Mr. Darren Entwistle reports

TELUS REPORTS OPERATIONAL AND FINANCIAL RESULTS FOR FOURTH QUARTER 2023; ANNOUNCES 2024 FINANCIAL TARGETS

Telus Corp. has 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 its 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 Telus's acquisition of WillowTree on Jan. 3, 2023, and favourable foreign exchange impacts, which collectively more than offset the impact of some DLCX clients managing their own costs, thus reducing the company's revenue. See fourth quarter 2023 operating highlights within this news release for a discussion on TTech and DLCX results.

"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 chief executive officer. "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's 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 10th consecutive year at less than 1 per cent."

"Today, TI reported its fourth quarter and full-year 2023 results that featured solid revenue growth, notwithstanding a continued challenging operating environment. Importantly, TI delivered on its commitment to improve profitability in the second half of the year, exiting the year with a strong margin profile more aligned with its historical trends," continued Mr. Entwistle. "Our synergistic relationship offered meaningful support for TI's business, alongside momentum fuelled by the AI solutions that TI provides to companies like Google, its second-largest client, offsetting an otherwise softer demand environment. The improvement in TI's profitability also reflected meaningful cost efficiency efforts implemented during the year, realigning its cost base to better meet the near-term demand environment. Over the long term, TI remains an exciting growth story, with meaningful opportunities driven by digital transformation, underpinned by robust AI capabilities.

"At our Telus Health business unit, we achieved fourth quarter revenues of $432-million, alongside 24-per-cent EBITDA contribution growth, delivering total annual revenues of $1.7-billion along with 11-per-cent EBITDA contribution growth. We continue to execute on our global growth strategy and demonstrate our progress towards our goal to be the most trusted well-being company in the world. This includes our health care services and programs now covering nearly 70 million lives around the world, an increase of 1.8 million year-over-year; supporting health outcomes on 610 million digital health transactions during 2023, up 5 per cent over last year; and increasing our virtual care membership to 5.6 million, up more than 24 per cent over the prior year. Since acquiring LifeWorks in 2022, our team has committed to driving $427-million in annualized synergies by the end of 2025. This includes $327-million expected to be realized through operating cost synergies from continued integration, and optimizing our organizational structure, systems and real estate. Furthermore, we anticipate $100-million from longer-term revenue synergies driven by cross-selling health services products within our Telus Health customer base, and throughout our Telus portfolio of assets, including Telus International. To date, we have achieved $233-million in combined annualized synergies towards our overall objective. These synergies will allow us to reinvest in the growth of our business and improve our profitability, while we focus on delivering efficient, secure and best-in-class health and wellness solutions to our customers.

"Our all-time record customer growth is underpinned by our dedicated team who are passionate about delivering superior service offerings and digital capabilities over our world-leading wireless and PureFibre broadband networks," added Mr. Entwistle. "Importantly, Telus's networks continued to earn global accolades in 2023 for reliability, expansiveness, speed and superiority, including multiyear recognition from independent, third party organizations, such as Opensignal and PCMag. Telus has been recognized as Canada's most awarded network by Opensignal over six consecutive years, while PCMag named Telus Canada's best mobile carrier, and best mobile carrier for business, in their annual Readers' Choice Awards. With respect to fixed, PCMag recognized Telus as the fastest Internet service provider (ISP) in Canada for the fourth consecutive year in 2023. These accolades illustrate the Telus team's steadfast commitment to connecting Canadians to the people and information that matter most."

