exhibit991.htm - Generated by SEC Publisher for SEC Filing

As previously announced, TDS^TM will hold a teleconference Nov. 5, 2009 at 10:00 a.m. Chicago time. Interested parties may listen to the call live by accessing the Conference Calls page of www.teldta.com.

§ Repurchased 1,149,046 TDS special common shares and 1,484,421 common shares for a total of $73.9 million.

§ Service revenues of $984.9 million, down 3 percent, due primarily to a $24.7 million decrease in inbound roaming revenues.

§ Retail service ARPU (average revenue per unit) increased from $46.97 to $47.02.

§ 34 percent increase in data revenues, to $174.3 million, representing 18 percent of service revenues. Data revenue per customer increased from $7.01 to $9.46.

§ Postpay churn was 1.7 percent; postpay customers comprised 96 percent of retail customers.

§ 14 percent increase in ILEC data revenues, to $26.2 million, representing 17 percent of ILEC revenues.

§ ILEC equivalent access lines remained stable at 772,700, due in part to acquisitions; ILEC physical access lines decreased 5 percent to 539,400.

CHICAGO – Nov. 5, 2009 – Telephone and Data Systems, Inc. [NYSE:TDS, TDS.S] reported operating revenues of $1,258.7 million for the third quarter of 2009, a decrease of 4 percent from $1,304.6 million in the comparable period one year ago. Net income attributable to TDS and related diluted earnings per share were $35.6 million and $0.33, respectively, for the third quarter of 2009, compared to $101.2 million and $0.87, respectively, in the comparable period one year ago. In the third quarter of 2008, TDS recorded a $31.7 million pre-tax gain on disposition of investments related to Rural Cellular Corporation.

“TDS made progress on several strategic fronts this quarter,” said LeRoy T. Carlson, Jr., TDS president and CEO. “Both U.S. Cellular and TDS Telecom continued to achieve strong growth in data revenues. While total revenues were down slightly, aggressive marketing and promotional programs at U.S. Cellular were well-received by customers, and TDS Telecom continued to drive sales of bundled services. Backed by TDS’ strong financial foundation, both businesses are investing in new technologies and network infrastructure to support future growth and to promote customer loyalty.

“U.S. Cellular accelerated the expansion of its 3G network, now reaching approximately 75 percent of its customer base,” continued Carlson. “This network enhancement will further promote the already robust growth in smartphone sales, messaging and data applications. The company is also making headway on the initial stages of long-term initiatives that are designed to spur customer growth and enable more targeted marketing and sales programs, while increasing efficiency. These initiatives will be a major focus for U.S. Cellular in 2010 and beyond.

“TDS Telecom continues to build its portfolio of broadband services and products for residential and commercial customers,” added Carlson. “The company is driving strong sales of triple play bundles of voice, broadband and DISH Network™ services, and enhancing its hosted solutions for commercial customers. Broadband penetration of TDS Telecom’s ILEC customer base is currently 37 percent, which leaves substantial room for future growth.

“And, as part of our ongoing efforts to increase shareholder value, TDS recently completed its second $250 million stock repurchase program, well ahead of schedule. Between June 2007 and October 2009, TDS repurchased more than 14 million shares, representing approximately 12 percent of shares outstanding.”

Guidance for the year ending Dec. 31, 2009 is as follows. There can be no assurance that final results will not differ materially from this guidance.

U.S. Cellular 2009 guidance as of Nov. 5, 2009 remains unchanged from Aug. 6, 2009 and is as follows:

This guidance represents the views of management as of Nov. 5, 2009 and should not be assumed to be accurate as of any other date. TDS undertakes no legal duty to update such information, whether as a result of new information, future events or otherwise.

The following represents repurchases of both TDS common shares and TDS special common shares.

· Access the live call on the Conference Calls page of www.teldta.com or at http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=67422&eventID=2517092

· Access the call by phone at 800/706-9695 (US/Canada) and use conference ID #38289990.

Before the call, certain financial and statistical information to be discussed during the call will be posted to the Conference Calls page of www.teldta.com, together with reconciliations to generally accepted accounting principles (GAAP) of any non-GAAP information to be disclosed. The call will be archived on the Conference Calls page of www.teldta.com.

