Telus Corp (TU) 2006 Q4 法說會逐字稿

Good morning, ladies and gentlemen.

Welcome to the TELUS fourth-quarter conference call.

I'd like to introduce your chairperson, Mr. John Wheeler, Vice President of TELUS Investor Relations.

Go ahead, sir.

Thank you very much and welcome to the TELUS fourth-quarter 2006 conference call and webcast.

Let me introduce the TELUS executives online with us today, they are Darren Entwistle, President and CEO, and Bob McFarland Executive Vice President and CFO.

We'll start with introductory comments by Darren and then Bob.

This will be followed by a question-and-answer session with both executives.

This call is scheduled for one hour.

The news release on fourth-quarter financial and operating results and detailed supplemental investor information are posted on our website at TELUS.com.

For those with access to the Internet the slides are posted for viewing at TELUS.com/investors.

You'll be listen-only mode during the opening comments.

Let me direct your attention to slide 2; the forward-looking nature of the presentation, answers to questions and statements about future financial results, guidance and financings are subject to risks and uncertainties and assumptions.

Accordingly they could differ materially from statements made today, so do not place undue reliance on them.

I ask that you read our legal disclaimers and refer you to the risks and assumptions outlined in our public disclosure and filings with securities commissions in Canada and the United States.

Now over to Darren on slide 3.

Thanks, John.

Good morning and thank you for joining us.

Let's begin on slide 4.

Today I will recap TELUS' full-year results for 2006 based on our excellent fourth quarter.

I will also discuss our strategic uses of cash flow and unprecedented recent developments on the regulatory front.

Bob will then review in detail our Q4 results.

In 2006 TELUS once again demonstrated the strength of our winning business strategy that focuses on the growth tenets of wireless and data in the domestic Canadian market.

At the consolidated level TELUS delivered strong revenue growth of 7%.

Not surprisingly, this was generated by wireless and data, the key drivers of which I will outline in a moment.

EBITDA or operating profit was up 9% to $3.6 billion on the year driven by our wireless operations.

Focusing on TELUS' bottom-line earnings and cash generation, net income was a record $1.1 billion, up $422 million from the previous year.

In addition, free cash flow was robust, up 9% to $1.6 billion.

Importantly, TELUS achieved or exceeded four of five of the 2006 consolidated targets we set over a year ago, building on the distinguished track record we have in realizing our financial and operating targets.

Indeed over the last seven years TELUS has met or exceeded 87% of the 38 targets that we have set for ourselves during that particular period.

Investors who've been involved with TELUS in recent years will know how important these results are as set out to the Company on slide 6.

It is our belief that you can only truly judge a company to be superior if it can build and sustain consistent performance at a high-level.

This four-year table demonstrates that we are accomplishing just that.

Our 2006 results demonstrate that we are on track for continuing our leading performance against our global telecom peers.

Value creating growth in revenue, operating profit and EPS remain top quartile again this year while cash flow is in the top half due to our stepped up capital programs which I will talk about in more detail in just a minute.

I now turn your attention to slide 7 for highlights of the wireline segment of our business.

TELUS has wireline results in 2006 that once again demonstrate our operating resiliency in a challenging industry.

In fact, TELUS experienced several improving trends on the wireline front; data revenues continued to be robust, up 7% in 2006 and almost 9% in the fourth quarter, more than offsetting declining local and long distance revenues.

This strong data result was based on exceptional high-speed Internet growth with 154,000 new connections, the best result for TELUS in this area in four years.

Notably our high-speed Internet base is up 20% from a year ago.

At the same time TELUS experienced moderate network access line losses at only 3%.

The 5% decrease on the residential front was mitigated by a small gain in business lines. 2006 revenue and EBITDA were down less than 1%, this can be attributed to line losses and lower profit margins on legacy services offset by the absence of labor disruption costs in 2005.

Turning to slide 8 -- let's examine our strong wireless results for 2006.

TELUS experienced substantial revenue growth up 17% on the wireless front.

This was based on a 12% growth in wireless subscribers as well as a 3% increase in ARPU which notably was the 16th consecutive quarter of year-over-year increases on the ARPU front.

Recent ARPU growth also reflects the 114% increase in wireless data revenue to $280 million.

This is more than offsetting the competitive declines that we are experiencing in voice revenue.

TELUS also generated a 21% increase in wireless operating profit.

Moreover, even with a 6% increase in capital expenditures, TELUS generated simple cash flow from our wireless business of $1.3 billion, up by $285 million from the previous year.

With more than 20 years of capital investment and cash flow losses the economics have now turned decidedly positive in the wireless industry.

TELUS' focus on profitable subscriber growth is also paying off.

For example, TELUS' current premium ARPU and load churn produce a lifetime average revenue per customer of $4850, an industry high.

This performance combined with a responsible cost of acquisition is generating increasing markets, notably 45% for 2006.

Factoring in a low CapEx intensity of 11%, the net result is expanding cash flow and a cash flow yield of 34%.

As shown on slide 9, this value driving metric at 34% compares very favorably with our peers across the global industry and is indicative of TELUS' strength traditionally in this area.

The Canadian wireless industry and indeed TELUS is a remarkable success story as shown on slides 10 and 11.

The first slide shows TELUS' wireless subscriber growth and net additions since 2000.

Notwithstanding marginally lower than expected additions this quarter, TELUS produced 535,000 net additions in total in 2006 which would represent the second-highest in terms of subscriber net loading for TELUS over the last seven years.

Furthermore, growth additions were a record high.

Indeed slide 10 illustrates that TELUS has consistently produced 500,000 or more net additions in each of the last three years and is again projecting strong growth in this area for 2007.

Slide 11 provides an overview of the Canadian wireless industry for the last four years including net additions, population penetration and the gain each year.

It is insightful to note that TELUS continues to win its fair share of net additions at approximately 32% each year.

This is solid progress given our long-standing strategic focus on profitable subscriber growth and maintaining a premium ARPU.

Most encouraging for investors, there remains significant room for growth overall in the Canadian wireless industry.

In a global comparison Canada is relatively under penetrated at 56%.

For example, the U.S. is at circa 75% penetration and growing.

There are no fundamental reasons to indicate that Canada cannot achieve similar levels.

With an expected growth of 450 to 500 basis points each year Canada can well achieve 80% penetration in the next five years.

That's a lot of growth still ahead for our organization in particular and the Canadian wireless industry in general.

Let's now turn to slide 12.

