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<SEC-DOCUMENT>0000018926-04-000018.txt : 20040312
<SEC-HEADER>0000018926-04-000018.hdr.sgml : 20040312
<ACCEPTANCE-DATETIME>20040312150005
ACCESSION NUMBER:		0000018926-04-000018
CONFORMED SUBMISSION TYPE:	10-K
PUBLIC DOCUMENT COUNT:		16
CONFORMED PERIOD OF REPORT:	20031231
FILED AS OF DATE:		20040312

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CENTURYTEL INC
		CENTRAL INDEX KEY:			0000018926
		STANDARD INDUSTRIAL CLASSIFICATION:	TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813]
		IRS NUMBER:				720651161
		STATE OF INCORPORATION:			LA
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-07784
		FILM NUMBER:		04665824

	BUSINESS ADDRESS:	
		STREET 1:		P O BOX 4065
		STREET 2:		100 CENTURYTEL DR
		CITY:			MONROE
		STATE:			LA
		ZIP:			71203
		BUSINESS PHONE:		3183889000

	MAIL ADDRESS:	
		STREET 1:		100 CENTURYTEL DR
		STREET 2:		P O BOX 4065
		CITY:			MONROE
		STATE:			LA
		ZIP:			71203

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CENTURY TELEPHONE ENTERPRISES INC
		DATE OF NAME CHANGE:	19920703

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CENTRAL TELEPHONE & ELECTRONICS CORP
		DATE OF NAME CHANGE:	19720512
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>file10k.txt
<DESCRIPTION>2003 FILE 10-K
<TEXT>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

           [ X ] Annual Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                   For the fiscal year ended December 31, 2003

                                       or

           [ ] Transition Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                          Commission file number 1-7784

                                CENTURYTEL, INC.
             (Exact name of Registrant as specified in its charter)

             Louisiana                                    72-0651161
  (State or other jurisdiction of                        (IRS Employer
  incorporation or organization)                      Identification No.)

  100 CenturyTel Drive, Monroe, Louisiana                    71203
  (Address of principal executive offices)                 (Zip Code)

Registrant's telephone number, including area code - (318) 388-9000

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class              Name of each exchange on which registered
     -------------------              -----------------------------------------

 Common Stock, par value $1.00               New York Stock Exchange
                                             Berlin Stock Exchange
 Preference Share Purchase Rights            New York Stock Exchange
                                             Berlin Stock Exchange
 Corporate Units issued May 2002             New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

                                  Stock Options
                                (Title of class)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.    Yes [X] No [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  [ ]

Indicate by check mark if the Registrant is an accelerated filer (as defined in
Rule 12b-2 of the Act).               Yes  [X]    No [   ]


The aggregate market value of voting stock held by non-affiliates (affiliates
being for these purposes only directors, executive officers and holders of more
than five percent of the Company's outstanding voting securities) was $5.0
billion as of June 30, 2003. As of February 27, 2004, there were 142,261,540
shares of common stock outstanding.


                      DOCUMENTS INCORPORATED BY REFERENCE:

Portions of the Registrant's Proxy Statement to be furnished in connection with
the 2004 annual meeting of shareholders are incorporated by reference in Part
III of this Report.

<PAGE>

                                     PART I

Item 1.       Business

      General. CenturyTel, Inc. ("CenturyTel") is a regional integrated
communications company engaged primarily in providing local exchange telephone
services. For the year ended December 31, 2003, local exchange telephone
operations provided 87% of the consolidated revenues from continuing operations
of CenturyTel and its subsidiaries (the "Company"). All of the Company's
operations are conducted within the continental United States.

      At December 31, 2003, the Company's local exchange telephone subsidiaries
operated approximately 2.4 million telephone access lines, primarily in rural,
suburban and small urban areas in 22 states, with over 70% of these lines
located in Wisconsin, Missouri, Alabama, Arkansas and Washington. According to
published sources, the Company is the eighth largest local exchange telephone
company in the United States based on the number of access lines served. For
more information, see "Telephone Operations."

      The Company also provides long distance, Internet access, fiber transport,
competitive local exchange carrier, security monitoring, and other
communications and business information services in certain local and regional
markets. For more information, see "Other Operations."

      Recent acquisitions. In June 2003, the Company acquired the assets of
Digital Teleport, Inc., a regional communications company providing wholesale
data transport services to other communications carriers over its fiber optic
network located in Missouri, Arkansas, Oklahoma and Kansas, for $39.4 million
cash. In addition, in December 2003, the Company acquired additional fiber
transport assets in Arkansas, Missouri and Illinois from Level 3 Communications,
Inc. for approximately $15.8 million cash. For additional information, see
"Other Operations - Fiber Transport."

      On August 31, 2002, the Company purchased assets utilized in serving
approximately 350,000 telephone access lines in the state of Missouri from
Verizon Communications, Inc. ("Verizon") for approximately $1.179 billion cash.
On July 1, 2002, the Company purchased assets utilized in serving approximately
300,000 telephone access lines in the state of Alabama from Verizon for
approximately $1.022 billion cash. The assets purchased in these transactions
included (i) the franchises authorizing the provision of local telephone
service, (ii) related property and equipment comprising Verizon's local exchange
operations in predominantly rural markets throughout Alabama and Missouri and
(iii) Verizon's assets used to provide digital subscriber line ("DSL") and other
high speed data services within the purchased exchanges. The acquired assets did
not include Verizon's cellular, personal communications services ("PCS"), long
distance, dial-up Internet, or directory publishing operations in these areas.

      On February 28, 2002, the Company purchased the fiber network and customer
base of KMC Telecom's operations in Monroe and Shreveport, Louisiana which
allows the Company to offer broadband and competitive local exchange services to
customers in these markets.

      On July 31, 2000 and September 29, 2000, affiliates of the Company
acquired assets utilized to provide local exchange telephone service to over
490,000 telephone access lines from Verizon in four separate transactions for
approximately $1.5 billion in cash. Under these transactions:

 o    On July 31, 2000, the Company purchased approximately 231,000 telephone
      access lines and related assets throughout Arkansas for approximately
      $842 million in cash.

 o    On July 31, 2000, Spectra Communications Group, LLC ("Spectra")
      purchased approximately 127,000 telephone access lines and related
      assets throughout Missouri for approximately $297 million cash. At
      closing, the Company made a preferred equity investment in Spectra of
      approximately $55 million (which represented a 57.1% interest) and
      financed substantially all of the remainder of the purchase price. In
      the first quarter of 2001, the Company purchased an additional 18.6%
      interest in Spectra for $47.1 million. In the fourth quarter of 2003,
      the Company purchased an additional 24.3% interest in Spectra for
      $32.4 million in cash.

 o    On September 29, 2000, the Company purchased approximately 70,500
      telephone access lines and related assets throughout Wisconsin for
      approximately $197 million in cash.

 o    On September 29, 2000, Telephone USA of Wisconsin, LLC ("TelUSA")
      purchased approximately 62,900 telephone access lines and related assets
      throughout Wisconsin for approximately $172 million in cash. The Company
      owns 89% of TelUSA, which was organized to acquire and operate these
      Wisconsin properties. At closing, the Company made an equity investment
      in TelUSA of approximately $37.8 million and financed substantially all
      of the remainder of the purchase price.

      In August 2000, the Company acquired the assets of CSW Net, Inc., a
regional Internet service provider that offers dial-up and dedicated Internet
access, and web site and domain hosting to more than 18,000 customers in 28
communities in Arkansas.

      The Company continually evaluates the possibility of acquiring additional
communications assets in exchange for cash, securities or both, and at any given
time may be engaged in discussions or negotiations regarding additional
acquisitions. The Company generally does not announce its acquisitions or
dispositions until it has entered into a preliminary or definitive agreement.
Although the Company's primary focus will continue to be on acquiring interests
that are proximate to its properties or that serve a customer base large enough
for the Company to operate efficiently, other communications interests may also
be acquired and these acquisitions could have a material impact upon the
Company.

      Recent Dispositions. On August 1, 2002, the Company sold substantially all
of its wireless operations principally to an affiliate of ALLTEL Corporation
("Alltel") for an aggregate of approximately $1.59 billion in cash. In
connection with this transaction, the Company divested its (i) interests in its
majority-owned and operated cellular systems, which at June 30, 2002 served
approximately 783,000 customers and had access to approximately 7.8 million pops
(the estimated population of licensed cellular telephone markets multiplied by
the Company's proportionate equity interest in the licensed operators thereof),
(ii) minority cellular equity interests representing approximately 1.8 million
pops at June 30, 2002, and (iii) licenses to provide PCS covering 1.3 million
pops in Wisconsin and Iowa. As a result, the Company's wireless operations are
reflected as discontinued operations in the Company's accompanying consolidated
financial statements.

      In the second quarter of 2001, the Company sold to Leap Wireless
International, Inc. 30 PCS operating licenses for an aggregate of $205 million.
The Company received approximately $118 million of the purchase price in cash at
closing and collected the remainder in installments through the fourth quarter
of 2001.

      In June 1999, the Company sold all of the operations of its Brownsville
and McAllen, Texas, cellular systems to Western Wireless Corporation for
approximately $96 million cash. The Company received its proportionate share of
the sale proceeds of approximately $45 million after-tax.

      In May 1999, the Company sold substantially all of its Alaska telephone
and wireless operations for approximately $300 million after-tax. In February
2000, the Company sold its interest in Alaska RSA #1, which completed the
Company's divestiture of its Alaska operations.

      Where to find additional information. The Company makes available free of
charge on its website (www.centurytel.com) filings made with the Securities and
Exchange Commission ("SEC") on Forms 10-K, 10-Q and 8-K as soon as reasonably
practicable after such filings are made with the SEC.

      The Company also makes available free of charge on its website its
Corporate Governance Guidelines, its Corporate Compliance Program and the
charters of its audit, compensation, risk evaluation, and nominating and
corporate governance committees. The Company will furnish printed copies of
these materials upon the request of any shareholder.

      Other. As of December 31, 2003, the Company had approximately 6,720
employees, approximately 1,800 of whom were members of 13 different bargaining
units represented by the International Brotherhood of Electrical Workers and the
Communications Workers of America. Relations with employees continue to be
generally good.

      CenturyTel was incorporated under Louisiana law in 1968 to serve as a
holding company for several telephone companies acquired over the previous 15 to
20 years. CenturyTel's principal executive offices are located at 100 CenturyTel
Drive, Monroe, Louisiana 71203 and its telephone number is (318) 388-9000.


                              TELEPHONE OPERATIONS

      According to published sources, the Company is the eighth largest local
exchange telephone company in the United States, based on the approximately 2.4
million access lines it served at December 31, 2003. All of the Company's access
lines are digitally switched. Through its operating telephone subsidiaries, the
Company provides services to predominantly rural, suburban and small urban
markets in 22 states. The following table sets forth certain information with
respect to the Company's access lines as of December 31, 2003 and 2002.

<TABLE>
<CAPTION>
                            December 31, 2003                    December 31, 2002
- -----------------------------------------------------------------------------------------
                       Number of         Percent of         Number of         Percent of
 State               access lines       access lines       access lines      access lines
- -----------------------------------------------------------------------------------------

<S>                      <C>                 <C>              <C>                 <C>
Wisconsin (1)             478,134             20%               490,116            21%
Missouri (2)              472,884             20                478,207            20
Alabama                   283,501             12                289,015            12
Arkansas                  264,787             11                268,220            11
Washington                186,329              8                188,733             8
Michigan                  111,104              5                112,713             5
Louisiana                 103,726              4                104,408             4
Colorado                   95,726              4                 96,799             4
Ohio                       82,995              3                 84,452             4
Oregon                     75,530              3                 76,751             3
Montana                    64,863              3                 65,666             3
Texas                      46,397              2                 48,931             2
Minnesota                  30,469              1                 30,930             1
Tennessee                  27,084              1                 27,365             1
Mississippi                24,420              1                 24,156             1
New Mexico                  6,512              *                  6,565             *
Idaho                       5,974              *                  5,976             *
Wyoming                     5,669              *                  5,494             *
Indiana                     5,401              *                  5,468             *
Iowa                        2,082              *                  2,099             *
Arizona                     2,000              *                  1,986             *
Nevada                        531              *                    514             *
- -----------------------------------------------------------------------------------------
                        2,376,118            100%             2,414,564           100%
=========================================================================================
</TABLE>
*     Represents less than 1%.
(1)   As of December 31, 2003 and 2002, approximately 59,130 and 61,060,
      respectively, of these lines were owned and operated by CenturyTel's
      89%-owned affiliate.
(2)   As of December 31, 2002, approximately 130,740 of these lines were owned
      and operated by an affiliate of which CenturyTel owned 75.7%.

      As indicated in the following table, the Company has experienced growth in
its telephone operations over the past five years, a substantial portion of
which was attributable to the third quarter 2002 and third quarter 2000
acquisitions of telephone properties from Verizon and the expansion of services.

<TABLE>
<CAPTION>
                                            Year ended or as of December 31,
- ----------------------------------------------------------------------------------------
                                2003         2002         2001         2000         1999
- ----------------------------------------------------------------------------------------
                                                 (Dollars in thousands)
<S>                        <C>          <C>          <C>          <C>          <C>
Access lines               2,376,118    2,414,564    1,797,643    1,800,565    1,272,867
   % Residential                  76%          76           76           76           75
   % Business                     24%          24           24           24           25
Operating revenues      $  2,071,980    1,733,592    1,505,733    1,253,969    1,126,112
Capital expenditures    $    317,357      319,536      351,010      275,523      233,512
- ----------------------------------------------------------------------------------------
</TABLE>

      As discussed further below, the Company's access lines (exclusive of
acquisitions) have declined in recent years, and are expected to continue to
decline. To offset these declines, the Company hopes to expand its telephone
operations by (i) acquiring additional telephone properties, (ii) providing
service to new customers, (iii) increasing network usage, (iv) further
penetrating its existing customer base with existing services and (v) providing
additional services which may be made possible by advances in technology,
improvements in the Company's infrastructure and the bundling of integrated
services. See "-Services" and "-Regulation and Competition."