Telephone and Data Systems, Inc. (TDS), a Fortune 500® company, provides wireless, local and long-distance telephone, and broadband services to approximately 7.3 million customers in 36 states through its business units, U.S. Cellular (wireless) and TDS Telecom (wireline). Founded in 1969 and headquartered in Chicago, TDS employed 12,300 people as of Sept. 30, 2009.

Visit www.teldta.com for comprehensive financial information, including earnings releases, quarterly and annual filings, shareholder information, and more.

United States Cellular Corporation, the nation’s fifth-largest, full-service wireless carrier, provides a comprehensive range of wireless products and services, excellent customer support, and a high-quality network to approximately 6.1 million customers in 26 states. The Chicago-based company employed 8,700 full-time equivalent associates as of Sept. 30, 2009. For more information about U.S. Cellular, visit www.uscellular.com.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: All information set forth in this news release, except historical and factual information, represents forward-looking statements. This includes all statements about the company’s plans, beliefs, estimates and expectations. These statements are based on current estimates, projections and assumptions, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Important factors that may affect these forward-looking statements include, but are not limited to: The ability of the company to successfully grow its markets; the current credit crisis affecting financial markets, and its effects on the overall economy; competition; the access to and pricing of unbundled network elements; the ability to obtain or maintain roaming arrangements with other carriers; the state and federal telecommunications regulatory environment; the value of assets and investments; adverse changes in the ratings afforded TDS and U.S. Cellular debt securities by accredited ratings organizations; industry consolidation; advances in telecommunications technology; uncertainty of access to the capital markets; pending and future litigation; changes in income tax rates, laws, regulations or rulings; acquisitions/divestitures of properties and/or licenses; and changes in customer growth rates, average monthly revenue per unit, churn rates, roaming revenue and terms, the availability of handset devices, or the mix of products and services offered by U.S. Cellular and TDS Telecom. Investors are encouraged to consider these and other risks and uncertainties that are discussed in the Form 8-K used by TDS to furnish this press release to the SEC, which are incorporated by reference herein.

UNITED STATES CELLULAR CORPORATION SUMMARY OPERATING DATA

Quarter Ended		9/30/2009			6/30/2009			3/31/2009			12/31/2008			9/30/2008
Total population
	Consolidated markets (1)		85,118,000			83,726,000			83,726,000			83,014,000			82,875,000
	Consolidated operating markets (1)		46,306,000			46,306,000			46,306,000			46,009,000			45,493,000
All customers
	Total at end of period		6,131,000			6,155,000			6,243,000			6,196,000			6,176,000
	Gross additions		386,000			317,000			404,000			395,000			367,000
	Net additions (losses)		(24,000	)		(88,000	)		47,000			20,000			(18,000	)
Market penetration at end of period
	Consolidated markets (2)		7.2	%		7.4	%		7.5	%		7.5	%		7.5	%
	Consolidated operating markets (2)		13.2	%		13.3	%		13.5	%		13.5	%		13.6	%
Retail customers
	Total at end of period		5,705,000			5,711,000			5,770,000			5,707,000			5,674,000
	Gross additions		351,000			286,000			366,000			352,000			325,000
	Net postpay additions (losses)		8,000			(32,000	)		60,000			41,000			12,000
	Net prepay additions (losses)		(14,000	)		(27,000	)		3,000			(8,000)			(15,000	)

Cell sites in service			7,161			7,043			6,942			6,877			6,716
Average monthly revenue per unit (3)		$	53.49		$	52.41		$	52.54		$	52.71		$	54.59
	Retail service revenue per unit (3) (5)	$	47.02		$	46.85		$	46.78		$	46.43		$	46.97
	Inbound roaming revenue per unit (3) (5)	$	3.73		$	3.35		$	3.21		$	4.25		$	5.03
	Other revenue per unit (3) (5)	$	2.74		$	2.21		$	2.55		$	2.03		$	2.59
Postpay churn rate (4)			1.7	%		1.7	%		1.5	%		1.6	%		1.6	%
Construction expenditures (000s)		$	128,900		$	91,200		$	137,700		$	190,000		$	146,100

(1) Used only to calculate market penetration of consolidated markets and consolidated operating markets, respectively, which is calculated by dividing customers by the total market population (without duplication of population in overlapping markets).

