Telus Corp T.T

Alternate Symbol(s): TU

Communication Services Telecom Services

TELUS Corporation is a Canada-based communications technology company. The Company provides a range of technology solutions, including mobile and fixed voice and data telecommunications services and products, healthcare software and technology solutions, and digitally led customer experiences. Data services include Internet protocol; television; hosting, managed information technology and cloud-based services; and home and business security. Its TELUS technology solutions segment includes network revenues and equipment sales arising from mobile technologies, data revenues, healthcare software and technology solutions, agriculture and consumer goods services, voice, and other telecommunications services revenues. Its TELUS International segment comprises digital customer experience and digital-enablement transformation solutions, including artificial intelligence (AI) and content management solutions. It is also a cybersecurity provider specializing in advanced penetration testing.

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Post by retiredcfon Feb 10, 2022 11:00am

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Post# 34416555

TD

TELUS Corp.

(T-T, TU-N) C$31.04 | US$24.51

Lots of Moving Pieces Event

Q4/21 results and 2022 guidance. The conference call is at 12 PM ET (Webcast link here).

Impact: MIXED

There are a lot of sub-segments and metrics to consider, so we suspect both bulls and bears will find something to chew on this morning and we would be surprised to see a big move up or down for the stock. Six key things stand out to us:

Q4/21 EBITDA was basically in-line (see table and bullets below).
EPS was a slight miss as D&A expense is rising on a lag to elevated capex (2022 guidance for D&A expense of $3.45-$3.55 billion also seems ~$200 million above expectations).
Overall subscriber metrics were strong (especially 3.9% wireless service revenue growth versus Q4/19, so over two years, versus +3.6% for Bell and -3.0% for Rogers), but subsequent to strong sub adds and revenue/ARPU growth at Bell/Rogers, we do not expect investors to view the TELUS Mobility figures as a beat.
2022 guidance for EBITDA looks in-line. The mid-point of 8-10% adjusted EBITDA growth (not all organic) implies $6,616mm, versus our estimate of $6,636mm.
FCF guidance is barely in-line ($1.0-$1.2B versus our estimate of $1,245mm) despite lower-than-expected capex guidance ($3.4B versus TD at $3,573mm). Cash tax, restructuring, and interest cost guidance does not look elevated versus our model, so TELUS must be assuming some extra working capital usage (perhaps related to EIP and handset subsidies).
Management reiterated its commitment for $2.5B (or less) in capex in 2023, which should please investors looking for better FCF growth and dividend payout ratios.

Adjusted EPS of $0.23 versus TD/consensus of $0.27/$0.25.
Total adjusted EBITDA of $1,517 million versus TD/consensus of $1,510mm/ $1,520mm.
TTech EBITDA of $1,348 million versus TD/consensus of $1,341mm/$1,350mm.
Mobile Phone ARPU of $57.45 versus TD/consensus of $57.16/$57.51 (+1.0% Y/ Y versus Bell and Rogers both up ~3%).
Wireless service revenue growth of 5% Y/Y (Bell and Rogers both up ~6%).
Mobile Phone net adds of +112k versus TD/consensus of +115k/+100k (recall that Bell added 110k and Rogers 130k).
Internet net adds of +40k versus TD/consensus of +40k/+40k.