Services

      The Company's local exchange telephone subsidiaries derive revenue from
providing (i) local telephone services, (ii) network access services and (iii)
other related services. The following table reflects the percentage of telephone
operating revenues derived from these respective services:

<TABLE>
<CAPTION>
                                             2003         2002         2001
- ---------------------------------------------------------------------------
<S>                                         <C>          <C>          <C>
Local service                                36.4%        34.9         32.6
Network access                               54.8         56.1         58.1
Other                                         8.8          9.0          9.3
- ---------------------------------------------------------------------------
                                            100.0%       100.0        100.0
===========================================================================
</TABLE>

      Local service. Local service revenues are derived from providing local
exchange telephone services in the Company's service areas, including basic
dial-tone service through the Company's regular switched network and local
private line services. Access lines declined 1.6% in 2003, 1.1% in 2002
(exclusive of the 2002 Verizon acquisitions) and 0.2% in 2001. The Company
believes these declines in the number of access lines were primarily due to
general economic conditions in the Company's markets and the displacement of
traditional wireline telephone services by other competitive service providers,
including the Company's DSL product offering. Even as the economy recovers, the
Company believes that any rebound in access lines will be limited by continued
access line losses caused primarily by the impact of other competitive services.
Based on current conditions, the Company expects access lines to decline between
1 and 2% for 2004.

      The use of digital switches, high-speed data circuits and related software
has been an important component of the Company's growth strategy because it
allows the Company to offer enhanced voice services (such as call forwarding,
conference calling, caller identification, selective call ringing and call
waiting) and data services (such as data private line, digital subscriber line,
frame relay and local area/wide area networks) and to thereby increase
utilization of existing access lines. In 2003 the Company continued to expand
the availability of enhanced services offered in certain service areas.

      Network access. Network access revenues primarily relate to (i) services
provided by the Company to long distance carriers, wireless carriers and other
carriers and customers in connection with the use of the Company's facilities to
originate and terminate their interstate and intrastate voice and data
transmissions and (ii) the receipt of universal support funds which allows the
Company to recover a portion of its costs under federal and state cost recovery
mechanisms (see - "Regulation and Competition - High-cost support funds" below).
Certain of the Company's interstate network access revenues are based on
tariffed access charges prescribed by the Federal Communications Commission
("FCC"); the remainder of such revenues are derived under revenue sharing
arrangements with other local exchange carriers ("LECs") administered by the
National Exchange Carrier Association ("NECA"), a quasi-governmental non-profit
organization formed by the FCC in 1983 for such purposes.

      Certain of the Company's intrastate network access revenues are derived
through access charges billed by the Company to intrastate long distance
carriers and other LEC customers. Such intrastate network access charges are
based on tariffed access charges, which are subject to state regulatory
commission approval. Additionally, certain of the Company's intrastate network
access revenues, along with intrastate and intra-LATA (Local Access and
Transport Areas) long distance revenues, are derived through revenue sharing
arrangements with other LECs.

      AT&T filed a petition with the FCC in December 2003 seeking forbearance
from enforcing certain provisions of the Telecommunications Act of 1996 that
allows LECs to file access tariffs on a streamlined basis and, if certain
criteria are met, deems those tariffs lawful. Certain of the Company's
telephone subsidiaries file interstate tariffs directly with the FCC using this
streamlined filing approach. As a result of recent court rulings, tariffs that
have been "deemed lawful" in effect nullify an interexchange carrier's ability
to seek refunds should the earnings from the tariffs ultimately result in
earnings above the authorized rate of return prescribed by the FCC. The Company
has not recognized any revenues in excess of the authorized rate of return
applicable to those carriers who historically have requested refunds pending
resolution of the "deemed lawful" tariff issue. The Company will continue to
monitor the status of the AT&T petition with the FCC. Although it is possible
the Company could benefit favorably upon resolution of this issue, there is no
assurance that a favorable outcome will occur.

      Other. Other telephone revenues include revenues related to (i) leasing,
selling, installing, maintaining and repairing customer premise
telecommunications equipment and wiring, (ii) providing billing and collection
services for long distance companies and (iii) participating in the publication
of local directories.

      Certain large communications companies for which the Company currently
provides billing and collection services continue to indicate their desire to
reduce their billing and collection expenses, which has resulted and may
continue to result in reductions of the Company's billing and collection
revenues. In addition, the Company expects its 2004 directory revenues to
decline from 2003 levels due to reduced revenues associated with the Verizon
properties acquired in 2002.

      For further information on regulatory, technological and competitive
changes that could impact the Company's revenues, see "-Regulation and
Competition" and "Special Considerations."

Federal Financing Programs

      Certain of the Company's telephone subsidiaries receive long-term
financing from the Rural Utilities Service ("RUS") or the Rural Telephone Bank
("RTB"). The RUS has made long-term loans to telephone companies since 1949 for
the purpose of improving telephone service in rural areas. The RUS continues to
make new loans at interest rates that range from 5% to 7% based on borrower
qualifications and the cost of funds to the United States government. The RTB,
established in 1971, makes long-term loans at interest rates based on its
average cost of funds as determined by statutory formula (which ranged from 5.7%
to 6.1% for the RTB's fiscal year ended September 30, 2003), and in some cases
makes loans concurrently with RUS loans. Approximately 25% of the Company's
telephone plant is pledged to secure obligations of the Company's telephone
subsidiaries to the RUS and RTB. The Company's telephone subsidiaries that are
indebted to government agencies generally may not loan or advance any funds to
CenturyTel, but may pay dividends if certain financial covenants are met.

      For additional information regarding the Company's financing, see the
Company's consolidated financial statements included in Item 8 herein.

Regulation and Competition

      Traditionally, LECs operated as regulated monopolies having the exclusive
right and responsibility to provide local telephone services. (These LECs are
sometimes referred to below as "incumbent LECs" or "ILECs"). Consequently, most
of the Company's intrastate telephone operations have traditionally been
regulated extensively by various state regulatory agencies (generally called
public service commissions or public utility commissions) and its interstate
operations have been regulated by the FCC. As discussed in greater detail below,
passage of the Telecommunications Act of 1996 (the "1996 Act"), coupled with
state legislative and regulatory initiatives and technological changes,
fundamentally altered the telephone industry by reducing the regulation of LECs
and attracting a substantial increase in the number of competitors and capital
invested in existing and new services. CenturyTel anticipates that these trends
towards reduced regulation and increased competition will continue.

      State regulation. The local service rates and intrastate access charges of
substantially all of the Company's telephone subsidiaries are regulated by state
regulatory commissions which typically have the power to grant and revoke
franchises authorizing companies to provide communications services. Most
commissions have traditionally regulated pricing through "rate of return"
regulation that focuses on authorized levels of earnings by LECs. Most of these
commissions also (i) regulate the purchase and sale of LECs, (ii) prescribe
depreciation rates and certain accounting procedures, (iii) oversee
implementation of several federal telecommunications laws and (iv) regulate
various other matters, including certain service standards and operating
procedures.

      In recent years, state legislatures and regulatory commissions in most of
the 22 states in which the Company operates have either reduced the regulation
of LECs or have announced their intention to do so, and it is expected that this
trend will continue. Wisconsin, Missouri, Alabama, Arkansas and several other
states have implemented laws or rulings which require or permit LECs to opt out
of "rate of return" regulation in exchange for agreeing to alternative forms of
regulation which typically permit the LEC greater freedom to establish local
service rates in exchange for agreeing not to charge rates in excess of
specified caps. As discussed further below, subsidiaries operating over half of
the Company's access lines in various states have agreed to be governed by
alternative regulation plans, and the Company continues to explore its options
for similar treatment in other states. The Company believes that reduced
regulatory oversight of certain of the Company's telephone operations may allow
the Company to offer new and competitive services faster than under the
traditional regulatory process. For a discussion of legislative, regulatory and
technological changes that have introduced competition into the local exchange
industry, see "-Developments Affecting Competition."

      Alternative regulation plans govern some or all of the access lines
operated by the Company in Wisconsin, Missouri, Alabama and Arkansas, which are
the Company's four largest state markets. The following summary describes the
alternative regulation plans applicable to the Company in these states.

     o   Approximately 70% of the Company's Wisconsin access lines are regulated
under various alternative regulation plans. Each of these alternative regulation
plans has a five-year term and permits the Company to adjust local rates within
specified parameters if it meets certain quality-of-service and
infrastructure-development commitments. These plans also include initiatives
designed to promote competition. The Company's Wisconsin access lines acquired
in mid-2000 continue to be regulated under "rate of return" regulation.

     o    All of the Company's Missouri LECs are regulated under a price-cap
regulation plan (effective in 2002) whereby basic service rates are adjusted
annually based on an inflation-based factor; non-basic services may be increased
up to 8% annually. The plan also allows LECs to rebalance local basic service
rates up to four times in the first four years of such regulation as a result of
access rate or toll reductions.

     o   Since 1995, the Company's Alabama telephone properties acquired from
Verizon in 2002 have been subject to an alternative regulation plan. Under this
plan, local rates were frozen initially for five years, after which time such
rates can be raised by an amount equal to consumer price index increases less
1%; non-basic service rates can be increased up to 10% per year.

     o   In January 2004, the Company's Alabama telephone properties and the
other independent LECs in the state filed comments recommending that the Alabama
Public Service Commission ("Alabama PSC") adopt an alternative regulation plan,
with modifications, proposed by BellSouth. This plan would allow exchanges
identified as competitive exchanges full pricing flexibility for all services.
Exchanges considered less competitive in nature would have the flexibility to
increase basic rates up to 5% a year and increase non-basic rates up to 10% a
year. The Company is currently awaiting a decision by the Alabama PSC concerning
this proposal.

     o   The Company's Arkansas LECs, excluding the properties acquired from
Verizon in 2000, are regulated under an alternative regulation plan adopted in
1997, which initially froze basic local and access rates for three years, after
which time such rates can be adjusted based on an inflation-based factor. Other
local rates can be adjusted without commission approval; however, such rates
are subject to commission review if certain petition criteria are met.

      Notwithstanding the movement toward alternative regulation, LECs operating
approximately 41% of the Company's total access lines continue to be subject to
"rate of return" regulation for intrastate purposes. These LECs remain subject
to the powers of state regulatory commissions to conduct earnings reviews and
adjust service rates, either of which could lead to revenue reductions.

      FCC regulation. The FCC regulates interstate services provided by the
Company's telephone subsidiaries primarily by regulating the interstate access
charges that are billed to long distance companies and other communications
companies by the Company for use of its network in connection with the
origination and termination of interstate voice and data transmissions.
Additionally, the FCC has prescribed certain rules and regulations for telephone
companies, including a uniform system of accounts and rules regarding the
separation of costs between jurisdictions and, ultimately, between interstate
services. LECs must obtain FCC approval to use certain radio frequencies, or to
transfer control of any such licenses.

      Effective January 1, 1991, the FCC adopted price-cap regulation relating
to interstate access rates for the Regional Bell Operating Companies. All other
LECs may elect to be subject to price-cap regulation. Under price-cap
regulation, limits imposed on a company's interstate rates are adjusted
periodically to reflect inflation, productivity improvement and changes in
certain non-controllable costs. In May 1993 the FCC adopted an optional
incentive regulatory plan for LECs not subject to price-cap regulation. A LEC
electing the optional incentive regulatory plan would, among other things, file
tariffs based primarily on historical costs and not be allowed to participate in
the relevant NECA pooling arrangements. The Company has not elected price-cap
regulation or the optional incentive regulatory plan for its incumbent
operations. However, the properties acquired from Verizon in 2002 are operated
under price-cap regulation. In connection with this acquisition, the Company
obtained a waiver of the FCC's "all or nothing" rule. This waiver is valid until
the FCC reviews the future appropriateness of the "all or nothing" rule. Absent
the waiver, present FCC rules require a carrier that purchases access lines
subject to price-cap regulation to convert all of its properties to price-cap
regulation.

      In 2001, the FCC modified its interstate access charge rules and universal
service support system for rate of return LECs. This order, among other things,
(i) increased the caps on the subscriber line charges ("SLC") to the levels paid
by most subscribers nationwide; (ii) allowed limited SLC deaveraging, which
enhanced the competitiveness of rate of return carriers by giving them pricing
flexibility; (iii) lowered per minute rates collected for federal access
charges; (iv) created a new explicit universal service support mechanism that
replaced other implicit support mechanisms in a manner designed to ensure that
rate structure changes do not affect the overall recovery of interstate access
costs by rate of return carriers serving high cost areas and (v) preserved the
historic 11.25% authorized interstate return rate for rate of return LECs. The
effect of this order on the Company was revenue neutral for interstate purposes,
but did result in a reduction in intrastate revenues in Arkansas and Ohio (where
intrastate access rates must mirror the interstate access rates).

      The FCC is currently examining several issues that could have a
substantial impact on the Company's revenues, including a broad inquiry
initiated in 2001 into all currently regulated forms of intercarrier
compensation. As discussed further below, certain providers of competitive
communications services are not required to compensate ILECs for the use of
their networks. The Company relies on access revenues as an important source of
revenues. Depending on the final outcome of the FCC's intercarrier compensation
issue, the Company could suffer a material loss of access revenues.

      All forms of federal support available to ILECs are currently available
to any local competitor that qualifies as an "eligible telecommunications
carrier." This support could encourage additional competitors to enter the
Company's high-cost service areas, and, as discussed further below, place
financial pressure on the FCC's support programs.

      High-cost support funds, revenue sharing arrangements and related matters.
A significant number of the Company's telephone subsidiaries recover a portion
of their costs under federal and state cost recovery mechanisms that
traditionally have allowed LECs serving small communities and rural areas to
provide communications services on terms and at prices reasonably comparable to
those available in urban areas.

