TELUS (T) investor relations material

Executive summary

• Leadership transition with new CEO and CFO, and strategic changes to executive team and organizational structure to drive accountability and execution.

• Reset quarterly dividend by 55% to CAD 0.1875 per share, targeting CAD 2.7 billion in cash savings through 2028 for deleveraging.

• Transformation strategy centers on strengthening financial foundation, operational discipline, and sustainable growth.

• Emphasis on simplifying business structure, focusing on core telecom and digital infrastructure, and restoring balance sheet strength.

• Announced removal of DRIP discount effective October 1, 2026, to reduce shareholder dilution.

Financial highlights

• Q2 2026 service revenue was CAD 4.4 billion, down 1% year-over-year; consolidated operating revenues and other income were CAD 4.9 billion, down 3%.

• Adjusted EBITDA was CAD 1.8 billion, down 2%; consolidated EBITDA down 5% to CAD 1.6 billion.

• Net loss of CAD 1.8 billion due to a CAD 2.1 billion non-cash impairment in TELUS Digital.

• Adjusted EPS was CAD 0.16, down from CAD 0.22 a year ago; adjusted net income of CAD 254 million, down 26%.

• Free cash flow rose 2% to CAD 545 million; cash from operations increased 15% to CAD 1.3 billion.

Outlook and guidance

• 2026 consolidated service revenue expected flat to -2%; adjusted EBITDA expected -2% to -4%.

• Free cash flow for 2026 now anticipated at approximately CAD 1.8 billion, down from prior outlook of CAD 2.45 billion.

• Previous guidance was for 2%-4% growth in both metrics.

• Committed to minimum 10% compounded annual free cash flow growth in 2027 and 2028, off the 2026 base.

• Targeting net debt-to-adjusted EBITDA of 3x or lower by end of 2028.