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February 2003 Shareholders’ Meeting

February 2003 Shareholders’ Meeting. Safe Harbor Statement.

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February 2003 Shareholders’ Meeting

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  1. February 2003 Shareholders’ Meeting

  2. Safe Harbor Statement This presentation contains forward-looking statements within the meaning of the Federal securities laws. We intend these forward-looking statements to be covered by the safe harbor provisions of the Federal securities laws. In particular, any statements or projections regarding our future synergies, earnings, costs, operating margins or advertising expenses are forward-looking statements. These statements reflect only our current expectations and are not guarantees of future performance or results. These statements involve risks, uncertainties and assumptions that could cause actual results or performance to differ materially from those contained in the forward-looking statements. These risks, uncertainties and assumptions include the successful integration of the operations of Ameritrade and Datek, operational cost savings resulting from the merger of Ameritrade and Datek, market fluctuations and changes in client trading activity, general economic conditions, increased competition, regulatory and legal matters and uncertainties and other risk factors described in our latest Annual Report on Form 10-K. These forward-looking statements speak only as of the date on which the statements were made. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

  3. Joe Moglia, CEO joem@ameritrade.com

  4. Executive Management Team • Phylis Esposito – Chief Strategy Officer • John Grifonetti – Senior Advisor • Kurt Halvorson – Chief Administrative Officer • Ellen Koplow – General Counsel • Randy MacDonald – Chief Financial Officer • John Mullin – Interim Chief of Technology • Anne Nelson – Chief Marketing Officer • Vince Passione – President, ICD • Pete Ricketts – President, PCD

  5. Ownership as of Datek Merger Closing (9/9/02) % Ownership Ricketts Family (Board) Bain Capital (Board) TA Associates (Board) Silver Lake Partners (Board) Datek Founders Deutsche Bank Groupe Arnault Advent Executive Officers 28% 12% 10% 8% 6% 5% 4% 3% 2% 77%

  6. 51.7 M Accounts 24.7 M Accounts 2007 2002 Industry Outlook: Secular Growth • Investors using the Internet to execute: • 15% - ’98 • 31% - ‘02 Human Behavior Demographics What’s our share? 3M to over 6M . . . Or more? Source: Jupiter, September 2002. SIA “Equity Ownership in America”, 2002

  7. When Does the Internet Transform an Industry? When it simultaneously improves both the Client’s experience and the service provider’s business model.

  8. Our Mission To lead by empowering Clients to pursue their financial goals, accomplished through integrity, teamwork and Client-driven innovation.

  9. Priorities – Resources – Focus Clients Shareholders Associates

  10. Ameritrade + Datek = #1 Online Broker

  11. #1: Online Equity Trades 4Q CY2002 Average Daily Equity Trades 141K 132K 92K 88K SCH TD ET AMTD Source: Company reports.

  12. Approaching 3 Million Clients 425K31% Organic 215K NDB 495K 15% Datek 876K 100K 3% (100K) –2% ET TD SCH AMTD #1: Net Account Growth (24 Mo.) 1.5 Million 112% Net account growth for the 24 months ended 12/31/02. Source: Derived from company reports.

  13. #1: Account Quality Average online equity trades per account per year 12 8 7 6 SCH TD ET AMTD Quarter ended 12/31/02 annualized. Source: Derived from company reports.

  14. 44% 38% 25% 13% AMTD + Datek(w/synergies) ET SCH AMTD + Datek #1: Operating Margin Operating Expense excludes advertising. Quarter ended 12/31/02. Source: Derived from company reports.

  15. Expected Synergies FY 03 Run Rate Pre-tax $127 $174 After-tax $73 $100 EPS $0.17 $0.23 In millions of dollars, except EPS.

  16. Trades Revenue Clients Scalability Better Client Experience R&D Innovation & Operational Efficiency Services & Products at Low Cost

  17. Record Year (EPS from Ongoing Operations) $0.32 $0.24 $0.12 $0.08 $0.07 $0.00 ‘97 ‘98 ‘99 ‘00 ‘01 ‘02 ‘03 E ($0.08) ($0.22)

  18. Record First Quarter • Net Inc.: $22M – 5¢ EPS • Net Rev.: $181M • Operating Margin: $69M – 38% • Pre-tax Margin: $37M – 20% • EBITDA: $47M – 26% of Net Rev. • 141,000 TPD

  19. Clean Balance Sheet As of Dec. 31, 2000 As of Dec. 31, 2002 Accounts (M) 1.4 2.9 Bank Debt ($M) 17 ---- Convertible Notes ($M) 200 46Total Debt 217 46 Stockholders’ Equity ($M) 139 1,123 Debt-to-Equity Ratio 156% 4% Non Broker/Dealer Cash ($M) 1 103 NITE, net of tax ($M) 68 23 Excess Net Capital ($M) 39 121Liquid Assets ($M) 108 247

  20. Current Sell-Side Coverage Firm Analyst Current Rating Bank of AmericaGoldman SachsPutnam LovellRaymond JamesSalomon Smith BarneyUBS Warburg Jeffries Sobhani/MannaStrauss/TukmanRepetto/HalkyVinciquerraMoszkowski/ClarkGlossman/Shteyman Justin Hughes Market Performer (3)Underperform (4)Outperform (2)Outperform (2)Outperform/Speculative (3)Neutral (3) Buy (1)

  21. Share Buy-Back Program • 40 million shares authorized • 5 million shares purchased Executive & Director Purchases > 1.9 million shares

  22. = Great Levered Play on a Market Turn around

  23. www.amtd.com

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