Mr. Entwistle further commented: "The generational broadband network investments that Telus has made over the last decade will continue to drive extensive socio-economic benefits for Canadians in communities from coast to coast, while underpinning the continued advancement of our financial and operational performance. These investments power our team's ability to consistently drive profitable growth over the long term, on the back of our differentiated asset base, best-in-class customer experience and world-leading networks, alongside our unique growth businesses. This provides us with confidence in the robust outlook for our business and delivering on the annual targets for 2024 that we have announced today. These include TTech operating revenues and adjusted EBITDA increases of 2 to 4 per cent and 5.5 to 7.5 per cent, respectively; consolidated capital expenditures of approximately $2.6-billion; alongside consolidated free cash flow of approximately $2.3-billion, up circa 30 per cent over 2023, bolstered by strong EBITDA growth and stable capital investments. Our outlook for 2024 will be supported by the 2024 targets announced this morning by TI, with revenue and EBITDA growth of 3 to 5 per cent and 7 to 10 per cent, respectively, and industry-leading free cash flow yield in line with TI's historical average. Combining our outlook for TTech and TI, consolidated operating revenues and adjusted EBITDA are expected to grow at similar rates approximate to our TTech outlook. Furthermore, the unparalleled skill, innovation, grit and execution excellence of our team, on our consistent and winning strategy, underpins our leading multiyear dividend growth program, now in its 14th year, through to the end of 2025.

"To further buttress the sustainability of our consistently strong performance, against the backdrop of the rapid transformation in our industry due to the evolving regulatory, competitive and macroeconomic environment that we currently face, we continue to focus on executing the extensive efficiency and effectiveness initiative across Telus, initially announced in August. Importantly, the transformational investments we have prudently made over the course of more than a decade in building the best culture, and enabling industry-leading customer experiences over our globally leading wireless and PureFibre broadband networks, allowed us to accelerate our well-progressed plans to digitally revolutionize our business and further streamline our operating costs. Our team's grit, resilience, and ability to embrace change and continuously evolve the way we operate have enabled us to achieve our targeted team member reductions in 2023, with the full run-rate of annualized cost savings expected to be realized in the second quarter of 2024. Furthermore, our focus on cost efficiency is continuing into 2024, targeting incremental restructuring investments of approximately $300-million. While these come with many difficult decisions, we continue to leverage our decades-long track record of successfully navigating exogenous factors, in order to rise to the current challenges and future-proof our business.

"Against the backdrop of these ongoing challenges, our Telus family continues to bring our caring culture to life," said Mr. Entwistle. "Last year alone, our team members and retirees logged an unprecedented 1.5 million hours of volunteerism in communities across the globe -- an unparalleled accomplishment that is more than any other company in the world. Importantly, this represents the fifth consecutive year that we have collectively contributed over one million hours. This brings us to a total of $1.6-billion gifted in cash, in-kind contributions, time and support programs, and 16 million hours, which equates to 2.2 million days of volunteering since 2000. Due, in part, to our team's unsurpassed dedication to putting our communities and customers first, the Telus brand has increased in value from $10.3-billion in 2023 to circa $11.5-billion today as ranked in the Brand Finance 2024 global report. Notably, Telus moved up two places to become the most valuable telco brand in Canada and the eighth most valuable brand, nationally."

Doug French, executive vice-president and chief financial officer, 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."

Mr. French 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.

"Our continued strong operational and financial performance supports our robust balance sheet and liquidity position," added Mr. French. "Our debt maturity schedule is a testament to our prudent financial planning. With the average maturity of our long-term debt of over 11 years, and 87 per cent of our debt being fixed, we are well positioned to successfully navigate a dynamic operating environment with resilience and foresight. Furthermore, the average cost of our long-term debt of 4.33 per cent at the end of 2023 remains low relative to current rates. Our balance sheet in 2024 will be further enhanced by the meaningful increase in free cash flow alongside strong EBITDA growth, and supported by our stable core capital expenditure outlook of approximately $2.6-billion, excluding investments related to real estate development initiatives. As a percentage of revenue, our consolidated capital intensity in 2024 will remain low and in the 13-per-cent range. This strong position further supports our industry-leading dividend growth program now in place through 2025, along with deleveraging our balance sheet while continuing to make strategic investments to continue advancing our winning and sustainable growth strategy.

"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," Mr. French concluded.

