Document


		Three months				Six months
Periods ended June 30 (US$ millions except earnings per share)	Note	2022		2021		2022		2021
REVENUE	3	$	624	$	533	$	1,223	$	1,038

OPERATING EXPENSES
Salaries and benefits		356		299		698		581
Goods and services purchased		118		103		233		197
Share-based compensation	4	7		19		14		45
Acquisition, integration and other		6		7		10		12
Depreciation	10	30		29		59		56
Amortization of intangible assets	11	34		36		70		72
		551		493		1,084		963

OPERATING INCOME		73		40		139		75

OTHER EXPENSES

Interest expense	5	10		12		19		26
Foreign exchange (gain) loss		(14)		(1)		(14)		2
INCOME BEFORE INCOME TAXES		77		29		134		47
Income tax expense	6	21		13		44		28
NET INCOME		56		16		90		19

OTHER COMPREHENSIVE INCOME (LOSS)
Items that may subsequently be reclassified to income
Change in unrealized fair value of derivatives designated as held-for-hedging		22		(2)		41		19
Exchange differences arising from translation of foreign operations		(66)		(9)		(97)		(42)
		(44)		(11)		(56)		(23)




COMPREHENSIVE INCOME (LOSS)		$	12	$	5	$	34	$	(4)

EARNINGS PER SHARE	7
Basic		$	0.21	$	0.06	$	0.34	$	0.07
Diluted		$	0.21	$	0.06	$	0.33	$	0.07

TOTAL WEIGHTED AVERAGE SHARES OUTSTANDING (millions)
Basic	7	266		266		266		261
Diluted	7	269		268		269		264


As at (US$ millions)	Note	June 30, 2022		December 31, 2021
ASSETS
Current assets
Cash and cash equivalents		$	123	$	115
Accounts receivable	8	440		414
Due from affiliated companies	15(a)	49		53
Income and other taxes receivable		5		6
Prepaid and other assets		52		36
Current portion of derivative assets	9	14		3
		683		627
Non-current assets
Property, plant and equipment, net	10	414		405
Intangible assets, net	11	1,062		1,158
Goodwill	11	1,327		1,380
Derivative assets	9	15		—
Deferred income taxes		13		23
Other long-term assets	16(b)	27		33
		2,858		2,999
Total assets		$	3,541	$	3,626

LIABILITIES AND OWNERS’ EQUITY
Current liabilities

Accounts payable and accrued liabilities	16(b)	$	301	$	336
Due to affiliated companies	15(a)	88		71
Income and other taxes payable		74		67
Current maturities of long-term debt	12	318		328
Current portion of derivative liabilities	9	6		5
		787		807
Non-current liabilities
Long-term debt	12	733		820
Derivative liabilities	9	—		17
Deferred income taxes		290		305
Other long-term liabilities		23		22
		1,046		1,164
Total liabilities		1,833		1,971

Owners’ equity		1,708		1,655
Total liabilities and owners’ equity		$	3,541	$	3,626

Contingent liabilities	14


(millions)	Note	Number of shares	Share capital		Contributed surplus		Retained earnings		Accumulated other comprehensive income (loss)		Total









Balance as at January 1, 2021		245	$	989	$	—	$	33	$	89	$	1,111
Net income		—	—		—		19		—		19
Other comprehensive loss		—	—		—		—		(23)		(23)
Class A to E shares exchanged or redesignated		(245)	(994)		—		—		—		(994)
Multiple Voting Shares redesignated from Class A to D shares		236	884		—		—		—		884
Subordinate Voting Shares redesignated from Class C to E shares		9	110		—		—		—		110
Multiple Voting Shares converted to Subordinate Voting Shares		(22)	(81)		—		—		—		(81)
Subordinate Voting Shares converted from Multiple Voting Shares		22	81		—		—		—		81
Subordinate Voting Shares issued in public offering		21	525		—		—		—		525
Share issuance costs, net of taxes		—	(24)		—		—		—		(24)
Share-based compensation	4	—	—		9		—		—		9
Balance as at June 30, 2021		266	$	1,490	$	9	$	52	$	66	$	1,617

Balance as at January 1, 2022		266	$	1,490	$	24	$	107	$	34	$	1,655
Net income		—	—		—		90		—		90
Other comprehensive loss		—	—		—		—		(56)		(56)

Share-based compensation	4	—	9		11		(1)		—		19
Balance as at June 30, 2022		266	1,499		35		196		(22)		1,708


