Vince Valentini: Okay. And just to make sure we’re clear, the guidance on ARPU for the fourth quarter, you’re not saying ARPU will be up from Q3. What you’re saying is the rate of year-over-year decline will improve versus the 0.5% we just saw in Q3. Is that fair?
Douglas French: That is correct.
Vince Valentini: Okay, thank you.
Robert Mitchell: Thanks, Vince. Next question, please, Mihai.
Operator: Alright. Next question comes from Jerome Dubreuil from Desjardins. Please go ahead.
Jerome Dubreuil: Hi, thanks for taking my questions. The first one I have is coming back to Darren, your comment about the payout ratio in the future trending toward the lower end of your comfort zone. I think it was 65% to 75%. Just want to confirm that this does not include any drip going forward? And then related to that, maybe for Doug, what are the maybe free cash flow implications for next year? Not asking for guidance, but maybe directionally in terms of the items we don’t think about too often like cash taxes and interest rates. And what would be these assumptions behind that payout ratio comment?
Darren Entwistle: Okay. So the ratio is not 65% to 75%, it’s 60% to 75% in terms of the payout ratio on the cash front. The comment that I made indeed indicated specifically in the quarters and years ahead that we expect through our EBITDA growth that we will be delivering, complemented by our significantly moderated capital profile that we will be pushing on the bottom end of that range, particularly when you do the calculation on a prospective basis. So you can do your calculations in terms of our 7% TTEC EBITDA growth this quarter are reconfirming of guidance for the full year. And where you think we would be shooting for in terms of EBITDA guidance in 2024. If you run those numbers, we would be hitting or falling through the lower end of the payout ratio range of 60%.And the point there, of course, is that that bodes well for the affordability of our 7% to 10% dividend growth model.
It also is indicative of our confidence in the free cash flow picture for this organization. We don’t just expect to see significant free cash flow growth in 2024, but beyond 2024 as well. And we see that as a synergistic combination with the affordability and the expansion, potential expansion of our dividend growth model. Finally, in respect of the D-DRIP, our view here within management is that it’s a necessary mechanism at the present point in time. We look forward to the future of turning that D component of the D-DRIP off, given the free cash flow expansion strength of the organization and what it portends for the strength of our balance sheet.
Douglas French: And maybe just starting to the capital and EBITDA that Darren covered, the next three main ones will probably be handset investments on renewals. And I would say we don’t see a material change in that going forward. It would be cash taxes to your point. And again, I think there will be no surprises on that front. And then restructuring, and I think the only item to highlight is there will probably be some of the restructuring that we have executed this year or where the cash will be paid out next year. And when we give out guidance, we will be clear on the cash versus expense component to free cash flow next year. But other than that, I would say it’s very straightforward and clear, as Darren discussed.
Darren Entwistle: And no repeating of union payments.
Jerome Dubreuil: Alright. Thank you.
Robert Mitchell: Thanks Jerome. Next question, please.
Operator: Alright. Next question comes from Drew McReynolds from RBC. Please go ahead.
Drew McReynolds: Yes. Thank you very much. Good morning. Two for me, first, maybe for you, Doug, just on the cost savings that were actually realized in Q3. Obviously, they will ramp up in Q4. So, just wondering if you could highlight for us just what percentage we did see here in the quarter. And then secondly, in a bigger picture question, maybe for you, Darren. You have alluded to the transformation period that the industry is in. It’s probably always in some kind of transformation period. But I would love to get your just high-level view, looking out 3 years to 5 years on kind of where you see the major changes in the industry, whether it’s competitive, regulatory technology? And why I am asking this question is it looks like your playbook differentiates itself from your Canadian peers.
And when I think about the contributors to growth that equity shareholders want to see, maybe you have a different definition of where those growth drivers come from over that medium-term. So, just at the high level, I would like to get your updated thoughts on that one.
Darren Entwistle: Okay. Go ahead.
Douglas French: Go on savings first. On savings, it will be at full run rate, as we suggested, by Q2 of next year. I would say we will probably exit the year a little greater than 50% to 60%. And in quarter then if you prorated it backwards, it would be substantially less than half this quarter and approaching an exit rate of above the halfway run rate in Q4.
Drew McReynolds: Thank you.
Darren Entwistle: Drew, I really appreciate that tight question that you gave me. Let me just try and tackle this efficiently. I think the investments that we have made on the broadband front, both wireline and wireless, will be key in the years ahead, leveraging whatever the environment at that juncture will entail. For sure, our goal to commercialize and monetize those investments is going to be key. So, when I look out, I look at 5G and to-date, beyond faster speeds and bigger buckets, it’s not really delivered on its promise on the productization front, particularly within the B2B and B2B2C space. I am cautiously optimistic that over the years ahead, the productization on 5G is going to be a big value generator for our business because it’s going to be a big factor within the private sector, the public sector and consumer lifestyles.
I think with that also comes the massive opportunity because of the data volumes generated for the data analytics commercialization and data monetization opportunity. So, I just see that as being massive. On the wireline front, I think it’s all about economies of scope. When you spend $7 billion position in fiber, I think the goal is how many differentiated RGUs that are meaningful to clients can you deliver over that particular mechanism to get the desired ROI, which is why you see us going from voice and data and entertainment into the areas of security, into the areas of health, into the areas of energy and home automation on both the wired and wireless basis. TELUS launched a strategy 23 years ago, saying that the future was all about data, both on wireline and wireless.
