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Raymond James & Associates Institutional Investors Conference March 5, 2003

Raymond James & Associates Institutional Investors Conference March 5, 2003. Safe Harbor Statement.

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Raymond James & Associates Institutional Investors Conference March 5, 2003

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  1. Raymond James & Associates Institutional Investors Conference March 5, 2003

  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. Ameritrade + Datek = #1 Online Broker

  5. Overview Industry Competitive Advantage Track Record Financial Results

  6. Industry Outlook Investors using the Internet to execute equity trades 31% 15% 2001 1998 Source: SIA “Equity Ownership in America” - 2002

  7. Industry Outlook Forecasted number of online accounts: 51.7M 24.7M 2007 2002 Source: Jupiter, September 2002

  8. Industry Outlook: Drivers Transformational Power of the Internet Human Behavior Demographics Consolidation

  9. 1.5 Million 112% Approaching 3 Million Clients NDB Datek #1: Net Account Growth (24 Mo.) 425K31% Organic 876K 495K 15% 100K 3% (100K) –2% 215K AMTD SCH TD ET Net account growth for the 24 months ended 12/31/02 Source: Derived from company reports

  10. Competitive Advantages Innovative Technology Value Proposition Operational Efficiency

  11. Competitive Advantages Innovative Technology Technology Investment Automation Value Proposition Scalability Operational Efficiency

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

  13. #1: Online Equity Trades 4Q CY2002 Average Daily Equity Trades 141K 132K 92K 88K ET TD SCH AMTD Source: Company reports

  14. Competitive Advantages Pricing Product Execution Service Reliability Brand Innovative Technology Value Proposition High Client Satisfaction Operational Efficiency

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

  16. #1: Account Quality Average online equity trades per account per year 12 8 7 6 ET TD SCH AMTD Quarter ended 12/31/02 annualized Source: Derived from company reports

  17. Competitive Advantages Technology Pure play Variable cost Innovative Technology Value Proposition Low-cost Producer Operational Efficiency Operational Efficiency

  18. #1: Operating Margin 44% 38% 25% 13% SCH ET AMTD + Datek(w/synergies) AMTD + Datek Operating Expense excludes advertising. Quarter ended 12/31/02. Source: Derived from company reports.

  19. Financial Leverage Balance sheet Profitability Successful Acquirer Risk/Reward

  20. 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

  21. Record Profitability in Down Market EPS from Ongoing Operations ’03 $0.32 ’03 $0.24 ’02 $0.12 0 ’01 ($0.22)

  22. 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. TPD: 141,000

  23. 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

  24. = Great Levered Investment on a Market Turnaround

  25. www.amtd.com

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