1 2005 fourth quarter review & conference call February 17, 2006

the future is friendly

2

forward-looking statements

This presentation and answers to questions contain forward-looking statements that require assumptions about expected future events including competition, financing, labour relations developments, and financial and operating results and 2006 targets that are subject to inherent risks and uncertainties. TELUS’ actual results, conditions, actions or events could differ materially from those expressed or implied by such statements. Assumptions for 2006 target purposes include: economic growth consistent with recent provincial and national estimates by the Conference Board of Canada that were available in 2005, including gross domestic product growth of 3.1% in Canada; increased wireline competition in both business and consumer markets; a wireless industry market penetration gain similar to the approximately five percentage point gain in 2005; approximately $100 million restructuring and workforce reduction expenses; an effective tax rate of approximately 35%; no prospective significant acquisitions or divestitures; no change in foreign ownership rules; and maintenance or improvement of investment grade credit ratings.

Factors that could cause actual results to differ materially include but are not limited to: competition; technology; regulatory developments; human resources; business integrations and internal reorganizations; process risks; financing and debt requirements; tax matters; health, safety and environment; litigation; business continuity events; economic growth and fluctuations; and other risk factors discussed herein and listed from time to time in TELUS’ reports and filings. For additional information on potential risk factors and assumptions, see TELUS’ 2004 Annual Report, updates in 2005 quarterly interim reports and other filings with securities commissions in Canada and the United States.

all dollars in C$ unless otherwise specified

3 the future is friendly 2005 fourth quarter review & conference call February 17, 2006 Darren Entwistle member of the TELUS team

2005 highlights

 Demonstrated continued wireless excellence  Resilience of wireline despite labour disruption  Achieved strong TELUS consolidated 2005 results  Revenue 7%    Free cash flow  13% 4 All 2005 consolidated targets achieved / 88% in last 6 years

2005 highlights by segment

 Wireless industry annual growth accelerated in Canada  Wireless segment continued excellent results  Revenue up 17% & EBITDA up 26%  Cash flow up 32% to $1.0 billion  Wireline segment resilient despite labour disruption  Revenue up 1.6%  data up 8% & long distance down 4%  EBITDA down 5%, up 2% normalizing for labour  Cash flow strong at $938 million 5 Q4 product launches: EVDO & TELUS TV

Leading global telecom performance

Growth Revenue EBITDA Cash flow** EPS

World Rankings*

2003

top quartile

2004

No.1

2005 2006E

top quartile top quartile top quartile No.1

nmf No.1

No.1

top quartile top quartile top quartile No.2

top half No.2

No.1

*

Source: TD Securities data on major global incumbent telecoms ** EBITDA less capital expenditures 6 TELUS performs well relative to global telecom peers

Benefits of new collective agreement

 Ratified 5 year collective agreement to Nov. 2010  All corporate objectives met without exception  Return to work program – best in class  Excellent employee engagement  Allows management to productively run the business  outsourcing, consolidating, scheduling  Supports a performance culture  Work with TWU to have all legal proceedings dismissed 7 Enhances TELUS ability to focus on customers and to compete

Returning significant capital to investors

 Continued focus in 2005 and 2006  December debt redemption $1.6 billion  Share repurchases total $970 million to date  Second share repurchase program underway  Second step of dividend growth model  37.5% increase Jan 2006 8 Focus on sustainable value creation over the long-term

2006 priorities support national growth strategy

 Advance TELUS’ leadership position in the Consumer market  Advance TELUS position in the Business market  Advance TELUS position in the Wholesale market  Drive improvements in productivity and service excellence  Strengthen the spirit of the TELUS team and brand, and develop the best talent in global communications industry 9 Continued on strategy execution for benefit of investors

10 2005 fourth quarter review & conference call February 17, 2006 Robert McFarlane EVP & Chief Financial Officer

wireless segment

financial results

($M) Revenue EBITDA EBITDA (normalized) 1 Capex Cash Flow (EBITDA less capex) Q4-04 756 285 285 123 162

