open >access choice support freedom community

Jeff GardnerSr. Vice President & Chief Financial Officer

Raymond James & Associates 24th Annual Institutional Investors Conference

The Hyatt Regency Grand Cypress Orlando, Florida

March 3, 2003

This presentation includes certain estimates and other forward-looking

statements, including statements with respect to anticipated operating and

financial performance, growth opportunities and growth rates, acquisition and

divestiture opportunities, and other statements of expectation. Words such as

“expects,” “anticipates,” “intends,” “plans,” “believes,” “assumes,” “seeks,”

“estimates,” and “should,” and variations of these words and similar

expressions, are intended to identify these forward-looking statements.

Forward-looking statements are subject to uncertainties that could cause

actual future performance, outcomes and results to differ materially. These

statements by the Company and its management are based on estimates,

projections, beliefs and assumptions of management and are not guarantees

of future performance. The company disclaims any obligation to update or

revise any forward-looking statement based on the occurrence of future

events, the receipt of new information, or otherwise.

“Safe Harbor” Statement“Safe Harbor” Statement

2002 Highlights2002 Highlights

• Equity Free Cash Flow1 growth of 21% to $996 million

• Return on Equity of 17%

• EPS from current businesses increased 14%2 to $3.24

• Wireless revenue growth of 9%

• Wireline revenue growth of 11%

• Raised our dividend for the 42nd consecutive year

1 Defined as Net Income + Depreciation & Amortization - Capital Expenditures2 Reflects January 2002 implementation of SFAS 142

Investment HighlightsInvestment Highlights

Solid Financial

Performance

Solid Financial

Performance

Industry Leading Results

Industry Leading Results

Conservative Capital

Structure

Conservative Capital

Structure

Strong Platform for Continued

Growth

Strong Platform for Continued

Growth

Strategic Model

Strategic Model

Strategic ModelStrategic Model

• Operational Focus

Operational Focus

• Point of Sale Experience• Customer Service

Experience• Network Quality

Experience

Strategic ModelStrategic Model

• Operational Focus

• Financial Discipline

Operational Focus

• Point of Sale Experience• Customer Service

Experience• Network Quality

Experience

Financial Discipline

• Invest in Businesses Not Products

• Best Customer/Best Price

• Stay Relevant

Strategic ModelStrategic Model

• Operational Focus

• Financial Discipline

• Opportunistic Growth

Operational Focus

• Point of Sale Experience• Customer Service

Experience• Network Quality

Experience

Financial Discipline

• Invest in Businesses Not Products

• Best Customer/Best Price

• Stay Relevant

Opportunistic Growth

• Focus on Free Cash Flow

• Operational “Fit”• Think Long-Term (5+

years)

ALLTEL Wireless

Verizon & Other Roaming

Agreements

Strong Platform for Continued Growth Wireless Markets as of 12/31/02 – A Closer LookStrong Platform for Continued Growth Wireless Markets as of 12/31/02 – A Closer Look

• 7.6 million customers• 59 million POPs

ALLTEL Wireless

Verizon & Other Roaming

Agreements

Strong Platform for Continued Growth Wireless Markets as of 12/31/02 – A Closer LookStrong Platform for Continued Growth Wireless Markets as of 12/31/02 – A Closer Look

Customers

Tier 2 & 3• Fewer Competitors• Higher Revenue Growth• Lower Churn• Better EBITDA Margins

• 7.6 million customers• 59 million POPs

ALLTEL Wireless

Verizon & Other Roaming

Agreements

0%

10%

20%

30%

40%

50%

60%

1st Qtr '02 2nd Qtr '02 3rd Qtr '02 4th Qtr '02

% of Gross Adds on Total/National Freedom Rate Plans

Strong Platform for Continued Growth Total/National Freedom Rate PlansStrong Platform for Continued Growth Total/National Freedom Rate Plans