      As mandated by the 1996 Act, in May 2001 the FCC modified its existing
universal service support mechanism for rural telephone companies. The FCC
adopted an interim mechanism for a five-year period, effective July 1, 2001,
based on embedded, or historical, costs that will provide predictable levels of
support to rural local exchange carriers, including substantially all of the
Company's local exchange carriers. During 2003 and 2002 the Company's telephone
subsidiaries received $199.2 million and $192.4 million, respectively, from the
federal Universal Service High Cost Loop Fund, representing 8.4% and 9.8%,
respectively, of the Company's consolidated revenues from continuing operations
for 2003 and 2002. The Company anticipates its 2004 revenues from the federal
Universal Service High Cost Loop Fund will be lower than 2003 levels due to
increases in the nationwide average cost per loop factor used by the FCC to
allocate funds among all recipients. Wireless and other competitive service
providers continue to seek eligible telecommunications carrier ("ETC") status in
order to be eligible to receive Universal Service Fund support, which is placing
additional financial pressure on the amount of money needed to provide support
to all eligible service providers, including support payments the Company
receives from the High Cost Loop Fund. As a result of the limited growth in the
size of the High Cost Loop Fund and changes in requests for support from the
Universal Service Fund, the Company has no assurance it will continue to
receive payments from the Universal Service Fund commensurate with those
received in the past.

      In late 2002, the FCC requested that the Federal-State Joint Board
("FSJB") on Universal Service review various FCC rules governing high cost
universal service support, including rules regarding eligibility to receive
support payments in markets served by LECs and competitive carriers. On February
7, 2003, the FSJB issued a notice for public comment on whether present rules
fulfill their purpose and whether or not modifications are needed. On February
27, 2004, the FSJB sent the FCC a series of recommendations concerning the
process of designating ETCs and suggestions for gaining better control over the
disbursement of high-cost universal service support in markets where one or more
ETCs are present. Specifically, the FSJB recommended that the FCC adopt
permissive federal guidelines designating service and operational criteria for
states to consider using in proceedings to designate ETC's. The FSJB also
recommended that the FCC limit the scope of high-cost support to a single
connection that provides access to the public telephone network. However, the
FSJB did not specify a process for determining which single connection should be
used or how best to address the numerous administrative issues associated with a
single connection. The FSJB declined to recommend that the FCC modify the
methodology used to calculate support in study areas with multiple ETCs, instead
recommending that the FSJB and the FCC consider possible modifications to the
basis of support as part of an overall review of the high-cost support mechanism
for rural and non-rural carriers sometime in 2006. The FCC has taken various
other steps in anticipation of restructuring universal service support
mechanisms, including opening a docket that will change the method of funding
contributions. The FCC is still considering various contribution methodologies
prior to issuing an order. The Congress is also exploring various universal
service issues ranging from targeted universal service legislation to re-writing
the 1996 Act. The Company has been and will continue to be active in monitoring
these developments.

      In addition, the Company's telephone subsidiaries received $33.3 million
and $31.7 million in 2003 and 2002, respectively, from intrastate support funds.

      In January 2003, the Louisiana Public Service Commission directed its
staff to review the feasibility of converting the $42 million Louisiana Local
Optional Service Fund ("LOS Fund") into a state universal service fund.
Currently, the LOS Fund is funded primarily by BellSouth, which proposes to
expand the base of contributors into the LOS Fund. A recommendation by the
Commission staff is not expected until late 2004. The Company currently receives
approximately $21 million from the LOS Fund each year. There can be no assurance
that this funding will remain at current levels.

      Some of the Company's telephone subsidiaries operate in states where
traditional cost recovery mechanisms, including rate structures, are under
evaluation or have been modified. See "- State Regulation." There can be no
assurance that these states will continue to provide for cost recovery at
current levels.

      The FCC requires all communications carriers providing interstate
telecommunications services, including the Company's LECs and long distance
operations, to contribute to programs to provide discounted telecommunications
services to schools, libraries and rural health care providers. The Company's
contributions by its LEC and long distance operations, both of which the Company
itemizes as separate charges on its customer's bills, was approximately $20.6
million and $6.6 million, respectively, in 2003, and $10.6 million and $4.4
million, respectively, in 2002.

      Substantially all of the Company's LECs (except for the properties
acquired from Verizon in 2002) concur with the common line tariff and certain of
the Company's LECs concur with the traffic sensitive tariffs filed by the NECA;
such LECs participate in the access revenue sharing arrangements administered by
the NECA for interstate services. All of the intrastate network access revenues
of the Company's LECs are based on access charges, cost separation studies or
special settlement arrangements. See "- Services."

      Certain long distance carriers continue to request that certain of the
Company's LECs reduce intrastate access tariffed rates. Long distance carriers
have also aggressively pursued regulatory or legislative changes that would
reduce access rates. See "-Services - Network Access" above for additional
information.

      Developments affecting competition. The communications industry continues
to undergo fundamental changes which are likely to significantly impact the
future operations and financial performance of all communications companies.
Primarily as a result of regulatory and technological changes, competition has
been introduced and encouraged in each sector of the telephone industry in
recent years. As a result, the Company increasingly faces competition from
providers seeking to use the Company's network and from providers offering
competitive services.

      The 1996 Act, which obligates LECs to permit competitors to interconnect
their facilities to the LEC's network and to take various other steps that are
designed to promote competition, imposes several duties on a LEC if it receives
a specific request from another entity which seeks to connect with or provide
services using the LEC's network. In addition, each incumbent LEC is obligated
to (i) negotiate interconnection agreements in good faith, (ii) provide
"unbundled" access to all aspects of the LEC's network, (iii) offer resale of
its telecommunications services at wholesale rates and (iv) permit competitors
to collocate their physical plant on the LEC's property, or provide virtual
collocation if physical collocation is not practicable. During 2003, the FCC
released new rules which outline the obligations of incumbent LECs to lease
elements of their circuit-switched networks on an unbundled basis to
competitors. The new framework eliminates the prior obligation of incumbent LECs
to lease their high-speed data lines to competitors. Incumbent LECs will remain
obligated to offer other telecommunications services to resellers at wholesale
rates. These wholesale rates are based on a forward-looking cost model and other
terms that substantially limit the profitability of these arrangements to
incumbent LECs. This new rule also provides for a significant role of state
regulatory commissions in implementing these new guidelines and establishing
wholesale service rates. On March 2, 2004, a federal district court of appeals
overturned the rules previously adopted by the FCC requiring LECs to provide
competitors with discounted access to the LECs networks. The court also ruled
that the FCC should not have given states the authority previously granted. It
is expected that such decision will be appealed to the Supreme Court. During
2003, the FCC also sought public comments on whether it should make additional
changes to its interconnection regulations, and instituted a comprehensive
review of its methodologies for establishing wholesale rates.

      Under the 1996 Act's rural telephone company exemption, approximately 50%
of the Company's telephone access lines are exempt from certain of the 1996
Act's interconnection requirements unless and until the appropriate state
regulatory commission overrides the exemption upon receipt from a competitor of
a bona fide request meeting certain criteria. States are permitted to adopt laws
or regulations that provide for greater competition than is mandated under the
1996 Act. Management believes that competition in its telephone service areas
has increased and will continue to increase as a result of the 1996 Act and the
FCC's interconnection rulings. While competition through use of the Company's
network is still limited in most of its markets, the Company expects to receive
additional interconnection requests in the future from a variety of resellers
and facilities-based service providers.

      In addition to these changes in federal regulation, all of the 22 states
in which the Company provides telephone services have taken legislative or
regulatory steps to further introduce competition into the LEC business.

      As a result of these regulatory developments, ILECs increasingly face
competition from competitive local exchange carriers ("CLECs"), particularly in
high population areas. CLECs provide competing services through reselling the
ILECs' local services, through use of the ILECs' unbundled network elements or
through their own facilities. The number of companies which have requested
authorization to provide local exchange service in the Company's service areas
has increased substantially in recent years, especially in the Company's Verizon
markets acquired in 2002 and 2000. The Company anticipates that similar action
may be taken by other competitors in the future, especially if all forms of
federal support available to ILECs continue to remain available to these
competitors.

     Technological developments have led to the development of new services that
compete with traditional LEC services. Technological improvements have enabled
cable television companies to provide traditional circuit-switched telephone
service over their cable networks, and several national cable companies have
aggressively pursued this opportunity. Recent improvements in the quality of
"Voice-over-Internet Protocol" ("VoIP") service have led several large cable
television and telephone companies, as well as start-up companies, to
substantially increase their offerings of VoIP service to business and
residential customers. VoIP providers route calls over the Internet, without use
of ILEC's circuit switches and, in certain cases, without use of ILEC's networks
to carry their communications traffic. VoIP providers can offer services at
prices substantially below those currently charged for traditional local and
long distance telephone services for several reasons, including lower network
cost structures and the current ability of VoIP providers to use ILECs' networks
without paying access charges. In December 2003, the FCC initiated rulemaking
that is expected to address the effect of VoIP on intercarrier compensation,
universal service and emergency services. There can be no assurance that this
rulemaking will be on terms favorable to ILECs, or that VoIP providers will not
successfully compete for the Company's customers.

      Wireless telephone services increasingly constitute a significant source
of competition with LEC services, especially as wireless carriers expand and
improve their network coverage and continue to lower their prices. As a result,
some customers have chosen to completely forego use of traditional wireline
phone service and instead rely solely on wireless service. This trend is
particularly evident among younger customers and in urban areas. The Company
anticipates this trend will continue, particularly if wireless service rates
continue to decline and the quality of wireless service in the Company's markets
improves. Technological and regulatory developments in cellular telephone,
personal communications services, digital microwave, satellite, coaxial cable,
fiber optics, local multipoint distribution services and other wired and
wireless technologies are expected to further permit the development of
alternatives to traditional landline services.

      In addition to facing direct competition from those providers described
above, ILECs increasingly face competition from alternate communication systems
constructed by long distance carriers, large customers or alternative access
vendors. These systems, which have become more prevalent as a result of the 1996
Act, are capable of originating or terminating calls without use of the ILECs'
networks or switching services. Other potential sources of competition include
noncarrier systems that are capable of bypassing ILECs' local networks, either
partially or completely, through substitution of special access for switched
access or through concentration of telecommunications traffic on a few of the
ILECs' access lines. The Company anticipates that all these trends will continue
and lead to increased competition with the Company's LECs.

      In November 2003, the FCC adopted rules requiring companies to allow their
customers to keep their wireline or wireless phone number when switching to
another service provider (generally referred to as "local number portability").
For several years, customers have been able to retain their numbers when
switching their local service between wireline carriers. The new rules now
require local number portability between wireline and wireless carriers. This
requirement went into effect November 24, 2003 for wireline carriers in the top
100 Metropolitan Statistical Areas ("MSAs"). The new requirement will go into
effect May 24, 2004 for wireline carriers operating in markets smaller than the
top 100 MSAs. The majority of the Company's wireline operations are conducted in
markets below the top 100 MSAs. Local number portability may increase the number
of customers who choose to completely forego the use of traditional wireline
phone service, although the Company believes that it is too early to fully
assess the rule's impact. The costs to comply with the requirements of local
number portability, net of the amount that is recoverable through the
ratemaking process, are not expected to have a material impact on the
Company's results of operations.

      Historically, ILECs had little or no competition associated with
intra-LATA long distance calls in their service areas. Principally as a result
of recent state regulatory changes, companies offering competing toll services
have emerged in the Company's local exchange markets.

      Significant competitive factors include pricing, packaging of services and
features, quality of service and meeting customer needs such as simplified
billing and timely response to service calls.

      As the telephone industry increasingly experiences competition, the size
and resources of each respective competitor may increasingly influence its
prospects. Many companies currently providing or planning to provide competitive
communication services have substantially greater financial and marketing
resources than the Company, and several are not subject to the same regulatory
constraints as the Company.

      The Company anticipates that the traditional operations of LECs will
continue to be impacted by continued regulatory and technological developments
affecting the ability of LECs to provide new services and the capability of long
distance companies, CLECs, wireless companies, cable television companies, VoIP
providers and others to provide competitive LEC services. Competition relating
to traditional LEC services has thus far affected large urban areas to a greater
extent than rural, suburban and small urban areas such as those in which the
Company operates. The Company intends to actively monitor these developments, to
observe the effect of emerging competitive trends in larger markets and to
continue to evaluate new business opportunities that may arise out of future
technological, legislative and regulatory developments.

      The Company anticipates that industry changes and competitive pressures
will continue to place downward pressure on its telephone revenues. However, the
Company anticipates that such reductions may be limited by increases in
revenues attributable to the continued demand for enhanced services and new
product offerings. The Company expects its telephone revenues to decline in 2004
due to continued access line losses and reduced network access revenues;
however, the Company expects its consolidated revenues to increase in 2004
primarily due to increased revenues from its newly-acquired LightCore operations
and expected increased demand for its long distance, fiber transport, DSL and
other nonregulated product offerings, as discussed further below.

                                OTHER OPERATIONS

      The Company provides long distance, Internet access, competitive local
exchange services, fiber transport, security monitoring, and other
communications and business information services in certain local and regional
markets. The results of these operations, which accounted for 13% of the
Company's consolidated revenues from continuing operations during 2003, are
reflected for financial reporting purposes as "Other operations." Additional
data on the Company's long distance and Internet access services is provided in
the table below.

<TABLE>
<CAPTION>
                                            Year ended or as of December 31,
- --------------------------------------------------------------------------------------
                                 2003         2002        2001        2000        1999
- --------------------------------------------------------------------------------------
                                                 (Dollars in thousands)
<S>                           <C>          <C>         <C>         <C>         <C>
Long distance operations
   Operating revenues      $  173,884      146,536     117,363     104,435      83,087
   Customers                  769,766      648,797     465,872     363,307     303,722
     % Residential                 90%          90          91          91          91
     % Business                    10%          10           9           9           9
Internet operations
   Operating revenues      $   79,933       58,665      39,057      23,491      16,818
   Customers                  215,548      179,440     144,817     108,700      68,392
     % Dial-Up Service             65%          73          84          95         100
     % DSL Service                 35%          27          16           5           -
- --------------------------------------------------------------------------------------
</TABLE>

      Long distance. In 1996 the Company began marketing long distance service
in its equal access telephone operating areas. At December 31, 2003, the Company
provided long distance services to nearly 770,000 customers. The Company owns
and operates switches in LaCrosse, Wisconsin, Shreveport, Louisiana and
Vancouver, Washington, which are utilized to provide long distance services.
The Company anticipates that most of its long distance service revenues will be
provided as part of an integrated bundle with the Company's other service
offerings, including its local exchange telephone service offering.