Q4-05 877

Change  16%

326 329 144 182

 14%  15%  17%  12% 1 Q4-05 EBITDA normalized to exclude $3M net expense impact of labour disruption 11 Excellent results despite EBITDA dilution from record gross adds

wireless segment

subscriber results

prepaid postpaid net additions 235K 186K total wireless subscribers 4.5 M 0.9 M prepaid 19% postpaid 81% 3.7 M Q4-04 Q4-05 12 Record fourth quarter net additions with stable postpaid and strong prepaid growth

wireless segment

industry subscriber growth

Population Net subscriber additions Cdn wireless market Penetration Penetration gain

2003

31.7M

1.4M

13.4M

42.3% 4.1% Source: Company reports, CWTA

2004

32.1M

1.6M

15.0M

46.7% 4.4%

2005

32.4M

1.8M

16.8M

51.8% 5.1% 13 Canadian wireless market growth continues to accelerate

wireless segment

industry ARPU

$61 $63 $49 $54 $50 $51 Q4-04 Q4-05 14 TELUS Source: Company reports 1 Pro forma Microcell Rogers Wireless 1 BCE Wireless Increased usage and data uptake driving ARPU growth

wireless segment

profitable growth

Q4-05

TELUS

ARPU Blended churn

$63 1.42%

Avg. lifetime revenue per sub $

4400

COA per gross add COA / lifetime revenue

$449 10%

BCE $51 1.5% $3400 $409 12% Rogers $54 2.04% $2600 $425 16% 15 TELUS’ wireless marketing efficiency remains best in Canada

wireless cash flow yield

2005 EBITDA margin (total rev.) Capex intensity (total rev.) Cash flow 1 yield (total rev.)

TELUS 44% 12% 31%

1 EBITDA less capex 16 North American leader in wireless cash flow yield

wireless segment

2005 results comparison to original targets

actual results targets 1 met or exceeded

Revenue EBITDA Capex Wireless Net Adds $3.30B

$1.44B

$405M 584K $3.20 to $3.25B

$1.35 to 1.40B

$350 to 400M 425 to 475K     1 Provided December 17, 2004 17 Met or exceeded original wireless targets for revenue, EBITDA and net adds

wireless segment

2005 results comparison to guidance

actual results

Revenue EBITDA Capex Wireless Net Adds $3.30B

$1.44B

$405M 584K

guidance 1

$3.275 to $3.3B

$1.425 to $1.45B

approx. $400M >550K

met or exceeded

    1 Updated December 16, 2005 18 Achieved updated wireless guidance across the board

wireline segment

revenue profile

($M) Voice – Local Voice – Long Distance Data Other Total Revenue Q4-04 534 230

Q4-05 537 212

373

400

72

61

$1,209

$1,210

change  0.4%  7.7%  7.2%  15% - % 19 Wireline revenue displays resilience despite labour disruption

wireline segment

financial results

Revenue EBITDA EBITDA (normalized) 1 Capex Cash Flow (EBITDA less capex) Q4-04 $1.21B

$482M $502M $221M $261M

Q4-05 $1.21B

$409M $494M $230M $179M

change  15%  1.6%  4.3%  32% 1 Normalized to exclude $20M & $36M in restructuring charges in Q4-04 and Q4-05, respectively. Q4-05 also normalized to exclude $49M net expense impact of labour disruption 20 EBITDA decline due to labour disruption and higher restructuring costs

wireline segment

non-ILEC revenue & EBITDA

($M)

revenue

165 156

EBITDA

Q4-04 Q4-05 3.7

7.1

Q4-04 Q4-05 21 Continued revenue and profitability growth in Central Canada

wireline segment

high-speed Internet subscriber growth

high-speed Internet net additions total Internet subscribers

1.0M

35K dial-up 24% 236K 27K 763K high-speed 76% Q4-04 Q4-05 22 High-speed net adds slowed by labour disruption TELUS now has 1M Internet subs with 76% on high-speed

wireline segment

network access line results

% of network access lines lost, YoY Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 -1.3% -1.1% -1.8% -2.2% -2.4%