TELUS' superior asset mix generated significant free cash flow at $1.6 billion in 2006.

We remain committed to creating long-term value for TELUS investors by continuing to balance their interests in the use of this cash.

We demonstrated this commitment to debt holders by retaining early $1.6 billion of debt just over a year ago and by maintaining clear public financial policies and achieving them.

We've demonstrated our commitment to shareholders by returning surplus cash in two ways -- number one, through consistent dividend increases; and number two, through significant share repurchase programs.

Equally important, we are also using our cash to make responsible and prudent capital investments in our core business in our domestic market.

Let me address each of these uses of cash.

First, we established and are continuing to pursue a dividend growth model by which investors can clearly assess the potential for future dividend increases.

TELUS has delivered three successive dividend increases over the past three years of 33, 38 and 36% respectively.

Second, TELUS has also embarked on three consecutive normal course issuer bids to repurchase TELUS shares.

Many companies announce these programs, but not very many realize them.

At TELUS we've repurchased nearly 40 million shares for $1.8 billion.

Finally, TELUS has been rigorously investing for seven years exclusively in our core business based on our national growth imperatives.

Our track record for creating value for our shareholders has been exemplary and this disciplined approach has paid dividends literally and it should continue to do so.

Slide 13 reflects TELUS' 2007 capital investment program.

On the wireless side the approximate $125 million increase in capital in 2007 is directed to meeting the demands of the fast-growing wireless business.

It includes coverage infrastructure, new technology like wireless high-speed, EVDO Rev A as well as new value added mobile services.

These investments imply a CapEx intensity of 12.6%, consistent with the modest 11 to 13% range that we have long indicated as an appropriate range for our wireless business.

On the Wireline front TELUS is making the necessary investments that support the exciting evolution of our heritage business.

We are thereby maintaining 2007 wireline capital expenditures at circa $1.2 billion and recognize that this is cyclically high at a CapEx intensity of 24.6%.

Our Wireline investments are directed at four main initiatives.

First, we are continuing to service the vibrant housing market in Western Canada where provincial economies are outpacing national GDP growth.

We are investing in new technology to capture value by serving these new customers' communications needs across voice, wireless, data and entertain services.

Second, we are investing $600 million in a three-year broadband network enhancement program to drive revenue growth still further.

TELUS is continuing to rollout high-speed ADSL services to our customers and we've again set a challenging net addition target of (technical difficulty) 135,000 net subscriber additions for 2007.

Moreover, through our future friendly home strategy TELUS is investing in the continued rollout of TELUS TV and the addition of high-definition capability.

Third, after a successful pilot with more than 20,000 customers in 2006, TELUS is implementing a multiyear initiative in information technology to consolidate the multiple legacy order entry and billing systems down to one customer care platform which is the last vestiges of the post acquisition integration following the merger of BP-Tel and TELUS Alberta some six years ago.

The long-term benefits are significant from the IT investments including cost efficiencies, differentiated customer service and improved customer retention.

We know from our experience in the wireless side that these IT benefits are real and achievable.

Finally, in terms of our investments on the wireline front, our infrastructure investments support our IP technology leadership across key industry verticals of energy, financial services, healthcare and the public sector.

We are investing for the benefit of our enterprise customers and the public sector.

We continue to be successful in the West and are making new inroads in Ontario and Québec.

For example, winning a $140 million five-year Government of Ontario contract triggers a success-based commitment to build out the wide area network that will generate future revenues and profits for years to come.

TELUS has a continuing responsibility to accept J curve investment opportunities in our core business.

Our CapEx is affordable due to the significant and differentiated exposure TELUS realizes from our wireless cash flow.

This affords us the opportunity to invest for the future in both wireless and in our heritage wireline business ensuring that TELUS remains the growth story in perpetuity.

As mentioned, TELUS is also in the enviable position to be able to consistently return capital to investors along the way without undermining our strong financial performance.

Let me now conclude by commenting on two regulatory developments in Canada as outlined on slide 14.

We believe at TELUS that these benefits have been underestimated by investors.

To begin, last December the federal government took significant steps towards the expeditious deregulation of the wireline industry.

The Federal Industry Minister issued a proposed order on local forbearance that would significantly change the CRTC's restrictive decision issued earlier in the year.

Once in force by early April 2007 the order would eliminate regulation of local phone services in markets where consumers have competitive choice.

It would also eliminate the archaic marketing restrictions on win back activities when we lose a customer to a competitor.

The federal government also issued an unprecedented directive instructing the CRTC to rely -- and I quote -- "on market forces to the maximum extent feasible which insures technological and competitive neutrality and allows the regulatory environment to begin streamlining its regulatory processes".

The government's approach will afford incumbent telcos more competitive flexibility, provide the full benefits of competition to our customers and foster enhanced innovation and investment in the Canadian economy.

In a word, it's good for Canadians.

The second regulatory development is the impending implementation of wireless number portability in March of 2007.

The U.S. experience with number portability showed that the impacts were not as large as initially feared and that companies with the lowest churn rates fared the best.

Additionally, the Canadian market today uses extensively one-, two- and three-year contracts providing significant retention benefits.

In fact, TELUS considers number portability to be an opportunity because it is one of the biggest impediments that we face in growing our relatively low market share within the business market in central Canada.

To summarize, with the imminent liberalization of local pricing and marketing as well as wireless number portability, TELUS is gaining competitive tools that were not formally in the repertoire of our company.

This will allow us judiciously over time to secure a more balanced approach to the market based on the quality of our comprehensive communications solutions.

We applaud the federal government for taking the necessary steps to ensure a sustainable business model for our industry in Canada that is now going to be governed by free market forces rather than onerous regulation that can sometimes frustrate sustainable competition.

Now over to Bob to brief you on TELUS' strong Q4 results.

Thanks very much, Darren.

Let's begin with a review of our wireless results on slide 16.

Wireless revenues and EBITDA continued to deliver strong double-digit growth.

Revenues surpassed $1 billion for the second straight quarter driven by continued subscriber growth and higher ARPU.

EBITDA increased 33% to a fourth-quarter record of $432 million.

Excluding cost of acquisition expenses, which were lower this quarter than a year ago due to a 10% decline in gross additions and a 3% decline in the cost of acquisition per gross add, EBITDA growth was 16%, in line with revenue growth.

CapEx in the quarter decreased by 26% -- this was more of a timing issue as we had higher CapEx in the fourth quarter of 2005 when the labor disruption ended.

