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TELUS Reports Operational and Financial Results for Fourth Quarter 2023; Announces 2024 Financial Targets
Thursday, February 15, 2024Company Profile | Follow Company
Total Mobile and Fixed customer growth of 404,000, up 103,000 over last year, and the company's strongest fourth quarter on record
Burnaby, BC, February 15, 2024--(T-Net)--TELUS Corporation today released its unaudited results for the fourth quarter of 2023. Consolidated operating revenues and other income increased by 2.8 per cent over the same period a year ago to $5.2 billion.
This growth was driven by higher service revenues in the company's two reportable segments: TELUS technology solutions (TTech) and Digitally-led customer experiences - TELUS International (DLCX).
TTech service revenue growth was driven by: (i) higher mobile network revenues attributable to subscriber and moderating roaming revenue growth; (ii) an increase in fixed data service revenues, resulting from subscriber growth and higher, albeit moderating, revenue per internet customer; and (iii) growth in health services revenues.
These factors were partly offset by lower TV and fixed legacy voice services revenues, primarily due to technological substitution, as well as macroeconomic and competitive pressures impacting consumer purchasing decisions across various products.
Higher DLCX operating revenues resulted from expanded services for certain existing clients and growth from new clients, including new clients from their acquisition of WillowTree on January 3, 2023, and favourable foreign exchange impacts, which collectively more than offset the impact of some DLCX clients managing their own costs thus reducing their revenue.
See Fourth Quarter 2023 Operating Highlights within this news release for a discussion on TTech and DLCX results.
Darren Entwistle, President and CEO, TELUS Communications Inc.
"Throughout 2023, our team successfully navigated a highly competitive industry, overcame a challenging macroeconomic landscape and a dynamic regulatory environment, to achieve strong financial and operational results across our business. Indeed, our results for the year demonstrate execution strength in our TTech business segment, characterized by the potent combination of leading customer growth, complemented by strong operational and financial results, and enhanced by our significant and ongoing focus on cost efficiency. These results were buttressed by improving and resilient fourth quarter profitability from our DLCX segment, despite the continued challenging macroeconomic operating environment faced by TELUS International," said Darren Entwistle, President and CEO.
"Robust performance in our core telecom business is underpinned by our globally leading broadband networks and superior customers-first culture. This enabled our strongest fourth quarter customer growth on record, with total net additions of 404,000, up 34 per cent, year-over-year, driven by strong demand for our leading portfolio of bundled services across Mobility and Fixed services. The fourth quarter capped off a record setting year for customer net additions of 1,266,000, surpassing our previous record high in 2022 by more than 21 per cent, and marked the second consecutive year our team delivered more than one million new customer additions. These strong results included robust Fixed subscriber growth of 259,000; our highest Mobile Phone net additions since 2010 with 443,000 net new customers; and all-time record connected device net additions of 564,000. TELUS' industry-leading growth reflects the consistent potency of our operational execution, and our unmatched bundled product offerings across Mobile and Home. Our team's passion for delivering customer service excellence contributed to continued strong loyalty across our key product lines, once again this quarter. Notably, postpaid mobile phone churn of 0.87 per cent for the full year marks the tenth consecutive year at less than one per cent."
Doug French, Executive Vice-President and Chief Financial Officer, TELUS Communications Inc.
Doug French, Executive Vice-president and CFO said, "In the fourth quarter of 2023, our team achieved strong operational and financial results, supported by our consistent focus on profitable customer growth and our ongoing focus on cost efficiency. For the year, operating revenue growth of 9.4 per cent was effectively aligned with the lower end of our updated guidance, while Adjusted EBITDA landed within the targeted range. Cash flow from operations decreased by 6.5 per cent and free cash flow increased by 38 per cent to approximately $1.8 billion, surpassing our updated target of approximately $1.5 billion. The higher free cash flow result for the year reflects the timing of restructuring payments of approximately $200 million related to our efficiency program in 2023 that will flow into 2024 along with a lower-than-expected cash impact from device financing."
Doug added, "In the fourth quarter, we purposefully accelerated capital expenditures, focusing additional investments in digitization and platform development, particularly within key growth areas of our business, along with additional investments to expand the reach of our PureFibre network within targeted communities. These additional investments will further enhance our go-to-market opportunities as we begin the new year. Our team also continued to execute against our significant cost efficiency program focused on driving sustainable EBITDA expansion, margin enhancements and cash flow generation. As we head into 2024, cost efficiency will remain a key priority as we identify further opportunities across our organization."
"For 2024, we have established ambitious financial targets, building off our leading growth profile and operating execution excellence. Our financial outlook reflects continued healthy growth within our core TTech business as we maintain our consistent focus on profitable customer growth driven by continued demand for our superior bundled offerings over our leading broadband networks. Furthermore, in 2024, we anticipate improving financial contributions from TELUS International, as well as from TELUS Health and TELUS Agriculture & Consumer Goods," Doug concluded.
To view the full release in PDF format, please download here.
About TELUS
TELUS (TSX: T, NYSE: TU) is a dynamic, world-leading communications technology company with more than $20 billion in annual revenue and over 19 million customer connections spanning wireless, data, IP, voice, television, entertainment, video, and security. Our social purpose is to leverage our global-leading technology and compassion to drive social change and enable remarkable human outcomes. Our longstanding commitment to putting our customers first fuels every aspect of our business, making us a distinct leader in customer service excellence and loyalty. The numerous, sustained accolades TELUS has earned over the years from independent, industry-leading network insight firms showcase the strength and speed of TELUS' global-leading networks, reinforcing our commitment to provide Canadians with access to superior technology that connects us to the people, resources and information that make our lives better.
Forward-looking Statements: These statements are made pursuant to the "safe harbour" provisions of applicable securities laws in Canada and the United States Private Securities Litigation Reform Act of 1995. By their nature, forward-looking statements are subject to inherent risks and uncertainties and are based on assumptions, including assumptions about future economic conditions and courses of action. These assumptions may ultimately prove to have been inaccurate and, as a result, our actual results or events may differ materially from our expectations expressed in or implied by the forward-looking statements. |
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