecom, Media & Technology at Desjardins Group00:50:28So we expect a lot of that and all of that to continue in 2025. Back to you, Dan. Darren EntwistlePresident and CEO at TELUS00:50:36Doug, do Darren EntwistlePresident and CEO at TELUS00:50:37you want to top off at all? Doug FrenchExecutive VP & CFO at TELUS00:50:38Yes. Maybe just on some of our thoughts as well that when you think through the uncertainty in the macroeconomic backdrop on interest rates, inflation and cost of borrowing, You'd also we've also made some assumptions on rationality to pricing to help support some of those higher costs. And so it's not unreasonable, but it's definitely more reflective of the situation we're in and some of the debt that's currently being issued is at higher rates. And so I think the alignment of the market to price accordingly on that is probably aligned. Darren EntwistlePresident and CEO at TELUS00:51:16And finally, our guidance isn't predicated on a miraculous ARPU recovery. So I think it's important to be understood. We would hope to see some elements of moderation. It would be great to see a miraculous ARPU recovery, but our guidance is not predicated on that. We think that would be an erroneous planning assumption. Darren EntwistlePresident and CEO at TELUS00:51:38And the only point that wasn't added is we have a lot of diversity of growth taking place at TELUS that's outside the dominion of wireless ARPU. Benjamin SwinburneManaging Director at Morgan Stanley00:51:49Thanks, Darren. Robert MitchellHead, IR at TELUS00:51:51Thanks, Ben. And thank you everyone for joining us today. Please feel free to reach out to the IR team with any follow ups you Robert MitchellHead, IR at TELUS00:51:58may have. Carl, over to you. Operator00:52:01This concludes the Telus twenty twenty four Q4 earnings conference call. Thank you for your participation and have a nice day.Read moreParticipantsExecutivesRobert MitchellHead, IRDarren EntwistlePresident and CEODoug FrenchExecutive VP & CFOZainul MawjiEVP & President of Telus Consumer SolutionsNazim BenhadidChief Technology OfficerAnalystsJerome Dubreuil.VP & Research Analyst - Telecom, Media & Technology at Desjardins GroupMaher YaghiManaging Director at ScotiabankStephanie PriceEquity Research Analyst - Software & Services at CIBC World MarketsDrew McReynoldsManaging Director - Global Research, Telecommunications & Media at RBC Capital MarketsSebastiano PettiSenior Research Analyst at JP MorganBenjamin SwinburneManaging Director at Morgan StanleyPowered by Conference Call Audio Live Call not available Earnings Conference CallTELUS Q4 202400:00 / 00:00Speed:1x1.25x1.5x2xTranscript SectionsPresentationParticipants Earnings DocumentsSlide DeckPress Release TELUS Earnings HeadlinesTelus customer ‘furious’ after he says was promised better rateApril 23 at 9:44 PM | msn.comTELUS Corporation: Outpacing Peers With Smarter Growth And Financial DisciplineApril 22 at 8:05 AM | seekingalpha.comTrump’s Bitcoin Reserve is No Accident…Bryce Paul believes this is the #1 coin to buy right now The catalyst behind this surge is a massive new blockchain development…April 24, 2025 | Crypto 101 Media (Ad)TELUS ANNOUNCES INAUGURAL JUNIOR SUBORDINATED NOTE OFFERINGApril 15, 2025 | prnewswire.comTelus Lays Out Plans for Two New AI Hubs in CanadaApril 15, 2025 | marketwatch.comJ.P. Morgan Keeps Their Hold Rating on Telus (TU)April 5, 2025 | markets.businessinsider.comSee More TELUS Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like TELUS? Sign up for Earnings360's daily newsletter to receive timely earnings updates on TELUS and other key companies, straight to your email. Email Address About TELUSTELUS (NYSE:TU), together with its subsidiaries, provides a range of telecommunications and information technology products and services in Canada. It operates through Technology Solutions and Digitally-Led Customer Experiences segments. The Technology Solutions segment offers a range of telecommunications products and services; network services; healthcare services; mobile technologies equipment; data services, such as internet protocol; television; hosting, managed information technology, and cloud-based services; software, data management, and data analytics-driven smart food-chain and consumer goods technologies; home and business security; healthcare software and technology solutions; and voice and other telecommunications services, as well as mobile and fixed voice and data telecommunications services and products. The Digitally-Led Customer Experiences segment provides digital customer experience and digital-enablement transformation solutions, including artificial intelligence and content management solutions. The company was formerly known as TELUS Communications Inc. and changed its name to TELUS Corporation in February 2005. TELUS Corporation was incorporated in 1998 and is based in Vancouver, Canada.View TELUS ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Seismic Shift at Intel: Massive Layoffs Precede Crucial EarningsRocket Lab Lands New Contract, Builds Momentum Ahead of EarningsAmazon's Earnings Could Fuel a Rapid Breakout Tesla Earnings Miss, But Musk Refocuses and Bulls ReactQualcomm’s Range Narrows Ahead of Earnings as Bulls Step InWhy It May Be Time to Buy CrowdStrike Stock Heading Into EarningsCan IBM’s Q1 Earnings Spark a Breakout for the Stock? Upcoming Earnings AbbVie (4/25/2025)AON (4/25/2025)Colgate-Palmolive (4/25/2025)HCA Healthcare (4/25/2025)NatWest Group (4/25/2025)Cadence Design Systems (4/28/2025)Welltower (4/28/2025)Waste Management (4/28/2025)AstraZeneca (4/29/2025)Booking (4/29/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. Start Your 30-Day Trial MarketBeat All Access Features Best-in-Class Portfolio Monitoring Get personalized stock ideas. Compare portfolio to indices. Check stock news, ratings, SEC filings, and more. Stock Ideas and Recommendations See daily stock ideas from top analysts. Receive short-term trading ideas from MarketBeat. Identify trending stocks on social media. Advanced Stock Screeners and Research Tools Use our seven stock screeners to find suitable stocks. Stay informed with MarketBeat's real-time news. Export data to Excel for personal analysis. Sign in to your free account to enjoy these benefits In-depth profiles and analysis for 20,000 public companies. Real-time analyst ratings, insider transactions, earnings data, and more. Our daily ratings and market update email newsletter. Sign in to your free account to enjoy all that MarketBeat has to offer. Sign In Create Account Your Email Address: Email Address Required Your Password: Password Required Log In or Sign in with Facebook Sign in with Google Forgot your password? Your Email Address: Please enter your email address. Please enter a valid email address Choose a Password: Please enter your password. Your password must be at least 8 characters long and contain at least 1 number, 1 letter, and 1 special character. Create My Account (Free) or Sign in with Facebook Sign in with Google By creating a free account, you agree to our terms of service. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