		Three months				Six months
Periods ended June 30 (US$ millions)	Note	2022		2021		2022		2021
OPERATING ACTIVITIES
Net income		$	56	$	16	$	90	$	19
Adjustments:
Depreciation and amortization	10,11	64		65		129		128
Interest expense	5	10		12		19		26
Income tax expense	6	21		13		44		28
Share-based compensation	4	7		19		14		45

Change in market value of derivatives and other		4		(34)		3		(5)
Net change in non-cash operating working capital	16(c)	(39)		35		(36)		(18)
Share-based compensation payments	4	(1)		—		(6)		(17)
Interest paid		(6)		(7)		(11)		(16)
Income taxes paid, net		(27)		(23)		(33)		(58)
Cash provided by operating activities		89		96		213		132

INVESTING ACTIVITIES
Cash payments for capital assets	16(c)	(29)		(24)		(50)		(38)
Cash payments for other assets		(20)		—		(20)		—

Cash used in investing activities		(49)		(24)		(70)		(38)

FINANCING ACTIVITIES
Shares issued		1		—		2		525
Share issuance costs		—		—		—		(32)
Withholding taxes paid related to net share settlement of equity awards	4(b)	(1)		—		(1)		—
Repayment of long-term debt	16(d)	(73)		(72)		(129)		(619)

Cash used in financing activities		(73)		(72)		(128)		(126)

Effect of exchange rate changes on cash and cash equivalents		(5)		2		(7)		(2)

CASH POSITION
(Decrease) increase in cash and cash equivalents		(38)		2		8		(34)
Cash and cash equivalents, beginning of period		161		117		115		153
Cash and cash equivalents, end of period		$	123	$	119	$	123	$	119


TELUS International (Cda) Inc. (TELUS International) is a leading digital customer experience innovator that designs, builds and delivers next-generation solutions, including AI and content moderation, for global and disruptive brands. TELUS International was incorporated under the Business Corporations Act (British Columbia) on January 2, 2016, and is a subsidiary of TELUS Corporation. TELUS International maintains its registered office at 510 West Georgia Street, Vancouver, British Columbia. The terms we, us, our or ourselves are used to refer to TELUS International and, where the context of the narrative permits or requires, its subsidiaries. Additionally, the term TELUS Corporation is a reference to TELUS Corporation, and where the context of the narrative permits or requires, its subsidiaries, excluding TELUS International.	Notes to the condensed interim consolidated financial statements		Page
	General application
	1.	Condensed interim consolidated financial statements	5
	2.	Capital structure financial policies	6
	Consolidated results of operations focused
	3.	Revenue	6
	4.	Share-based compensation	7
	5.	Interest expense	9
	6.	Income taxes	9
	7.	Earnings per share	10
	Consolidated financial position focused
	8.	Accounts receivable	11
	9.	Financial instruments	12
	10.	Property, plant and equipment	13
	11.	Intangible assets and goodwill	13
	12.	Long-term debt	14
	13.	Share capital	15
	14.	Contingent liabilities	15
	Other
	15.	Related party transactions	16
	16.	Additional financial information	18

The notes presented in our condensed interim consolidated financial statements include only significant events and transactions and are not fully inclusive of all matters normally disclosed in our annual audited financial statements; thus, our interim consolidated financial statements are referred to as condensed. Our financial results may vary from period to period during any fiscal year. The seasonality in our business, and consequently, our financial performance, mirrors that of our clients. Our revenues are typically higher in the third and fourth quarters than in other quarters.

These condensed interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2021, and are expressed in United States dollars and follow the same accounting policies and methods of their application as set out in our audited consolidated financial statements for the year ended December 31, 2021, other than as described in the section “Change in presentation” below. The generally accepted accounting principles that we use are International Financial Reporting Standards as issued by the International Accounting Standards Board (IFRS-IASB). Our condensed interim consolidated financial statements comply with International Accounting Standard 34, Interim Financial Reporting and reflect all adjustments (which are of a normal recurring nature) that are, in our opinion, necessary for a fair statement of the results for the interim periods presented.

In February 2021, the International Accounting Standards Board issued narrow-scope amendments to IAS 1, Presentation of Financial Statements, IFRS Practice Statement 2, Making Materiality Judgements and IAS 8, Accounting Polices, Changes in Accounting Estimates and Errors. The amendments are effective for annual periods beginning on or after January 1, 2023, although earlier application is permitted. The amendments will require the disclosure of material accounting policy information rather than disclosing significant accounting policies and clarify how to distinguish changes in accounting policies from changes in accounting estimates. We are currently assessing the impacts of the amended standards, but do not expect that our financial disclosure will be materially affected by the application of the amendments.