      Internet access. The Company began offering traditional dial-up Internet
access services to its telephone customers in 1995. In late 1999, the Company
began offering digital subscriber line ("DSL") Internet access services, a
high-speed premium-priced data service. As of December 31, 2003, approximately
63% of the Company's access lines were DSL-enabled.

      Competitive local exchange services. In late 2000, the Company began
offering competitive local exchange telephone services, coupled with long
distance, Internet access and other Company services, to small to medium-sized
businesses in Monroe and Shreveport, Louisiana. On February 28, 2002, the
Company purchased the fiber network and customer base of KMC Telecom's
operations in Monroe and Shreveport, Louisiana, which allowed the Company to
offer broadband and competitive local exchange services to customers in these
markets.

      Fiber transport. During the second quarter of 2001, the Company began
selling capacity to other carriers and businesses over a 700-mile fiber optic
ring that the Company constructed in southern and central Michigan. In June
2003, the Company acquired the assets of Digital Teleport, Inc., a regional
communications company providing wholesale data transport services to other
communications carriers over its fiber optic network located in Missouri,
Arkansas, Oklahoma and Kansas, for $39.4 million cash. The Company has used the
network to sell services to new and existing customers and to reduce the
Company's reliance on third party transport providers. In addition, in December
2003, the Company acquired additional fiber transport assets in Arkansas,
Missouri and Illinois from Level 3 Communications, Inc. for approximately $15.8
million cash to provide services similar to those described above. The Company
operates the assets acquired from both transactions under the name LightCore. As
of December 31, 2003, LightCore's network encompassed more than 6,500 route
miles of lit fiber in the central United States.

      Security monitoring. The Company offers 24-hour burglary and fire
monitoring services to approximately 8,600 customers in select markets in
Louisiana, Arkansas, Mississippi, Texas and Ohio.

      The Company also provides audiotext services; printing, database
management and direct mail services; and cable television services. From time to
time the Company also makes investments in other domestic or foreign
communications companies, the most significant of which is an interest in a
start-up satellite service company.

      Certain service subsidiaries of the Company provide installation and
maintenance services, materials and supplies, and managerial, technical,
accounting and administrative services to the telephone and other operating
subsidiaries. In addition, the Company provides and bills management services to
subsidiaries and in certain instances makes interest-bearing advances to finance
construction of plant, purchases of equipment or acquisitions of other
businesses. These transactions are recorded by the Company's regulated telephone
subsidiaries at their cost to the extent permitted by regulatory authorities.
Intercompany profit on transactions with regulated affiliates is limited to a
reasonable return on investment and has not been eliminated in connection with
consolidating the results of operations of CenturyTel and its subsidiaries. Such
intercompany profit is reflected as a reduction of cost of sales and operating
expenses in "Other operations".

                               OTHER DEVELOPMENTS

      The Company is in the process of developing an integrated billing and
customer care system which will provide the Company with, in addition to
standard billing functionality currently being provided by its legacy system,
custom built hardware and software technology for more efficient and effective
customer care, billing and provisioning systems. The costs to develop such
system have been accounted for in accordance with Statement of Position 98-1,
"Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use" ("SOP 98-1"). The capitalized costs of the system aggregated
$163.5 million (before accumulated amortization) at December 31, 2003. The
Company began amortizing its billing system costs in early 2003 (over a 20-year
period) based on the total number of customers that the Company has migrated to
the new system.

      The system remains in the development stage and has required
substantially more time and money to develop than originally anticipated. The
Company currently expects to complete all phases of the new system no later than
mid-2005 at an aggregate capitalized cost in accordance with SOP 98-1 of
approximately $200-215 million (exclusive of previously-disclosed write-offs).
In addition, the Company expects to incur additional costs related to completion
of the project, including (i) approximately $15 million of customer service
related and data conversion costs (the majority of which are expected to be
incurred in 2004) that will be expensed as incurred and (ii) $10 million of
capitalized hardware costs (which will be amortized over a three-year period).
The estimates above do not include any amounts for maintenance or on-going
support of either the old or new system, and are based on assumptions regarding
various future events, several of which are beyond the Company's control. There
is no assurance that the system will be completed in accordance with this
schedule or budget, or that the system will function as anticipated. If the
system does not function as anticipated, the Company may have to write off part
or all of its development costs and further explore its other billing and
customer care system alternatives.

                             SPECIAL CONSIDERATIONS

Risk Factors

o     We face competition, which could adversely affect us.

      As a result of various technological, regulatory and other changes, the
telecommunications industry has become increasingly competitive, and we expect
these trends to continue. The number of companies that have requested
authorization to provide traditional local exchange service in our markets has
increased in recent years, and we anticipate that others will take similar
action in the future. Recent technological developments have led several
competitors to substantially increase their service offerings, often at prices
substantially below those charged for traditional phone services. Wireless
telephone services increasingly constitute a significant source of competition
with LEC services, especially as wireless owners expand and improve their
network coverage and continue to lower their prices.

      We expect competition to intensify as a result of new competitors and
the development of new technologies, products and services. We cannot predict
which future technologies, products or services will be important to maintain
our competitive position or what funding will be required to develop and provide
these technologies, products or services. Our ability to compete successfully
will depend on how well we market our products and services, and on our ability
to anticipate and respond to various competitive and technological factors
affecting the industry, including a changing regulatory environment that may
affect us differently from our competitors, new services that may be introduced,
changes in consumer preferences, demographic trends, economic conditions and
discount pricing strategies by competitors.

      Many of our current and potential competitors have market presence,
engineering, technical and marketing capabilities and financial, personnel and
other resources substantially greater than ours. In addition, some of our
competitors can conduct operations or raise capital at a lower cost than we can,
are subject to less regulation, or have substantially stronger brand names.
Consequently, some competitors may be able to charge lower prices for their
products and services, to develop and expand their communications and network
infrastructures more quickly, to adapt more swiftly to new or emerging
technologies and changes in customer requirements, and to devote greater
resources to the marketing and sale of their products and services than we can.

      Competition could adversely impact us in several ways, including (i)
the loss of customers and market share, (ii) the possibility of customers
shifting to less profitable services, (iii) our need to lower prices or increase
marketing expenses to remain competitive and (iv) our inability to diversify by
offering new products or services.

o     We could be harmed by rapid changes in technology.

      The communications industry is experiencing significant technological
changes, particularly in the areas of VoIP, data transmission and wireless
communications. Some of our competitors may enjoy network advantages that will
enable them to provide services more efficiently or at lower cost. Rapid changes
in technology could result in the development of products or services that
compete with or displace those offered by traditional LECs. If we cannot develop
new products to keep pace with technological advances, or if such products are
not widely embraced by our customers, we could be adversely impacted.

o     Our industry is highly regulated, and continues to undergo various
      fundamental regulatory changes.

      As a diversified full service incumbent local exchange carrier, or
ILEC, we have traditionally been subject to significant regulation from federal,
state and local authorities. This regulation imposes substantial compliance
costs on us and restricts our ability to raise rates, to compete and to respond
rapidly to changing industry conditions. In recent years, the communications
industry has undergone various fundamental regulatory changes that have
generally reduced the regulation of telephone companies and permitted
competition in each segment of the telephone industry. These and subsequent
changes could adversely affect us by reducing the fees that we are permitted to
charge, altering our tariff structures, or otherwise changing the nature of our
operations and competition in our industry. Recent rule changes that permit
customers to retain their wireline or wireless number when switching to another
service provider could increase the number of our customers who choose to
disconnect their wireline service from us. Other pending rulemakings could have
a substantial impact on our operations, including in particular rulemakings on
intercarrier compensation, universal service, interconnection terms and resale
rates. Litigation and different objectives among federal and state regulators
could create uncertainty and delay our ability to respond to new regulations.
Moreover, changes in tax laws, regulations or policies could increase our tax
rate, particularly if state regulators continue to search for additional revenue
sources to address budget shortfalls. We are unable to predict the future
actions of the various regulatory bodies that govern us, but such actions could
materially affect our business.

o     We cannot assure you of growth in our core business.

      Due to the above-cited changes, the ILEC industry has recently
experienced a decline in access lines and long distance minutes of use. While we
have not suffered as much as a number of other ILECs from recent industry
challenges, the recent decline in access lines and long distance usage, coupled
with the other changes resulting from competitive, technological and regulatory
developments, could materially adversely effect our core business and future
prospects.

      We have traditionally sought growth largely through acquisitions of
properties similar to those currently operated by us. However, we cannot assure
you that properties will be available for purchase on terms attractive to us,
particularly if they are burdened by regulations, pricing plans or competitive
pressures that are new or different from those historically applicable to our
incumbent properties. Moreover, we cannot assure you that we will be able to
arrange additional financing on terms acceptable to us.

o     Our future results will suffer if we do not effectively manage our growth.

      Recently, we have rapidly expanded our operations primarily through
acquisitions and new product and service offerings, and we intend to pursue
similar growth opportunities in the future. Our future success depends, in
part, upon our ability to manage our growth, including our ability to:

      o       upgrade our billing and other information systems

      o       retain and attract technological, managerial and other
              key personnel

      o       effectively manage our day to day operations while attempting
              to execute our business strategy of expanding our wireline
              operations and our emerging businesses

      o       realize the projected growth and revenue targets developed by
              management for our newly acquired and emerging businesses, and

      o       continue to identify new acquisition or growth opportunities
              that we can finance, consummate and operate on attractive terms.

      Our rapid growth poses substantial challenges for us to integrate new
operations into our existing business in an efficient and timely manner, to
successfully monitor our operations, costs, regulatory compliance and service
quality, and to maintain other necessary internal controls. We cannot assure you
that these efforts will be successful, or that we will realize our expected
operating efficiencies, cost savings, revenue enhancements, synergies or other
benefits. If we are not able to meet these challenges effectively, our results
of operations may be harmed.

o     We cannot assure you that our new billing system will be successful.

      We are developing a new integrated billing and customer care system.
The system remains in the development stage and has required substantially more
time and money to develop than originally anticipated. As discussed further
herein, we expect our aggregate capitalized costs associated with the billing
system to total $200-215 million (exclusive of previously-disclosed write-offs)
upon completion of the system. Although we expect to complete all phases of the
system no later than mid-2005, we cannot assure you that this deadline (or our
budget) will be met or that the system will function as anticipated. If the
system does not function as anticipated, we may have to write off part or all of
our development costs.

o     We are reliant on support funds provided under federal and state laws.

      We receive a substantial portion of our revenues from the federal
Universal Service Fund and, to a lesser extent, intrastate support funds. These
governmental programs are reviewed and amended from time to time, and we cannot
assure you that they will not be changed or impacted in a manner adverse to us.
Unless the FCC can obtain additional funding sources for the Universal Service
Fund, we cannot assure you that we will continue to receive payments from the
Fund commensurate with those received in the past.

o     We could be affected by certain changes in labor matters.

      At December 31, 2003, approximately 27% of our employees were members
of 13 separate bargaining units represented by two different unions. From time
to time, our labor agreements with these unions lapse, and we typically
negotiate the terms of new agreements. We cannot predict the outcome of these
negotiations. We may be unable to reach new agreements, and union employees may
engage in strikes, work slowdowns or other labor actions, which could materially
disrupt our ability to provide services. In addition, new labor agreements may
impose significant new costs on us, which could impair our financial condition
or results of operations in the future.

o     We have a substantial amount of indebtedness.

      Principally as a result of our recent acquisitions, we have a
substantial amount of indebtedness. This could hinder our ability to adjust to
changing market and economic conditions, as well as our ability to access the
capital markets to refinance maturing debt in the ordinary course of business.
In connection with executing our business strategies, we are continuously
evaluating the possibility of acquiring additional communications assets, and we
may elect to finance acquisitions by incurring additional indebtedness. If we
incur significant additional indebtedness, our credit ratings could be adversely
affected. As a result, our borrowing costs would likely increase, our access to
capital may be adversely affected and our ability to satisfy our obligations
under our current indebtedness could be adversely affected.

o     We cannot assure you that we will obtain sufficient capital to expand.

      To respond to the competitive challenges discussed above, we may be
required to raise substantial additional capital to finance acquisitions or new
product or service offerings. Our ability to arrange additional financing will
depend on, among other factors, our financial position and performance, as well
as prevailing market conditions and other factors beyond our control. We cannot
assure you that we will be able to raise additional financing on terms
acceptable to us or at all.

o     We could be harmed by the adverse developments affecting other
      communications companies.

      During the past couple of years, WorldCom, Inc. and several other large
communications companies declared bankruptcy or suffered financial difficulties.
Likewise, a number of our suppliers have recently experienced financial
challenges, which could cause us to experience delays, interruptions or
additional expenses associated with upgrading and expanding our information
systems and networks and offering new products and services. Continued weakness
in the communications industry could have additional future adverse effects on
us, including reducing our ability to collect receivables and to access the
capital markets on favorable terms.

o     Our agreements and organizational documents and applicable law could
      limit another party's ability to acquire us at a premium.

      Under our articles of incorporation, each share of common stock that
has been beneficially owned by the same person or entity continually since May
30, 1987 generally entitles the holder to ten votes on all matters duly
submitted to a vote of shareholders. As of March 8, 2004, the holders of our
ten-vote shares held approximately 40% of our total voting power. In addition,
a number of other provisions in our agreements and organizational documents,
including our shareholder rights plan, and various provisions of applicable law
may delay, defer or prevent a future takeover of CenturyTel unless the takeover
is approved by our board of directors. This could deprive our shareholders of
any related takeover premium.