PresentationSkip to Participants Operator00:00:00Good day. Welcome to TELUS twenty twenty four Q4 Earnings Conference Call. I'd like to introduce your speaker, Mr. Robert Mitchell. Please go ahead. Robert MitchellHead, IR at TELUS00:00:08Hello, everyone. Thank you for joining us today. Our fourth quarter twenty twenty four results, news release, MD and A financial statements and detailed supplemental investor information were Robert MitchellHead, IR at TELUS00:00:17posted through our website earlier this morning. Robert MitchellHead, IR at TELUS00:00:20Our call today will begin with remarks by Darren and Doug. For the Q and A portion, we will be joined by Zainal, Navin, Jason and Tobias. Briefly, prepared remarks, slides and answers to questions contain forward looking statements. Actual results could vary 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. Robert MitchellHead, IR at TELUS00:00:42S, including fourth quarter and annual 2024 MD and A. With that, over to you, Darren. Darren EntwistlePresident and CEO at TELUS00:00:49Thanks, Ragnar. Hello, everyone. And in the fourth quarter and for 2024, our team's relentless pursuit of operational excellence continued to differentiate the TELUS organization, driving significant customer growth and robust financial results. Through our premier asset portfolio and unwavering commitment to cost efficiency, we delivered strong profitable growth to close out 2024, momentum that we intend to build upon in 2025 and beyond. Our focus on margin accretive customer expansion, globally leading broadband networks and a customer centric culture culminated in our third consecutive year of surpassing 1,000,000 mobility and fixed customer additions. Darren EntwistlePresident and CEO at TELUS00:01:38Once again, TELUS led the industry with more than 1,200,000 telecom net new customer additions in 2024. This performance is a testament to our unmatched bundled product offerings across mobile and home. Indeed, our team's passion for delivering customer service excellence again contributed to continued strong loyalty across our key product lines. Notably postpaid mobile phone churn of 0.99% for the full year marks the eleventh consecutive year at less than 1%. Despite a challenging competitive regulatory and macroeconomic landscape, Telus drove 5.5% key tech EBITDA growth for 2024 meeting the target range that we set at the beginning of 2024. Darren EntwistlePresident and CEO at TELUS00:02:32This included strong TTEC EBITDA growth of 7% in the fourth quarter. Our team once again achieved industry best total customer telecom net additions of 328,000 for the quarter. In mobile, we drove leading total net additions of 264,000 including healthy mobile phone net additions of 70,000 and strong connected device net additions of 194,000. This was supported by our ongoing intense focus on economic margin accretive customer growth, which is evidenced by our consistent industry leading lifetime revenue, buttressed by our industry best churn and superior customer experience. Let's turn now and take a look at our wireline business. Darren EntwistlePresident and CEO at TELUS00:03:26TELUS delivered another quarter of industry leading total wireline customer growth, including industry best fourth quarter intranet net additions of 37,000. Notably, this drove industry leading fixed data services revenue growth of 3.5%. Furthermore, in the fourth quarter, we drove continued strong momentum in our unique and highly differentiated data centric growth businesses. Our TELUS Health team achieved accelerated revenue growth in the quarter of 10% alongside 20% growth in its EBITDA contribution. Since acquiring LifeWorks in 2022, we've achieved $355,000,000 in combined annualized synergies, including $294,000,000 in cost synergies and $61,000,000 in cross selling. Darren EntwistlePresident and CEO at TELUS00:04:24Importantly, we remain on track to deliver our goal of $427,000,000 by year end. Moreover, we drove a 10% year over year increase in global lives covered to over $76,000,000 a 16% increase in virtual care members and a 7% increase in digital health transactions. Likewise, our team achieved robust performance in TELUS agriculture and consumer goods with revenue growth of 16% on the back of eight consecutive quarters of record sales performance driving increasing profitability and margin contributions. We look forward to continuing the momentum in these emerging growth areas in 2025 and beyond. The strategic investments that we've made in our leading broadband networks alongside our customer experience leadership underpin the continued advancement and sustainability of our strong financial and operational performance. Darren EntwistlePresident and CEO at TELUS00:05:31This gives us confidence in the robust outlook for consistent long term profitable growth and our ability to deliver on the annual targets that we've set out for 2025. These include industry leading TTEC operating revenue and adjusted EBITDA growth of up to 45% respectively and consolidated free cash flow of approximately $2,150,000,000 supported by continued moderated capital expenditures of approximately $2,500,000,000 representing an industry best capital intensity. Our team's track record for execution excellence alongside an attractive long term free cash flow growth outlook underpin our sustainable and leading multi year dividend growth program now in its fifteenth year. Needless to say, we remain disappointed in our share price performance over the past year in spite of significantly outperforming the majority of our national and global peers across a wide range of operational and financial metrics. This is frustrating for our management team in the context of our robust and profitable customer growth, which drove leading fourth quarter telecom EBITDA growth of seven percent and five point five percent for the year, not to mention our dividend yield of 8% coupled with TELUS' potent defensive characteristics in a volatile macroeconomic environment. Darren EntwistlePresident and CEO at TELUS00:07:21Furthermore, our leading and differentiated asset mix underpins the significant value that we have created, including our pervasive pure fiber network with world's best