Mr. Darren Entwistle reports

TELUS PROVIDES THREE-YEAR FREE CASH FLOW GROWTH TARGET

Telus Corp. has provided an updated midterm outlook and further details of its enhanced capital allocation framework, including a new multiyear free cash flow growth target. In addition, Telus will systematically step down its discounted DRIP (dividend reinvestment plan) beginning in early 2026 and pause its dividend growth while continuing to pay its quarterly dividend at the most recent level of 41.84 cents per share. These actions augment Telus's plan to reduce its net-debt-to-EBITDA (earnings before interest, taxes, depreciation and amortization) leverage ratio to approximately three times by the end of 2027. As of Sept. 30, 2025, the company's leverage ratio improved to 3.5 times, supported by its successful Terrion partnership, hybrid note issuances, other strategic partnerships and non-core asset divestitures, and continued access to Telus Digital's strong cash flow generation. The company expects further improvement to approximately 3.3 times by the end of 2026, supported by considerable deleveraging initiatives, potential hybrid note offerings and meaningful free cash flow generation.

"Telus is advancing its capital allocation strategy, supported by strong business fundamentals and significant free cash flow generation," said Darren Entwistle, president and chief executive officer of Telus. "Our confidence in delivering free cash flow growth at a minimum 10-per-cent compounded annual growth rate through 2028 reflects our strong financial momentum. Additionally, we are executing on our clearly defined plan to advance and systematically step down the discounted DRIP beginning in Q1 2026. Importantly, it is our intention to continue paying the dividend at its current nominal level. We will, however, moderate our dividend growth model of 3 to 8 per cent according to our dividend yield, including pausing our dividend growth until such time as our share price and associated dividend yield better reflects the considerable growth prospects of Telus. These actions will be augmented by a range of opportunities that we are actively pursuing, including a strategic partner for Telus Health and accelerated monetization of considerable real estate and copper assets. Collectively, these undertakings reinforce our strong progress on deleveraging, with our leverage ratio expected to reach approximately 3.3 times by the end of 2026 as we advance toward our target of approximately three times by the end of 2027."

Three-year free cash flow growth target

Consistent with its public targets, Telus expects to generate approximately $2.15-billion in free cash flow in 2025. For the subsequent three years, from 2026 through 2028, Telus expects to grow its free cash flow at a minimum 10-per-cent compounded annual growth rate. The company's preliminary target for free cash flow for 2026 is $2.4-billion, with capital expenditure target for 2026 at approximately $2.3-billion.

Concurrently, Telus's free cash flow projections translate into a cash dividend coverage ratio of approximately 75 per cent of free cash flow on a prospective basis, for each of these three years, consistent with the company's long-term guideline.

Stepdown of discounted DRIP

Telus plans a stepdown of its current discounted DRIP (DDRIP) of 2 per cent to a discount of 1.75 per cent for dividends declared in February and May, 2026, moving to 1.5 per cent for dividends declared in August and November, 2026, and to 1 per cent for dividends declared in 2027, with zero discount starting in 2028. The company's DDRIP has served as a prudent capital management tool as it navigated a significant investment cycle related to its PureFibre network build as well as over $4-billion in spectrum purchases since 2019. Dividend decisions will continue to be subject to the Telus board's assessment and the determination of the company's financial position and outlook on a quarterly basis.

About Telus Corp.

Telus is a world-leading communications technology company operating in more than 45 countries and generating over $20-billion in annual revenue with more than 20 million customer connections through its advanced suite of broadband services for consumers, businesses and the public sector. Telus is committed to leveraging its technology to enable remarkable human outcomes. Telus is passionate about putting its customers and communities first, leading the way globally in client service excellence and social capitalism. Telus Health is enhancing more than 160 million lives across 200 countries and territories through innovative preventive medicine and well-being technologies. Telus Agriculture & Consumer Goods utilizes digital technologies and data insights to optimize the connection between producers and consumers. Telus Digital specializes in digital customer experiences and future-focused digital transformations that deliver value for its global clients. Guided by the company's enduring "give where we live" philosophy, Telus and the company's team members and retirees have contributed $1.8-billion in cash, in-kind contributions, time and programs, including 2.4 million days of service since 2000, earning Telus the distinction of the world's most giving company.

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