As compared with the same period a year ago, net income in the quarter of $310-million was up 17 per cent and basic earnings per share (EPS) of 20 cents increased by 18 per cent. These increases were driven by the impacts from: (i) consolidated EBITDA (earnings before interest, taxes, depreciation and amortization) growth, as discussed below; and (ii) the estimated unrealized appreciation recorded from Telus's virtual power purchase agreements with renewable energy projects as of Dec. 31, 2023. These were partially offset by: (i) higher depreciation and amortization reflecting increases related to growth in capital assets in support of the expansion of Telus's broadband footprint, including Telus's generational investment to connect homes and businesses to Telus PureFibre and 5G technology coverage; and growth in Internet, TV and security subscriber loading; (ii) higher interest costs primarily from greater long-term debt outstanding, attributable in part to business acquisitions, in addition to an increase in the effective interest rate; and (iii) higher employee benefits expense to reflect higher restructuring costs related to accelerated cost efficiency programs. As it relates to EPS, the trends also reflect the effect of a higher number of common shares outstanding. When excluding the effects of restructuring and other costs, income tax-related adjustments, real estate rationalization-related restructuring impairments, virtual power purchase agreements unrealized change in forward element, other equity losses related to real estate joint ventures, and other adjustments, adjusted net income of $341-million increased by 0.6 per cent over the same period last year, while adjusted basic EPS of 24 cents was unchanged over the same period last year. Adjusted net income is a non-GAAP (generally accepted accounting principles) financial measure and adjusted basic EPS is a non-GAAP ratio.

Compared with the same period last year, consolidated EBITDA increased by 6.7 per cent to approximately $1.7-billion and adjusted EBITDA increased by 9.4 per cent to more than $1.8-billion. The growth in adjusted EBITDA reflects: (i) broad-based cost reduction efforts across both the TTech and DLCX segments, including work force reductions, synergies achieved between LifeWorks and Telus's legacy Health business, and increased TTech outsourcing to DLCX, as well as savings in marketing, discretionary and administrative costs; (ii) higher mobile network, residential Internet and security revenues largely driven by subscriber growth; (iii) higher mobile equipment margins; and (iv) organic health services growth. These factors were partly offset by: (i) merit-based compensation increases; (ii) higher bad debt expense; (iii) declining TV and fixed legacy voice margins; (iv) higher costs related to the scaling of Telus's digital capabilities, inclusive of increased subscription-based software licences, contractor and cloud usage costs; and (v) lower agriculture and consumer goods margins.

In the fourth quarter, the company added 404,000 net customer additions, up 103,000 over the same period last year, and inclusive of 126,000 mobile phones and 203,000 connected devices, in addition to 36,000 Internet, 23,000 TV and 23,000 security customer connections. This was partly offset by residential voice losses of 7,000. Telus's total TTech subscriber base of more than 19.3 million is up 7.6 per cent over the last 12 months, reflecting a 4.1-per-cent increase in Telus's mobile phones subscriber base to 10.1 million, and a 26-per-cent increase in its connected devices subscriber base to more than 3.1 million. Additionally, Telus's Internet connections grew by 8.8 per cent over the last 12 months, surpassing 2.6 million customer connections, its TV subscriber base increased by 5.2 per cent to approximately 1.4 million customers and its security customer base expanded by 8 per cent to over one million customers.

In health services, as of the end of the fourth quarter of 2023, virtual care members were 5.6 million and health care lives covered were 69.5 million, up 24 per cent and 2.7 per cent over the past 12 months, respectively. Digital health transactions in the fourth quarter of 2023 were 157.9 million, up 3.7 per cent over the fourth quarter of 2022.

Cash provided by operating activities increased by $188-million in the fourth quarter of 2023 and free cash flow of $590-million increased by $267-million compared with the same period a year ago, reflecting lower capital expenditures and lower income taxes paid, partly offset by an increase in cash interest paid. The increase in free cash flow was driven by: (i) higher EBITDA; (ii) lower restructuring and other costs, net of disbursements, due to a greater number of real estate rationalization initiatives where payments of executory costs will be disbursed over multiple years, in addition to the timing of disbursements for personnel-related costs expected to impact the following year; (iii) lower income taxes paid, net of refunds; and (iv) a decline in capital expenditures.