In May 2021, the International Accounting Standards Board issued targeted amendments to IAS 12, Income Taxes. The amendments are effective for annual periods beginning on or after January 1, 2023, although earlier application is permitted. With a view to reducing diversity in reporting, the amendments will clarify that companies are required to recognize deferred taxes on transactions where both assets and liabilities are recognized, such as with leases and asset retirement (decommissioning) obligations. Based upon our current facts and circumstances, we do not expect our financial performance or disclosure to be materially affected by the application of the amended standard.

In the management of capital and in its definition, we include owners’ equity (excluding accumulated other comprehensive income), long-term debt (including long-term credit facilities and any hedging assets or liabilities associated with our long-term debt, net of amounts recognized in accumulated other comprehensive income and excluding lease liabilities) and cash and cash equivalents. We manage capital by monitoring the financial covenants in our credit facility (Note 12).

We manage our capital structure and make adjustments to it in light of changes in economic conditions and the risk characteristics of our business. In order to maintain or adjust our capital structure, we may issue new shares, issue new debt with different terms or characteristics, which may be used to replace existing debt, or pay down our debt balance with cash flows from operations.

We earn revenue pursuant to contracts with our clients, who operate in various industry verticals. In the first quarter of 2022, we revised our revenue by vertical disaggregation to include our top strategic and growth verticals, including Banking, Financial Services and Insurance vertical, and we have grouped our Healthcare vertical as part of Other.


	Three months				Six months
Periods ended June 30 (millions)	2022		2021		2022		2021
Tech and Games	$	287	$	244	$	567	$	468
Communications and Media	143		132		282		261
eCommerce and FinTech	77		61		154		116
Banking, Financial Services and Insurance	50		23		85		44
Travel and Hospitality	19		13		36		27
Other	48		60		99		122
	$	624	$	533	$	1,223	$	1,038

We serve our clients, who are primarily domiciled in North America, from multiple delivery locations across four geographic regions. In addition, our TIAI Data Solutions business has clients that are largely supported by crowdsourced contractors that are globally dispersed and not limited to the physical locations of our delivery centres. The following table presents our earned revenue disaggregated by geographic region, based on location of our delivery centre or where service was provided, for the following periods:

We have various restricted share unit award types, including equity-accounted restricted share units (RSUs) and performance restricted share units (PSUs), and liability-accounted restricted share units (Phantom RSUs) and performance restricted share units (Phantom PSUs). All restricted share units are nominally equal in value to one TELUS International subordinate voting share, and liability-accounted restricted share units are settled in cash. Beginning January 1, 2021, restricted share unit awards granted were equity-accounted. The following table presents a summary of the activity related to our restricted share units:


	Three months				Six months
	Number of units		Weighted average grant-date		Number of units		Weighted average grant-date
Period ended June 30, 2022	Non-vested	Vested	fair value		Non-vested	Vested	fair value
Outstanding, January 1, 2022	2,343,529	—	$	23.71	1,850,807	—	$	21.94
Granted	16,685	—	22.60		806,395	—	26.30
Vested	(365,673)	365,673	14.67		(519,645)	519,645	17.73
Exercised1	—	(365,673)	14.67		—	(519,645)	17.73
Forfeited	(29,128)	—	17.95		(172,144)	—	17.12
Outstanding, June 30, 2022	1,965,413	—	$	25.47	1,965,413	—	$	25.47

1During the three-month period ended June 30, 2022, 365,673 restricted share units were exercised at an average share price of $23.75; 109,547 RSUs were exercised and settled with subordinate voting shares issued from treasury and 256,126 Phantom RSUs were exercised for $6 million accrued and payable as at June 30, 2022. During the six-month period ended June 30, 2022, 519,645 restricted share units were exercised at an average share price of $24.77; 263,519 RSUs were exercised and settled with subordinate voting shares issued from treasury, and 256,126 Phantom RSUs were exercised for $6 million accrued and payable as at June 30, 2022.

During the three months ended June 30, 2022, we granted 16,685 RSUs, and during the six months ended June 30, 2022, we granted 576,768 RSUs and 229,627 PSUs. RSUs generally vest in four equal annual instalments, and PSUs vest in three years and are subject to TELUS International revenue and earnings per share performance growth targets. These RSUs and PSUs are eligible for dividend reinvestment units, if declared and paid by TELUS International, as such the fair value was determined to be equal to the market price of a subordinate voting share of TELUS International on the date of grant.