KPIs as reflected in recent U. S. Fiber transactions. It includes our differentiated TELUS Health and TELUS Agriculture and Consumer Goods businesses with their attractive growth and valuation multiple characteristics. And it includes the best telecom asset in the business with a reliable execution track record. Darren EntwistlePresident and CEO at TELUS00:08:02Going forward, this management team remains laser focused on building on the strong operational and financial performance momentum with which we exited 2024. We remain focused on achieving our robust targets for 2025 and we remain focused on delivering sustainable free cash flow expansion year in and year out for the foreseeable future. This is buttressed by one of the lowest capital intensity ratios globally alongside compelling monetization opportunities that we anticipate supporting meaningful deleveraging also a key area of focus for 2025 and beyond. TELUS is targeting to achieve a net debt to EBITDA ratio of approximately three times in 2027 in conjunction with the contemporaneous removal of the discounted dividend reinvestment plan preceded by a ratcheting down of the plan in 2026. In May, per our established cycle, we will provide an update on our dividend growth program for 2026 through 2028 and more generally for the return of capital to our shareholders. Darren EntwistlePresident and CEO at TELUS00:09:30In closing, I'd like to express my gratitude to our team for their efforts, their expertise and frankly in the environment, their grit in executing on our consistent winning strategy to meet our commitments to all of our stakeholders. And on that note, let me turn the call over now to Uncle Doug. Doug FrenchExecutive VP & CFO at TELUS00:09:52Thank you, Darren, and hi, everyone. Mobile network revenue was flat as profitable mobile loading and connected device additions were offset by lower mobile phone ARPU, which declined 3.6%. The decline in ARPU, although reflective of the ongoing competitive pressures in the market, remained relatively stable as compared to the previous few quarters. Double digit IoT revenue growth partially mitigated this impact. Fixed data services revenue grew 3.5% year over year driven by strong customer growth across our leading product portfolio of pure fiber Internet, TV, security and home automation as well as B2B growth. Doug FrenchExecutive VP & CFO at TELUS00:10:36At the segment level, TTEC operating revenues were up 4.1% driven primarily by mobile equipment, fixed data services as well as strong growth in health and agriculture as Darren highlighted. Other income of $52,000,000 in the quarter increased by $37,000,000 over last year, largely due to gains recognized on our real estate and copper monetization programs. We anticipate these programs to continue in 2025 as we execute against these initiatives. Notably, TTEC adjusted EBITDA increased by 7% in the fourth quarter and 5.5% for the full year, achieving the low end of our target range alongside margin expansion of 110 basis points to 38.2% demonstrating an unparalleled track record of execution excellence in a highly dynamic operating environment. These results were driven by our consistent emphasis on profitable revenue growth or customer growth and the benefits from our ongoing focus on cost efficiency and effectiveness, gains from our real estate and copper monetization programs, as well as increasing margin contribution from TELUS Health and TELUS Agriculture and Consumer Goods. Doug FrenchExecutive VP & CFO at TELUS00:11:56Looking at our TELUS Digital segment, operating revenues and adjusted EBITDA for the fourth quarter continued to reflect stabilization and performance, both improving on a sequential quarterly basis. The team continues to manage their cost structure while focusing on revenue generation. Please refer to TELUS Digital's quarterly conference call earlier today. On a consolidated basis, net income increased by 3.2% year over year, while basic EPS was higher by 20%. On an adjusted basis, net income and EPS were higher by eleven percent and four point two percent respectively. Doug FrenchExecutive VP & CFO at TELUS00:12:33This growth was driven by the after tax impacts of higher operating income, partially offset by higher financing costs, mainly reflecting the impact of unrealized changes in the forward element of our virtual power purchase agreements, as well as higher interest costs associated with our increased long term debt and higher interest rates. For the full year, CapEx excluding real estate declined by $294,000,000 or 11% driven by our planned slowdown of our fiber and wireless asset bills as we approach their completions. Consolidated capital intensity of 12% was down 200 basis points year over last year. For the full year, free cash flow of approximately $2,000,000,000 came in slightly below our target of $2,100,000,000 This was primarily due to higher than expected cash impact effects of contract assets and device financing associated with the higher contracted devices in Q4 as promotions were heavily focused on device subsidies throughout Black Friday and the holiday selling period. Free cash flow was also impacted by slightly higher restructuring from our ongoing cost efficiency programs. Doug FrenchExecutive VP & CFO at TELUS00:13:46These factors were partially offset by lower capital expenditures. Looking ahead, our financial targets for 2025 build off our leading growth profile and operating execution excellence. Our financial targets include TTEC operating revenue growth of 2% to 4% and TTEC adjusted EBITDA growth of 3% to 5%. Consolidated capital expenditures, excluding real estate, are targeted to remain at approximately $2,500,000,000 We also set aside $100,000,000 in capital for real estate development initiatives similar to 2024. Lastly, free cash flow for 2025 is forecasted to be approximately $2,150,000,000 driven by higher EBITDA and disciplined capital management. Doug FrenchExecutive VP & CFO at TELUS00:14:32Our outlook for free cash flow includes an increase to cash taxes due to higher installments related to higher taxable income. Additionally, there'll be a catch up tax payment in 2025 related to 2024 for the increase on our earnings before tax as well as a step down in the amount of tax depreciation Telus can claim under the accelerated investment incentive program. For 2025, we also anticipate slightly higher interest paid. The effects of asset sorry, the contract assets and device financing as well as cash restructuring payments both anticipated to be flat in 2024. A detailed list of our assumptions for 2025 are set out in our annual MD and A release today. Doug FrenchExecutive