23 NAL results impacted by labour disruption & increased competition from cable telephony

wireline segment

2005 results comparison to original targets

2005 actual results original 2005 targets 1 met or exceeded

Revenue Non-ILEC Revenue EBITDA Non-ILEC EBITDA Capex High-Speed Net Adds $4.85B

$632M $1.85B

$21M $914M 73K $4.70 to 4.75B

$600 to $650M $1.85 to 1.90B

$0 to 10M $950 to 1,000M approx. 100K       1 Provided on December 17, 2004 24 Exceeded original wireline revenue and Non-ILEC EBITDA targets

wireline segment

2005 results comparison to guidance

2005 actual results most recent guidance 1 met or exceeded

Revenue Non-ILEC Revenue EBITDA Non-ILEC EBITDA Capex High-Speed Net Adds $4.85B

$632M $1.85B

$21M $914M 73K $4.825 to $4.85B

$625 to $635M $1.84 to $1.865B

$15 to $20M approx. $900M > 65K       1 Updated on December 16, 2005 25 Achieved updated wireline guidance

TELUS Consolidated

financial results

Revenue Q4-04 $1.96B

Q4-05 $2.09B

EBITDA $767M

$734M

EPS Capex $0.38

$343M

$0.22

$374M

change  6.2%  4.2%  42%  8.9% 26 Profitability significantly impacted by labour disruption and one time debt redemption charge

TELUS Consolidated

EBITDA - normalized

($M) Consol. EBITDA (reported) Restruc. & w. r. costs Consol. EBITDA (bef. restruc.) Net labour disruption impacts

Consol. EBITDA (normalized)

Q4-04 767 20 787

787

-

Q4-05 734

36

770

52

822 change

 4.3%  2.2%  4.4

%

27 Normalized consolidated EBITDA growth of 4.4%

TELUS Consolidated

EPS continuity

EPS reported

Restr. & workforce reduction Labour disruption impact Early bond redemption Other Tax related matters

EPS normalized

Q4-04 $0.38

$0.04

(0.02) (0.07) $0.33

Q4-05 $0.22

$0.07

$0.10

$0.06

$0.01

$0.46

change  42%  40% 28 Strong normalized EPS growth at 40%

free cash flow

29

($M) EBITDA Capex Net Cash Interest Cash Restruct. Payments (in excess of expense) Non-Cash Share Based Compensation Q4-04 $767 (343) (290) (15) 6 (2) Net Cash Tax Recovery Free Cash Flow Share Issuance (non-public) Cash Dividends A/R securitization Payment Received from Verizon Working Capital/Other $122 77 (113) 148 116 Cash avail. for debt reduction & share redemp.

$351 Q4-05 $734 (374) (306) 5 3 47 $110 19 (97) 350 (30) $352

TELUS Consolidated   

return of capital – share buy back

Repurchased 5.1M shares for $229M under both NCIB programs in Q4-05 Repurchased 20.8M shares for $892M during 2005 under both NCIB programs Current 24 million share (7% of outstanding) NCIB effective Dec. 20, 2005 to Dec. 19, 2006  5% completed in 7 trading days in Dec-05 30 TELUS committed to share repurchases

TELUS Consolidated  

return of capital – continued

Completed $1.6B early debt redemption of 7.5% Series CA Notes on Dec. 1, 2005  Funded by cash on hand, $350M increase in A/R securitization program and $142M in bank facilities  Incurred $33.5M loss on redemption & settlement of interest rate hedges  Interest savings benefit in Dec-05 and 2006 Previously announced a 38% quarterly dividend increase to 27.5 cents per share, for Jan. 1, 2006 payment  Consistent with dividend payout ratio guideline of 45 to 55% of sustainable net earnings 31 TELUS has strong track record for returning capital to investors

TELUS consolidated

credit ratings & financial policy targets

Previous Rating Current Rating Moody’s S&P Fitch DBRS

Baa3 (stable) BBB (positive) BBB (positive) BBB (stable) 

Baa2 (stable)



BBB+ (stable)



BBB+ (stable)