Each Phantom TELUS Corporation RSU is nominally equal in value to the market price of one TELUS Corporation common share. The Phantom TELUS Corporation RSUs are historic grants made to certain employees, and no new awards are expected to be made. The following table presents a summary of the activity related to Phantom TELUS Corporation RSUs:


	Three months				Six months
Period ended June 30, 2022	Number of units		Weighted average grant-date fair value		Number of units		Weighted average grant-date fair value
Canadian $ denominated	Non-vested	Vested			Non-vested	Vested
Outstanding, January 1, 2022	65,189	—	$	24.08	78,011	—	$	24.20
Vested	(59,549)	59,549	24.13		(59,549)	59,549	24.13
Exercised1	—	(59,549)	24.13		—	(59,549)	24.13
Dividends	709	—	28.67		1,568	—	30.85
Forfeited	(6,349)	—	24.13		(20,030)	—	24.92
Outstanding, June 30, 2022	—	—	$	—	—	—	$	—

We have equity-accounted share option awards (Share Options), and liability-accounted share option awards (Phantom Share Options). Share Options grant the right to the employee recipient to purchase and receive a subordinate voting share of TELUS International for a pre-determined exercise price. Phantom Share Options grant the right to the employee recipient to receive cash equal to the intrinsic value of the share option award, determined as the difference between the market price of a subordinate voting share of TELUS International and the exercise price. Share option awards are generally exercisable for a period of ten years from the time of grant. Beginning January 1, 2021, share option awards granted were equity-accounted.


	Three months				Six months
	Number of share option award units		Weighted average exercise price		Number of share option award units		Weighted average exercise price
Period ended June 30, 2022	Non-vested	Vested			Non-vested	Vested
Outstanding, January 1, 2022	932,052	2,096,582	$	10.94	1,084,185	2,096,582	$	10.74
Vested	(293,860)	293,860	8.46		(293,860)	293,860	8.46
Exercised1	—	(293,860)	8.46		—	(293,860)	8.46
Forfeited	(5,203)	—	8.46		(157,336)	—	6.80
Outstanding, June 30, 20222	632,989	2,096,582	$	11.21	632,989	2,096,582	$	11.21
Exercisable, June 30, 2022	—	2,096,582	$	7.45	—	2,096,582	$	7.45

1During both the three- and six-month period ended June 30, 2022, 293,860 share option awards were exercised at an average share price of $23.75; 159,354 Share Options were net-settled with subordinate voting shares issued from treasury, net of withholding taxes paid of $1 million, and 134,506 Phantom Share Options were exercised for $2 million, of which $1 million was paid prior to June 30, 2022 and $1 million was accrued and payable as at June 30, 2022.


	Three months				Six months
Periods ended June 30 (millions)	2022		2021		2022		2021
Current income tax expense
For current reporting period	$	22	$	19	$	44	$	40

	22		19		44		40
Deferred income tax expense (recovery)
Arising from the origination and reversal of temporary differences	(1)		(6)		—		(12)

	(1)		(6)		—		(12)
	$	21	$	13	$	44	$	28


	Three months								Six months
Periods ended June 30 (millions except percentages)	2022				2021				2022				2021
Income taxes computed at applicable statutory income tax rates	$	19	24.5	%	$	7	24.9	%	$	32	23.6	%	$	11	23.6	%
Non-deductible items	1				2				4				8
Withholding and other taxes	5				4				12				8
Losses not recognized	1				1				3				3
Foreign tax differential	(6)				(1)				(8)				(1)
Other	1				—				1				(1)
Income tax expense	$	21	27.3	%	$	13	44.8	%	$	44	32.8	%	$	28	59.6	%

Diluted earnings per share is calculated to give effect to the potential dilutive effect that could occur if additional equity shares were assumed to be issued under securities or instruments that may entitle their holders to obtain equity shares in the future, such as share option awards and restricted share units. The number of additional shares for inclusion in the diluted earnings per share calculation was determined using the treasury stock method.