VP & CFO at TELUS00:15:20As it relates to our balance sheet, the average turn to maturity of our long term debt stands at over ten years and our average cost of debt is 4.37%. Our leverage ratio at the end of twenty twenty four is at 3.9 times Doug FrenchExecutive VP & CFO at TELUS00:15:33and Doug FrenchExecutive VP & CFO at TELUS00:15:33we remain committed to delevering our balance sheet with the execution of the plan in place towards the net debt to EBITDA leverage of approximately three times in 2027. The plan includes EBITDA growth and cash flow expansion alongside a reducing capital intensity, as well as the continuing of programs such as real estate and copper initiatives, partner opportunities within our growth businesses, divestiture of non core assets and surfacing or some value servicing value in our infrastructure where appropriate. Furthermore, as Darren outlined, we expect to achieve this target leverage ratio alongside our plans to reduce the discount associated with our dividend reinvestment plan in 2026 with the intention of removing it in 2027. Overall, we look forward to the new year. We remain highly confident in our ability to build on a track record of execution excellence underpinned by our leading asset mix and resilient business strategy. Doug FrenchExecutive VP & CFO at TELUS00:16:37This will be supported by our focus on de levering as we ensure we are well equipped to deliver strong sustainable growth into the future. With that, back to you, Robert. Robert MitchellHead, IR at TELUS00:16:48Carl, we're ready for questions, please. Operator00:17:00The first question is from Jerome Dubreuil from Desjardins. Please go ahead. Jerome Dubreuil.VP & Research Analyst - Telecom, Media & Technology at Desjardins Group00:17:06Thanks for taking my questions. A couple for me. First topic is on your target of three times leverage in 2027. I think that was very interesting. How much asset divestiture does that include? Jerome Dubreuil.VP & Research Analyst - Telecom, Media & Technology at Desjardins Group00:17:19And can we infer from this that you are happy with your current portfolio of assets going forward? And then the second topic for me, in light of the high dividend yield, if you can maybe elaborate on the merits of having a long term dividend plan in general, the competitive environment evolves, investment opportunities arise and interest rate changes in three years just seemed like a very long time. So if you can talk about these things. Doug FrenchExecutive VP & CFO at TELUS00:17:52Okay. I'll start. So on the assets going forward, so that question, we have a placeholder in our plan. We've been open on that of approximately $500,000,000 and that is included in our three year plan going forward that we will continue to do appropriate divestitures as we seem appropriate or acquisitions as we seem appropriate. On the delevering side of assets as highlighted, we're obviously leveraging up our free cash flow and capital intensity reductions. Doug FrenchExecutive VP & CFO at TELUS00:18:26We have a three year plan that includes the divestiture of some of the non core assets. We haven't disclosed exactly the amount with that, But I think with the initiatives over the next little bit, you'll see some coming to fruition within 2025. And we'll continue to update on our progression on that, but I'm not going to give an exact number on those divestitures today. And on the growth plan, Aaron, I'll pass it back to you. Darren EntwistlePresident and CEO at TELUS00:18:58So I think over the past fifteen years, the dividend growth model has served investors extremely well at this organization. Secondly, I think we've been pretty clear in respect of the pecking order for our capital allocation, Party number one for the benefit of all securities holders is to drive improvements in our balance sheet. And you've heard us this morning come out with a public target in that regard and ancillary considerations around it, including ratcheting down and removing the D DRIP along the way. We think we've got the latitude to continue invest prudently in the growth of the business. And then thirdly, to return cash to shareholders where the primary, but not the exclusive vehicle has been our dividend growth model. Darren EntwistlePresident and CEO at TELUS00:19:53When I look at the future prospects of this organization from EBITDA growth to operating efficiency to the emerging growth opportunities within health and TELUS agriculture and consumer goods. When I look at a capital appetite that's moderating with a goal to get down to a CapEx intensity level of circa 10%, I foresee a very strong and sustainable free cash flow story for this organization prospectively. And that strong free cash flow generation on that longitudinal basis with that parameter of sustainability supports the affordability of the dividend growth model, both in terms of magnitude and longevity. Having said that, as I have said over and over and over again, the dividend remains the quarterly provenance of the board to adjudicate upon factoring in multiple considerations. And if there is undue volatility of some sort, we always have that lever to be adjusted smartly appropriately according to those conditions. Darren EntwistlePresident and CEO at TELUS00:21:23But when I normalize for anomalies of that nature, I think the growth trajectory of this organization at the cash flow level for the reasons that I've just decided supports the type of continuity as it relates to returning cash to shareholders in a fashion that's both meaningful and differentiated from our peer group. Robert MitchellHead, IR at TELUS00:21:48Thank you. Thanks, Jerome. Carl, next question please. Operator00:21:53The next question is from Maher Yaghi from Scotiabank. Please go ahead. Maher YaghiManaging Director at Scotiabank00:21:58Great. Thank you for taking my question. Good morning. First, I would like to ask you on your fixed data services and fixed service revenue service revenue in general. This is the second quarter that we see an acceleration and growth on both metrics, quite a feat I see in the current environment. Maher YaghiManaging Director at Scotiabank00:22:21Can you discuss the underlying KPIs that is supporting this improvement? And it seems to me it's coming from pricing and customer intensity. Can you confirm that? And Maher YaghiManaging Director at Scotiabank00:22:37is this the Maher YaghiManaging Director at Scotiabank00:22:37when you look at the pricing in general, can you comment a little bit about the pricing in your marketplace? Thank you. Darren EntwistlePresident and CEO at TELUS00:22:45Okay. I don't think it's quite a feat. I think it's a satisfactory achievement. And Zanna, why don't you speak to your satisfactory achievement? Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:22:54Always striving for better. So I think it's a great question. I think that what you should see from our fixed data growth is that, first of all, it is based on a foundation of volume and significant quarter over quarter, year over year growth in our fixed customer base. The second thing that I would highlight is that we're always driving for profitable growth across our regions. And so while we have access to new markets and territories, we're always going to do that in a profitable way. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:23:32So that's the volume side. The other piece that's very important is that we have a diversified and growing portfolio of services that are dependent and driven and driving the fixed growth. And then I think it's really important to look at the characteristics that Darren alluded to on the fiber side with respect to the percentage of customers that are taking higher speeds and continue to be pushed up the speed curve and want to take those higher levels of the portfolio that we offer as well as the product intensity that we offer in terms of the incremental products and services. So we have significant opportunity to continue growing that market and we are seeing a strong take rate of our services over time. And of course, we're going to be supporting the idea that as we grow and ensure that we provide better reliability, better capacity of our networks that the pricing dynamic keeps pace with that. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:24:38So those are all the kinds of things that we will look to. I think over time as well when you look at there are some policy and other elements in terms of our pricing strategy that still have accretion opportunity for us and we're going to continue to be mining those. So I think our overall strategy is going to be product diversification and growth and we're always going to see that profitably and you see that in our results. Darren EntwistlePresident and CEO at TELUS00:25:04One of the areas where we've again delivered differentiated results on this exact front is within the B2B side of our business. Navin, would you please provide a short top up to Zainal's excellent comments? Nazim BenhadidChief Technology Officer at TELUS00:25:23Yes, for sure, Darren. And yes, just as a top up to Zainal's comments, we're seeing very strong volume growth and growth of share on the fixed data services side. And quite frankly, in B2B and specifically SMB, we had room to grow share in our ILEC territory and obviously, the opportunity in our non ILEC Eastern territories. So that is an area that we've been very focused on and have seen good success in terms of driving good volume and market share penetration. We've also have a good opportunity that we've made progress on, but still have lots more to go in terms of product intensity, especially in the SMB space and we'll continue to focus on that. Nazim BenhadidChief Technology Officer at TELUS00:26:23And then lastly, we continue to look at our product depth and breadth and look to drive product expansion that then also drives improved revenues. So back to you, Darren. Darren EntwistlePresident and CEO at TELUS00:26:37Thanks. Maher YaghiManaging Director at Scotiabank00:26:38Thank you. Darren EntwistlePresident and CEO at TELUS00:26:39Thanks, Meyer. Next question please, Karl. Operator00:26:42The next question is from Stephanie Price from CIBC. Please go ahead. Stephanie PriceEquity Research Analyst - Software & Services at CIBC World Markets00:26:47Good morning. On the drip removal, can you talk a little bit about how you're thinking about the payout ratio by 2027, excluding the drip? And then maybe you can talk more broadly about kind of that term ratcheting down the drip in 2026 and what that implies in terms of magnitude? Doug FrenchExecutive VP & CFO at TELUS00:27:05Yes. So we expect our ratio to be within our payout ratio that we have actually put out. So that up to 75% to 50% to 75% or sorry, 60% to 75%. That ratio is one we'd expect to be in 2027, even with all the moving parts that we've just talked about. Darren EntwistlePresident and CEO at TELUS00:27:29And in terms of the 2026 ratchet down component, we've not provided that specificity. We will do so in May. But I think a good operating assumption would be that we would make half a step in the ultimate direction that we want to achieve in 2027. So a move halfway there, I think is a good modeling assumption. Stephanie PriceEquity Research Analyst - Software & Services at CIBC World Markets00:27:51Perfect. Thank you. And then Zainal, you mentioned the answer to the last question about moving into new territories and fixed data in a profitable way. Just curious if you can expand a little bit on the move into the Ontario Internet market, what the strategy is there and what you're seeing so far in terms of uptake? Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:28:07Sure, Stephanie. So I think the key thing is that it's not a new move, right? So we have been acquiring assets and making sure that we look at the market in terms of what the customer behavior and customer desires are. We've had Kudo Internet in market for a period of time and we're seeing good bifurcation in terms of product intensity from a Kudo Internet perspective in terms of the take rate for that demographic of the market. And when we bundle in elements like Stream Plus and other offers, there's a really great value proposition for our customers there. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:28:49And I think that as it relates to PureFibre Internet, this is a marathon. It's not a sprint. We've always talked about smart economics and leveraging new products. And so we have areas where we have consumers that are taking our security services that want our view and our responsibility and reliability on their Wi Fi and their Internet. And so those are the kinds of areas that we're going to grow in profitably, where we can provide a value added service and an end to end opportunity for our customers to experience both our wireless, wireline and our value added products. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:29:35So when we look at this, we have to look at it from that lens. And we're not running to the market and doing dilutive offers, but we're really finding the niches where our customers want those bundles and products and growing profitably from that perspective. Stephanie PriceEquity Research Analyst - Software & Services at CIBC World Markets00:29:54Thank you for the color. Robert MitchellHead, IR at TELUS00:29:57Thanks, Stephanie. Next question please, Carl. Operator00:30:00The next question is from Drew McReynolds from RBC. Please go ahead. Maher YaghiManaging Director at Scotiabank00:30:05Yes. Thanks very much. Drew McReynoldsManaging Director - Global Research, Telecommunications & Media at RBC Capital Markets00:30:07A couple for me. Just first on, I guess, the revenue growth guidance. We've heard from some of your competitors just in terms of population growth assumptions or more broadly wireless market expansion assumptions. Just wondering what you're thinking on the volume side for wireless in 2025? And then secondly, just back to the earlier question on TPIA and whether there will or won't be a big three band out of footprint. Drew McReynoldsManaging Director - Global Research, Telecommunications & Media at RBC Capital Markets00:30:40Just wondering from a TELUS perspective, again with reference to perhaps the 2025 guidance, if you're unable to tap TPIA in the East, just wondering what other kind of growth opportunities you would have or whether that materially changed the growth outlook here for TELUS short and medium term? Thank you. Darren EntwistlePresident and CEO at TELUS00:31:04You want to take the first part of that question, Zainal? Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:31:08Sure. On the volume side, so I will say that Darren reminds me daily of the comments that he's made for several consecutive quarters on the fact that our EBITDA growth could be at its at the high end of guidance on the back of leveraging our existing customers and ensuring that we provide continue to provide great service, continue to drive product intensity and continue to improve on our churn and other economics. So I think that we're really focused on what we can do with the capabilities that we have. We have a breadth of a product portfolio that is unmatched domestically and we have the opportunity to continue to leverage that differentiation to grow our business. And we're going to be focused regardless of the macroeconomics and the macro environment on driving that level of product intensity. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:32:11So we are absolutely seeing some shifts and we're seeing some areas of decline. I think that we're all managing through that and our approach is to be as disciplined as we possibly can and continue to grow profitably off this opportunity size that we already have that we can continue to mature. Darren EntwistlePresident and CEO at TELUS00:32:33Again, given that the differentiated success on the B2B front, particularly as it relates to national expansion and the growth opportunities within the small medium business side are considerable. Navin, would you top up on Sanil's response as well please? And then I'll close it out for Drew. Nazim BenhadidChief Technology Officer at TELUS00:32:58Yes, thanks Darren. So just as an example, we saw 6% revenue growth in our SMB segment in the fourth quarter And we continue to see double digit growth in our five gs IoT portfolio, which all continue to contribute positively to the B2B growth story. And so when we look at 2025 wireless specifically, yes, there's some headwinds that will continue, but we feel very confident in our ability to drive the volume growth, the new product growth. The opportunity to monetize data is nascent at this point and a very good opportunity for us to continue to grow on that front as well. So the SMB opportunity on a national basis continues to be an area of strong growth for us. Darren EntwistlePresident and CEO at TELUS00:34:05Finally, Drew, I could reiterate the comment that I made last time, which I still feel strongly about, which is the significant growth opportunity that exists within our existing client base in terms of the upside of product intensity that would give us volume loading growth and extremely attractive economics associated with that because it would be economic quality loading that would be that we would be affecting. And to be quite clear about that, that's really a four point game because not only do we get economically accretive loading, but we improve the product intensity, which lowers the turn rate, which gives us a better overall lifetime value. So that's at the backbone of everything that we're doing right now. But when you think about the question you're asking on third party access in whatever guys, I guess the best way I could answer it is we're going to make the bold assumption that regulatory decisions pronounced by the CRTC after a comprehensive and rigorous and exhaustive process where the diversity of voices was consulted in terms of all stakeholder constituency groups, where the documentation of the decision was highly exacting, where the decision was confirmed twice over from interim to final, where the decision was twice vetted and approved by the Competition Bureau. Darren EntwistlePresident and CEO at TELUS00:35:55And also a decision that's I think consistent on a contemporary basis with Canada wanting to remove not increase international trade barriers given some of the challenges that may confront us prospectively at the international level, we will expect that particular decision to stand and we will adjudicate accordingly in terms of our go to market activities. I think that decision and our response from a go to market perspective is in the best interest conclusively of Canadian consumers and Canadian businesses, particularly small businesses accretive to the welfare of consumers or the productivity of businesses. Drew McReynoldsManaging Director - Global Research, Telecommunications & Media at RBC Capital Markets00:37:01Understood. Thank you, Bowen. Robert MitchellHead, IR at TELUS00:37:04Thanks, Drew. Next question please, Carl. Operator00:37:13The The next question is from Sebastien Opete from JPMorgan. Please go ahead. Sebastiano PettiSenior Research Analyst at JP Morgan00:37:19Thank you for taking the question. Just maybe following up on Jerome's question and just about the leverage target. Darren, you did mention surfacing value in your infrastructure assets and Aetna, a comment reiterated or echoed by your telco peer there. Any examples of perhaps what you're exploring? Obviously Rogers is going down a path with some unclear on how that will result, but you have obviously telecom infrastructure assets related to your towers, other fiber. Sebastiano PettiSenior Research Analyst at JP Morgan00:37:55What is or is not on the table? And then just any other help as we kind of think about getting to that three the three turns of leverage over time. You