Consolidated capital expenditures of $533-million, including $47-million for real estate development, decreased by 19 per cent in the fourth quarter of 2023. TTech operations drove $141-million of the decrease primarily due to the planned slowdown of the company's fibre and wireless network build and systems development, which is consistent with 2023 build targets when compared with the accelerated investments in 2022. TTech real estate development capital expenditures of $47-million increased by $11-million in the fourth quarter of 2023 due to increased capital investment to support construction of multiyear development projects, including Telus Ocean and other commercial buildings in British Columbia. By Dec. 31, 2023, Telus's 5G network covered more than 31.6 million Canadians, representing approximately 86 per cent of the population.

Fourth quarter 2023 operating highlights

Telus technology solutions (TTech):

• TTech operating revenues (arising from contracts with customers) increased by $113-million or 2.6 per cent in the fourth quarter of 2023, primarily reflecting increases in mobile network revenue, mobile equipment and other service revenues, fixed data services revenues, and health services revenues, as described below. Decreases in fixed voice services revenues, fixed equipment and other service revenues, and agriculture and consumer goods services revenues were partial offsets.
• TTech EBITDA increased by $43-million or 2.9 per cent in the fourth quarter of 2023, while TTech adjusted EBITDA increased by $119-million or 8 per cent, reflecting: (i) broad-based cost reduction efforts across both the TTech and DLCX segments, including work force reductions, synergies achieved between LifeWorks and Telus's legacy health business, and increased TTech outsourcing to DLCX, as well as savings in marketing, discretionary and administrative costs; (ii) higher mobile network, residential Internet and security revenues largely driven by subscriber growth; (iii) higher mobile equipment margins; and (iv) organic health services growth. These factors were partly offset by: (i) merit-based compensation increases; (ii) higher bad debt expense; (iii) declining TV and fixed legacy voice margins; (iv) higher costs related to the scaling of Telus's digital capabilities, inclusive of increased subscription-based software licences, contractor and cloud usage costs; and (v) lower agriculture and consumer goods margins.

Mobile products and services:

• Mobile network revenue increased by $64-million or 3.8 per cent in the fourth quarter of 2023, largely due to growth in Telus's mobile phone and connected device subscriber base, as well as moderating roaming revenue growth. These impacts were partly offset by the impact of lower base rate plan prices and lower overage revenues, discussed below in mobile phone ARPU (average revenue per user).
• Mobile equipment and other service revenues increased by $9-million or 1.3 per cent in the fourth quarter of 2023, primarily attributable to higher-value smart phones in the sales mix. This was partly offset by a reduction in contracted volumes attributed to increased promotional activity centred around rate plans and market aggression, in addition to more customers taking advantage of bring-your-own-device (BYOD) plan offerings.
• TTech mobile products and services direct contribution increased by $74-million or 4.9 per cent in the fourth quarter of 2023, largely reflecting mobile subscriber growth, higher equipment margins and higher roaming margins associated with increased international travel volumes. These were partly offset by the impact of lower base rate plan prices and lower overage revenues as discussed below in mobile phone ARPU.
• Mobile phone ARPU was $58.50 in the fourth quarter of 2023, reflecting a year-over-year decrease of 19 cents or 0.3 per cent for the fourth quarter. This decrease is attributed to lower overage revenues as customers continue to adopt larger or unlimited data and voice allotments in their rate plans, in addition to lower base rate plan prices from increased promotional activity and market aggression affecting both new and existing customers, which first escalated in the second quarter of 2023 and continued through the heightened seasonal promotional periods. These impacts are partly mitigated by Telus's continued focus to drive higher-value loading and realize higher, albeit moderating, roaming revenues from increased travel.
• Mobile phone gross additions were 545,000 in the fourth quarter of 2023, an increase of 83,000 or 18 per cent, driven by continued market-driven promotional activity, which first escalated in the second quarter of 2023 and continued through the remainder of the year during the heightened seasonal promotional periods; in addition to increased retail and digital traffic, Telus's 5G subscription value proposition on public mobile and growth in the Canadian population.
• Mobile phone net additions were 126,000 in the fourth quarter of 2023, an increase of 14,000 or 13 per cent, driven by higher mobile phone gross additions, partially offset by higher mobile phone churn, as described below.
• Telus's mobile phone churn rate was 1.40 per cent in the fourth quarter of 2023, compared with 1.22 per cent in the fourth quarter of 2022, largely due to higher customer switching activity from heightened seasonal promotional activity, as discussed above. These factors have been partly mitigated by Telus's continued focus on customer retention through its industry-leading service and network quality, successful promotions, and bundled offerings.
• Connected device net additions were 203,000 in the fourth quarter of 2023, an increase of 97,000, attributable to increased IoT (Internet of Things) connections from customers in the transportation, health care and home security industries.

