Re: Financial Edge, (March 13-19)
I am writing in response to your reprint of comments made by Mr. Ross Healy regarding Telus and its management that were printed in your March 13-19 issue.
Your readers may be interested to know that Mr. Healy has never met Telus senior management, or asked to, and his firm’s methods of analysis are quantitative in nature and not qualitative.
It is therefore curious that he takes such a personal approach in his negative public comments. Most analysts that follow a company and make informed comments about it and its management usually meet (with) management.
Telus’s management and our associated public disclosure have been very consistent for several years on our national wireless and data growth strategy and what our financial targets are. This is a strategy, which has been lauded by many industry analysts, as one that has conserved and focused our resources and been appropriate to the tough economic and capital market conditions that telecommunications firms have endured in the last couple of years.
I’ll let the facts speak for themselves.
In 2002, our free cash flow* position improved by $1.3 billion to almost break-even and we met the high end of our original target for operating earnings (earning before interest, taxes, depreciation and amortization [EBITDA]). Our Telus Mobility business segment produced 50-per-cent EBITDA growth and cash flow, as measured by EBITDA less capex, turned positive.
In 2003, Telus EBITDA is expected to grow nine per cent and our free cash flow is expected to increase between $300 and $600 million, putting us at the forefront of North American telecom companies.
Furthermore, as we have largely completed our major growth investments, we are now building bottom-line earnings and our targeting EPS of $0.35 to $0.55 (up a significant $1.10 to $1.30).
A track record of performance in 2002 and these 2003 public targets have helped build investor trust in a difficult environment for most telecom companies. As you correctly pointed out, our share has tripled since last July and also noteworthy is that our public bonds are back trading at or above par, after a severe summer dip, demonstrating again increased investor confidence in Telus and its management.
I trust this provides you and your readers some context and balance about Telus. If your readers have any questions, or if they ever want to find out more about this or any other issue involving Telus, they should feel free to contact me through investor relations at 1-800-667-4871 or at email@example.com.
– John Wheeler Vice-president, investor relations, Telus
*EBITDA less capital expenditures, cash interest, cash taxes and cash dividends.