One Year of Performance  
    Thirty Years of Perspective  
  Ameritrade Holding Corporation Annual Report 2004
    Letter to Shareholders
Financial Highlights
Letter to Shareholders
Chairman's Letter
Shareholder Information
Dear Shareholders,

In every sense of the word, 2004 was a success at Ameritrade. We demonstrated our ability to operate effectively and produce record results while delivering outstanding products and services to our clients. Illustrating perhaps our greatest competitive advantage, we saw an agile, opportunistic and focused brokerage strategy pay off despite another unpredictable environment.

Thanks to bold steps taken over the past few years to solidify our operating model and strategy, I’m pleased to present a few examples of what we were able to accomplish in fiscal 2004:

  • Our four quarters in 2004 were the best in the history of this company (see graph).
  • Pre-tax margin of 50 percent once again led our publicly-traded peers.1
  • We led the online brokerage industry in client retail equity trades.2
  • Earnings per share doubled from last year, to $0.64, and we nearly doubled our return on shareholder equity to 22 percent (see graph).
  • We continued to pursue beneficial acquisition opportunities, acquiring Bidwell & Company and the retail accounts of BrokerageAmerica and Investex. We also announced the acquisition of the retail accounts of JB Oxford & Company, and have since completed this purchase.
  • We continue to believe in the current and future value of our stock, investing about $324 million in repurchasing almost 26 million shares, with resulting accretion of $0.04 per share.

As thrilling as our 2004 performance was, we have every intention — and capability — to continue that success in 2005 and beyond. A very competitive industry demands that we advance the needs of clients, and this year Ameritrade was up to the challenge.

Through our brokerage subsidiary, Ameritrade, Inc., we launched a new Web site in 2004, as well as a consummate package of innovative products that demonstrate Ameritrade’s technological edge.3 This platform will serve as a foundation for launching future generations of client-focused tools and services. We also introduced our Exchange Traded Funds (ETF) Center, a useful online resource that offers tools, education and information related to these important investment alternatives.4

While we continued to expand our active trader position, we also began reaching out to what we consider untapped potential — long-term investors. At last year’s annual meeting, I spent time discussing the importance of share of wallet and Ameritrade obtaining a greater percentage of our clients’ investable assets. This focus led us to launch Amerivest this past fall through our Amerivest Investment Management, LLC registered investment advisor subsidiary.5 We believe Amerivest will not only be a catalyst for our future growth, it will also redefine and simplify long-term investing. Amerivest is an online advisory service that allows investors to manage their investment goals using a simple 5-step process and index-based securities. I invite you to learn more by visiting

Ameritrade believes in a strong capital market structure that treats all investors fairly and provides for increased competition. In 2004, we took our case to Capitol Hill, testifying before the Securities & Exchange Commission and Senate Banking Committee in support of non-discriminatory access, transparency of market data as well as the elimination of the trade-through rule.

More recently, we’ve set Ameritrade on a path towards becoming a truly client-centric organization, with a focus on managing our business from the valuable perspective of individual investors. Our management team has every intention of utilizing this “outside-in” approach as we extend our legacy of innovation to all types of investors in the 21st century.

The four years I’ve spent at Ameritrade have been something of which I am very proud. In that time, we’ve seen unpredictability, highs and lows, gains and losses. Yet through it all, our associates have remained steady and focused, exemplifying the type of character that so often turns stumbling blocks into stepping-stones. Along with Joe Ricketts and the rest of the management team, I feel secure with our strategy knowing the absolute sense of mission this organization shares in delivering the future for individual investors.

2004 tested our conviction and we persevered by translating uncertainty into unparalleled performance. And today, as we step into our 30th year, you can be assured that Ameritrade has the experience and confidence to pursue any challenge that maximizes the benefits to our associates, clients and shareholders.


Joe Moglia Signature

Joe Moglia