Telus Profits Rising Faster Than Revenues

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Canada's Telus reported a modest rise in its fourth quarter revenues and a faster growth in profits as margins improved.

Revenues were up by 3.4 percent to C$2.95 billion for the three months to the end of last year, while net profits rose by 10.3 percent to C$290 million.

The increase in consolidated revenue was generated by 4.1 per cent growth in wireless network revenue and 3.4 per cent growth in wireline revenue. Wireless revenue benefited from a 14 per cent increase in data revenue reflecting subscriber growth and increased data usage from continued smartphone adoption. Wireline revenue growth was driven by a 10.5 per cent increase in data revenue, generated in part by ongoing robust Telus TV and high-speed Internet subscriber growth, as well as increasing revenue per customer.

Postpaid net additions of 113,000 were partially offset by a loss of 22,000 lower-ARPU prepaid subscribers (excluding Public Mobile) for total net additions of 91,000, compared to 112,000 a year ago. The total wireless subscriber base (excluding Public Mobile) was up 1.8 per cent from a year ago to 7.8 million, while the proportion of high-value postpaid subscribers was 86 per cent of the base. Smartphone subscribers now represent 77 per cent of Telus' postpaid base, up from 66 per cent a year ago.

Blended wireless ARPU (excluding Public Mobile) increased by 1.5 per cent to $61.86 as data ARPU growth more than offset the decline in voice ARPU. This is Telus' thirteenth consecutive quarter of year-over-year growth in blended ARPU.

Darren Entwistle, Telus President and CEO commented: "Building on our robust operational momentum in both wireless and wireline, our 2014 financial targets reflect strong and profitable growth and cash flow generation, and will support continued investment in broadband wireline and wireless expansion as well as shareholder-friendly initiatives including our dividend growth and share purchase programs."

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