(2) Calculated by dividing the number of wireless customers at the end of the period by the total population of consolidated markets and consolidated operating markets, respectively, as estimated by Claritas.

(3) Derived from Service revenues as reported in Financial Highlights for each respective quarter as follows:

Service revenue (000s)		$	984,923	$	974,755	$	981,874	$	976,952	$	1,013,928
Components
	Retail service revenue (000s)		865,867		871,209		874,098		860,503		872,397
	Inbound roaming revenue (000s)		68,767		62,223		60,057		78,768		93,472
	Other revenue (000s)		50,289		41,323		47,719		37,681		48,059

Divided by average customers (000s)			6,138		6,199		6,229		6,178		6,191
Divided by three months in each quarter			3		3		3		3		3

Average monthly revenue per unit		$	53.49	$	52.41	$	52.54	$	52.71	$	54.59
Retail service revenue per unit		$	47.02	$	46.85	$	46.78	$	46.43	$	46.97
Inbound roaming revenue per unit		$	3.73	$	3.35	$	3.21	$	4.25	$	5.03
Other revenue per unit		$	2.74	$	2.21	$	2.55	$	2.03	$	2.59

(4) Calculated by dividing the total postpay customer disconnects during the quarter by the average postpay customer base for the quarter.

(5) Long-distance revenue was reclassified in the fourth quarter of 2008 from Other revenue to Retail service revenue and Inbound roaming revenue. Previous quarters have been adjusted to reflect this change.

TELEPHONE AND DATA SYSTEMS, INC. SUMMARY OPERATING DATA

Quarter Ended		9/30/2009		6/30/2009		3/31/2009		12/31/2008		9/30/2008
TDS Telecom
ILEC
	Equivalent access lines (1)		772,700		775,800		777,100		776,700		773,700
	Physical access lines (2)		539,400		548,000		556,800		566,200		568,900
	High-speed data customers (3)		202,100		197,100		188,100		178,300		171,300
	Managed IP stations (4)		1,500		1,200		1,000		600		500
	Long-distance customers		356,500		354,100		348,900		347,000		346,600
	Construction expenditures (000s)	$	23,800	$	26,200	$	21,400	$	50,200	$	33,300
CLEC
	Equivalent access lines (1)		364,100		372,300		381,000		393,000		402,600
	High-speed data customers (3)		37,600		38,700		39,700		40,800		41,900
	Managed IP stations (4)		9,600		6,400		4,100		2,100		600
	Construction expenditures (000s)	$	4,700	$	5,700	$	5,000	$	7,200	$	4,500

	(1)	Sum of physical access lines and high-capacity data lines, adjusted to estimate the equivalent number of physical access lines in terms of capacity, plus the number of managed IP stations.
	(2)	Individual circuits connecting customers to a telephone company's central office facilities.
	(3)	The number of customers provided high-capacity data circuits via various technologies, including digital subscriber line (“DSL”), managed Internet Protocol (“Managed IP”) and dedicated Internet circuit technologies.
	(4)	The number of telephone handsets providing communications using packet networking technology.

Telephone And Data Systems, Inc.
Consolidated Statement of Operations Highlights
Three Months Ended September 30,
(Unaudited, dollars and shares in thousands, except per share amounts)

								Increase/ (Decrease)
				2009		2008		Amount		Percent
Operating revenues
	U.S. Cellular			$	1,058,300	$	1,091,875	$	(33,575)	(3	)%
	TDS Telecom				196,542		205,992		(9,450)	(5	)%
	All Other (1)				3,900		6,731		(2,831)	(42	)%
					1,258,742		1,304,598		(45,856)	(4	)%
Operating expenses
	U.S. Cellular
		Expenses excluding depreciation, amortization and accretion			849,651		819,600		30,051	4	%
		Depreciation, amortization and accretion			147,586		145,434		2,152	1	%
		Loss on asset disposals, net			3,371		6,884		(3,513)	(51	)%
					1,000,608		971,918		28,690	3	%
	TDS Telecom
		Expenses excluding depreciation, amortization and accretion			131,439		130,944		495	—
		Depreciation, amortization and accretion			41,746		39,036		2,710	7	%
		Loss on asset disposals, net			1,135		151		984	N/M
					174,320		170,131		4,189	2	%
	All Other (1)
		Expenses excluding depreciation and amortization			3,185		6,840		(3,655)	(53	)%
		Depreciation and amortization			2,915		3,505		(590)	(17	)%
		Loss on asset disposals, net			51		65		(14)	(22	)%
					6,151		10,410		(4,259)	(41	)%