did say EBITDA and free cash flow growth, but I think just commentary we're hearing folks perhaps struggling a little bit trying to see how the glide path gets there without perhaps meaningful asset monetization. So just maybe double clicking on that would be lovely. Thank you. Darren EntwistlePresident and CEO at TELUS00:38:21Okay. Given you asked for examples, I'll give you the recipe that we're pursuing with a requisite degree of specificity with some degree of insights needing to be assumed along the way. First and foremost, we're going to keep pushing on EBITDA growth. We think we've got attractive opportunities for cash expansion through EBITDA growth. And I think 7% EBITDA growth to exit Q4 is an excellent example in that regard. Darren EntwistlePresident and CEO at TELUS00:38:56We've been very proactive and aggressive in terms of our cost efficiency programs. And that has been a key underpinning to our go to market activities to deliver the nominal results that we are on the EBITDA side of the business. On the capital investment side, I've been quite explicit saying that the goal of this organization is to get down to 10% CapEx intensity. And it's not a fanciful goal. It's a goal that recognizes that the heavy CapEx lifts that are really characterized the decade between 2013 and 2023 are more behind us now than ahead of us because of the pervasive fiber build that we've affected and the spectrum gauntlet that we have survived through along the way. Darren EntwistlePresident and CEO at TELUS00:40:00And I think those are positive things. The other aspects that are buttressing our ability to get down to that 10% CapEx intensity level is the digital transformation of the TELUS organization aided and embedded by TELUS Digital, the cloudification of our support infrastructure and the fact that increasingly Zainal and Navin's portfolio is characterized by SaaS solutions. So I think all of those things cumulatively are quite supportive in that regard. And we're not a one trick pony in terms of where our sources of growth are coming from. We're getting it from consumer, we're getting it from business and we're getting it from our emerging growth areas, including TELUS Health and TELUS Agriculture and Consumer Goods. Darren EntwistlePresident and CEO at TELUS00:40:59As it relates to monetization programs, we have a very attractive opportunity for us on the real estate front because of the supplanting of copper with fiber and what it does in terms of yielding real estate development opportunities from our former central offices that are very attractively located. And we exited 2024, releasing about 24 central offices for real estate development. And I would expect by the end of twenty twenty five, we'll have a total of 35 to 40 central offices released for real estate development. And that's extremely attractive. And we see a real estate opportunity from a monetization perspective in the $3,000,000,000 zone, which is why we're progressing our REIT strategy with the future CEO of that business being Doug. Darren EntwistlePresident and CEO at TELUS00:42:07And he certainly has a passion to bring that to fruition. The other synergistic byproduct of fiber and the supplanting of copper is the recycling of copper, our ability to mine copper within our access infrastructure at a time when the spot price on copper is extremely attractive. And we think that there's a progressive opportunity that we're going to have like real estate on a multi year basis that is economically attractive. And the opportunity there is circa $1,000,000,000 at a gross level and post or net of recycling, maybe doing it with some interesting partners within the Canadian resource industry is probably netting out at $500,000,000 As it relates to our emerging growth businesses, both TELUS Health and TELUS Agriculture and Consumer Goods, where TELUS Health has the pole position on this front given the scale characteristics that we're now achieving and the growth and profitability characteristics that we're now achieving. We have the opportunity to look at bringing in key partners to help accelerate the growth and the value of that asset and looking at monetization opportunities within the medium term as it relates to IPO undertakings that are very, very real for the TELUS organization. Darren EntwistlePresident and CEO at TELUS00:43:38We also have some assets within the portfolio that need to be groomed because they no longer represent a productive or elegant strategic or commercial fit. There are other organizations out there externally that would covet those assets where it would be a better strategic fit for them than us. And so we will look to undertake certain divestitures in that regard. And then specifically, as it relates to telecommunications infrastructure and monetization strategies, as it relates to fiber, the answer to your question is no. And as it relates to towers, the answer to your question is maybe. Darren EntwistlePresident and CEO at TELUS00:44:26If we like the economics, if we like the deal, if we like what could be done with that particular asset post monetization, It's something that we would consider along the way and we think it is our responsibility to do exactly that. And so the laundry list goes further, but I think from a recipe point of view, that should give you significant insight as to just how real and concrete these activities are to assure our ability to hit the net debt to EBITDA goal that we've now gone public with and the synergistic complement on that front in terms of removing our discount dividend reinvestment plan. Sebastiano PettiSenior Research Analyst at JP Morgan00:45:15If I could quickly follow-up, that's Sebastiano PettiSenior Research Analyst at JP Morgan00:45:17a very thorough answer. I appreciate that Darren. But as you think about the real estate monetization opportunity, you have marked another $100,000,000 this year towards that program. Is that can you achieve your $3,000,000,000 monetization goal in real estate at that kind of run rate level on Sebastiano PettiSenior Research Analyst at JP Morgan00:45:33an annual basis as we kind Sebastiano PettiSenior Research Analyst at JP Morgan00:45:34of think about maybe the medium term? Thank Sebastiano PettiSenior Research Analyst at JP Morgan00:45:37you. Doug FrenchExecutive VP & CFO at TELUS00:45:38Yes. There's going to be more of a run rate similar to 2024 for the next year or so. And then there'll be a call it a lump sum monetization when you have a pool of assets that carry a magnitude of substance. So that could be two years out, give or take, or it could be sooner if we continue down the path on development we're on. Doug