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TELUS - President and CEO , Darren Entwistle - The Market Herald Canada
President and CEO , Darren Entwistle
Source: Financial Post
  • Telecommunications provider, TELUS (T) has posted a mixed second quarter report, showing profits falling but a strong increase in cash flows
  • The company’s cash flow grew 57 per cent to C$511 million, due to decreased income tax payments, lower device subsidy amounts, and lower restructuring costs
  • Despite the strong cash flow, the company posted a quarterly net income of just $315, a 39 per cent fall compared to 2019’s same period
  • TELUS attributed the drop to a number of factors, including the impact of the pandemic, higher taxes, increased depreciation and amortization rates and higher financing costs 
  • Even with the fall in profits, the company still expects to meet the lower range of its free cash flow full-year guidance of around $1.4 billion
  • TELUS (T) is down 1.37 per cent and is trading at $23.04 per share

Telecommunications provider, TELUS (T) has posted a mixed second quarter report, showing profits falling but a strong increase in cash flows.

Most notably, the company’s cash flow grew 57 per cent to $511 million, due to decreased income tax payments, lower device subsidy amounts, and lower restructuring costs.

As a result, TELUS posted a quarterly dividend of $0.29125 per share and hopes to meet or exceed its targeted dividend increase in the third quarter. 

Meanwhile, the company has bumped its consolidated revenue growth to $3.7 billion, a 3.6 per cent increase compared to last year’s corresponding period. 

Earnings before interest, income taxes, depreciation and amortization, commonly known as EBITDA, held relatively steady, decreasing just one per cent compared on 2019’s same quarter. 

Despite the strong cash flow, the company posted a quarterly net income of just $315, a 39 per cent fall compared to 2019’s same period.

While the company attributed much of the drop to the impact of the pandemic, it also considered higher taxes, increases in depreciation and amortization, and higher financing costs as other relevant factors.

Even with the fall in profits, the company still expects to meet the lower range of its free cash flow full-year guidance of around $1.4 billion. 

Darren Entwistle, President and CEO of TELUS, said the company has posted resilient results, despite the difficult environment posed by COVID-19. 

“This accomplishment, realized against the backdrop of an unprecedented operating environment, is reflective of our longstanding and consistent focus on creating a world-leading culture, enabled by our highly engaged team.

"Our robust and consistent performance over the longer-term, coupled with our strong balance sheet, positioned us well to navigate the uncertainty caused by the global health emergency," he said.

TELUS (T) is down 1.37 per cent and is trading at $23.04 per share at 2:35pm EDT.


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