			Total operating expenses		1,181,079		1,152,459		28,620	2	%
Operating income (loss)
	U.S. Cellular				57,692		119,957		(62,265)	(52	)%
	TDS Telecom				22,222		35,861		(13,639)	(38	)%
	All Other (1)				(2,251)		(3,679)		1,428	39	%
					77,663		152,139		(74,476)	(49	)%
Investment and other income (expense)
	Equity in earnings of unconsolidated entities				23,334		22,566		768	3	%
	Interest and dividend income				3,461		8,617		(5,156)	(60	)%
	Gain on investments and financial instruments				—		31,997		(31,997)	N/M
	Interest expense				(30,430)		(31,684)		1,254	4	%
	Other, net				1,030		383		647	N/M
			Total investment and other income (expense)		(2,605)		31,879		(34,484)	N/M
Income before income taxes					75,058		184,018		(108,960)	(59	)%
	Income tax expense				27,793		61,024		(33,231)	(54	)%
Net income					47,265		122,994		(75,729)	(62	)%
	Less: Net income attributable to noncontrolling interests, net of tax				(11,620)		(21,771)		10,151	47	%
Net income attributable to TDS					35,645		101,223		(65,578)	(65	)%
	Preferred dividend requirement				(13)		(13)		—	—
Net income available to common				$	35,632	$	101,210	$	(65,578)	(65	)%

Basic weighted average shares outstanding					108,289		115,700		(7,411)	(6	)%
Basic earnings per share attributable to TDS shareholders				$	0.33	$	0.87	$	(0.54)	(62	)%

Diluted weighted average shares outstanding					108,565		116,193		(7,628)	(7	)%
Diluted earnings per share attributable to TDS shareholders				$	0.33	$	0.87	$	(0.54)	(62	)%

Telephone and Data Systems, Inc.
Consolidated Statement of Operations Highlights
Nine Months Ended September 30,
(Unaudited, dollars and shares in thousands, except per share amounts)

								Increase/ (Decrease)
				2009		2008		Amount		Percent
Operating revenues
	U.S. Cellular			$	3,153,614	$	3,190,323	$	(36,709)	(1	)%
	TDS Telecom				591,804		619,492		(27,688)	(4	)%
	All Other (1)				12,447		18,235		(5,788)	(32	)%
					3,757,865		3,828,050		(70,185)	(2	)%
Operating expenses
	U.S. Cellular
		Expenses excluding depreciation, amortization and accretion			2,408,734		2,383,500		25,234	1	%
		Depreciation, amortization and accretion			423,851		433,222		(9,371)	(2	)%
		Loss on asset disposals, net			7,648		16,776		(9,128)	(54	)%
					2,840,233		2,833,498		6,735	—
	TDS Telecom
		Expenses excluding depreciation, amortization and accretion			398,002		392,661		5,341	1	%
		Depreciation, amortization and accretion			125,272		117,615		7,657	7	%
		Loss on asset disposals, net			1,752		349		1,403	N/M
					525,026		510,625		14,401	3	%
	All Other (1)
		Expenses excluding depreciation and amortization			14,826		17,049		(2,223)	(13	)%
		Depreciation and amortization			9,239		11,322		(2,083)	(18	)%
		Loss on asset disposals, net			69		65		4	6	%
					24,134		28,436		(4,302)	(15	)%

			Total operating expenses		3,389,393		3,372,559		16,834	—
Operating income (loss)
	U.S. Cellular				313,381		356,825		(43,444)	(12	)%
	TDS Telecom				66,778		108,867		(42,089)	(39	)%
	All Other (1)				(11,687)		(10,201)		(1,486)	(15	)%
					368,472		455,491		(87,019)	(19	)%
Investment and other income (expense)
	Equity in earnings of unconsolidated entities				67,034		66,945		89	—
	Interest and dividend income				8,435		35,818		(27,383)	(76	)%
	Interest expense				(92,780)		(108,634)		15,854	15	%
	Loss on investments and financial instruments				—		31,595		(31,595)	N/M
	Other, net				1,504		2,086		(582)	(28	)%
		Total investment and other income (expense)			(15,807)		27,810		(43,617)	N/M
Income before income taxes					352,665		483,301		(130,636)	(27	)%
	Income tax expense				121,467		163,536		(42,069)	(26	)%
Net income					231,198		319,765		(88,567)	(28	)%
	Less: Net income attributable to noncontrolling interests, net of tax				(53,814)		(57,298)		3,484	6	%
Net income attributable to TDS					177,384		262,467		(85,083)	(32	)%
	Preferred dividend requirement				(38)		(39)		1	3	%
Net income available to common				$	177,346	$	262,428	$	(85,082)	(32	)%