Slide 17 shows the pre and post paid composition of TELUS' 182,000 net subscriber additions in the fourth quarter of 2006 and 2005.

The lower year-over-year result was predominantly due to a $40,000 decline in prepaid subscriber net additions in the face of aggressive prepaid offerings by certain of our competitors this year.

Post paid net additions of 129,500 were down a more modest 10% from year ago and represented 71% of TELUS' total quarterly net adds, a 10 point improvement in the mix from the fourth quarter of '05.

The subscriber results reflect reduced share of net adds for TELUS associated with lower gross addition opportunities due to the reduction in overall industry churn and the resulting reduction in deactivations available from other carriers, as well as an overall slowing of industry penetration growth in the fourth quarter.

In 2006 our total subscribers increased 12% to 5.1 million and we experienced record high annual gross additions despite the slowdown in the fourth quarter.

So TELUS continues to experience solid growth and our overall subscriber mix remains strong with an industry-leading 81% being postpaid.

Our wireless revenue and EBITDA gains are being driven by more than just subscriber growth, as shown on slide 18.

ARPU continues to increase, up $2.00 year-over-year driven by significant growth from adoption of new wireless data services which has exceeded the continued erosion in traditional voice service ARPU.

TELUS' wireless data ARPU increased by $3.00 to just over $6.00 and accounted for just under 10% of ARPU this quarter.

This is evidence that in a very competitive wireless voice market we've introduced value added data applications that have met with success and the tremendous adoption of these services is driving our overall ARPU increase despite reduced voice ARPUs.

Slide 19 shows that our profitable subscriber growth operating metrics are improving significantly.

Our low blended prepaid and post paid churn rate decreased to 1.33%.

Given lower churn and higher ARPU the average lifetime revenue per TELUS subscriber has increased 10% to an industry-leading $4,850.

COA per gross add was down 3%, which is all the more impressive given the 10 point year-over-year lift in the post paid mix we generated this quarter.

It led to a 120 point improvement in our best in class marketing efficiency metric which is COA over lifetime revenue which was 9% as shown on the last line in the slide.

So we continue to generate attractive returns from our COA investment.

To conclude on the wireless segment please go to slide 20.

TELUS met or exceeded all of its original financial targets set in December 2005 with notable out performance in wireless revenues.

As mentioned, wireless net additions of 535,000 for the year were 3% lower than TELUS' original target, and our latest guidance, and was a result of reduced share, prepaid additions as well as lower seasonally adjusted market growth in the fourth quarter.

Now let's turn to our wireline operations on slide 21.

Wireline revenues were very resilient in the quarter with overall revenues up 2% year-over-year.

This slide shows the components of this growth.

Local and long distance revenue declines are reflective of the increased competitive environment from wireless and VoIP; however, it's notable that TELUS experienced a slowing of long distance revenue decline to 6.7%.

This reflects TELUS' success in partially offsetting competitive industry trends of lower volumes, declining prices and technological substitution.

The strong growth in high speed Internet, a pricing increase in the second quarter of the year, plus increased managed data revenues on the business side together led to a data revenue growth of 8.8%.

Lower quality of service penalties and stronger CPE sales at the end of the year contributed to other revenue growth.

Moving to slide 22, we can see a key driver of data growth was high-speed Internet additions.

TELUS finished the year with another strong quarter; net adds were up 64% to more than 44,000 as marketing promotions met with success in the fourth quarter of '06 whereas in the fourth quarter of '05 they were partially affected by the labor disruption.

Our high-speed Internet subscriber base now totals 917,000, up 20% from a year ago which represents 83% of our total 1.1 million Internet connections when you include dial-up.

In 2006 TELUS' marketing efforts garnered the clear majority of high-speed Internet subscriber growth in our incumbent markets.

Consistent with past statements we continue to target improving our high-speed Internet share relative to cable Internet, which is reflected in our target for 2007 net additions.

The balance of our wireline financials are on slide 23.

Reported EBITDA was up 9.2% which I'll examine further in a few moments on the next slide.

Capital expenditures were higher this quarter rising to $309 million reflecting increased investments in broadband, TELUS TV and network access growth as well as suppressed CapEx last year due to the labor disruption which impacted wireline much more than wireless.

Slide 24 helps to show the underlying wireline EBITDA.

Reported EBITDA growth for the quarter of 9.2% overstates the underlying trend.

Taking into consideration $50 million in net expenses from the labor disruption in 2005 as well as for restructuring costs in both quarters, adjusted EBITDA shows an apparent decline to $452 million.

It should be noted that the Q4 '06 wireline EBITDA was affected by the cost of sales from successful broadband loading in both high-speed Internet and TELUS TV, collectively what we call our future friendly home initiatives or abbreviated as FFH on the slide, which, as already mentioned, was up significantly year-over-year.

Excluding 21 million in increased cost of sales from the stronger loading a more representative underlying EBITDA trend is a decline of just over 4% before one takes into consideration certain regulatory events during the year.

Slide 25 provides a snapshot of our nonincumbent operations in Ontario and Québec focused on the business market.

This is a subset of our wireline segment.

We saw continued moderate growth in revenue, an EBITDA increase and improved margins, so all in all good going in central Canada, particularly with new business in the pipeline such as that associated with large contract wins like the government of Ontario.

Slide 26 highlights our network access line performance.

Residential line losses in the fourth quarter were 34,000 or 5.2% on a year-over-year basis reflecting increased competitive activity from resellers and VoIP competitors, particularly cable TV, as well as second line losses and of course from wireless substitution.

However, this decline in residential lines was partially offset by a 0.6% increase in business lines resulting in an overall line loss of 3% from a year ago.

As Darren noted, this is a relatively moderate loss compared to those experienced by most other North American telcos.

Slide 27 shows the growth trajectory and changing mix of TELUS' overall total subscriber connections.

It shows that on a consolidated basis continued growth in wireless and high-speed Internet subscribers is significantly outpacing declines in residential network access lines and dial-up Internet.

Interestingly TELUS has 1 million more total connections than it did two years ago despite competitive pressures in the Wireline business.

This slide clearly shows the continued execution of our strategy focused on growth in wireless and data.

To conclude for the wireline segment, you can see on slide 28 our wireline results compared to our original 2006 targets.

At $4.823 billion we just missed the lower end of our original revenue target range by $2 million or less than half of a percent.

So being technically precise, we gave ourselves an X in that category, as you can see.

