UPDATE 3-Telus trims forecasts, expands cuts as profit falls

* 2008 profit, revenue targets lowered

* Q3 EPS 89 Canadian cents

* Cost-cutting program expanded

* Shares drop as much as 3 percent

(Adds details, updates stock price)

By Wojtek Dabrowski

TORONTO, Nov 7 (Reuters) - Telus Corp (T.TO), Canada's No. 2 phone company, on Friday posted a lower quarterly profit, trimmed its revenue and profit forecasts for the year and said it would make even deeper cost cuts than it had planned.

The news, which drove the shares down more than 3 percent, was softened by an increase in revenues during the latest quarter thanks to growth in its wireless business. Telus also boosted its dividend.

The company's decision to expand its cost-cutting plan reflected spending on the launch of Koodo, its discount wireless brand, as well as the planned rollout of a television service and recent spending on wireless spectrum, it said.

Telus also cited the expense of a network technology upgrade in partnership with BCE Inc (BCE.TO), parent of Bell Canada.

Profit fell to C$285.1 million ($239.6 million), or 89 Canadian cents a share, in the third quarter, down from C$409.9 million, or C$1.23, a year earlier. The company attributed much of the drop to tax-related adjustments.

The company, which has now signed up 6 million wireless subscribers, said revenue rose to C$2.45 billion from C$2.31 billion.

Chief Executive Darren Entwistle said Telus will "materially and substantially" cut costs over the remainder of 2008 and beyond to offset its investments in Koodo and in other areas.

As a result, Telus has increased its restructuring charges for this year by C$20 million to a total of C$50 million, it said.

National Bank Financial analyst Greg MacDonald said the results were largely in line with his expectation and added the restructuring isn't a huge surprise.

"Restructuring in the telecom industry is an ongoing event that will last for years," he said.