TELUS continues to demonstrate to the market that a disciplined approach to profitable growth is the right strategy. This is especially important to today's environment where improving cash flow is the only sure way to build shareholder value.

In the second half of 2002, we were free cash flow (FCF)¹ positive and for the full year, had a $1.3 billion improvement to almost breakeven. In 2003, we are looking to generate $500 to $600 million of positive FCF. We are leading the market with a high EBITDA growth estimate of 9.2% this year, vs. 5.5% for BCE and a cumulative decline of 6.7% for U.S. Bells². Our target for 2003 EBITDA growth puts us in the top echelon of North American telecom companies.

In wireless in 2002, our revenue per customer, or ARPU, was resilient at $55 per month, a significant 20% premium to the closest of our major competitors. Our subscriber base was up 16% to 3 million customers, and an industry-leading churn rate of only 1.68% in the fourth quarter is good news for 2003. To top it off, wireless EBITDA was up 50% this year to $535 million.


In a recent analysis, one telecom industry analyst commented that TELUS is a rare combination in the North American telecom sector of a growth company backed by stable performance in core wireline business. Moreover, based on our 2002 results, our wireless unit continues to be among the best in North America.

¹ FCF is EBITDA less capital expenditures, cash interest, cash taxes and cash dividends. This is before the cash costs of workforce restructuring which are estimated to be $280 million in 2003.

² Source: TD Securities, based on analyst estimates

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Despite a year of tremendous challenges for the telecom industry and TELUS specifically, our disciplined approach to profitable growth has put us in the top echelon of North American telecom companies.