UPDATE 3-Telus says Alberta weakness, competition hurt fourth-qtr profit

Thu Feb 11, 2016 2:41pm EST
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* Q4 revenue rises 2.8 pct; profit down 16 pct

* Adds net 62,000 postpaid wireless customers, down 56,000 yr/yr

* Sees 2016 earnings growth of 3-6 pct for wireless and fixed-line (Adds CEO comment, dividend outlook, share price)

By Alastair Sharp

TORONTO, Feb 11 (Reuters) - Telus Corp, one of Canada's three big telecom providers, reported a 16 percent drop in fourth-quarter profit on Thursday, hurt by increased wireless competition and sagging demand, partly due to economic weakness in the oil-producing province of Alberta.

But the company said it was expecting earnings growth of between 3 percent and 6 percent for both its wireless and fixed-line units in 2016 and planned to increase its dividend payout by 10 percent, likely split between rises in May and November.

Shares in the Vancouver-based company were down 1.2 percent at C$39.37 in early afternoon trade.

Telus said it would increase capital expenditures by 3 percent to C$2.65 billion this year, after spending heavily in the fourth quarter to improve and expand its broadband network.

"We can afford to make these investments, we've got a strong balance sheet and I think it's a smart use of our ability to absorb leverage," Telus Chief Executive Officer Darren Entwistle said on a conference call with analysts.   Continued...