EBITDA came in closer to the top end of the range at $1.84 billion and our non-ILEC operations had a successful year led by Joe Natale and his business solutions team, meeting targets for both revenue and EBITDA.

We slightly exceeded the top end of original target for CapEx reflecting a commitment to significant investments for the longer-term in the areas that Darren has already covered.

Finally, a big highlight for John Watson's consumer team was the strong 154,000 high-speed net adds in 2006.

We raised guidance twice during the year for high-speed adds and exceeded our original target by more than 50%.

Turning now to look at TELUS on a consolidated basis on slide 29, revenue growth in the fourth quarter was 8%; reported EBITDA increased 20%, while reported EPS increased 218% to $0.70.

Now let me elaborate on these two items in the next few slides.

As shown on slide 30, this analysis is to again help investors understand the true underlying trends, adjusting for $52 million in net consolidated expenses incurred for the labor disruption last year as well as restructuring costs in both years underlying EBITDA grew 7.8%.

Furthermore, adjusting for wireless cost of acquisition expenses which were lower, as well as wireline cost of sales related to our future friendly home initiatives which were higher in the quarter, underlying EBITDA growth was about 6%.

This is consistent with and actually towards the upper end of our 2007 target for EBITDA growth of 4 to 7%.

This indicates that we're entering 2007 with good momentum.

In a similar manner, slide 31 shows EPS adjusted for the labor disruption and excluding the $0.06 of positive tax related impacts this quarter as well as $0.01 negative impact in Q4 '05, as well as acting out the $0.06 charge taken in the fourth quarter last year related to the early redemption of the 2006 notes.

As you can see, underlying organic EPS growth was still very significant at 64%.

Slide 32 gives analysts a detailed breakdown of the positive contributors to the significant increase in EPS.

I must say I like this chart as all the arrows are pointing in the up direction, as you can see.

EBITDA growth generated the biggest impact of $0.17 including $0.05 of lower restructuring costs, a further $0.10 contribution was related to net expense's from the labor disruption last year that were not incurred this year; lower financing costs due to the retirement of debt at the end of 2005 added $0.08 while tax related adjustments represented a $0.07 delta.

A decrease in the average number of outstanding shares due to share repurchases represented another $0.03 while lower depreciation and amortization and other items contributed the remaining $0.03.

All in EPS growth was significant any way you cut it.

Turning to the next slide.

On a consolidated basis TELUS achieved four out of five of its original targets for 2006 driven by wireless and data.

The exception was increased capital expenditures associated with prudent long-term investments, as Darren has already discussed.

With fourth-quarter free cash flow up $100 million, TELUS hit the middle of our original target with $1.6 billion of total free cash flow in 2006.

So a key point for investors is that although CapEx increased it did not come at the expense of our targeted free cash flow and instead reflects TELUS' strong asset mix and ability to reinvest in the business.

Of course the strong free cash flow allowed TELUS to continue its considerable efforts in retuning capital to share owners, as we can see on the next slide.

Slide 34 summarizes our normal course issuer bids with the first one beginning in December of '04.

In the fourth quarter of 2007 we remained active in the market, repurchasing a total of 3.6 million TELUS shares for just under $200 million.

In total in 2006 TELUS repurchased a total of 16.4 million shares for about $800 million.

This brings TELUS' aggregate share repurchases since December of '04 to 39.4 million shares or $1.77 billion.

More importantly for investors is that this has led to a 6% or 20.6 million reduction in the total shares down standing in the past two years despite shares issued for option exercises, etc.

So as you'll recall, TELUS renewed a third NCIB share repurchase program for up to 24 million shares expiring in the middle of December of 2007.

TELUS' decision to move to a cash settlement program for options exercised beginning in 2007 will also reduce dilution going forward.

Slide 35 shows our strong track record in returning capital to shareholders since 2003 expressed on a per share basis.

In 2006 we returned $3.43 per share when one adds dividends to our full-year share repurchases.

In 2007 the combination of our higher dividend and estimated significant share repurchases at an amount assumed to be consistent with 2006 would result in a total return of capital to shareholders of approximately $3.90 per average share outstanding.

Ironically this is a level of cash distributions per share previously associated with TELUS when the possibility of converting to an income trust was considered.

While I put up the 2007 figures for illustrative purposes only, what is clear is that TELUS' strong free cash flow profile is allowing TELUS to deliver on our commitment of returning a significant and growing amount of capital to investors.

Turning to slide 36, a reminder, as mentioned in December in our targets call, that in 2007 we are introducing the cash settlement method for all outstanding vested options.

This innovative approach has several advantages.

Settling the in the money value of options for cash when exercised in the future is both more tax efficient and avoids shareholder dilution.

The cash payment will be tax-deductible for TELUS yielding potential cash savings of up to $70 million over three years.

The accounting result is estimated to be increased non-cash compensation expense of between 150 to $200 million before tax and an EPS impact after-tax of course of $0.30 to $0.40, substantially all of which will be recorded in the first quarter of 2007.

Turning to slide 37, while not as hot a topic as it's been over the past several years, pension funding has been a tough issue for many corporations.

In our case TELUS ended the year with strong investment performance in our pension plans leaving them more than 100% funded in aggregate and in a going concerned surplus position.

This stems from strong investment performance in the past several years as well as conservative and prudent management.

We currently expect to contribute approximately $112 million in pension funding in 2007 to our defined benefit plans as compared to 123 million in 2006.

For 2007 all of our major pension assumptions remain unchanged including a 5% discount rate and a 7.25% long-term rate of return.

Today I'm pleased to announce on slide 38 that TELUS has received commitments from 18 financials institutions for a new $2 billion credit facility to replace our existing $1.6 billion facilities.

The new facility is more favorable terms reflecting our strong leverage metrics and extends the maturity to 2012.

The use of proceeds is for general corporate purposes and may be used to back up commercial paper, or CP for short, issuance.

In addition, TELUS also extended its existing accounts receivable securitization agreement by one year to July 18, 2008.

As a result TELUS is well positioned to take advantage of the refinancing opportunity provided by the 1.5 billion of 7.5% coupon debt coming due in mid 2007.

The refinancing will likely be through a combination of long-term debt issuance and a new commercial paper program.

Slide 39 highlights more corporate governance developments.

In mid 2006 given the frequency of alleged stock option backdating issues in the market TELUS management voluntarily initiated an internal audit of our stock option and long-term incentive compensation practices.

