Q4 2010 TELUSinvestor conference call

Robert McFarlaneEVP & Chief Financial Officer

Joe NataleEVP & Chief Commercial Officer

Darren EntwistlePresident & Chief Executive Officer

February 11, 2011

2TELUS forward looking statements

Today's presentation and answers to questions contain statements about expected future events and financial and operating performance of TELUS that are forward-looking. By their nature, forward-looking statements require the Company to make assumptions and predictions and are subject to inherent risks and uncertainties. There is significant risk that the forward-looking statements will not prove to be accurate. Readers are cautioned not to place undue reliance on forward-looking statements as a number of factors could cause actual future performance and events to differ materially from that expressed in the forward-looking statements. Accordingly our comments are subject to the disclaimer and qualified by the assumptions (including assumptions for 2011 targets), qualifications and risk factors referred to in the Management’s discussion and analysis in the 2009 annual report and in the 2010 quarterly reports. Except as required by law, TELUS disclaims any intention or obligation to update or revise forward-looking statements, and reserves the right to change, at any time at its sole discretion, its current practice of updating annual targets and guidance.

3Agenda

2010 scorecard

Wireless and wireline segment reviews

Consolidated financial review Updates

Regulatory IFRS Pension update

Q4 summary 2011 corporate priorities Question and answers

3

2010 consolidated scorecard 4

Achieved 3 of 4 original consolidated targets

Original targets(GAAP)

Actual results(GAAP)

Result

Revenue(external)

$9.8 to 10.1B $9.779B

EBITDA $3.5 to 3.7B $3.643B

EPS – basic $2.90 to 3.30 $3.23

Capex Approx. $1.7B $1.721B

Q4 2010 wireless financial results 5

Strong revenue and EBITDA growth of over 9% supporting cash flow growth of 17%

($M) Q4-09 Q4-10 change

Revenue (external) 1,225 1,338 9.2%

EBITDA 435 476 9.4%

EBITDA margins1

(total revenue)35.3% 35.3% no change

Capex 192 192 no change

EBITDA less capex 243 284 17%

1 Margins on network revenue in Q4/10 and Q4/09 were 39.7% and 39.4%, respectively.

Subscriber results 6

Stable net additions in very competitive environmentHigh value postpaid represented 92% of net adds

prepaid18%

Wireless subscribers

postpaid82%

Postpaidnet adds

7M total

5.7M

1.3M

Q4-09

109K 109K

Q4-10

Totalnet adds

Q4-09

122K 119K

Q4-10

Smartphone subscriber mix 7

Smartphone base increased 74% y/y to 1.9M

Smartphone subscriber loading hit inflection point Smartphones represented over 2/3 of postpaid

retention units compared to 1/3 a year ago Smartphones represented 46% of postpaid gross

loading compared to 25% a year ago BlackBerries and iPhones continue to dominate

with over 3/4 of smartphone retention loading Smartphones now represent 33% of postpaid base

compared to 20% a year ago

Data revenue growth 8

Data revenue growth accelerated to 36% driven by strong smartphone adoption

Q4-09

$239M

Q4-10

$326M

$203M

Q4-08BlackBerry Torch

Marketing and retention 9

Record gross adds offset by slightly higher churn COA/COR expense increase reflects record loading

Q4-09 Q4-10 change

Gross adds (000s) 431 475 10%

Churn 1.60% 1.72% 0.12 pts

COA per gross add $380 $388 2.1%

COA expense $163M $184M 13%

Retention expense $133M $170M 28%

Blended ARPU analysis 10

ARPU up 1.9% y/y as strong data ARPU growth more than offset voice ARPU decline

Data

Q4-10

$58.48Voice

$57.38

Q4-09

% of ARPU

12.60

44.78 42.47

16.01

Q4-10Q4-09

22%

78% 73%

27%

Q4 2010 wireline financial results 11

EBITDA growth and margin expansion due to lower restructuring costs

($M) Q4-09 Q4-10 Change

Revenue (external) 1,218 1,213 (0.4)%

EBITDA 354 371 4.8%

EBITDA margins(total revenue)

28.2% 29.6% 1.4 pts

Capex 322 372 16%

EBITDA less capex 32 (1) n.m.

TELUS TV subscribers 12

Record quarterly net adds of 48K up 45% y/y, while total TV subscribers up 85%

Q4-09

33K

48K

Q4-10

TELUS TV net additions*

TELUS TV subscribers*

* Includes both TELUS IP TV and TELUS Satellite TV subscribers

Q4-10Q4-09

170K

314K

TELUS line losses 13

Residential line losses improved 18% y/y while business line losses reflect increased competition and IP upgrades

Q4-10 Q4-10

-45K-37K

-8K-18K

Q4-09Q4-09

BusinessResidential

Improved wireline operating stats 14

TV & HSIA loading more than offset total NAL losses for second consecutive quarter

Q4-10

-53K

Q4-09

* Historic NALs restated for prior periods starting in 2007 as a result of a periodic subscriber measurement review and correction.

