Moody's puts Telus on review for upgrade

Moody's Investors Service said it placed Telus Corp.'s Ba1 senior unsecured rating under review for possible upgrade.

Moody's said the review is prompted by continuing improvements in Moody's expectations of Telus' free cash flow in 2004 and 2005 based on results to date. In particular, Telus Mobility has been outperforming Moody's expectations.

This performance, together with reduced losses in the non-ILEC segment, has offset softness in Telus' incumbent wireline revenue. In addition, management has significantly reduced working capital and capital expenditures, which, together with tax refunds, has reduced debt levels more than expected.

Debt affected by this action includes the company's C$1.6 billion 7.5% notes due June 2006, US$1.2 billion 7.5% notes due June 2007, and US$1.9 billion 8% notes due June 2011.

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