Total/National Freedom Plans• Leverage Verizon roaming agreement• Net present values are significantly higher than other rate plans• ARPU is 20-40% higher• Approximately 20% of customer base is on a national plan

Strong Platform for Continued Growth Local Network Coverage Matters Strong Platform for Continued Growth Local Network Coverage Matters

PCS Competitor vs. ALLTEL Local Package

ALLTEL Wireline

ALLTEL Wireless

Verizon & Other Roaming

Agreements

Strong Platform for Continued Growth Wireline Markets as of 12/31/02 – A Closer Look Strong Platform for Continued Growth Wireline Markets as of 12/31/02 – A Closer Look

• 2nd largest independent ILEC• Almost 3.2 million customer lines

ALLTEL Wireline

ALLTEL Wireless

Verizon & Other Roaming

Agreements

Strong Platform for Continued Growth Wireline Markets as of 12/31/02 – A Closer LookStrong Platform for Continued Growth Wireline Markets as of 12/31/02 – A Closer Look

• 2nd largest independent ILEC• Almost 3.2 million customer lines

• Less competitive pressure• Little exposure to UNE-P• Success with vertical and

enhanced services

• Over 1.5 million LD customers (almost 50%

penetration)

• 38%-42% vertical services penetration

• 70,000 DSL customers - 4.3% penetration of addressable lines

• More than 80% of DSL customers have

ALLTEL Internet Service

• Over 1.5 million LD customers (almost 50%

penetration)

• 38%-42% vertical services penetration

• 70,000 DSL customers - 4.3% penetration of addressable lines

• More than 80% of DSL customers have

ALLTEL Internet Service

Strong Platform for Continued Growth Wireline Markets as of 12/31/02 – A Closer LookStrong Platform for Continued Growth Wireline Markets as of 12/31/02 – A Closer Look

16,712

19,996

22,249

26,816

38,067

56,005

70,182

32,907

0

20,000

40,000

60,000

80,000

1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02

1,160

1,212

1,240

1,265

1,364

1,462

1,542

1,318

1,000

1,100

1,200

1,300

1,400

1,500

1,600

1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02

DSL Customers Long-Distance Customers

In t

hou

sand

s

Industry Leading Results Wireless EBITDA MarginsIndustry Leading Results Wireless EBITDA Margins

EBITDA Drivers:• Direct Sales Channel is approximately 70%-75% of total sales• CDMA technology• Cash cost per customer competitive with companies with greater scale

Service revenue margin. Source: Company reports.

40%38%

34%

29%

25%

18%

38% 38%

32%

38%

30%

25%27%

34%

0%

10%

20%

30%

40%

ALLTEL Verizon Wireless Cingular Nextel US Cellular AT&T Wireless Sprint PCS

2001 EBITDA Margin2002 EBITDA Margin

Industry Leading Results Wireless 4Q 2002 Industry Leading Results Wireless 4Q 2002

Market Penetration

Churn

Gross Gain per POPs

Cash Flow Margins

0.0%

0.5%

1.0%

1.5%

Verizon ALLTEL US Cellular AT&T Sprint PCS Cingular T-Mobile* Nextel

0.0%

4.0%

8.0%

12.0%

16.0%

Verizon ALLTEL USCellular

AT&T Cingular Sprint PCS Nextel T-Mobile*

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

Nextel USCellular

Verizon AT&T T-Mobile* Cingular ALLTEL Sprint PCS0.00%

15.00%

30.00%

45.00%

Nextel Verizon ALLTEL Cingular AT&T SprintPCS

USCellular

T-Mobile*

T-Mobile based on 1/28/03 news release.Source: Company reports

Industry Leading Results Wireline EBITDA MarginsIndustry Leading Results Wireline EBITDA Margins

EBITDA Drivers:• Focused on second and third tier cities and rural markets• Convergence drives better margins

Source: Company reports.