I'm pleased to report this audit concluded with a well controlled rating, our highest rating for internal audits.

As far as Sox goes, TELUS has successfully completed all necessary work for compliance with section 404 of the U.S.

Sarbanes-Oxley Act.

This organization has addressed approximately 90 processes and 740 key controls.

Darren and I in our capacities as CEO and CFO have assessed the effectiveness of the Company's internal control of our financial reporting as at December 31, 2006.

Based on this assessment we've determined that our controls are effective and expect to certify TELUS' annual filings with the U.S.

Securities and Exchange Commission in the near future.

This is a credit to the entire TELUS team.

Feedback from external parties that we've been working with is that our project management and approach to the Sox 404 project has been at a best in class level.

And to conclude on slide 40, we present a summary of TELUS' 2007 consolidated targets.

These are unchanged from those resented in mid-December.

For comparability purposes EBITDA and EPS targets are adjusted to exclude the impact of the non-cash accounting expense for the newly introduced cash settlement of option so regardless of the amount recorded for the cash settled option expense in 2007, there will be no impact on their 2007 targets for either EBITDA or EPS which have been normalized for this occurrence.

When looking at these growth rates on an organic basis, it's evident that we expect solid performance in the upcoming year which builds on the momentum of 2006 and our track record of operational excellence.

With that Darren and I would be pleased to answer your questions.

So I'll turn the call over to John Wheeler to moderate the next part of the call.

Thanks, Bob and Darren.

Just before I turn the call over to Ron to conduct the Q&A session, can I ask your cooperation for one question at a time, please?

Ron, please proceed.

(OPERATOR INSTRUCTIONS).

Peter MacDonald, GMP Securities.

My question is on the wireline margins.

If I exclude restructuring and non-ILEC my back of the envelope calculation shows that your traditional wireline margins were down somewhere around 300 to 400 basis points sequentially.

Now obviously you met the high end of the guidance range, but maybe you can just discuss what the trends are in there.

Was there something earlier in the year that doesn't transpire into Q4 or were there any onetime items for example?

And that's it.

Thanks.

Yes, there were a number of I guess what you'd call onetime, hopefully onetime if you count weather as onetime, but who knows these days?

But certainly in the fourth quarter this year in the west we experienced some highly unusual weather patterns that led to significant overtime in our field force to maintain quality of service.

So that was an impact this year.

If we go back to last year there was, as I recall, circa $7 million of credits on CD&S which were reaped by our TELUS Québec incumbent territory.

And so that was in the results a year ago.

There were rate reductions in CD&S that affected our ILEC territory to the negative side throughout most of 2006 and certainly for the full quarter of the fourth quarter.

And I think the other two things to note are in our incumbent areas we are rolling out TELUS TV service and there is -- and we also have significant work going on on the network and there's an element that's capitalized, but there's a significant element that is not capitalized.

So there is an OpEx ramp up associated with deployment of those new services and that's reflected in the numbers; it was relatively negligible a year ago.

So those are the big things.

Generically typically, as we all know, and it's been a permanent trend, $1.00 of data carries a smaller margin than $1.00 of voice conventionally, so that would be more of a macro point.

Peter Rhamey, BMO Capital Markets.

Actually just as a follow-up to that question real quick, Bob, typically do you expense about 15% of CapEx?

And my real question is on data growth 8.8%, how much of that is organic?

Is there any equipment revenue in there and if so what would be the adjusted number?

Peter, could you just reask the question?

You said we expense 15% of CapEx --

Typically for every rule of thumb that I've been using, and I could be wrong, is 15% of CapEx gets expensed typically and I was wondering if that's kind of what we could apply for your broadband build because I understand it's about $200 million, just for us to get some sense of the numbers.

Yes, that's not an approach I'm really familiar with looking at it.

You typically -- when (indiscernible) or if you look at labor expense, a certain portion is capitalized versus expense depending on what they're working on.

And for example, when you are working on repairing weather-related damage, etc., that's not a capitalizable expense because you're just repairing to the original state.

And we certainly had a high level of that occurring which drives actually a compounded cost because you're running into overtime as well as, not just the fact that it's work that is expensed rather than being capitalized.

So I don't have the exact number in that regard, but absolutely, that was a definite trend in the fourth quarter.

I know most of you are on Bay Street, but if you were living out here on the West Coast and we had an all-time record amount of rain and an all-time record amount of snow and it was in the same month of November, right in the middle of the fourth quarter.

So needless to say, that was a challenge for maintaining our network.

The second part of your -- sorry, you asked a question about equipment, Peter.

Just rephrase that.

Yes, organic data revenue growth, I assume it includes some equipment sales which are lower margin.

I was wondering if you could help us out with that 8.8% number and adjust it for equipment sales and give us a service revenue growth rate.

I don't know that top of mind, but I think the conclusion would be whether you're looking at the revenue or the equipment side it would be similarly positive.

There's no big differential that I'm familiar with.

Vance Edelson, Morgan Stanley.

My question is on wireless data.

Can you provide us an update on the status of the EVDO rollout; maybe give us a feel for what percent of the footprint is covered?

And the fact that wireless CapEx was down year-over-year, is that an indication that major markets are now covered and there is not much more planned, or should we expect considerable wireless CapEx going forward to expand the reach of 3G?

In terms of EVDO, we have concentrated mostly on urban deployments.

So whether it is our CapEx or that of Bell's collectively through a network sharing arrangement, all of the major urban areas have been covered.

We are continuing to push that footprint out into rural areas, for example, in Alberta.

So there continues to be expenditures in that regard.

We have also begun predeploying for [Dora], if you will, the [REB-A] of EVDO, and that is also reflected in our projected CapEx guidance for wireless in 2007.

So we are definitely going down that path as well.

We have been incurring EVDO expenditures for two years.

We're definitely past the peak, but it remains an element.

We are not providing specific guidance as to the amount being expended, but suffice to say we do have deployment not only for concluding the EVDO but also to commence Dora in 2007.

Jonathan Allen, RBC Capital Markets.

Thanks very much.

Wireless data was very impressive in the quarter.

And Stan pulled up the overall ARPU for wireless, but looking at the underlying voice trend, Bob, it seems to be flat for the last couple of quarters and then seems to be down about 1.5%, 2% this quarter with minutes of usage also flat to declining.

The question for you is, one, is this at all a concern for you with the trend that we're seeing in voice ARPU?

Second of all, is there a way or is there a need to simulate to minutes of usage in any way?