	Three months				Six months
Periods ended June 30 (millions except earnings per share)	2022		2021		2022		2021
Net income for the period	$	56	$	16	$	90	$	19
Weighted average number of equity shares outstanding	266		266		266		261
Dilutive effect of share-based compensation	3		2		3		3
Weighted average number of diluted equity shares outstanding	269		268		269		264
Diluted earnings per share	$	0.21	$	0.06	$	0.33	$	0.07


As at (millions)	June 30, 2022		December 31, 2021
Customer accounts receivable – billed, net of allowance for doubtful accounts
Less than 30 days past billing date	$	142	$	162
30-60 days past billing date	35		39
61-90 days past billing date	10		3
More than 90 days past billing date	5		7
	192		211
Accounts receivable – unbilled	219		175
Other receivables	29		28
Total	$	440	$	414

We maintain allowances for lifetime expected credit losses related to doubtful accounts. Current economic conditions (including forward-looking macroeconomic data), historical information (including credit agency reports, if available), reasons for the accounts being past due and line of business from which the customer accounts receivable arose are all considered when determining whether to make allowances for past-due accounts. The same factors are considered when determining whether to write off amounts charged to the allowance for doubtful accounts against the customer accounts receivable. The doubtful accounts expense is calculated on a specific-identification basis for customer accounts receivable over a specific balance threshold and on a statistically derived allowance basis for the remainder. No customer accounts receivable balances are written off directly to bad debt expense.

The fair values of the derivative financial instruments we use to manage our exposure to currency risks are estimated based upon quoted market prices in active markets for the same or similar financial instruments or on the current rates offered to us for financial instruments of the same maturity, as well as discounted future cash flows determined using current rates for similar financial instruments subject to similar risks and maturities (such fair value estimates being largely based on the European euro: US$ and Philippine peso: US$ forward exchange rates as at the statement of financial position dates).


		June 30, 2022							December 31, 2021
As at (millions)	Designation	Maximum maturity date	Notional amount		Fair value and carrying value		Price or rate		Maximum maturity date	Notional amount		Fair value and carrying value		Price or rate
Current assets1
Derivatives used to manage
Currency risks arising from Indian rupee denominated purchases	—	—	$	—	$	—	—		2022	$	10	$	—	USD:1.00 INR:76.21

Currency risks arising from Euro business acquisition	HFH3	2023	$	21	$	14	USD:1.00 EUR:0.86		2022	$	21	$	3	USD:1.00 EUR:0.86

Non-current assets
Derivatives used to manage
Currency risks arising from Euro business acquisition	HFH3	2025	$	352	$	15	USD:1.00 EUR:0.86		—	$	—	$	—	—



Current liabilities1
Derivatives used to manage
Currency risks arising from Indian rupee denominated purchases	HFT2	2022	$	3	$	—	USD:1.00 INR:76.73		2022	$	2	$	—	USD:1.00 INR:74.99
Currency risks arising from Philippine peso denominated purchases	HFH3	2023	$	114	$	6	USD:1.00 PHP:52.05		2022	$	92	$	3	USD:1.00 PHP:50.1
Interest rate risk associated with non-fixed rate credit facility amounts drawn	HFH3	2022	$	92	$	—	2.64	%	2022	$	95	$	2	2.64	%

Non-current liabilities1
Derivatives used to manage
Currency risks arising from Euro business acquisition	—	—	$	—	$	—	—		2025	$	362	$	17	USD:1.00 EUR:0.86

3Designated as held for hedging (HFH) upon initial recognition (cash flow hedging item); hedge accounting is applied. Unless otherwise noted, hedge ratio is 1:1 and is established by assessing the degree of matching between the notional amounts of hedging items and the notional amounts of the associated hedged items.


	Owned assets										Right-of-use lease assets
(millions)	Computer hardware and network assets		Buildings and leasehold improvements		Furniture and equipment		Assets under construction		Total		Buildings		Total
At cost
As at January 1, 2022	$	48	$	119	$	231	$	26	$	424	$	317	$	741
Additions	1		4		13		29		47		32		79
Dispositions, retirements and other	(1)		(4)		(7)		—		(12)		(4)		(16)
Transfers	1		6		14		(21)		—		—		—
Foreign exchange	(1)		(4)		(6)		(2)		(13)		(13)		(26)
As at June 30, 2022	$	48	$	121	$	245	$	32	$	446	$	332	$	778
Accumulated depreciation
As at January 1, 2022	$	26	$	45	$	138	$	—	$	209	$	127	$	336
Depreciation	4		7		20		—		31		28		59
Dispositions, retirements and other	(1)		(4)		(7)		—		(12)		(4)		(16)
Foreign exchange	(1)		(2)		(4)		—		(7)		(8)		(15)
As at June 30, 2022	$	28	$	46	$	147	$	—	$	221	$	143	$	364
Net book value
As at December 31, 2021	$	22	$	74	$	93	$	26	$	215	$	190	$	405
As at June 30, 2022	$	20	$	75	$	98	$	32	$	225	$	189	$	414