Basic weighted average shares outstanding					110,408		116,510		(6,102)	(5	)%
Basic earnings per share attributable to TDS shareholders				$	1.61	$	2.25	$	(0.64)	(28	)%

Diluted weighted average shares outstanding					110,633		117,065		(6,432)	(5	)%
Diluted earnings per share attributable to TDS shareholders				$	1.60	$	2.24	$	(0.64)	(29	)%

Telephone and Data Systems, Inc.
Consolidated Balance Sheet Highlights
(Unaudited, dollars in thousands)

ASSETS


		September 30,		December 31,
		2009		2008
Current assets
	Cash and cash equivalents	$	778,159	$	777,309
	Short-term investments		136,400		27,705
	Accounts receivable from customers and other		541,211		516,849
	Inventory		126,007		122,377
	Other current assets		196,247		184,696
			1,778,024		1,628,936

Investments
	Licenses		1,453,526		1,441,440
	Goodwill		707,840		707,079
	Customer lists		25,577		34,032
	Investments in unconsolidated entities		219,760		205,768
	Other investments		9,996		10,623
			2,416,699		2,398,942

Property, plant and equipment, net
	U.S. Cellular		2,561,766		2,620,376
	TDS Telecom		880,838		918,454
	Other		30,265		30,094
			3,472,869		3,568,924

Other assets and deferred charges			65,583		55,614

Total assets		$	7,733,175	$	7,652,416

Telephone and Data Systems, Inc.
Consolidated Balance Sheet Highlights
(Unaudited, dollars in thousands)

LIABILITIES AND STOCKHOLDERS' EQUITY


				September 30, 2009			December 31, 2008
				September 30, 2009			December 31, 2008
Current liabilities
	Current portion of long-term debt			$	15,126		$	15,337
	Accounts payable				297,249			319,575
	Customer deposits and deferred revenues				170,493			174,101
	Accrued interest				24,129			14,236
	Accrued taxes				66,661			25,192
	Accrued compensation				84,125			90,512
	Other current liabilities				116,041			134,334
					773,824			773,287
Deferred liabilities and credits
	Net deferred income tax liability				499,002			471,623
	Other deferred liabilities and credits				384,032			368,045
					883,034			839,668

Long-term debt					1,620,979			1,621,422

Noncontrolling interests with mandatory redemption features					708			589

Equity
	TDS stockholders' equity
		Common Shares, par value $.01			571			571
		Special Common Shares, par value $.01			634			634
		Series A Common Shares, par value $.01			65			65
		Capital in excess of par value			2,084,481			2,066,597
		Treasury shares, at cost:
			Common Shares		(206,244	)		(163,017	)
			Special Common Shares		(462,788	)		(350,091	)
		Accumulated other comprehensive loss			(12,951	)		(16,812	)
		Retained earnings			2,370,595			2,229,540
			Total TDS stockholders' equity		3,774,363			3,767,487

	Preferred shares				845			852
	Noncontrolling interests				679,422			649,111

		Total equity			4,454,630			4,417,450

Total liabilities and equity				$	7,733,175		$	7,652,416

Telephone and Data System, Inc.
Balance Sheet Highlights
Three Months Ended September 30, 2009
(Unaudited, dollars in thousands)


			U.S. Cellular		TDS Telecom		TDS Corporate & Other		Intercompany Eliminations		TDS Consolidated
Cash and cash equivalents			$	404,894	$	28,336	$	344,929	$	—	$	778,159
Affiliated cash investments				—		523,179		—		(523,179)		—
Short-term investments				180		136,220		—		—		136,400
Notes receivable—affiliates				—		—		253,582		(253,582)		—
			$	405,074	$	687,735	$	598,511	$	(776,761)	$	914,559