Firstly, it would be incorrect to conclude that voice ARPU started to decline in the fourth quarter and not in the previous quarters.

We have been running for some period of time year-over-year decreases in our voice ARPU.

That is not a new fourth-quarter phenomenon.

I just chose maybe to emphasize it more.

I think there is a misconception out there in the general public that pricing is going up in wireless when, in fact -- because of ARPUs going up when, in fact, pricing continues to go down on a net basis on voice.

But it is the significant adoption of new data services as well as roaming revenues for some carriers contributing to an overall aggregate increase in ARPU.

So, in our case, we have always modeled some compression in the voice ARPU.

I think that has been the case for quite a while now.

So what we are really seeing is that the significant adoption of wireless is more than offsetting that, and that is why the overall ARPU is going up as it is.

Glen Campbell, Merrill Lynch.

My question is for Darren.

Darren, you mentioned that wireline CapEx in '07 at $1.2 billion is a cyclical peak.

I wonder if you could talk a little bit about whether you see the possibility that TELUS might have to go beyond its plan for ADSL [2+] fiber-to-the-node strategy for the wireline network, just something that might cause CapEx to either rise after 2007 or remain high for a very long time?

Thanks.

Thanks for the question, Glen.

I think we have been pretty clear from the outset that our approach on the broadband front is one where we are looking to achieve a smooth CapEx profile on a sustained basis.

So when you see us make an announcement about a $600 million broadband built program, that was projecting out for three years.

So that is indicative of the smooth profile in respect of providing the necessary technology upgrades that deliver the bandwidth on a per-home basis that we need to be competitive.

We have also indicated that quite explicitly in previous calls what the technology path for this organization looks like.

And effectively, what we have said is we're going to take ADSL to ADSL 2+, and then from there to proceed to ADSL 2+ bonding where we are actually multiplexing access lines together to double the bandwidth to around 30 megs.

And also simultaneously with that push fiber deeper into the access layer closer to the neighborhood, again to raise the bandwidth.

And that would allow us to deploy technologies like VDSL or GPON where we would have a combination of a fiber deeply deployed within a neighborhood and then an Ethernet connection into the home.

So for us, what we would like to do is push fiber deeper into the access layer on a consistent basis rather than a lumpy CapEx profile, and then have an Ethernet connection into the home.

And we think that's the right balance between the necessary bandwidth to be competitive and prudent capital investments that are done on a smooth basis, if you will, over a protracted period; we've indicated three years in this particular instance.

The only area where I think we would be different in terms of our technology deployment and the topology of our technology deployment would be apartment buildings or what we would term to be multiple dwelling units.

In those instances we would be looking to bring fiber directly to the suite because it's economical to do so, or in new neighborhoods where we're deploying fiber on a greenfield basis and we have the opportunity to more economically deploy fiber directly into people's homes and bring that type of bandwidth into play.

We've also said that the balance for us is we never want to hit our head on a bandwidth ceiling and become uncompetitive.

We want to make sure that we've got a bandwidth envelope that allows us to deliver the type of applications that customers want and whereby we can derive an attractive economic rent from those applications.

But also, not to get ahead of ourselves in terms of technology upgrades, to make sure that we sweat each access technology along the way to maximize the return on the investment.

Dvai Ghose, Genuity Capital.

If I can ask a question about use of cash.

You've set some pretty clear targets, but the ranges are quite big and you're clearly trending to the low-end of your dividend payout as well as your net debt to EBITDA range.

On the other hand, you obviously have the commitment to your debt holders to improve credit metrics and so on and you have some refinancings coming up, and to further complicate issues there's speculation about privatization and so on.

How do you balance all these things, either Darren or Bob?

And as a quick factual question -- Bob, in December you published a free cash flow target of 15.25 to 16.25 for '07 and you've taken it away in your release today;

I'm wondering why that is?

Firstly, I'm puzzled by the commitment for a credit upgrade.

We have a target credit rating policy, it's very clear, for a number of years, BBB high to A low.

We're sitting at BBB high for three of the four and the fourth has a rating under review.

So I'm not sure we have any pressure in that regard.

We just carried through with our long-standing targets.

We're sitting in the middle of our 1.5 to 2.0 debt to EBITDA range, so certainly don't seem to be constrained one way or the other.

Perhaps we could be at 1.75 and be exactly in the middle and that would satisfy you even more, I'm not sure.

And then in terms of how this all balances, it's pretty straightforward.

I don't think now there are many companies with as clear financial policies as we do when we provide both a dividend payout ratio target range on a sustainable go forward basis as well as a leverage policy target.

So it's easy to model our business and I think, as I tried to demonstrate in the presentation today, that's led to significant returns in capital, increased dividends, increased share repurchases and I think that's been healthy for our share price.

And I also am not sure that all the analysts have understood the cash settlement program given the absence of any dilution now that will occur from share option issuances.

So a share repurchase program in terms of gross repurchases is going to flow right through to net repurchases; it won't be offset as it has been partially in the past.

So I think we've got the right set of policies, we're not looking to revise them.

They've worked well.

We think that they are aligned with lowering the cost of capital for the organization and we remain committed to that approach.

In terms of a free cash flow target for 2007, I'm not sure why it's not on the slide.

I don't know if there's a particular issue; we're not really docking anything, Dvai.

There's no conspiracy theory I think working in this regard.

So be free to talk to anyone about free cash flow off-line.

Randal Rudniski, Credit Suisse.

Can you tell us when you would expect to be rolling out high def on the TELUS TV?

And are there any kind of metrics around TELUS TV that you can share with us at this point?

I think right now, given that we are best in class in terms of our disclosure, we would prefer to keep the operating metrics to ourselves in respect to TELUS TV as it goes through its infancy period.

From a competitive intelligence perspective we think that this particular policy well serves our existing shareholders.

In terms of high definition per se, we will be looking to deploy high definition in the latter half of 2007.

And I guess the only thing to say in conclusion would be that we are indeed reasonably satisfied that with the progress and the take-up that we are seeing on TELUS TV right from an execution perspective within the TELUS network, a service delivery perspective and a customer appetite perspective in terms of demand for the service.

So we are pleased thus far and I think for this organization right now we want to execute on the ADSL 2+ deployment which will give us the bandwidth that we're looking for to enable the rollout of high-definition TV.

The ADSL 2+ footprint will largely be in place over the course of 2007 so that we can bring HD to the market in the latter half of this year.