      Forward-Looking Statements

      This report on Form 10-K and other documents filed by us under the federal
securities laws include, and future oral or written statements or press releases
by us and our management may include, certain forward-looking statements,
including without limitation statements with respect to our anticipated future
operating and financial performance, financial position and liquidity, growth
opportunities and growth rates, business prospects, regulatory and competitive
outlook, investment and expenditure plans, investment results, financing
opportunities and sources (including the impact of financings on our financial
position, financial performance or credit ratings), pricing plans, strategic
alternatives, business strategies, and other similar statements of expectations
or objectives that are highlighted by words such as "expects," "anticipates,"
"intends," "plans," "believes," "projects," "seeks," "estimates," "hopes,"
"should," and "may," and variations thereof and similar expressions. Such
forward-looking statements are based upon our judgment and assumptions as of the
date of this report concerning future developments and events, many of which are
outside of our control. These forward-looking statements, and the assumptions
upon which such statements are based, are inherently speculative and are subject
to uncertainties that could cause our actual results to differ materially from
such statements. These uncertainties include but are not limited to those set
forth below:

o     the extent, timing, success and overall effects of competition from
      wireless carriers, VoIP providers, CLECs, cable television companies and
      others, including without limitation the risks that these competitors may
      offer less expensive or more innovative products and services.

o     the risks inherent in rapid technological change, including without
      limitation the risk that new technologies will displace our products and
      services.

o     the effects of ongoing changes in the regulation of the communications
      industry, including without limitation (i) increased competition resulting
      from the FCC's regulations relating to local number portability,
      interconnection and other matters, (ii) the final outcome of various
      federal, state and local regulatory initiatives and proceedings that could
      impact our competitive position, compliance costs, capital expenditures or
      prospects, and (iii) reductions in revenues received from the federal
      Universal Service Fund or other current or future federal and state
      support programs designed to compensate LECs operating in high-cost
      markets.

o     our ability to effectively manage our growth, including without limitation
      our ability to (i) integrate newly-acquired operations into our
      operations, (ii) attract and retain technological, managerial and other
      key personnel, (iii) achieve projected growth, revenue and cost savings
      targets, (iv) successfully upgrade our billing and other information
      systems in a timely and cost-efficient manner and (v) otherwise monitor
      our operations, costs, regulatory compliance, and service quality and
      maintain other necessary internal controls.

o     possible changes in the demand for, or pricing of, our products and
      services, including without limitation (i) reduced demand for traditional
      telephone services caused by greater use of wireless or Internet
      communications or other factors, (ii) reduced demand for second lines and
      (iii) reduced demand for our access services.

o     our ability to successfully introduce new product or service offerings on
      a timely and cost-effective basis, including without limitation our
      ability to (i) expand successfully our long distance and Internet
      offerings to new or acquired markets and (ii) offer bundled service
      packages on terms attractive to our customers.

o     our ability to collect receivables from financially troubled
      communications companies.

o     regulatory limits on our ability to change the prices for telephone
      services in response to industry changes.

o     impediments to our ability to expand through attractively priced
      acquisitions, whether caused by regulatory limits, financing constraints,
      a decrease in the pool of attractive target companies, or competition for
      acquisitions from other interested buyers.

o     the possible need to make abrupt and potentially disruptive changes in our
      business strategies due to changes in competition, regulation, technology,
      product acceptance or other factors.

o     the lack of assurance that we can compete effectively against
      better-capitalized competitors.

o     the impact of terrorist attacks on our business.

o     other risks referenced in this report and from time to time in our other
      filings with the Securities and Exchange Commission.

o     the effects of more general factors, including without limitation:

      --   changes in general industry and market conditions and growth rates
      --   changes in labor conditions, including workforce levels and labor
      negotiations
      --   changes in interest rates or other general national, regional
      or local economic conditions
      --   changes in legislation, regulation or public policy, including
      changes in federal rural financing programs or changes that increase
      our tax rate
      --   increases in capital, operating, medical or administrative costs, or
      the impact of new business opportunities requiring significant up-front
      investments
      --   the continued availability of financing in amounts, and on terms
      and conditions, necessary to support our operations
      --   changes in our relationships with vendors, or the failure of these
      vendors to provide competitive products on a timely basis
      --   changes in our senior debt ratings
      --   unfavorable outcomes of regulatory or legal proceedings, including
      rate proceedings
      --   losses or unfavorable returns on our investments in other
      communications companies
      --   delays in the construction of our networks
      --   changes in accounting policies, assumptions, estimates or practices
      adopted voluntarily or as required by generally accepted accounting
      principles.

      For additional information, see the description of our business included
above, as well as Item 7 of this report. Due to these uncertainties, there can
be no assurance that our anticipated results will occur, that our judgments or
assumptions will prove correct, or that unforeseen developments will not occur.
Accordingly, you are cautioned not to place undue reliance upon these
forward-looking statements, which speak only as of the date made. We undertake
no obligation to update or revise any of our forward-looking statements for any
reason, whether as a result of new information, future events or developments,
or otherwise.

                                  OTHER MATTERS

      The Company has certain obligations based on federal, state and local laws
relating to the protection of the environment. Costs of compliance through 2003
have not been material and the Company currently has no reason to believe that
such costs will become material.

      For additional information concerning the business and properties of the
Company, see Item 7 elsewhere herein, and the Consolidated Financial Statements
and notes 2, 5, 6, 13, and 18 thereto set forth in Item 8 elsewhere herein.

Item 2.       Properties.

      The Company's properties consist principally of telephone lines, central
office equipment, and land and buildings related to telephone operations. As of
December 31, 2003 and 2002, the Company's gross property, plant and equipment of
approximately $7.2 billion and $6.9 billion, respectively, consisted of the
following:

<TABLE>
<CAPTION>
                                                                December 31,
                                                           2003             2002
- --------------------------------------------------------------------------------
<S>                                                       <C>              <C>
Telephone operations
      Cable and wire                                       52.9%            53.0
      Central office                                       31.1             31.3
      General support                                       6.8              6.9
      Information origination/termination equipment         0.6              0.6
      Construction in progress                              0.3              0.5
      Other                                                 0.1              0.1
- --------------------------------------------------------------------------------
                                                           91.8             92.4
- --------------------------------------------------------------------------------

Other operations                                            8.2              7.6
- --------------------------------------------------------------------------------

                                                          100.0%           100.0
================================================================================
</TABLE>

      "Cable and wire" facilities consist primarily of buried cable and aerial
cable, poles, wire, conduit and drops. "Central office equipment" consists
primarily of switching equipment, circuit equipment and related facilities.
"General support" consists primarily of land, buildings, tools, furnishings,
fixtures, motor vehicles and work equipment. "Information
origination/termination equipment" consists primarily of premise equipment
(private branch exchanges and telephones) for official company use.
"Construction in progress" includes property of the foregoing categories that
has not been placed in service because it is still under construction.

      The properties of certain of the Company's telephone subsidiaries are
subject to mortgages securing the debt of such companies. The Company owns
substantially all of the central office buildings, local administrative
buildings, warehouses, and storage facilities used in its telephone operations.

      The Company's property in its Other Operations consist primarily of (i)
corporate general support assets, (ii) fiber transport assets and (iii)
equipment to provide competitive local exchange and Internet access services.

      For further information on the location and type of the Company's
properties, see the descriptions of the Company's operations in Item 1.


Item 3.       Legal Proceedings.

      In Barbrasue Beattie and James Sovis, on behalf of themselves and all
others similarly situated, v. CenturyTel, Inc., filed on October 29, 2002 in the
United States District Court for the Eastern District of Michigan (Case No.
02-10277), the plaintiffs allege that the Company unjustly and unreasonably
billed customers for inside wire maintenance services, and seek unspecified
money damages and injunctive relief under various legal theories on behalf of a
purported class of over two million customers in the Company's telephone
markets. The Court has not yet ruled on the plaintiffs' certification motion,
and has not yet set a date to resolve this issue. Given the current status of
this case, the Company cannot estimate the potential impact, if any, that this
case will have on its results of operations.

      From time to time, the Company is involved in other litigation incidental
to its business, including administrative hearings of state public utility
commissions relating primarily to rate making, actions relating to employee
claims, occasional grievance hearings before labor regulatory agencies and
miscellaneous third party tort actions. Currently, there are no material legal
proceedings of this nature.


Item 4.       Submission of Matters to a Vote of Security Holders.

      Not applicable.


                      Executive Officers of the Registrant

      Information concerning the Company's Executive Officers, set forth at Item
10 in Part III hereof, is incorporated in Part I of this Report by reference.


Item 5.       Market for Registrant's Common Equity and Related
              Stockholder Matters

      CenturyTel's common stock is listed on the New York Stock Exchange and is
traded under the symbol CTL. The following table sets forth the high and low
sales prices, along with the quarterly dividends, for each of the quarters
indicated.

<TABLE>
<CAPTION>
                                           Sales prices            Dividend per
                                       -------------------
                                        High          Low          common share
                                       ------        -----         ------------
<S>                                      <C>         <C>                <C>
2003:
      First quarter                  $   31.79       25.25              .0550
      Second quarter                 $   35.90       27.33              .0550
      Third quarter                  $   35.85       32.45              .0550
      Fourth quarter                 $   36.76       30.09              .0550

2002:
      First quarter                  $   35.50       28.80              .0525
      Second quarter                 $   34.45       27.00              .0525
      Third quarter                  $   30.60       21.13              .0525
      Fourth quarter                 $   31.65       22.35              .0525

</TABLE>

      Common stock dividends during 2003 and 2002 were paid each quarter.
As of February 27, 2004, there were approximately 4,530 stockholders of record
of CenturyTel's common stock.  As of March 8, 2004, the closing stock price of
CenturyTel common stock was $28.95.

      For information regarding shares of CenturyTel common stock authorized for
issuance under CenturyTel's equity compensation plans, see Item 12.


Item 6.       Selected Financial Data.

      The following table presents certain selected consolidated financial data
(from continuing operations) as of and for each of the years ended in the
five-year period ended December 31, 2003:

Selected Income Statement Data
<TABLE>
<CAPTION>
                                                                Year ended December 31,
                                       ----------------------------------------------------------------
                                              2003          2002        2001        2000        1999
                                       ----------------------------------------------------------------
                                                      (Dollars, except per share amounts, and
                                                           shares expressed in thousands)
<S>                                      <C>           <C>         <C>         <C>         <C>
Operating revenues
      Telephone                       $  2,071,980     1,733,592   1,505,733   1,253,969   1,126,112
      Other                                308,765       238,404     173,771     148,388     128,288
                                       ----------------------------------------------------------------
Total operating revenues              $  2,380,745     1,971,996   1,679,504   1,402,357   1,254,400
                                       ================================================================

Operating income
      Telephone                       $    688,114       543,113     423,420     376,290     351,559
      Other                                 62,282        43,568      22,098      31,258      22,580
      Corporate overhead costs
       allocable to discontinued
       operations                                -       (11,275)    (20,213)    (21,411)    (19,416)
                                       ----------------------------------------------------------------
Total operating income                $    750,396       575,406     425,305     386,137     354,723
                                       ================================================================

Nonrecurring gains and
 losses, net (pre-tax)                $          -         3,709      33,043           -      11,284
                                       ================================================================

Income from continuing operations     $    344,707       193,533     149,081     127,474     134,038
                                       ================================================================

Basic earnings per share from
 continuing operations                $       2.40          1.36        1.06         .91         .96
                                       ================================================================

Basic earnings per share from
 continuing operations, as
 adjusted for goodwill
 amortization                         $       2.40          1.36        1.39        1.17        1.19
                                       ================================================================

Diluted earnings per share from
 continuing operations                $       2.38          1.35        1.05         .90         .95
                                       ================================================================

Diluted earnings per share from
 continuing operations, as
 adjusted for goodwill
 amortization                         $       2.38          1.35        1.37        1.16        1.17
                                       ================================================================

Dividends per common share            $        .22           .21         .20         .19         .18
                                       ================================================================

Average basic shares outstanding           143,583       141,613     140,743     140,069     138,848
                                       ================================================================

Average diluted shares
 outstanding                               144,700       142,879     142,307     141,864     141,432
                                       ================================================================

Selected Balance Sheet Data

                                                                    December 31,
                                       ------------------------------------------------------------------
                                              2003         2002         2001         2000          1999
                                       ------------------------------------------------------------------
                                                               (Dollars in thousands)
Net property, plant and
 equipment                            $  3,455,481    3,531,645    2,736,142    2,698,010    2,000,789
Goodwill                              $  3,425,001    3,427,281    2,087,158    2,108,344    1,267,908
Total assets                          $  7,895,852    7,770,408    6,318,684    6,393,290    4,705,407
Long-term debt                        $  3,109,302    3,578,132    2,087,500    3,050,292    2,075,212
Stockholders' equity                  $  3,478,516    3,088,004    2,337,380    2,032,079    1,847,992
                                       ------------------------------------------------------------------
</TABLE>

      See Items 7 and 8 for a discussion of the Company's discontinued wireless
operations.

      The following table presents certain selected consolidated operating data
as of the end of each of the years in the five-year period ended December 31,
2003:

<TABLE>
<CAPTION>
                                                              Year ended December 31,
                                       ----------------------------------------------------------------
                                              2003         2002         2001         2000        1999
                                       ----------------------------------------------------------------

<S>                                      <C>          <C>          <C>          <C>         <C>
Telephone access lines                   2,376,118    2,414,564    1,797,643    1,800,565   1,272,867
Long distance customers                    769,766      648,797      465,872      363,307     303,722
                                       ----------------------------------------------------------------
</TABLE>

      See Items 1 and 2 in Part I and Items 7 and 8 elsewhere herein for
additional information.


Item 7.       Management's Discussion and Analysis of Financial
              Condition and Results of Operations

                             Results of Operations

                                    Overview

      CenturyTel, Inc. ("CenturyTel") and its subsidiaries is a regional
integrated communications company engaged primarily in providing local exchange,
long distance, Internet access and data services to customers in 22 states. For
the year ended December 31, 2003, local exchange telephone operations provided
87% of the consolidated revenues of CenturyTel and its subsidiaries (the
"Company"). The Company's local exchange telephone operations derive revenues
from providing (i) local telephone services, (ii) network access services and
(iii) other related services.