BBB high (stable) Date of Change

June 27 Sept 27 Oct 18 Oct 24

Long-term financial policy target

Net Debt : EBITDA Net Debt : Total Cap

target 1

1.5 to 2.0x

45 to 50% 32 1 Net debt to EBITDA target updated November 10, 2005 All four rating agencies upgraded TELUS in 2005

Q4-05

1.7x

45.7%

Met

 

TELUS Consolidated

2005 results versus analyst estimates

2005 consensus estimates 1 2005 original targets 2

Revenue EBITDA EPS Capex Free Cash Flow $7.84B

$3.25B

$1.80

$1.35B

$1.20B

$7.9 to 8.0B

$3.2 to 3.3B

$1.65 to 1.85

$1.3 to 1.4B

$1.2 to 1.3B

1 Analyst consensus estimates for TELUS, as at Nov 30/04, preceding 2005 targets provided Dec 17/04 2 Provided December 17, 2004 33 Original targets challenging as compared to analyst estimates

TELUS Consolidated

2005 results comparison to original targets

2005 actual results original 2005 targets 1 met or exceeded

Revenue EBITDA 2 EPS Capex Free Cash Flow $8.14B

$3.30B

$1.96

$1.32B

$1.47B

$7.9 to 8.0B

$3.2 to 3.3B

$1.65 to $1.85

$1.3 to 1.4B

$1.2 to $1.3B

     1 Provided December 17, 2004 2 Includes actual restructuring costs of $54M versus original restructuring costs of approx. $100M 34 TELUS achieved original 2005 financial targets on the back of solid wireless results despite labour disruption

TELUS Consolidated

2005 results comparison to guidance

2005 actual results most recent guidance 1 met or exceeded

Revenue EBITDA 2 EPS Capex Free Cash Flow $8.14B

$3.30B

$1.96

$1.32B

$1.47B

$8.10 to 8.15B

$3.275 to 3.325B

$1.90 to 2.00

approx. $1.3B

$1.4 to 1.5B

     1 Updated December 16, 2005 2 Actual 2005 results include restructuring costs of $54M 35 Consolidated results consistent with December 2005 guidance

TELUS Consolidated

Pension plans – update

 Strong investment performance in Q4-05 and lower discount rate for 2006  In aggregate, TELUS pension funds are 98% funded  Approx. $165M in cash contributions expected in 2006 (DB & DC plans)  Discount rate assumption for 2006 lowered to 5.0% (vs. 5.25% guidance on Dec. 16, 2005, and 6.0% in 2005)  TCI defined benefit pension plans ceased accepting new management employees 36 Lower discount rate offset by strong investment performance

TELUS Consolidated

2006 Consolidated targets summary

Revenue EBITDA 1 EPS Capex Free Cash Flow

2006 targets

$8.6 to 8.7B

$3.5 to 3.6B

$2.40 to 2.60

$1.50 to 1.55B

$1.55 to 1.65B

change

  6 to 7% 6 to 9%  22 to 33%  14 to 18%  6 to 13% 1 Including restructuring & workforce reduction costs of $54M in 2005 and approx. $100M in 2006 37 2006 targets build upon track record of strong operational execution

TELUS Consolidated

Summary

 Solid quarterly and annual consolidated results despite one-time labour disruption impact and increasingly competitive environment  Continued strong profitable wireless growth  Reached 5-year collective agreement allowing for increased flexibility  Generating significant cash flow  Strong 2006 revenue, earnings and cash flow growth outlook 38 Continued execution into a future friendly 2006

39

questions?

2005

fourth quarter review

investor relations 1-800-667-4871 TELUS.com

[email protected]

appendix

definitions



EBITDA

: Earnings, after restructuring and workforce reduction costs, before interest, taxes, depreciation and amortization 

Capital intensity:

capex divided by total revenue 

Cash flow:

EBITDA less capex 

Free Cash Flow:

EBITDA, adding Restructuring and workforce reduction costs, cash interest received and excess of share compensation expense over share compensation payments, subtracting cash interest paid, cash taxes, capital expenditures, and cash restructuring payments 40 TELUS definitions for non-GAAP measures