Jeffrey Fan, UBS.

Can I just follow-up quickly on the free cash flow question that Dvai asked?

Is there no target now for free cash flow for 2007 or is it just the same and maybe it was a print error?

Jeff, we didn't set a target for FCF, so maybe it was a question that you wanted to ask back in December as opposed to new news in February.

But free cash flow, first of all it's a troubling one because each analyst seems to want to come up with their own definition of free cash flow which means comparing our number to consensus is a meaningless exercise because you each have different definitions.

So what we do is we disclose, as you see in this package, the free cash flow in terms of how we get there.

We're certainly not shying away from any targets, but we also have significant refinancings and other elements are going to affect our interest expense and I think all that is a question of how good is it going to get as opposed to is it going to get better.

And so it's not that we've changed anything here, it's just I think what you need to know it is in the deck and I'm willing to talk openly about free cash flow with anyone off-line.

I want to ask a question about the wireless industry and maybe this is directed to Darren.

In your optimism about the long-term penetration opportunities in Canada, if we look at all the carriers now, everybody has reported Q4 gross adds, it looks like it's down high single-digit year-on-year.

Mind you acquisition spending and marketing spending is down as well it seems like with the industry.

But in order to get -- for penetration to continue to grow at the trend, 400 basis points, 500 basis points per year, do you think anything needs to be done within the industry?

Meaning sort of further promotions, higher COAs per sub?

Are we getting to that level where we need to step things up a little bit as an industry?

No, I don't think so.

I think it's quite an amazing discussion actually when you think about it, Jeff.

I mean, you can't judge an organization on a quarter's performance and we said it was a little bit lighter in Q4 in terms of net adds than what we expected.

But if you look at the full year 2006 at 535,000 net adds, it was the second-highest loading for us in seven years.

And if you look at the industry overall it was up 470 bips and we're projecting 450 to 500 for the industry in 2007 and potentially beyond.

We're also projecting pretty robust performance for TELUS in 2007 in the 550,000 net add zone.

And what is kind of amazing to me is that here we are growing our subscriber base at a double-digit rate of 12% in 2006, ARPU is up for the 16th consecutive quarter, churn is down.

We set a record in terms of lifetime revenue per customer of $4,850.

COA is down and if you go back to Q4 2005, COA was a big subject of discussion and now it's down.

And if you combine our lifetime revenue per customer with our COA efficiency and an 11% CapEx intensity you get a 34% cash flow yield.

So for every $1.00 that we generated in 2006 of revenue, $0.34 of cash came out the other end.

Those are metrics that are just absolutely nothing short of unbelievable in terms of our performance.

If you compare us to other markets around the world, I think there are some pretty obvious differentiating factors.

Number one, Canada was effectively one of the last of the established markets to get going on wireless.

There is no fundamental impediment that would block us from achieving the long-term goals in terms of penetration.

We've had more of a post paid focus in Canada which I've got to believe is a good thing given the economic characteristics of post paid versus prepaid.

And then the thing that's quite amazing is the investment opportunity.

If you look at where we stand now from a penetration perspective, contingent upon what measurement you're using we're either 56 or 57% penetration.

And if you did a survey across all the analysts and said to them one what's the end game going to look like when it comes to wireless penetration in Canada?

You'd get answers between 85% and 105% over the longer-term.

So what we're talking about here is just how big can the growth story be and that's pretty damn exciting.

And when you do the simple math and say from where we are I'd say even a conservative approach as to what the end game might look like, at 450 to 500 bips of growth per year you're looking at six to seven nears of very, very healthy growth for the industry.

And that six to seven years of healthy growth, when we're already as an industry enjoying significant scale economies.

So that's six to seven years of value creation from an investor perspective.

And I would say to investors, I'll tell you what, I'll be guided by you.

Let's just ask the question -- what matters to you is how fast we get there or how much money we make for you along the way?

And I've got to believe that speed is a secondary consideration when it comes to penetration, it's the value creation that we can realize along the way.

And for me, I'm pretty excited about 2007.

I mean, I look at 2007 and every year since my tenure at TELUS we've been staring in the face of negative regulatory events.

In 2007 we've got two positive regulatory events that are coming to fruition, the forbearance one on the wireline side, but the positive one in terms of number portability on the wireless front.

And we have experienced a structural impediment to achieving our balance share of growth in terms of the business market in the East because of the lack of number portability.

With that impediment being alleviated we will judiciously, prudently, in the price disciplined fashion seek to capture a balanced share within the business market in the East where at the present time we have a disproportionately low share.

And we should do well within the number portability environment given that we have the smallest subscriber base and we've got one of the lowest churn rates on a consistent basis.

That for us is very exciting.

And also in 2007 we're bringing Ap to the market that for us this is something that we embarked upon six to nine months ago to operationalize this relationship in Canada and we're encouraged by what we see as the performance of Apna in the U.S. and the ARPU characteristics that they're generating.

And once again you've seen the TELUS philosophy of bringing a new brand into the market, but not on a discount basis, but on a premium basis.

And not looking at a broad based service offering but a targeted service offering to a certain demographic that's interested in that type of content and is going to pay a premium for it.

So for me, when I look at where we're going there's huge potential for growth.

We're already enjoying significant economies of scale and every operating metric across the board for TELUS is not just strong but it improved over the course of 2006 and I think that bodes well for the future.

John Henderson, Scotia Capital.

I have a supplemental to Randal's question on IPTV and then just a quick one on non-ILEC.

On your FHA dilution that you noted, is that all IPTV and is that -- have I got it right about $20 million for this quarter?

And is that a sort of level or a disclosure that we're going to see going forward?

No, it's actually the aggregate of the Internet and the TTV.

And as you noticed, the Internet adds were up tremendously year-over-year, so that was a dominant component of the change.

In terms of disclosure, I think to the extent that on a -- it's a material contributor to a year-over-year variance and that we would be emphasizing it I haven't really thought through whether we're going to mention the number exactly each quarter.

I think this quarter on a year-over-year basis, unless we focused on it one wouldn't even understand the nature of the year-over-year change, so that's why we focused on it at this juncture.

I think it's fair to say, John, that the impact of the labor disruption last year in '05 was exceptional and it hurt our operational ability to employ ADSL.

So we wanted to highlight the difference in the cost of sale on this year versus last year because of that exceptional event.

I think it's not something that we would do on a routine basis going forward.