44K

-55K

66KTELUS TV

Total NAL losses*

High-speed Internet

33K48K

Q4 2010 consolidated financial results 15

Strong consolidated results inline with recent guidance

($M excl. EPS) Q4-09 Q4-10 change

Revenue (external) 2,443 2,551 4.4%

EBITDA 789 847 7.4%

EPS (basic) 0.49 0.70 43%

Capex 514 564 9.7%

EBITDA less capex 275 283 2.9%

EPS continuity ($) 16

Double digit EPS growth of 43%

0.49

0.26Excl.

Tax Adj.

Q4-09 reported

Normalized EBITDA2

Restr.costs

Normalized Financing

costs1

Pension & other

1 Q4 2010 Normalized Financing costs excludes early debt redemption penalty in Q4 2009.

2 Normalized EBITDA excludes restructuring and pension costs.

Q4-10 reported

0.70

0.22

Lower tax rates

0.67Excl.

Tax Adj.

0.03

Tax adjustment

2009 debt

redemption

0.100.01

0.06- 0.01

EPS normalization 17

Normalized EPS up 40% to $0.67 per share

  Q4-09 Q4-10 Change

EPS - basic $0.49 $0.70 43%

Early debt redemption +0.22

Income-tax related adjs (0.23) (0.03)

EPS normalized $0.48 $0.67 40%

TELUS’ efficiency savings ($M) 18

Efficiency initiatives have enabled significant productivity benefits

150

267

401

2008 2009 2010

*See forward looking statement caution

114

Restrcosts

$59 $190 $74

In-year savings

Cumulative efficiency savings

134

117

TELUS update on Cdn GAAP to IFRS transition 19

Quantified impacts on key financial statement line items and other measures in Q4-10 review of operations including

Pro forma 2010 net income and EPS per IFRS 1% higher by $14M or $0.04

Statement of Financial Position includes recognition of cumulative unamortized gains and losses for employee defined benefit plans and asset impairment reversal

Net impact of $220 million or 3% reduction in Owners’ Equity, as of January 1, 2010

A full description and illustration of expected effects of transition to IFRS will be updated in TELUS’ annual 2010 MD&A

TELUS conversion to IFRS effective January 1, 2011

Defined Benefit pension assumptions update 20

Discount rate and long-term rate of return expectation lowered slightly from preliminary guidance given in December 2010

2010(GAAP)

2011E*(IFRS)

Discount rate 5.85% 5.25%

Long-term expected return 7.25% 7.0%

Pension Expense / (Recovery) $28M $(34)

Pension Funding $137M $298M

*See forward looking statement caution

Pension funding includes $200M voluntary contribution made in January 2011

TELUS commends CRTC’s Videotron / TVA & Shaw / Canwest decisions

Decisions support pre-existing principle of programming content being made available non-exclusively on reasonable commercial terms

BCE/CTV hearing held early February and decision expected in March 2011

Public policy hearing on effects of consolidation and vertical integration is scheduled for June 2011

TELUS believes CRTC needs to implement measures to effectively address and deter any anti-competitive behaviour from content ownership

Industry vertical integration update

CRTC reinforces principle that conferring undue preferences by carriers who own content not permitted

21

Jan 25 - Following series of decisions from May 2010, CRTC determined incumbents could assess usage caps on wholesale Internet providers and apply overage charges at a 15% discount to their own retail UBB rates starting March 1

Customers of wholesale ISPs would have been subject to additional charges for going over bandwidth caps

Industry Minister instructed CRTC to consider a review

CRTC has suspended implementation of decisions pending the outcome of its Feb 8 decision to review billing practices

No short-term implications for TELUS

TELUS has not billed usage overage for Internet service

Usage-based billing

CRTC wholesale UBB decision to be reviewed

22

In March 2010, government announced its intention to open Canada’s doors further to foreign investment in telecom

June 2010 consultation launched asking for comments on three options for relaxing rules on foreign ownership

TELUS advocated a fourth option: liberalization for all telcos and cablecos but retain restrictions for pure broadcasting activities

The Federal Court recently overturned the Cabinet’s December 2009 Order on Globalive ownership structure

Decision could be appealed by Globalive and/or Government

Issue could be cured by new corporate governance structure

Not an issue of whether Globalive will remain in operation

The Minister of Industry expects to issue final report on Digital Economy Strategy in spring of 2011

We expect government to use this opportunity to provide direction on foreign ownership