Fixed products and services:

• Fixed data services revenues increased by $40-million in the fourth quarter of 2023, driven by an increase in Telus's Internet, security and TV subscribers, and higher, albeit moderating, revenue per customer as a result of Internet speed upgrades and rate changes. This growth was partially offset by lower TV revenue per customer, reflecting an increased mix of customers selecting smaller TV combination packages and technological substitution.
• Fixed voice services revenues decreased by $6-million in the fourth quarter of 2023, reflecting the continuing decline in legacy voice revenues as a result of technological substitution and price plan changes. Declines were partly mitigated by the success of Telus's bundled product offerings, its retention efforts and the migration from legacy to Internet protocol services offerings.
• Fixed equipment and other service revenues decreased by $13-million in the fourth quarter of 2023, largely reflecting a reduction in residential and business development project work, both as a result of the non-recurrence of large projects in the fourth quarter of 2022 and rising interest rates that softened the property development market in 2023.
• TTech fixed products and services direct contribution increased by $11-million or 0.8 per cent in the fourth quarter of 2023, reflecting increased Internet and security margins, driven by subscriber growth and higher, albeit moderating, revenue per customer as a result of Internet speed upgrades and rate changes, in addition to organic health services growth. These were fully offset by technological substitution driving declines in TV and legacy voice margins, as well as lower agriculture and consumer goods margins as a result of transient headwinds and macroeconomic challenges.
• Internet net additions were 36,000 in the fourth quarter of 2023, a decrease of 6,000, due to a higher churn rate from macroeconomic and competitive pressures impacting consumer purchasing decisions, partly offset by Telus's success in driving strong gross additions in the consumer market through diverse products and services.
• TV net additions were 23,000 in the fourth quarter of 2023, an increase of 6,000, due to the company's diverse products and services, partly offset by higher churn related to the same factors as Internet.
• Security net additions were 23,000 in the fourth quarter of 2023, a decrease of 5,000, due to higher churn related to the same factors as Internet, partly offset by increased demand for Telus's bundled product offerings and diverse products and services.
• Residential voice net losses were 7,000 in the fourth quarter of 2023, an increased loss of 3,000. Telus's bundled product and lower-priced offerings have been successful at mitigating losses and minimizing substitution to mobile and Internet-based services.