      On July 1, 2002, the Company acquired the local exchange telephone
operations of Verizon Communications, Inc. ("Verizon") in the state of Alabama
for approximately $1.022 billion cash. On August 31, 2002, the Company acquired
the local exchange telephone operations of Verizon in the state of Missouri for
approximately $1.179 billion cash. The results of operations for the Verizon
assets acquired are reflected in the Company's consolidated results of
operations subsequent to each respective acquisition. See "Acquisitions" below
and Note 2 of Notes to Consolidated Financial Statements for additional
information. During 2003, the Company also acquired fiber transport assets in
five central U.S. states (which the Company operates under the name LightCore)
for $55.2 million cash.

      On August 1, 2002, the Company sold substantially all of its wireless
operations principally to an affiliate of ALLTEL Corporation ("Alltel") in
exchange for an aggregate of approximately $1.59 billion in cash. As a result,
the Company's wireless operations for the years ended December 31, 2002 and 2001
have been reflected as discontinued operations on the Company's consolidated
statements of income and cash flows. For further information, see "Discontinued
Operations" below.

      During the three years ended December 31, 2003, the Company has acquired
and sold various other operations, the impact of which has not been material to
the financial position or results of operations of the Company.

      The net income of the Company for 2003 was $344.7 million, compared to
$801.6 million during 2002 and $343.0 million during 2001. Diluted earnings per
share for 2003 was $2.38 compared to $5.61 in 2002 and $2.41 in 2001. Income
from continuing operations (and diluted earnings per share from continuing
operations) was $344.7 million ($2.38), $193.5 million ($1.35) and $149.1
million ($1.05) for 2003, 2002 and 2001, respectively. In accordance with the
provisions of Statement of Financial Accounting Standards No. 142, "Goodwill and
Other Intangible Assets" ("SFAS 142"), amortization of goodwill ceased effective
January 1, 2002. If the results of operations for the year ended December 31,
2001 been subject to the provisions of SFAS 142, income from continuing
operations (and diluted earnings per share) would have been $195.4 million
($1.37) and net income (and diluted earnings per share) would have been $399.3
million ($2.81).

<TABLE>
<CAPTION>
Year ended December 31,                                  2003        2002         2001
- -----------------------------------------------------------------------------------------
                                                      (Dollars, except per share amounts,
                                                           and shares in thousands)
<S>                                                   <C>         <C>          <C>
Operating income
     Telephone                                   $    688,114     543,113      423,420
     Other                                             62,282      43,568       22,098
     Corporate overhead costs allocable
      to discontinued operations                            -     (11,275)     (20,213)
- -----------------------------------------------------------------------------------------
                                                      750,396     575,406      425,305
Interest expense                                     (226,751)   (221,845)    (225,523)
Income from unconsolidated cellular entity              6,160       5,582        7,592
Nonrecurring gains and losses, net                          -       3,709       33,043
Other income and expense                                2,154     (63,814)          32
Income tax expense                                   (187,252)   (105,505)     (91,368)
- -----------------------------------------------------------------------------------------
Income from continuing operations                     344,707     193,533      149,081
Discontinued operations, net of tax                         -     608,091      193,950
- -----------------------------------------------------------------------------------------
Net income                                       $    344,707     801,624      343,031
=========================================================================================
Net income, as adjusted for goodwill
 amortization                                    $    344,707     801,624      399,297
=========================================================================================

Basic earnings per share
     From continuing operations                  $       2.40        1.36         1.06
     From continuing operations, as
      adjusted for goodwill amortization         $       2.40        1.36         1.39
     From discontinued operations                $          -        4.29         1.38
     From discontinued operations, as
      adjusted for goodwill amortization         $          -        4.29         1.45
     Basic earnings per share                    $       2.40        5.66         2.43
     Basic earnings per share, as
      adjusted for goodwill amortization         $       2.40        5.66         2.83

Diluted earnings per share
     From continuing operations                  $       2.38        1.35         1.05
     From continuing operations, as
      adjusted for goodwill amortization         $       2.38        1.35         1.37
     From discontinued operations                $          -        4.26         1.36
     From discontinued operations, as
      adjusted for goodwill amortization         $          -        4.26         1.43
     Diluted earnings per share                  $       2.38        5.61         2.41
     Diluted earnings per share, as
      adjusted for goodwill amortization         $       2.38        5.61         2.81

Average basic shares outstanding                      143,583     141,613      140,743
=========================================================================================
Average diluted shares outstanding                    144,700     142,879      142,307
=========================================================================================
</TABLE>

      Contributions to operating revenues and operating income by the Company's
telephone and other operations for each of the years in the three-year period
ended December 31, 2003 were as follows:

<TABLE>
<CAPTION>
Year ended December 31,                       2003       2002        2001
- --------------------------------------------------------------------------
<S>                                           <C>        <C>         <C>
Operating revenues
   Telephone operations                       87.0%      87.9        89.7
   Other operations                           13.0%      12.1        10.3
Operating income
   Telephone operations                       91.7%      94.4        99.6
   Other operations                            8.3%       7.6         5.2
   Corporate overhead costs allocable
    to discontinued operations                   -%      (2.0)       (4.8)
- --------------------------------------------------------------------------
</TABLE>

      In addition to historical information, this management's discussion and
analysis includes certain forward-looking statements that are based on current
expectations only, and are subject to a number of risks, uncertainties and
assumptions, many of which are beyond the control of the Company. Actual events
and results may differ materially from those anticipated, estimated or projected
if one or more of these risks or uncertainties materialize, or if underlying
assumptions prove incorrect. Factors that could affect actual results include
but are not limited to: the timing, success and overall effects of competition
from a wide variety of competitive providers; the risks inherent in rapid
technological change; the effects of ongoing changes in the regulation of the
communications industry; the Company's ability to effectively manage its growth,
including integrating newly-acquired businesses into the Company's operations,
hiring adequate numbers of qualified staff, and successfully upgrading its
billing and other information systems; possible changes in the demand for, or
pricing of, the Company's products and services; the Company's ability to
successfully introduce new product or service offerings on a timely and
cost-effective basis; the Company's ability to collect its receivables from
financially troubled communications companies; other risks referenced from time
to time in this report or other of the Company's filings with the Securities and
Exchange Commission; and the effects of more general factors such as changes in
interest rates, in tax rates, in accounting policies or practices, in operating,
medical or administrative costs, in general market, labor or economic
conditions, or in legislation, regulation or public policy. These and other
uncertainties related to the business are described in greater detail in Item 1
included herein. You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this report. The
Company undertakes no obligation to update any of its forward-looking statements
for any reason.

Telephone Operations

      The Company conducts its telephone operations in rural, suburban and small
urban communities in 22 states. As of December 31, 2003, approximately 70% of
the Company's 2.4 million access lines were in Wisconsin, Missouri, Alabama,
Arkansas and Washington. The operating revenues, expenses and income of the
Company's telephone operations for 2003, 2002 and 2001 are summarized below.

<TABLE>
<CAPTION>
Year ended December 31,                        2003         2002         2001
- -------------------------------------------------------------------------------
                                                   (Dollars in thousands)
<S>                                       <C>          <C>          <C>
Operating revenues
   Local service                      $     754,063      604,580      491,529
Network access                            1,135,223      972,303      874,458
Other                                       182,694      156,709      139,746
- -------------------------------------------------------------------------------
                                          2,071,980    1,733,592    1,505,733
- -------------------------------------------------------------------------------
Operating expenses
   Plant operations                         505,786      433,187      380,466
Customer operations                         167,594      148,502      117,080
Corporate and other                         259,635      211,924      186,483
Depreciation and amortization               450,851      396,866      398,284
- -------------------------------------------------------------------------------
                                          1,383,866    1,190,479    1,082,313
- -------------------------------------------------------------------------------
Operating income                      $     688,114      543,113      423,420
===============================================================================
</TABLE>

      Local service revenues. Local service revenues are derived from the
provision of local exchange telephone services in the Company's service areas.
Of the $149.5 million (24.7%) increase in local service revenues in 2003, $130.1
million was due to the properties acquired from Verizon in the third quarter of
2002. Of the remaining $19.4 million increase, $8.4 million was due to the
provision of custom calling features to more customers and $5.9 million was due
to increased rates in certain jurisdictions. Of the $113.1 million (23.0%)
increase in local service revenues in 2002, $102.8 million was due to the
acquisition of the Verizon properties in 2002. The remaining $10.3 million
increase was primarily due to a $7.6 million increase resulting from the
provision of custom calling features to more customers and a $1.8 million
increase due to increased rates in certain jurisdictions. Access lines declined
38,400 (1.6%) during 2003 compared to a decline of 19,600 (1.1%) in 2002
(exclusive of acquisitions). The Company believes the decline in the number of
access lines during 2003 and 2002 is primarily due to general economic
conditions in the Company's markets and the displacement of traditional wireline
telephone services by other competitive services, including the Company's DSL
product offering. Even as the economy recovers, the Company believes that any
rebound in access lines will be limited by continued access line losses caused
primarily by the impact of other competitive services. Based on current
conditions, the Company expects access lines to decline between 1 and 2% for
2004.

      Network access revenues. Network access revenues are primarily derived
from charges to long distance companies and other customers for access to the
Company's local exchange carrier ("LEC") networks in connection with the
completion of interstate or intrastate voice and data transmissions. Certain of
the Company's interstate network access revenues are based on tariffed access
charges filed directly with the Federal Communications Commission ("FCC"); the
remainder of such revenues are derived under revenue sharing arrangements with
other LECs administered by the National Exchange Carrier Association. Intrastate
network access revenues are based on tariffed access charges filed with state
regulatory agencies or are derived under revenue sharing arrangements with other
LECs.

      Network access revenues increased $162.9 million (16.8%) in 2003 and $97.8
million (11.2%) in 2002 due to the following factors:
<TABLE>
<CAPTION>
                                                         2003          2002
                                                       increase      increase
                                                      (decrease)    (decrease)
- ------------------------------------------------------------------------------
                                                       (Dollars in thousands)

<S>                                               <C>                  <C>
Acquisitions of Verizon properties in
 third quarter 2002                               $      146,941       98,014
Increased recovery from the federal
 Universal Service Fund ("USF")                              250       13,832
One-time refund of access charges to
 interexchange carriers                                    7,645       (7,645)
Intrastate revenues due to decreased
 minutes of use and decreased access
 rates in certain states                                  (6,798)     (27,740)
Partial recovery of increased operating
 costs through revenue sharing
 arrangements with other telephone companies,
 increased recovery from state support
 funds and return on rate base                             4,116        9,756
Rate changes in certain jurisdictions                      2,472        5,600
Revision of prior year revenue
 settlement agreements                                     9,983        1,912
Other, net                                                (1,689)       4,116
- ------------------------------------------------------------------------------
                                                  $      162,920       97,845
==============================================================================
</TABLE>

      As indicated in the chart above, in 2003 the Company experienced a
reduction in its intrastate revenues (exclusive of the properties acquired from
Verizon in 2002) of approximately $6.8 million primarily due to (i) a reduction
in intrastate minutes (partially due to the displacement of minutes by wireless
and electronic mail services) and (ii) decreased access rates in certain states.
The corresponding decrease in 2002 compared to 2001 was $27.7 million. The
Company believes intrastate minutes will continue to decline in 2004, although
the magnitude of such decrease cannot be precisely estimated.

      The Company anticipates that revenue derived from its revision of prior
year revenue settlement agreements will be lower in 2004 compared to 2003
levels.

      Other revenues. Other revenues include revenues related to (i) leasing,
selling, installing, maintaining and repairing customer premise
telecommunications equipment and wiring ("CPE services"), (ii) providing billing
and collection services for long distance carriers and (iii) participating in
the publication of local directories. Other revenues increased $26.0 million
(16.6%) during 2003, substantially all of which is due to the properties
acquired from Verizon in the third quarter of 2002. Other revenues increased
$17.0 million (12.1%) in 2002, of which $18.2 million was due to the properties
acquired from Verizon in 2002.

      Operating expenses. Plant operations expenses during 2003 and 2002
increased $72.6 million (16.8%) and $52.7 million (13.9%), respectively. Of the
$72.6 million increase in 2003, $74.8 million was due to the properties acquired
from Verizon in the third quarter of 2002. The remaining $2.2 million decrease
was due to a $5.7 million decrease in information technology expenses and a $5.2
million decrease in repair and maintenance expenses. Such decreases were
partially offset by a $4.8 million increase in access expenses and $4.7 million
increase in salaries and benefits. Of the $52.7 million increase in 2002, $58.4
million was attributable to the properties acquired from Verizon in 2002 and
$13.8 million related to increases in salaries and benefits. Such increases were
partially offset by a $16.4 million decrease in access expenses primarily as a
result of changes in certain optional calling plans in Arkansas approved in late
2001 and a $3.0 million decrease in repairs and maintenance expense.

      Customer operations, corporate and other expenses increased $66.8 million
(18.5%) in 2003 and $56.9 million (18.7%) in 2002. Of the $66.8 million increase
in 2003, $65.4 million related to the Verizon acquisitions in 2002. The
remaining increase of $1.4 million was due primarily to (i) a $14.0 million
increase in operating taxes, which included a $7.5 million charge arising out of
various operating tax audits in 2003, and (ii) a $6.7 million increase in
information technology expenses largely attributable to the Company's
development of the new billing system described below under "Development of
Billing System". Such increases were partially offset by (i) a $16.0 million
decrease in the provision for uncollectible receivables (as 2002 was adversely
impacted by the establishment of a $15.0 million reserve for uncollectible
receivables primarily related to the bankruptcy of MCI (formerly WorldCom,
Inc.), whereas 2003 was positively impacted by a $5.0 million reduction in the
provision for uncollectible receivables due to the partial recovery of amounts
previously written off related to the bankruptcy of MCI) and (ii) a $4.6 million
decrease in customer service expenses. Of the $56.9 million increase in 2002,
$47.2 million related to the Verizon acquisitions in 2002. The remaining
increase of $9.7 million was due primarily to a $7.7 million increase in
salaries and benefits, a $4.6 million increase in customer service expenses and
a $3.9 million increase in the provision for uncollectible receivables
(attributable to the above-mentioned establishment of a $15.0 million reserve
for uncollectible receivables primarily related to the bankruptcy of MCI which
was partially offset by an $11.1 million reduction in the provision for
uncollectible receivables for non-carrier customers). Such increases were
partially offset by a $5.0 million decrease in operating taxes and a $1.4
million decrease in expenses related to the provision of CPE services.