And the other thing to note is Bob's conservatism once again because we didn't just normalize so to speak for the higher ADSL and FFH loadings, we also made an adjustment for what transpired on the wireless front where we have lighter loading.

So we took, again, a very balanced approach and I think that's judicious and fair to investors.

On non-ILEC, I just wander when we might expect to get to positive returns in that business.

It's been something like six years or so of pretty heavy investments in it and I wonder if you have some comments, color on that and just -- or is this a business that's really a necessity for the whole picture of TELUS?

You hit the nail on the head in the last comment.

Everyone looks at Ontario and Quebec as sort of an incremental thing that we're doing just from an expansion perspective.

But I've got to tell you right now it's a necessity if we're going to keep our business customer relationships in place in the West because they need national connectivity.

And in the absence of a Stentor organization we've got to be able to provide that for them and have both the service capability and the footprint to address the needs of business customers that are headquartered in Western Canada but have satellite operations in the East.

Number two, it would be fair to say that if you look at the EBITDA growth of our business in the non-ILEC region, it's a pretty healthy year-over-year growth rate.

And in terms of the cash dilution versus the $1.6 billion of free cash flow that this organization generates, the cash dilution is very, very, very modest.

In fact, what would be an interesting way, John, to look at it is why don't you look at Ontario and Québec in totality, both the non-ILEC business and its cash appetite and as well the ILEC business in Eastern Québec and the cash that it generates.

And if you actually meld the two of them together we're cash positive.

So it would be fair to say that the cash flow appetite of our non-ILEC business addressing in a targeted fashion the business markets in Toronto, Montreal, Ottawa and Québec City is being answered by the cash generation coming off of our ILEC business in Eastern Québec.

So if you actually [trametically] seal Ontario and Québec there is no cash drain off of the ILEC business in Western Canada.

And I think that's a pretty attractive picture.

So I would encourage you actually to follow-up with Bob and take an aggregate view of the revenue that we generate on the wireline front from Ontario and Québec, the aggregate EBITDA that we generate and what the net cash picture looks like when you bring the Québec ILEC together with the Ontario Québec non-ILEC to see that it's actually non-dilutive to the cash that we're generating out of the West.

And I think that's something perhaps that we haven't done the best job disclosing on in the past, but something that we can take up with you in discussions going forward.

The other thing that's kind of amazing and we talked about over the last six to seven years is cash flow dilution from the non-ILEC business.

And I've got to smile because I would say where's the patience that you exhibited on wireless?

It's amazing right now that we talk about the fantastic economic performance of wireless and everyone seems to forget that in the first two years of the new millennium, 2000 and 2001, we burnt through $700 million of cash on the wireless front.

I would say when you look at our 45 points of margin on wireless I think that's well-deserved because just in 2000 and 2001 alone we spent $700 million in cash, bringing that business up to scale so that we could deliver the applications that customers want.

So it's taken a very protracted period for wireless to get into a position where it's now throwing off significant amounts of cash.

I would say lets extend that same degree of patience and leniency as we build our wireline business in the East.

And then the other thing that I think you should think about is that a lot of the CapEx that impacts our cash flow in the East is variable.

So for example, we will be looking in 2007 to spend $30 million to operationalize the $140 million contract that we just secured with the government of Ontario.

If we hadn't secured that particular contract we wouldn't be spending that $30 million.

And I've got to tell you, when CapEx is success based, which it is because we've already deployed the base infrastructure in the East and that's the type of dilution that we are willing to experience in the near-term to cash because we know we can generate a long-term return from that investment.

We've gone well from 9:00 so we'll take one last question.

Philip Olesen, UBS.

Thanks for taking the question.

Actually two quick ones.

First, in terms of the refinancing plans for the '07s, if you could maybe just give a little bit more color as to your current thought process, both the split between term debt and commercial paper and the likely currency of choice for the term debt?

And then secondly, maybe a little bit on the financial policy question.

Understanding your desire to kind of be able to continue to invest in the core business to allow yourselves to generate superior growth, that said is there -- or what would need to change for you to want to revisit your current capital allocation and kind of capital structure policies?

And is there in your mind any meaningful restriction on your ability to take on a substantial amount of debt if you wanted to dramatically alter that balance sheet structure?

Okay.

Boy, there's a lot in there.

See if I can rattle through them.

In terms of financing plans, I can't be definitive but I would say we certainly have an intention to use both long-term debt, we haven't settled on maturities but I would expect perhaps a combination of maturities in terms of evening out a maturity profile.

The commercial paper program we are establishing or intend to establish would be a maximum of $800 million Canadian, so that would be a book end, I doubt it would approach the maximum.

So the billing in five Canadian refinancing program somewhere around one-third or a little more than that could be from commercial paper.

I think today DBRS put out a press release giving us a CP rating as well that you might reference on the news quotes.

In terms of currency of choice, if you stood today and looked at swap-in rates from U.S. to Canadian they really don't provide any advantage given the Canadian yield curve.

We are a company generating revenues almost entirely in C dollars, so the natural hedge is C dollar liabilities.

Although of course one could issue in U.S. and swap in, but I think if the yield curve and swap rates remain as they are I think it would most likely be a Canadian dollar issuance we're talking about.

So that's really the refinancing side of it.

In terms of financial policy, we have very clear financial target guidelines.

These are reviewed with the Board of Directors periodically.

We just went through our annual review only in the fourth quarter.

So there was a very recent re-looking at these and we reconfirmed the 1.5 to 2.0 debt to EBITDA target range as well as our net capitalization target an dividend payout range as well.

So we remain committed to our leverage policy targets, we're right in the zone now.

They are long-term targets so in terms of restrictions, yes, we could deviate below or we could deviate above.

Generally what we've been doing is using a share repurchase program to ensure we don't drive below the guideline range.

We actually changed the definition in the fourth quarter to make it more conservative to include the full amount of accounts receivable securitization, by the way, so the 1.7 is a more conservative definition than that which formerly existed.

So again, we're committed on a long-term basis.

We could go below, we could go above, but we will act in accordance with getting back into range if we do so.

And so I think all our debt investors should take comfort in the record that we demonstrated in the past of balancing the interests of equity holders and debt holders for the mutual benefit of both will remain the case going forward.

Okay, thank you very much.

We appreciate you joining us today and as well your continued support of TELUS.

Thank you.

Thank you.

And this concludes the TELUS fourth-quarter investor conference call.

On behalf of myself and the rest of the conferencing team, thank you from TELUS.