Health services:

• Through Telus Health, Telus is leveraging technology to deliver connected solutions and services, improving access to care, and revolutionizing the flow of information while facilitating collaboration, efficiency and productivity across the health care ecosystem, progressing its vision of transforming health care and empowering people to live healthier lives.
• Health services revenues increased by $21-million in the fourth quarter of 2023, driven by: (i) demand for Telus's integrated health, productivity, retirement and benefit solutions; (ii) increased pharmacy management software revenue; and (iii) the continued adoption of Telus's virtual care solutions.
• At the end of the fourth quarter of 2023, 5.6 million members were enrolled in Telus's virtual care services, an increase of 1.1 million over the past 12 months, attributable to the continued adoption of virtual solutions that keep Canadians and others safely connected to health and wellness care.
• At the end of the fourth quarter of 2023, Telus's health care programs covered 69.5 million lives, an increase of 1.8 million over the past 12 months, mainly due to healthy growth in the company's employee and family assistance programs from both new and existing clients across all of its regions, in addition to continued demand for virtual solutions.
• Digital health transactions were 157.9 million in the fourth quarter of 2023, an increase of 5.6 million, largely driven by increased paid exchange of health care data between Telus's health benefits management system and care providers resulting from higher patient demand for elective health services.

Agriculture and consumer goods services:

• Through Telus Agriculture & Consumer Goods, Telus provides innovative digital solutions and actionable data insights that better connect the global supply chain, driving more efficient production processes and improving the safety, quality and sustainability of food and consumer goods. Importantly, these efforts are also enabling better traceability to the end consumer, further supporting improved food outcomes.
• Agriculture and consumer goods services revenues decreased by $2-million or 1.9 per cent in the fourth quarter of 2023, reflecting transient headwinds and macroeconomic challenges, including subscription demand softness and customer churn for Telus's software-as-a-service-based revenue management software for consumer goods manufacturers. These effects were partly offset by increased animal agriculture pharmacy and research revenues. Telus's agriculture and consumer goods revenues are largely earned in U.S. dollars, and in the fourth quarter of 2023 compared with the fourth quarter of 2022, the Canadian dollar was consistent against the U.S. dollar.

Digitally led customer experiences -- Telus International (DLCX):

• DLCX operating revenues (arising from contracts with customers) increased by $20-million or 2.9 per cent in the fourth quarter of 2023. The increase was primarily attributable to growth in Telus's tech and games, e-ommerce and fintech, and other industry vertical clients, arising from additional services provided to certain existing clients and new clients added since the prior year, including new clients from the acquisition of WillowTree. This growth was partially offset by lower revenues from one of Telus's largest clients, a leading social media company, as well as a global financial institution client. In addition, the strengthening of both the U.S. dollar and the European euro against the Canadian dollar resulted in a favourable foreign currency impact on the company's DLCX operating results.
• Revenue from Telus's tech and games industry vertical increased by $7-million in the fourth quarter of 2023, due to continued growth experienced with a number of the company's technology clients and the addition of new clients, which was partially offset by lower revenue from one of its largest clients, a leading social media company.
• Revenue from Telus's communications and media industry vertical increased by $43-million in the fourth quarter of 2023, driven primarily by more services provided to the TTech segment and the addition of new clients from its acquisition of WillowTree.
• Revenue from the company's e-commerce and fintech industry vertical increased by $10-million in the fourth quarter of 2023, due to the addition of new clients from Telus's acquisition of WillowTree, partially offset by a decline in service volumes from fintech clients.
• Revenue from Telus's health care industry vertical increased by $27-million in the fourth quarter of 2023, primarily due to more services provided to the health care business unit of the TTech segment.
• Revenue from Telus's banking, financial services and insurance industry vertical decreased by $7-million in the fourth quarter of 2023, due to lower service volumes from a global financial institution client, partially offset by the addition of new clients from its acquisition of WillowTree.
• DLCX EBITDA increased by $64-million or 37 per cent in the fourth quarter of 2023, while DLCX adjusted EBITDA increased by $39-million or 19 per cent in the same period. The increases in EBITDA and adjusted EBITDA were primarily due to other income arising from the revaluation on Telus's provisions for written put options, positive impacts realized from cost efficiency efforts initiated in the second quarter of 2023 and lower share-based compensation, which were partially offset by cost imbalances arising from reductions in service demand, principally in Europe, from some of the company's larger technology clients, with the impacts being more significant beginning in the second quarter of 2023.