(millions)	Customer relationships		Crowdsource assets		Software		Brand and other		Total intangible assets		Goodwill		Total intangible assets and goodwill
At cost
As at January 1, 2022	$	1,182	$	120	$	57	$	37	$	1,396	$	1,380	$	2,776
Additions	—		—		7		—		7		—		7
Dispositions, retirements and other	—		—		(10)		—		(10)		—		(10)
Foreign exchange	(42)		—		—		(3)		(45)		(53)		(98)
As at June 30, 2022	$	1,140	$	120	$	54	$	34	$	1,348	$	1,327	$	2,675
Accumulated amortization
As at January 1, 2022	$	173	$	15	$	31	$	19	$	238	$	—	$	238
Amortization	49		8		8		5		70		—		70
Dispositions, retirements and other	—		—		(10)		—		(10)		—		(10)
Foreign exchange	(10)		—		—		(2)		(12)		—		(12)
As at June 30, 2022	$	212	$	23	$	29	$	22	$	286	$	—	$	286
Net book value
As at December 31, 2021	$	1,009	$	105	$	26	$	18	$	1,158	$	1,380	$	2,538
As at June 30, 2022	$	928	$	97	$	25	$	12	$	1,062	$	1,327	$	2,389

As at June 30, 2022, we had a credit facility secured by our assets with a syndicate of financial institutions, expiring on January 28, 2025. The credit facility is comprised of $850 million revolving components, and amortizing $786 million term loan components (comprised of term loans with $555 million and $231 million outstanding balances). The outstanding revolving and term loan components had an effective interest rate of 3.12% as at June 30, 2022 (December 31, 2021 - 1.87%).


As at (millions)	June 30, 2022						December 31, 2021
	Revolving component		Term loan component1		Total		Revolving component		Term loan component1		Total
Available	$	788	N/A		$	788	$	716	N/A		$	716
Outstanding
Due to TELUS Corporation	$	8	$	69	$	77	$	16	$	71	$	87
Due to Other	54		717		771		118		736		854
	$	62	$	786	$	848	$	134	$	807	$	941
Total	$	850	$	786	$	1,636	$	850	$	807	$	1,657

The credit facility bears interest at prime rate, U.S. dollar base rate, a bankers’ acceptance rate or London interbank offered rate (LIBOR) (all such terms as used or defined in the credit facility), plus applicable margins. The credit facility contains customary representations, warranties and covenants, including two financial quarter-end ratio tests. Net debt to EBITDA ratio must not exceed 4.50:1.00 for each quarter in fiscal 2022 and 3.75:1.00 subsequently. The EBITDA to debt service (interest and scheduled principal repayment) ratio must not be less than 1.50:1.00, all as defined in the credit facility. If an acquisition with an aggregate cash consideration in excess of $60 million occurs in any twelve-month period, the maximum permitted net debt to EBITDA ratio per credit agreement may be increased to 4.50:1.00 and shall return to 3.75:1.00 after eight fiscal quarters.

The term loan component of our credit facility are subject to an amortization schedule requiring that 1.25% of the principal advanced be repaid each quarter of the term of the agreement, with the balance due at maturity. The $231 million term loan matures on December 22, 2022 and the $555 million term loan matures on January 28, 2025.


Composite long-term debt denominated in	U.S dollars						European euros		Other currencies
For each fiscal year ending December 31(millions)	Long-term debt, excluding leases		Leases		Total		Leases		Leases		Total
2022 (remainder of the year)	$	246	$	10	$	256	$	6	$	11	$	273
2023	30		21		51		10		21		82
2024	30		10		40		8		19		67
2025	542		9		551		6		15		572
2026 and thereafter	—		15		15		29		20		64
Future cash outflows in respect of composite long-term debt principal repayments	848		65		913		59		86		1,058
Future cash outflows in respect of associated interest and like carrying costs1	51		12		63		11		15		89
Undiscounted contractual maturities	$	899	$	77	$	976	$	70	$	101	$	1,147

In the normal course of operations, we provide indemnification in conjunction with certain transactions. The terms of these indemnification obligations range in duration. These indemnifications would require us to compensate the indemnified parties for costs incurred as a result of failure to comply with contractual obligations or litigation claims or statutory sanctions or damages that may be suffered by an indemnified party. In some cases, there is no maximum limit on these indemnification obligations. The overall maximum amount of an indemnification obligation will depend on future events and conditions and therefore cannot be reasonably estimated. Where appropriate, an indemnification obligation is recorded as a liability. Other than obligations recorded as liabilities at the time of such transactions, historically we have not made significant payments under these indemnifications. As at June 30, 2022, we had no liability recorded in respect of indemnification obligations (December 31, 2021 - $nil).