58%

55%

51%

48%

41%

58%

55%

50% 49%

45%

40%

44%

0%

10%

20%

30%

40%

50%

60%

ALLTEL CenturyTel BellSouth Sprint FON Verizon SBC

2001 EBITDA Margin 2002 EBITDA Margin

-4.5%

-4.0%

-3.5%

-3.0%

-2.5%

-2.0%

-1.5%

-1.0%

-0.5%

0.0%

ALLTEL CenturyTel Sprint Verizon BellSouth SBC

Industry Leading Results Wireline 4Q 2002Industry Leading Results Wireline 4Q 2002

Customer Growth* (vs. 4Q01)

0%

10%

20%

30%

40%

50%

60%

ALLTEL CenturyTel Sprint BellSouth Verizon SBC

Cash Flow Margin

* Excludes DSLSource: Company reports

ALLTEL has one of the strongest credit profiles in the telecom industry• Well capitalized balance sheet

– A1 / Prime-1 / F1 (S&P / Moody’s / Fitch) Commercial Paper ratings– A / A2 / A (S&P / Moody’s / Fitch) long-term credit ratings

• Net Debt / EBITDA 1.7X

Conservative Capital StructureConservative Capital Structure

Source: Wall Street equity research and company filings.Note : Assumes 80% equity credit for AT, CZN, CTL and Sprint Equity Units. Q pf directories sale and debt exchange, Sprint pf directories sale, SBC pf Cegetel sale, VZ pf Northcoast. (a) Net Debt/EBITDA as of 12/31/02 except for CZN, NXTL and RCCC as of 9/30/02.

Solid Financial Performance Delivering Consistent GrowthSolid Financial Performance Delivering Consistent Growth

$5.2$5.8

$6.5$7.2

$7.5$8.0

1997 1998 1999 2000 2001 2002

Revenue ($bn)

$1.8$2.1

$2.5$2.7

$2.9$3.1

1997 1998 1999 2000 2001 2002

EBITDA** ($bn)

$1.74

$2.14

$2.59 $2.72 $2.84

$3.24

1997 1998 1999 2000 2001 2002

Earnings per Share

$1.12$1.18

$1.24$1.29

$1.33$1.37

1997 1998 1999 2000 2001 2002

Dividends per Share

* *

*Not restated for new reporting standard.**Excluding merger and integration expenses.

0

200

400

600

800

1,000

1,200

1997 1998 1999 2000 2001 200212%

16%

20%

24%

28%

Equity Free Cash Flow CAPEX as a % of Revenues

Millions

* Defined as Net Income + Depreciation & Amortization - CAPEX.

% of Revenues

$

15

*

Solid Financial Performance Strong and Growing Free Cash FlowSolid Financial Performance Strong and Growing Free Cash Flow

5-Year CAGR = 26%

ALLTEL has performed better than the S&P 500 over the last 5 yearsALLTEL has performed better than the S&P 500 over the last 5 years

Assumes that $100 was invested on the last trading day of 1997 and that all dividends were reinvested.

Note - ALLTEL has raised dividends for 42 consecutive years - new annual dividend is $1.40 per common share “pre-tax”.

Proposed Sale of Financial Services Division of AISProposed Sale of Financial Services Division of AIS

> Proceeds– $775M in cash– $275M in common stock

> Retaining Telecom Services Division ~10-12% of revenue and EBITDA

> Expect to close 3/31/03

> Proposed sale will– Improve telecom focus – Improve the balance sheet– Improve financial flexibility

> Expect $.22 dilution in ‘03 (9 months) assuming close on 3/31/03

2003 Outlook2003 Outlook

> EPS from current businesses of $3.12 to $3.22– Includes $.22 of expected dilution from the proposed sale of

the financial services division of AIS– Includes $.08 of pension expense– Implies normalized growth rate of 6% to 9%

> Capital expenditures of $1.2 billion to $1.3 billion– Includes further deployment of CDMA coverage– Includes 1X data deployment

Source: 4Q02 Earnings Call on January 29, 2003