FrenchExecutive VP & CFO at TELUS00:45:59But I would assume for '25 is similar to '24, but there could be a lump sum within the three year planning period. Sebastiano PettiSenior Research Analyst at JP Morgan00:46:09Thank you. Robert MitchellHead, IR at TELUS00:46:10Thanks Sebastiano. Carl, we have time for one more question please. Operator00:46:15The final question is from Benjamin Swinburne from Morgan Stanley. Please go ahead. Benjamin SwinburneManaging Director at Morgan Stanley00:46:21Thank you. Good morning to you guys. I wanted to ask about the wireless marketplace and particularly around pricing environment and ARPU. I see ARPU I think mobile ARPU is down about 3.5% year on year in Q4. I think you've put in a price increase on public mobile in the first quarter. Benjamin SwinburneManaging Director at Morgan Stanley00:46:40Just wondering what you're thinking about ARPU trends in 2025 and what underpinning the guidance if you want to talk about it? And just generally the environment you think you're operating in today versus what we saw over the course of the past year? Thank you so much. Darren EntwistlePresident and CEO at TELUS00:46:56Okay. I'll ask Zanele and Navin to kick it off and then Doug and I can close as it relates to the guidance roundup. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:47:07Thank you. So I think I would say that you've seen similar ARPU performance from us from a stabilization perspective. And it is no doubt a competitive and aggressive market out there, and it's a disrupted market. So I think that we are continuing to assume that we see some of the same challenging competitive dynamics. I don't think that there's going to be a material swing. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:47:38If there is to the upside, then that will be accretive. Our guidance is based on much of the same. And I think that as we spoke earlier, we see good opportunity to continue increasing product intensity into our base. I would tell you that I'm not satisfied or happy with the ARPU performance or quite frankly with our churn performance. And I think both of those levers could be improved with respect to how we attract different demographics of the right market. Zainul MawjiEVP & President of Telus Consumer Solutions at TELUS00:48:10I also think there's some mix evolution. So as you highlighted with areas like public, we are we do have offerings that are attractive to different segments of the market that impact the mix. But I think the key thing here is that our guidance assumes that we're aligned to the same sort of performance dynamic that we've seen on the lower side. And on the upper side, there might be accretion opportunity from that point. Over to you, Navin. Nazim BenhadidChief Technology Officer at TELUS00:48:42Yes. Thanks, Daniel. Just a few top ups. So as Boseley and Onai have said, we still see opportunity to grow share in B2B. We still see the opportunity to drive product intensity and that has a positive impact on churn as well, of course. Nazim BenhadidChief Technology Officer at TELUS00:49:04I think on the B2B side, we have some really strong growth assets. So the IoT business is growing nicely double digit. You may have seen the press release that we just signed a private wireless network agreement with the Calgary Airport. And that's the first of its kind with potentially more to come. And so those are examples of great growth assets that are helping to offset some of the competitive intensity we're seeing. Nazim BenhadidChief Technology Officer at TELUS00:49:38The other thing I would say is, and Darren alluded to this on our cost focus, but there's a lot of digital and digitization opportunities that we're working with TELUS Digital and our internal CIO team around how we improve our AMPU. So waving with ARPU pressures, how we're maintaining and expanding our margin profile. And I think the fact that in the B2B space for a good part of the decade, the last decade, we've had the best loyalty results in the space and that continues to always be an important contributor to our ARPU as well as to our churn. Jerome Dubreuil.VP & Research Analyst - Telecom, Media & Technology at Desjardins Group00:50:28So we expect a lot of that and all of that to continue in 2025. Back to you, Dan. Darren EntwistlePresident and CEO at TELUS00:50:36Doug, do Darren EntwistlePresident and CEO at TELUS00:50:37you want to top off at all? Doug FrenchExecutive VP & CFO at TELUS00:50:38Yes. Maybe just on some of our thoughts as well that when you think through the uncertainty in the macroeconomic backdrop on interest rates, inflation and cost of borrowing, You'd also we've also made some assumptions on rationality to pricing to help support some of those higher costs. And so it's not unreasonable, but it's definitely more reflective of the situation we're in and some of the debt that's currently being issued is at higher rates. And so I think the alignment of the market to price accordingly on that is probably aligned. Darren EntwistlePresident and CEO at TELUS00:51:16And finally, our guidance isn't predicated on a miraculous ARPU recovery. So I think it's important to be understood. We would hope to see some elements of moderation. It would be great to see a miraculous ARPU recovery, but our guidance is not predicated on that. We think that would be an erroneous planning assumption. Darren EntwistlePresident and CEO at TELUS00:51:38And the only point that wasn't added is we have a lot of diversity of growth taking place at TELUS that's outside the dominion of wireless ARPU. Benjamin SwinburneManaging Director at Morgan Stanley00:51:49Thanks, Darren. Robert MitchellHead, IR at TELUS00:51:51Thanks, Ben. And thank you everyone for joining us today. Please feel free to reach out to the IR team with any follow ups you Robert MitchellHead, IR at TELUS00:51:58may have. Carl, over to you. Operator00:52:01This concludes the Telus twenty twenty four Q4 earnings conference call. Thank you for your participation and have a nice day.Read moreParticipantsExecutivesRobert MitchellHead, IRDarren EntwistlePresident and CEODoug FrenchExecutive VP & CFOZainul MawjiEVP & President of Telus Consumer SolutionsNazim BenhadidChief Technology OfficerAnalystsJerome Dubreuil.VP & Research Analyst - Telecom, Media & Technology at Desjardins GroupMaher YaghiManaging Director at ScotiabankStephanie PriceEquity Research Analyst - Software & Services at CIBC World MarketsDrew McReynoldsManaging Director - Global Research, Telecommunications & Media at RBC Capital MarketsSebastiano PettiSenior Research Analyst at JP MorganBenjamin SwinburneManaging Director at Morgan StanleyPowered by