We are party to various legal proceedings and claims that arise in the ordinary course of business. The ultimate outcome of these matters is inherently uncertain. Therefore, if one or more of these matters were resolved against us for amounts in excess of management's estimates of loss, or if any outcome becomes more likely than not and estimable, our results of operations and financial condition could be adversely affected.

TELUS Corporation and its subsidiaries receive customer care, integrated business process outsourcing and information technology outsourcing services from us, and provide services (including people, network, finance, communications, and regulatory) to us. We also participate in defined benefit pension plans that share risks between TELUS Corporation and its subsidiaries.


	2022						2021
Three months ended June 30 (millions)	TELUS Corporation (parent)		Subsidiaries of TELUS Corporation		Total		TELUS Corporation (parent)		Subsidiaries of TELUS Corporation		Total
Transactions with TELUS Corporation and subsidiaries
Revenues from services provided to	$	—	$	101	$	101	$	—	$	86	$	86
Goods and services purchased from	—		(8)		(8)		—		(6)		(6)
	—		93		93		—		80		80
Receipts from related parties	—		(95)		(95)		—		(86)		(86)
Payments to related parties	1		—		1		13		—		13
Payments (made) collected by related parties on our behalf	(16)		14		(2)		(29)		9		(20)
Foreign currency adjustments	—		—		—		—		(1)		(1)
Change in balance	(15)		12		(3)		(16)		2		(14)
Accounts with TELUS Corporation and subsidiaries
Balance, beginning of period	(63)		27		(36)		8		2		10
Balance, end of period	$	(78)	$	39	$	(39)	$	(8)	$	4	$	(4)
Accounts with TELUS Corporation and subsidiaries
Due from affiliated companies	$	4	$	45	$	49	$	(8)	$	56	$	48
Due to affiliated companies	(82)		(6)		(88)		—		(52)		(52)
	$	(78)	$	39	$	(39)	$	(8)	$	4	$	(4)


	2022						2021
Six months ended June 30 (millions)	TELUS Corporation (parent)		Subsidiaries of TELUS Corporation		Total		TELUS Corporation (parent)		Subsidiaries of TELUS Corporation		Total
Transactions with TELUS Corporation and subsidiaries
Revenues from services provided to	$	—	$	194	$	194	$	—	$	168	$	168
Goods and services purchased from	—		(18)		(18)		—		(16)		(16)
	—		176		176		—		152		152
Receipts from related parties	—		(207)		(207)		—		(168)		(168)
Payments to related parties	1		—		1		17		—		17
Payments (made) collected by related parties on our behalf1	(35)		44		9		(52)		30		(22)
Foreign currency adjustments	—		—		—		—		(1)		(1)
Change in balance	(34)		13		(21)		(35)		13		(22)
Accounts with TELUS Corporation and subsidiaries
Balance, beginning of period	(44)		26		(18)		27		(9)		18
Balance, end of period	$	(78)	$	39	$	(39)	$	(8)	$	4	$	(4)
Accounts with TELUS Corporation and subsidiaries
Due from affiliated companies	$	4	$	45	$	49	$	(8)	$	56	$	48
Due to affiliated companies	(82)		(6)		(88)		—		(52)		(52)
	$	(78)	39		(39)		$	(8)	$	4	$	(4)

1Certain key management personnel at TELUS International participate in the Pension Plan for Management and Professional Employees of TELUS Corporation, a defined benefit pension plan. During the six-month period ended June 30, 2022, TELUS Corporation incurred $2 million (June 30, 2021 - $nil) for these individuals, which are excluded from the table above.

In relation to our key management personnel, during the three-month period ended June 30, 2022, share-based compensation expense of $2 million was recognized and 8,763 RSUs were granted, with a grant-date fair value of less than $1 million. 212,567 equity-accounted awards were exercised and settled with subordinate voting shares issued from treasury, and 330,456 liability-accounted awards were exercised for $7 million, $6 million of which was payable as at June 30, 2022.