      Depreciation and amortization increased $54.0 million (13.6%) in 2003 and
decreased $1.4 million (0.4%) in 2002. Of the $54.0 million increase in 2003,
$50.9 million was due to the properties acquired from Verizon in 2002. The
remaining increase is primarily due to an increase in depreciation expense due
to higher levels of plant in service in incumbent markets. Of the $1.4 million
decrease in 2002, $58.0 million related to ceasing amortization of goodwill
effective January 1, 2002 in accordance with the provisions of SFAS 142. Such
decrease was substantially offset by $38.0 million of depreciation and
amortization related to the properties acquired from Verizon in 2002 and a $21.8
million increase in depreciation expense due to higher levels of plant in
service in incumbent markets. The composite depreciation rate for the Company's
telephone properties was 7.0% for 2003, 6.9% for 2002 and 6.8% for 2001.

      Other. For additional information regarding certain matters that have
impacted or may impact the Company's telephone operations, see "Regulation and
Competition".


Other Operations

      Other operations includes the results of continuing operations of
subsidiaries of the Company which are not included in the telephone segment
including, but not limited to, the Company's non-regulated long distance
operations, Internet operations, competitive local exchange carrier ("CLEC")
operations and fiber transport operations. During 2003, the Company paid $55.2
million cash to acquire fiber transport assets in five central U.S. states
(which the Company operates under the name LightCore). The operating revenues,
expenses and income of the Company's other operations for 2003, 2002 and 2001
are summarized below.

<TABLE>
<CAPTION>
Year ended December 31,                        2003         2002         2001
- ------------------------------------------------------------------------------
                                                   (Dollars in thousands)
<S>                                         <C>          <C>          <C>
Operating revenues
   Long distance                       $    173,884      146,536      117,363
   Internet                                  79,933       58,665       39,057
   Other                                     54,948       33,203       17,351
- ------------------------------------------------------------------------------
                                            308,765      238,404      173,771
- ------------------------------------------------------------------------------
Operating expenses
   Cost of sales and operating
    expenses                                226,693      180,076      142,919
   Depreciation and amortization             19,790       14,760        8,754
- ------------------------------------------------------------------------------
                                            246,483      194,836      151,673
- ------------------------------------------------------------------------------
Operating income                       $     62,282       43,568       22,098
==============================================================================
</TABLE>

      Long distance revenues increased $27.3 million (18.7%) and $29.2 million
(24.9%) in 2003 and 2002, respectively. The $27.3 million increase in 2003 was
primarily attributable to the growth in the number of customers and increased
minutes of use ($32.6 million), primarily due to penetration of the markets
acquired from Verizon in 2002. Such increase was partially offset by a decrease
in the average rate charged by the Company ($5.3 million). The $29.2 million
increase in 2002 was primarily attributable to the growth in the number of
customers and increased average minutes of use ($34.8 million), partially offset
by a decrease in the average rate charged by the Company per minute of use ($5.8
million). The Company anticipates that increased competition will continue to
place downward pressure on rates. The number of long distance customers as of
December 31, 2003, 2002, and 2001 was approximately 769,760, 648,790, and
465,870, respectively.

      Internet revenues increased $21.3 million (36.3%) in 2003 and $19.6
million (50.2%) in 2002 due primarily to growth in the number of customers,
principally due to the expansion of the Company's DSL product offering.

      Other revenues increased $21.7 million (65.5%) primarily due to (i) $16.7
million of revenues associated with the Company's LightCore operations and (ii)
a $4.3 million increase in revenues in the Company's CLEC business primarily due
to an increased number of customers, including those acquired in connection with
the purchase of certain CLEC operations on February 28, 2002. Other revenues
increased $15.9 million in 2002, of which $15.1 million was due to increased
revenues in the Company's CLEC business, primarily due to the above-referenced
CLEC acquisition in early 2002.

      Cost of sales and operating expenses increased $46.6 million (25.9%) in
2003 primarily due to (i) a $14.6 million increase in expenses associated with
the Company's long distance operations (of which $7.4 million was due to
increased payments to other carriers due to higher minutes of use partially
offset by a decrease in the rate per minute of use; $2.8 million was due to an
increase in the provision for doubtful accounts; and $2.4 million was due to an
increase in billing and collection costs); (ii) a $16.4 million increase in
expenses associated with the Company's Internet operations due to an increase in
the number of customers; and (iii) a $10.4 million increase in expenses
associated with the Company's LightCore operations.

      Cost of sales and operating expenses increased $37.2 million (26.0%) in
2002 primarily due to (i) a $23.9 million increase in expenses associated with
the Company's long distance operations (of which $13.4 million was due to
increased payments to other carriers due to higher minutes of use partially
offset by a decrease in the rate per minute of use; $5.3 million was related to
increased sales and marketing costs; $2.2 million was due to an increase in the
provision for doubtful accounts; and $2.3 million was due to an increase in
billing and collection costs); (ii) an $11.8 million increase in expenses
associated with the Company's CLEC operations primarily due to the expansion of
the business and operations acquired in the first quarter of 2002; and (iii) a
$12.3 million increase associated with expanding the Company's Internet
operations due to an increase in customers. Such increases were partially offset
by a $7.4 million reduction in expenses primarily due to the increased
intercompany profit with regulated affiliates (the recognition of which in
accordance with regulatory accounting principles acts to offset operating
expenses).

      Depreciation and amortization increased $5.0 million in 2003 and $6.0
million in 2002 primarily due to increased depreciation expense in the Company's
CLEC and fiber transport businesses (including LightCore).

      Certain of the Company's service subsidiaries provide managerial,
operational, technical, accounting and administrative services, along with
materials and supplies, to the Company's telephone subsidiaries. In accordance
with regulatory accounting, intercompany profit on transactions with regulated
affiliates has not been eliminated in connection with consolidating the results
of operations of the Company. When the regulated operations of the Company no
longer qualify for the application of Statement of Financial Accounting
Standards No. 71, "Accounting for the Effects of Certain Types of Regulation"
("SFAS 71"), such intercompany profit will be eliminated in subsequent financial
statements, the primary result of which will be a decrease in operating expenses
applicable to the Company's telephone operations and an increase in operating
expenses applicable to the Company's other operations. The amount of
intercompany profit with regulated affiliates which was not eliminated was
approximately $28.5 million, $29.5 million and $22.0 million in 2003, 2002 and
2001, respectively. For additional information applicable to SFAS 71, see
"Regulation and Competition -- Other Matters."

INTEREST EXPENSE

      Interest expense increased $4.9 million in 2003 primarily due to $7.5
million of interest associated with various operating tax audits. Such increase
was partially offset by reduced interest expense due to a decrease in average
debt outstanding.

      Interest expense decreased $3.7 million in 2002 due to a decrease in
average debt outstanding and decreased rates.

INCOME FROM UNCONSOLIDATED CELLULAR ENTITY

      Income from unconsolidated cellular entity was $6.2 million in 2003, $5.6
million in 2002 and $7.6 million in 2001. Such income represents the Company's
share of income from its 49% interest in a cellular partnership.

NONRECURRING GAINS AND LOSSES, NET

      In 2002, the Company recorded a pre-tax gain of $3.7 million from the sale
of a PCS license.

      In 2001, the Company's net favorable nonrecurring pre-tax gains were $33.0
million. The Company recorded a pre-tax gain on the sale of its remaining shares
of Illuminet Holdings, Inc. ("Illuminet") common stock aggregating $54.6 million
($35.5 million after-tax; $.25 per diluted share) and a pre-tax gain of $4.0
million ($2.6 million after-tax; $.02 per diluted share) on the sale of certain
other assets. Additionally in 2001, the Company recorded pre-tax charges of
$25.5 million ($16.6 million after-tax; $.12 per diluted share) due to the
write-down in the value of certain non-operating investments in which the
Company owns a minority interest.

OTHER INCOME AND EXPENSE

      Other income and (expense) was $2.2 million in 2003, ($63.8 million) in
2002 and $32,000 in 2001. Included in 2002 was a $59.9 million pre-tax charge
related to the Company's payment of premium in connection with redeeming its
Series I remarketable notes, net of unamortized premium.

INCOME TAX EXPENSE

      The Company's effective income tax rate (from continuing operations) was
35.2%, 35.3% and 38.0% in 2003, 2002 and 2001, respectively. The decrease in the
effective tax rate in 2002 compared to 2001 is primarily attributable to the
effect of ceasing amortization of goodwill (some of which was nondeductible for
tax purposes) effective January 1, 2002 in accordance with the provisions of
SFAS 142. In 2003, the Company reduced the valuation allowance related to net
state operating loss carryforwards as it was more likely than not that future
taxable income will be sufficient to enable the Company to utilize a portion of
the operating loss carryforwards. For additional information, see Note 12 to the
Company's consolidated financial statements appearing elsewhere in this report.
The Company expects its effective income tax rate to increase in 2004 due to an
increase in the effective state income tax rate.

DISCONTINUED OPERATIONS

      On August 1, 2002, the Company sold substantially all of its wireless
operations to Alltel and certain other purchasers for an aggregate of
approximately $1.59 billion in cash. As a result, the Company's wireless
operations for 2002 have been reflected as discontinued operations in the
Company's consolidated financial statements. The results of operations for 2001
have been restated to conform to the 2002 presentation. The following table
summarizes certain information concerning the Company's wireless operations for
the periods presented.

<TABLE>
<CAPTION>
Year ended December 31,                                   2002        2001
- ----------------------------------------------------------------------------
                                                       (Dollars in thousands)
<S>                                                   <C>         <C>
Operating revenues                                $    246,705     437,965
Operating expenses, exclusive of
 corporate overhead costs of $11.3
 million and $20.2 million                            (175,447)   (305,351)
Income from unconsolidated
 cellular entities                                      25,768      19,868
Minority interest expense                               (8,569)    (11,510)
Gain on sale of discontinued operations                803,905           -
Nonrecurring gains                                           -     166,928
Other income                                               188       4,707
Income tax expense                                    (284,459)   (118,657)
- ---------------------------------------------------------------------------
Income from discontinued operations,
 net of tax                                       $    608,091     193,950
===========================================================================
</TABLE>

      Included in operating expenses for 2002 is a $30.5 million charge
associated with a write-off of all amounts expended to develop the wireless
portion of the Company's billing system currently in development. Depreciation
and amortization of long-lived assets and amortizable intangibles related to the
Company's wireless operations ceased effective March 19, 2002, the date of the
Company's definitive sales agreement with Alltel. Such cessation of depreciation
and amortization had the effect of reducing depreciation and amortization
expense approximately $20 million in 2002.

      The Company recorded an $803.9 million pre-tax gain on the sale of
substantially all of its wireless business in the third quarter of 2002.

      Nonrecurring gains for 2001 relate to the sale of 30 PCS licenses to Leap
Wireless International, Inc.

      For further information, see Notes 3 and 13 to the Company's consolidated
financial statements appearing elsewhere in this report.


ACQUISITIONS AND RELATED FINANCING ARRANGEMENTS

      On July 1, 2002, the Company completed the acquisition of approximately
300,000 telephone access lines in the state of Alabama from Verizon for
approximately $1.022 billion cash. On August 31, 2002, the Company completed the
acquisition of approximately 350,000 telephone access lines in the state of
Missouri from Verizon for approximately $1.179 billion cash.

      On May 6, 2002, the Company issued and sold in an underwritten public
offering $500 million of equity units. Net proceeds to the Company from this
issuance were approximately $483.4 million. Each of the 20 million equity units
issued was priced at $25 and consists initially of a beneficial interest in a
CenturyTel senior unsecured note with a principal amount of $25 and a contract
to purchase shares of CenturyTel common stock no later than May 2005. The senior
notes mature in May 2007. Each purchase contract will generally require the
holder to purchase between .6944 and .8741 of a share of CenturyTel common stock
in May 2005 based on the then current price of CenturyTel common stock in
exchange for $25, subject to certain adjustments and exceptions. Accordingly,
upon full settlement of the purchase contracts in May 2005, the Company will
receive proceeds of $500 million and will deliver between 13.9 million and 17.5
million common shares in the aggregate. The senior notes are pledged by the
holders to secure their obligations under the purchase contracts. The total
distributions on the equity units will be at an initial annual rate of 6.875%,
consisting of interest (6.02%) and contract adjustment payments (0.855%), each
payable quarterly. On or after mid-February 2005, the senior notes will be
remarketed, at which time the remarketing agent will reset the interest rate on
the senior notes in order to generate sufficient proceeds to secure the holder's
obligation under the purchase contract. In the event of an unsuccessful
remarketing, the Company will exercise its right as a secured party to dispose
of the senior notes and satisfy in full the holder's obligation to purchase
common stock under the purchase contract.

      On July 22, 2002, the Company entered into $800 million of credit
facilities, consisting of a $533 million three-year facility and a $267 million
364-day revolving facility which lapsed during 2003. These facilities replaced
credit facilities that matured during the third quarter of 2002.

      In the third quarter of 2002, the Company issued $500 million of senior
notes due 2012 (which bear interest at 7.875%) and $165 million of convertible
senior debentures (which bear interest at 4.75% and which may be converted into
shares of CenturyTel common stock at a conversion price of $40.455 per share).