Foreign ownership update 23

Q4 2010 summary 24

Strong year-end results set the stage for 2011 earnings and free cash flow growth

Wireless Strong revenue and EBITDA growth driven by 1.9%

increase in ARPU and healthy wireless subscriber growth

Smartphone adoption accelerating data revenue growth to 36%

Wireline EBITDA growth and margin expansion supported by

lower restructuring costs Record TELUS TV subscriber growth led by Optik TV Improved residential NAL losses and HSIA loading

TELUS’ 2011 corporate priorities 25

1. Deliver on our future friendly brand promise to clients

2. Optimize the potential of TELUS’ leading wireless and wireline broadband networks

3. Drive market leadership position in the Small and Medium Business (SMB) and healthcare markets

4. Continue to improve TELUS’ operational efficiency to effectively compete in the market and fund future growth

5. Raise TELUS team engagement to the next level and continue to drive the philosophy of “Our Business, Our Customers, Our Community, Our Team, My Responsibility”

Building value from strategic investments in recent years

Evolution of clear and simple customer approach 26

Simplified rate plans, customer experience enhancements and data reflected in operating results

Launch of Clear Choice wireless plans late 2009

Introduced Data notifications in 2010

Clear and Simple Device Upgrade program in 2010

Unlocking of SIM based postpaid wireless devices in 2011

-7.7%

-4.4%

-1.9%-1.2%

1.9%

Q4-09 Q1-10 Q2-10 Q3-10

Q4-10

Year over year ARPU change

Evolution of wireless network to Dual Cell HSPA 27

Strategic investments in network technology and new devices enhancing customer experience

Launch of HSPA+ network in late 2009

Upgrade to Dual Cell HSPA 4G1 technology in Mar 20112

Manufacturer-rated peak download speeds up to 42 Mbps Launch cities: greater Vancouver area, Edmonton, Calgary, Fort

McMurray, Whistler, Camrose, Winnipeg and Toronto Consistent with TELUS’ evolution towards LTE

1 As defined by International Telecommunications Union (ITU), Dec. 20102 See forward looking statement caution

28Building TELUS TV momentum 28

Investments in broadband have enabled TELUS to offer differentiated and integrated service and applications

Record quarterly TV loading driven by Optik

Optik TV reaccelerating High-Speed subscriber loading

Optik footprint now covers 2.1M households

33 29 2938

48

44

32 32

53

66

Q4-09 Q1-10 Q2-10 Q3-10 Q4-10

High-speed Internet

TV

Appendix – free cash flow

2010Q4

2009Q4

C$ millions

EBITDA 789 847

Capex (514) (564)

Net Employee Defined Benefit Plans Expense 8 10

Employer Contributions to Employee Defined Benefit Plans (45) (30)

Interest expense paid (includes income tax interest income) (296) (141)

Cash Income Taxes and Other 4 28

Non-cash portion of share-based compensation 7 3

Restructuring payments (net of expense) 51 23

Donations and securitization fees included in other expense (7) (12)

Free Cash Flow (before share-based compensation payment) (3) 164

Share Based Compensation Paid (47) (43)

Free Cash Flow (per current public guidance methodology) (50) 121

(151) (160)Dividends

Working Capital and Other 61 16

Funds Available for debt redemption (140) 37

A/R Securitization

Net Issuance (Repayment) of debt 47 (70)

Increase (Decrease) in cash 7 (33)

Issuance of non-voting shares* - 52

* Non-voting share issuance from treasury primarily for shareholders in the DRIP

-

Issuance of common shares - 8

100

Appendix – definitions

TELUS definitions for non-GAAP measures

EBITDA: earnings, after restructuring and workforce reduction costs, before interest, taxes, depreciation and amortization

Capital intensity: capital expenditures divided by total revenue

Cash flow: EBITDA less capex

Free cash flow: EBITDA, adding Restructuring and workforce reduction costs, net employee defined benefit plans expense, cash interest received and excess of share compensation expense over share compensation payments, subtracting cash interest paid, cash taxes, capital expenditures, cash restructuring payments, employer contributions to employee defined benefit plans, and cash related to Other expenses such as charitable donations and securitization fees

Cost of retention (COR): total costs to retain existing subscribers, often presented as a percentage of network revenue

2011 annual consolidated targets* 32

2011 targets(IFRS)

y/y growth**

Revenue(external)

$9.925 to 10.225B 1 to 4%

EBITDA $3.675 to 3.875B 1 to 6%

EPS – basic $3.50 to 3.90 7 to 19%

Capex Approx. $1.7B

*See forward looking statement caution** Y/Y growth rates reflect 2011 guidance and 2010 results according to current understanding of IFRS