During the six-month period ended June 30, 2022, share-based compensation expense of $8 million was recognized, and we granted 301,190 RSUs and 229,627 PSUs, with total grant-date fair value of $14 million. 338,499 equity-accounted awards were exercised and settled with subordinate voting shares issued from treasury, and 330,456 liability-accounted awards were exercised for $7 million, $6 million of which was payable as at June 30, 2022.

During the six-month periods ended June 30, 2022 and 2021, we had three customers which accounted for more than 10% of our operating revenue. Our largest client during the six-month periods ended June 30, 2022 and 2021 was a leading social media company, accounting for approximately 16.6% and 16.3% of our revenue, respectively. TELUS Corporation, our controlling shareholder, was our second largest client for the six-months ended June 30, 2022 and 2021, accounting for approximately 15.9% and 16.2% of our revenue, respectively. Our third largest client, Google, accounted for approximately 11.4% of our revenue for both the six-month periods ended June 30, 2022 and 2021, respectively.


As at (millions)	June 30, 2022		December 31, 2021
Other long-term assets
Lease deposits and other	$	20	$	26
Other	7		7
	$	27	$	33
Accounts payable and accrued liabilities
Trade accounts payable	$	17	$	79
Accrued liabilities	99		75
Payroll and other employee-related liabilities	168		144
Share-based compensation liability	8		22
Other	9		16
	$	301	$	336


	Three months				Six months
Periods ended June 30 (millions)	2022		2021		2022		2021
Net change in non-cash operating working capital
Accounts receivable	$	(15)	$	(30)	$	(28)	$	(73)
Due to and from affiliated companies, net	3		14		21		22
Prepaid expenses	10		1		(6)		(16)
Other long-term assets	5		(4)		6		5
Accounts payable and accrued liabilities	(40)		46		(23)		57
Income and other taxes receivable and payable, net	(2)		3		(7)		(5)
Other long-term liabilities	—		5		1		(8)
	$	(39)	$	35	$	(36)	$	(18)
Cash payments for capital assets
Capital asset additions
Capital expenditures
Property, plant and equipment, excluding right-of-use assets	$	(27)	$	(24)	$	(47)	$	(41)
Intangible assets	(2)		(1)		(7)		(2)
	(29)		(25)		(54)		(43)
Change in accrued payables related to the purchase of capital assets	—		1		4		5
	$	(29)	$	(24)	$	(50)	$	(38)


			Statements of cash flows				Non-cash changes
Three-month period ended June 30, 2022 (millions)	Beginning of Period		Issued or received		Redemptions, repayments or payments		Foreign exchange movement		Other		End of period
Long-term debt
Credit facility	$	901	$	—	$	(53)	$	—	$	—	$	848
Lease liabilities	204		—		(20)		(7)		33		210
Deferred debt transaction costs	(8)		—		—		—		1		(7)
	$	1,097	$	—	$	(73)	$	(7)	$	34	$	1,051

			Statements of cash flows				Non-cash changes
Three-month period ended June 30, 2021 (millions)	Beginning of Period		Issued or received		Redemptions, repayments or payments		Foreign exchange movement		Other		End of period
Long-term debt
Credit facility	$	1,038	$	—	$	(55)	$	—	$	—	$	983
Lease liabilities	203		—		(17)		(1)		18		203
Deferred debt transaction costs	(10)		—		—		—		—		(10)
	$	1,231	$	—	$	(72)	$	(1)	$	18	$	1,176


			Statements of cash flows				Non-cash changes
Six-month period ended June 30, 2022 (millions)	Beginning of Period		Issued or received		Redemptions, repayments or payments		Foreign exchange movement		Other		End of period
Long-term debt
Credit facility	$	941	$	—	$	(93)	$	—	$	—	$	848
Lease liabilities	215		—		(36)		(8)		39		210
Deferred debt transaction costs	(8)		—		—		—		1		(7)
	$	1,148	$	—	$	(129)	$	(8)	$	40	$	1,051

			Statements of cash flows				Non-cash changes
Six-month period ended June 30, 2021 (millions)	Beginning of Period		Issued or received		Redemptions, repayments or payments		Foreign exchange movement		Other		End of period
Long-term debt
Credit facility	$	1,568	$	—	$	(585)	$	—	$	—	$	983
Lease liabilities	209		—		(34)		(3)		31		203
Deferred debt transaction costs	(11)		—		—		—		1		(10)
	$	1,766	$	—	$	(619)	$	(3)	$	32	$	1,176


TELUS INTERNATIONAL (CDA) INC. CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) June 30, 2022