Licenses, goodwill and customer lists			$	1,945,511	$	435,836	$	(194,404)	$	—	$	2,186,943
Investment in unconsolidated entities				177,497		3,656		44,249		(5,642)		219,760
Other investments				4,247		2,307		3,442		—		9,996
			$	2,127,255	$	441,799	$	(146,713)	$	(5,642)	$	2,416,699


Property, plant and equipment, net			$	2,561,766	$	880,838	$	30,265	$	—	$	3,472,869

Notes payable—affiliates			$	—	$	253,582	$	523,179	$	(776,761)	$	—

Long-term debt
	Current portion		$	10,088	$	428	$	4,610	$	—	$	15,126
	Non-current portion			997,552		2,347		621,080		—		1,620,979
		Total	$	1,007,640	$	2,775	$	625,690	$	—	$	1,636,105

Preferred shares			$	—	$	—	$	845	$	—	$	845

Construction expenditures
	Quarter ended 9/30/09		$	128,900	$	28,500	$	2,400	$	—	$	159,800
	Nine months ended 9/30/09		$	357,800	$	86,800	$	6,000	$	—	$	450,600

		TDS Telecom Highlights
		Three Months Ended September 30,
		(Unaudited, dollars in thousands)

							Increase (Decrease)
			2009		2008		Amount		Percent
Local Telephone Operations
	Operating revenues
		Voice	$	46,462	$	51,222	$	(4,760)	(9	)%
		Data		26,166		22,964		3,202	14	%
		Network access		66,963		69,199		(2,236)	(3	)%
		Miscellaneous		10,068		9,604		464	5	%
				149,659		152,989		(3,330)	(2	)%
	Operating expenses
		Cost of services and products		50,352		47,337		3,015	6	%
		Selling, general and administrative expenses		41,397		40,311		1,086	3	%
		Depreciation, amortization and accretion		35,652		33,469		2,183	7	%
		Loss on asset disposals, net		1,072		78		994	N/M
				128,473		121,195		7,278	6	%

	Operating income		$	21,186	$	31,794	$	(10,608)	(33	)%

Competitive Local Exchange Carrier Operations
		Revenues	$	49,153	$	54,690	$	(5,537)	(10	)%

		Expenses excluding depreciation, amortization and accretion		41,960		44,983		(3,023)	(7	)%
		Depreciation, amortization and accretion		6,094		5,567		527	9	%
		Loss on asset disposals, net		63		73		(10)	(14	)%
				48,117		50,623		(2,506)	(5	)%

	Operating income		$	1,036	$	4,067	$	(3,031)	(75	)%

Intercompany revenues			$	(2,270)	$	(1,687)	$	(583)	(35	)%
Intercompany expenses				(2,270)		(1,687)		(583)	(35	)%
				—		—		—

Total TDS Telecom operating income			$	22,222	$	35,861	$	(13,639)	(38	)%

		TDS Telecom Highlights
		Nine Months Ended September 30,
		(Unaudited, dollars in thousands)

							Increase (Decrease)
			2009		2008		Amount		Percent
Local Telephone Operations
	Operating revenues
		Voice	$	141,919	$	153,723	$	(11,804)	(8	)%
		Data		76,717		65,888		10,829	16	%
		Network access		201,912		210,008		(8,096)	(4	)%
		Miscellaneous		27,506		28,384		(878)	(3	)%
				448,054		458,003		(9,949)	(2	)%
	Operating expenses
		Cost of services and products		146,442		139,044		7,398	5	%
		Selling, general and administrative expenses		128,254		124,208		4,046	3	%
		Depreciation, amortization and accretion		107,040		100,595		6,445	6	%
		Loss on asset disposals, net		1,493		32		1,461	N/M
				383,229		363,879		19,350	5	%

	Operating income		$	64,825	$	94,124	$	(29,299)	(31	)%

Competitive Local Exchange Carrier Operations
		Revenues	$	150,435	$	166,707	$	(16,272)	(10	)%

		Expenses excluding depreciation, amortization and accretion		129,991		134,627		(4,636)	(3	)%
		Depreciation, amortization and accretion		18,232		17,020		1,212	7	%
		Loss on asset disposals, net		259		317		(58)	(18	)%
				148,482		151,964		(3,482)	(2	)%

	Operating income		$	1,953	$	14,743	$	(12,790)	(87	)%

Intercompany revenues			$	(6,685)	$	(5,218)	$	(1,467)	(28	)%
Intercompany expenses				(6,685)		(5,218)		(1,467)	(28	)%
				—		—		—

Total TDS Telecom operating income			$	66,778	$	108,867	$	(42,089)	(39	)%

Telephone and Data Systems, Inc.