Corporate highlights

Telus makes significant contributions and investments in the communities where team members live, work and serve and to the Canadian economy on behalf of customers, shareholders and team members. These include:

• Paying, collecting and remitting more than $2.3-billion in 2023 to federal, provincial and municipal governments in Canada consisting of corporate income taxes, sales taxes, property taxes, employer portion of payroll taxes and various regulatory fees. Since 2000, it has remitted over $36-billion in these taxes.
• Investing more than $2.8-billion in capital expenditures in 2023 primarily in communities across Canada and nearly $54-billion since 2000.
• Disbursing spectrum renewal fees of approximately $53-million to Innovation, Science and Economic Development Canada in 2023. Since 2000, Telus's total tax and spectrum remittances to federal, provincial and municipal governments in Canada have totalled more than $43-billion.
• Spending $10-billion in total operating expenses in 2023, including goods and services purchased of approximately $6.5-billion. Since 2000, Telus has spent $159-billion and $108-billion, respectively, in these areas.
• Generating a total team member payroll of approximately $4.1-million in 2023, including wages and other employee benefits, and payroll taxes of $201-million. Since 2000, total team member payroll totals $61-billion.
• Returning approximately $2.1-billion in dividends declared in 2023 to individual shareholders, mutual fund owners, pensioners and institutional investors. Since 2004, Telus has returned approximately $25-billion to shareholders through its dividend and share purchase programs, including $20-billion in dividends and $5-billion in share repurchases, representing $17 per share.

Telus sets 2024 financial targets

Telus's financial targets for 2024 are guided by a number of long-term financial objectives, policies and guidelines, which are detailed in Section 4.3 of the 2023 annual management discussion and analysis. With these policies in mind, the company's financial targets for 2024, as presented herein, reflect its expectations for continued strong subscriber growth across mobile and fixed, as well as continued investments in its leading PureFibre network and 5G deployment. Telus's strategic focus to drive increased cost efficiency is also expected to contribute to its financial outlook.

Supporting Telus's targets in 2024 are its unique and diversified growth businesses -- Telus International, Telus Health, and Telus Agriculture & Consumer Goods. The company's growth profile is underpinned by a team member culture focused on delivering customer service excellence.

When combined with the 2024 financial targets set by Telus International this morning, the company expect Telus's Consolidated operating revenues and adjusted EBITDA to grow at similar rates approximate to its TTech outlook.

Dividend declaration

The Telus board of directors declared a quarterly dividend of 37.61 cents per share on the issued and outstanding common shares of the company payable on April 1, 2024, to holders of record at the close of business on March 11, 2024. This quarterly dividend reflects an increase of 7.1 per cent from the 35.11-cent-per-share dividend declared one year earlier and consistent with Telus's multiyear dividend growth program. When a dividend payment date falls on a weekend or holiday, the payment shall be made on the next succeeding day that is a business day.

Access to quarterly results information

Interested investors, the media and others may review this earnings news release, Telus's 2023 annual management's discussion and analysis, results slides, audio and transcript of the investor webcast call, and supplementary financial information on Telus's website.

Telus's fourth quarter 2023 conference call is scheduled for Friday, Feb. 9, 2024, at 12:30 p.m. ET (9:30 a.m. PT) and will feature a presentation followed by a question-and-answer period with investment analysts. Interested parties can access the webcast on Telus's website. An audio recording will be available approximately 60 minutes after the call until midnight March 9, 2024, at 1-855-201-2300. Please quote conference access code 98417 followed by the pound key and playback access code 0114271 followed by the pound key. An archive of the webcast will also be available on Telus's website and a transcript will be posted on the website within a few business days.

About Telus Corp.

Telus 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. Its social purpose is to leverage its global-leading technology and compassion to drive social change and enable remarkable human outcomes. Telus's long-standing commitment to putting its customers first fuels every aspect of the business, making it 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's global-leading networks, reinforcing its commitment to provide Canadians with access to superior technology that connects it to the people, resources and information that make lives better.

We seek Safe Harbor.