Consolidated Statement of Cash Flows
(Unaudited)

				Nine Months Ended
				September 30,
				2009		2008
				(Dollars in thousands)
Cash flows from operating activities
	Net income			$	231,198	$	319,765
	Add (deduct) adjustments to reconcile net income to net cash flows from operating activities
			Depreciation, amortization and accretion		558,362		562,159
			Bad debts expense		78,941		59,452
			Stock-based compensation expense		24,523		15,961
			Deferred income taxes, net		25,935		(298,200)
			Gain on investments and financial instruments, net		—		(31,595)
			Equity in earnings of unconsolidated entities		(67,034)		(66,945)
			Distributions from unconsolidated entities		51,668		51,224
			Loss on asset disposals, net		9,469		17,190
			Noncash interest expense		2,160		8,573
			Excess tax benefit from stock awards		(5)		(1,832)
			Other operating activities		(41)		(1,955)
		Changes in assets and liabilities from operations
			Accounts receivable		(102,137)		(82,857)
			Inventory		(3,595)		(12,929)
			Accounts payable		(29,401)		7,140
			Customer deposits and deferred revenues		(3,609)		9,827
			Accrued taxes		82,267		109,269
			Accrued interest		9,893		5,528
			Other assets and liabilities		(68,643)		(37,951)
					799,951		631,824

Cash flows from investing activities
	Additions to property, plant and equipment				(450,594)		(485,028)
	Cash paid for acquisitions and licenses				(15,242)		(336,259)
	Cash received from divestitures				50		6,838
	Proceeds from disposition of investments				—		259,017
	Cash paid to settle derivative liabilities				—		(17,404)
	Cash paid for short-term investments				(109,055)		—
	Other investing activities				3,285		(832)
					(571,556)		(573,668)

Cash flows from financing activities
	Issuance of notes payable				—		100,000
	Repayment of notes payable				—		(100,000)
	Repayment of variable prepaid forward contracts				—		(47,357)
	Repayment of long-term debt				(2,507)		(8,296)
	TDS Common Shares and Special Common Shares reissued for benefit plans, net of tax payments				1,296		1,916
	U.S. Cellular Common Shares reissued for benefit plans, net of tax payments				(119)		(1,286)
	Excess tax benefit from stock awards				5		1,832
	Repurchase of TDS Common and Special Common Shares				(152,918)		(111,769)
	Repurchase of U.S. Cellular Common Shares				(24,283)		(23,146)
	Dividends paid				(35,389)		(35,783)
	Payment of debt issuance costs				(10,074)		—
	Distributions to noncontrolling interests				(4,962)		(6,539)
	Other financing activities				1,406		3,909
					(227,545)		(226,519)

Net increase (decrease) in cash and cash equivalents					850		(168,363)

Cash and cash equivalents
	Beginning of period				777,309		1,174,446
	End of period			$	778,159	$	1,006,083

	Service revenue	$3,900-$3,950 million
	Operating income(1)	$300-$375 million
	Depreciation, amortization and accretion(1)	Approx. $600 million
	Capital expenditures	Approx. $575 million

	Operating revenues	$775-$800 million
	Operating income (1)(2)	$80-$95 million
	Depreciation, amortization and accretion (1)(2)	Approx. $170 million
	Capital expenditures	Approx. $125 million

Repurchase Period	# Shares	Cost (in millions)
2009 (fourth quarter)	441,679	$	13.4
2009 (third quarter)	2,633,467	$	73.9
2009 (second quarter)	2,684,267	$	73.9
2009 (first quarter)	504,026	$	12.1
2008 (full year)	5,861,822	$	199.6
2007 (full year)	2,076,979	$	126.7
Total 2009, 2008 and 2007	14,202,240	$	499.6