      The Company used proceeds from the sale of equity units, senior notes and
convertible senior debentures, along with the $1.59 billion cash proceeds
received from the sale of substantially all of the Company's wireless operations
and utilization of its credit facilities, to finance the third quarter 2002
acquisitions of telephone properties in Alabama and Missouri from Verizon which
aggregated $2.201 billion, the redemption of $400 million principal amount in
remarketable debt securities (plus an associated $71.1 million premium payment)
in October 2002, and the Company's fourth quarter 2002 estimated tax payment,
which aggregated $290 million and included the obligation to pay taxes
associated with the sale of substantially all of its wireless operations.

      In June and December 2003, the Company purchased certain fiber transport
assets for an aggregate of approximately $55.2 million. In the fourth quarter of
2003, the Company acquired an additional 24.3% interest in a telephone company
in which it owned a majority interest for $32.4 million cash.


ACCOUNTING PRONOUNCEMENTS

      On January 1, 2003, the Company adopted Statement of Financial Accounting
Standards No. 143, "Accounting for Asset Retirement Obligations" ("SFAS 143"),
which addresses financial accounting and reporting for legal obligations
associated with the retirement of tangible long-lived assets and requires that
the fair value of a liability for an asset retirement obligation be recognized
in the period in which it is incurred and be capitalized as part of the book
value of the long-lived asset.

      Although the Company generally has had no legal obligation to remove
obsolete assets, depreciation rates of certain assets established by regulatory
authorities for the Company's telephone operations subject to Statement of
Financial Accounting Standards No. 71, "Accounting for the Effects of Certain
Types of Regulation" ("SFAS 71"), have historically included a component for
removal costs in excess of the related estimated salvage value. Notwithstanding
the adoption of SFAS 143, SFAS 71 requires the Company to continue to reflect
this accumulated liability for removal costs in excess of salvage value even
though there is no legal obligation to remove the assets. For the Company's
telephone operations acquired from Verizon in 2002 and its other operations
(neither of which are subject to SFAS 71), the Company has not accrued a
liability for anticipated removal costs in the past. For these reasons, the
adoption of SFAS 143 did not have a material effect on the Company's financial
statements.

      In May 2003, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 150, "Accounting for Financial Instruments
with Characteristics of both Liabilities and Equity" ("SFAS 150"), which
provides standards for how an issuer classifies and measures certain financial
instruments with characteristics of both liabilities and equity. SFAS 150 is
effective for financial instruments entered into or modified after May 31, 2003
and for pre-existing instruments as of the beginning of the first interim period
beginning after June 15, 2003. The adoption of SFAS 150 did not have a material
impact on the Company's financial condition or results of operations.

      In December 2002, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 148, "Accounting for Stock-Based
Compensation" ("SFAS 148"). SFAS 148, effective for fiscal years ending after
December 15, 2002, amends Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation" ("SFAS 123") to provide alternative
methods of transition for a voluntary change to the fair value method of
accounting for stock-based compensation. In addition, SFAS 148 amends the
disclosure requirements of SFAS 123 to require prominent disclosure in both
annual and interim financial statements about the method of accounting for
stock-based compensation and the effect of the method used on reported results.
The Company has elected to account for employee stock-based compensation using
the intrinsic value method in accordance with Accounting Principles Board
Opinion No. 25, "Accounting for Stock Issued to Employees," as allowed by SFAS
123.

      In November 2002, the Emerging Issues Task Force ("EITF") reached a
consensus on EITF 00-21, "Accounting for Revenue Arrangements with Multiple
Element Deliverables." This release addresses how to account for arrangements
that may involve the delivery or performance of multiple products, services or
rights to use assets. Under this release, revenue arrangements with multiple
deliverables should be divided into separate units of accounting based on their
relative fair value. The final consensus was applicable to agreements entered
into in periods beginning after June 15, 2003. The adoption of EITF 00-21 did
not have a material impact on the Company's results of operations.


CRITICAL ACCOUNTING POLICIES

      The Company's financial statements are prepared in accordance with
accounting principles that are generally accepted in the United States. The
preparation of these financial statements requires management to make estimates
and judgments that affect the reported amounts of assets, liabilities, revenues
and expenses. Management continually evaluates its estimates and judgments
including those related to (i) revenue recognition, (ii) allowance for doubtful
accounts, (iii) purchase price allocation, (iv) pension and postretirement
benefits and (v) long-lived assets. Actual results may differ from these
estimates. The Company believes the following critical accounting policies
involve a higher degree of judgment or complexity.

      Revenue recognition. Certain of the Company's telephone subsidiaries
participate in revenue sharing arrangements with other telephone companies for
interstate revenue and for certain intrastate revenue. Under such sharing
arrangements, which are typically administered by quasi-governmental agencies,
participating telephone companies contribute toll revenue or access charges
within state jurisdictions and access charges in the interstate market. These
revenues are pooled by the administrative agencies and used to reimburse
exchange carriers for their costs. Typically, participating companies have 24
months to update or correct data previously submitted. As a result, revenues
earned through the various sharing arrangements are initially recorded based on
the Company's estimates. Historically, revisions of previous revenue estimates
have not been material.

      Certain of the Company's telephone subsidiaries file tariffs directly with
the Federal Communications Commission ("FCC") for certain interstate revenues.
Generally, the Company records such revenue at the authorized rate of return
prescribed by the FCC. If amounts are billed in excess of the authorized rate of
return, such excess is subject to refund upon request from other
telecommunications carriers and customers. Amounts not requested for refund by
carriers or customers are recognized as revenues at the end of the settlement
period, which is generally 33 months subsequent to the two-year monitoring
periods. See Note 19 to the Company's consolidated financial statements
appearing elsewhere in this report for additional information.

      Allowance for doubtful accounts. In evaluating the collectibility of its
accounts receivable, the Company assesses a number of factors, including a
specific customer's or carrier's ability to meet its financial obligations to
the Company, the length of time the receivable has been past due and historical
collection experience. Based on these assessments, the Company records both
specific and general reserves for uncollectible accounts receivable to reduce
the related accounts receivable to the amount the Company ultimately expects to
collect from customers and carriers. If circumstances change or economic
conditions worsen such that the Company's past collection experience is no
longer relevant, the Company's estimate of the recoverability of its accounts
receivable could be further reduced from the levels reflected in the
accompanying consolidated balance sheet.

      Purchase price allocation. For the properties acquired from Verizon in
2002, the Company allocated the aggregate purchase price to the assets acquired
and liabilities assumed based on fair value at the date of acquisition. The fair
value of property, plant and equipment and identifiable intangible assets was
determined by an independent appraisal of such assets. The fair value of the
postretirement benefit obligation was determined through actuarial valuations.
The fair value of current assets and current liabilities was assumed to
approximate the recorded value at acquisition due to their short maturity. The
remaining unallocated acquisition cost was considered goodwill.

      Pension and postretirement benefits. The amounts recognized in the
financial statements related to pension and postretirement benefits are
determined on an actuarial basis, which utilizes many assumptions in the
calculation of such amounts. A significant assumption used in determining the
Company's pension and postretirement expense is the expected long-term rate of
return on plan assets. For 2003, the Company lowered its expected long-term rate
of return on plan assets to 8.25%, reflecting the expected moderation of
long-term rates of return in the financial markets. For 2002, such expected
return was assumed to be 10%.

      Another assumption used in the determination of the Company's pension and
postretirement benefit plan obligations is the appropriate discount rate, which
is generally based on the yield on high-quality corporate bonds. The Company
lowered its assumed discount rate to 6.0% at December 31, 2003 from 6.75% at
December 31, 2002. Changes in the discount rate do not have a material impact on
the Company's results of operations.

      See "Pension and Medical Costs" for additional information.

      Intangible and long-lived assets. Effective January 1, 2002, the Company
was subject to testing for impairment of long-lived assets under two new
accounting standards, Statement of Financial Accounting Standards No. 142,
"Goodwill and Other Intangible Assets" ("SFAS 142") and Statement of Financial
Accounting Standards No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets" ("SFAS 144").

      SFAS 142 requires goodwill recorded in business combinations to be
reviewed for impairment at least annually and requires write-downs only in
periods in which the recorded amount of goodwill exceeds the fair value. Under
SFAS 142, impairment of goodwill is tested by comparing the fair value of the
reporting unit to its carrying value (including goodwill). Estimates of the fair
value of the reporting unit are based on valuation models using techniques such
as multiples of earnings (before interest, taxes and depreciation and
amortization). If the fair value of the reporting unit is less than the carrying
value, a second calculation is required in which the implied fair value of
goodwill is compared to its carrying value. If the implied fair value of
goodwill is less than its carrying value, goodwill must be written down to its
implied fair value. The Company completed the required annual test of goodwill
impairment (as of September 30, 2003) under SFAS 142 and determined its goodwill
is not impaired as of such date. Prior to January 1, 2002, substantially all of
the Company's goodwill was amortized over 40 years. The Company's amortization
of goodwill for the year ended December 31, 2001 totaled approximately $69.2
million.

      Under SFAS 144, the carrying value of long-lived assets other than
goodwill is reviewed for impairment whenever events or circumstances indicate
that such carrying amount cannot be recoverable by assessing the recoverability
of the carrying value through estimated undiscounted net cash flows expected to
be generated by the assets. If the undiscounted net cash flows are less than the
carrying value, an impairment loss would be measured as the excess of the
carrying value of a long-lived asset over its fair value.

      For additional information on the Company's critical accounting policies,
see "Accounting Pronouncements" and "Regulation and Competition - Other
Matters", and the footnotes to the Company's consolidated financial statements.


INFLATION

      The effects of increased costs historically have been mitigated by the
Company's ability to recover certain costs over time applicable to its regulated
telephone operations through the rate-making process. Possible future regulatory
changes and the continued movement toward alternative forms of regulation for
intrastate operations may alter the Company's ability to recover increased costs
in its regulated operations. For the properties acquired from Verizon in 2002,
which are regulated under price-cap regulation for interstate purposes, price
changes are limited to the rate of inflation, minus a productivity offset. For
additional information regarding the current regulatory environment, see
"Regulation and Competition." As operating expenses in the Company's
nonregulated lines of business increase as a result of inflation, the Company,
to the extent permitted by competition, attempts to recover the costs by
increasing prices for its services and equipment.


MARKET RISK

      The Company is exposed to market risk from changes in interest rates on
its long-term debt obligations. The Company has estimated its market risk using
sensitivity analysis. Market risk is defined as the potential change in the fair
value of a fixed-rate debt obligation due to a hypothetical adverse change in
interest rates. Fair value of long-term debt obligations is determined based on
a discounted cash flow analysis, using the rates and maturities of these
obligations compared to terms and rates currently available in the long-term
financing markets. The results of the sensitivity analysis used to estimate
market risk are presented below, although the actual results may differ from
these estimates.

      At December 31, 2003, the fair value of the Company's long-term debt was
estimated to be $3.4 billion based on the overall weighted average rate of the
Company's long-term debt of 6.4% and an overall weighted maturity of 10 years
compared to terms and rates currently available in long-term financing markets.
Market risk is estimated as the potential decrease in fair value of the
Company's long-term debt resulting from a hypothetical increase of 64 basis
points in interest rates (ten percent of the Company's overall weighted average
borrowing rate). Such an increase in interest rates would result in
approximately a $143.9 million decrease in the fair value of the Company's
long-term debt. As of December 31, 2003, after giving effect to interest rate
swaps currently in place, approximately 84% of the Company's long-term debt
obligations were fixed rate.

      The Company seeks to maintain a favorable mix of fixed and variable rate
debt in an effort to limit interest costs and cash flow volatility resulting
from changes in rates. From time to time, the Company uses derivative
instruments to (i) lock-in or swap its exposure to changing or variable interest
rates for fixed interest rates or (ii) to swap obligations to pay fixed interest
rates for variable interest rates. The Company has established policies and
procedures for risk assessment and the approval, reporting and monitoring of
derivative instrument activities. The Company does not hold or issue derivative
financial instruments for trading or speculative purposes. Management
periodically reviews the Company's exposure to interest rate fluctuations and
implements strategies to manage the exposure.

      At December 31, 2003, the Company had outstanding four fair value
interest rate hedges associated with the full $500 million aggregate principal
amount of its Series L senior notes, due 2012, that pay interest at a fixed rate
of 7.875%. These hedges are "fixed to variable" interest rate swaps that
effectively convert the Company's fixed rate interest payment obligations under
these notes into obligations to pay variable rates that range from the six-month
London InterBank Offered Rate ("LIBOR") plus 3.229% to the six-month LIBOR plus
3.67%, with settlement and rate reset dates occurring each six months through
the expiration of the hedges in August 2012. At December 31, 2003, the Company
realized a rate under these hedges of 4.8%. Interest expense was reduced by $7.7
million during 2003 as a result of these hedges. The aggregate fair market value
of these hedges was $11.7 million at December 31, 2003 and is reflected both as
a liability and as a decrease in the Company's underlying long-term debt on the
December 31, 2003 balance sheet. With respect to these hedges, market risk is
estimated as the potential change in the fair value of the hedge resulting from
a hypothetical 10% increase in the forward rates used to determine the fair
value. A hypothetical 10% increase in the forward rates would result in a $17.8
million decrease in the fair value of these hedges.

      Effective May 8, 2003, the Company terminated a fair value interest rate
hedge associated with $500 million aggregate principal amount of its Series H
senior notes and received $22.3 million cash upon settlement, which represented
the fair value of the hedge at the termination date. Such amount will be
amortized as a reduction of interest expense through 2010, the maturity date of
the Series H notes.


DEVELOPMENT OF BILLING SYSTEM

      The Company is in the process of developing an integrated billing and
customer care system which will provide the Company with, in addition to
standard billing functionality currently being provided by its legacy system,
custom built hardware and software technology for more efficient and effective
customer care, billing and provisioning systems. The costs to develop such
system have been accounted for in accordance with Statement of Position 98-1,
"Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use" ("SOP 98-1"). The capitalized costs of the system aggregated
$163.5 million (before accumulated amortization) at December 31, 2003. The
Company began amortizing its billing system costs in early 2003 (over a 20-year
period) based on the total number of customers that the Company has migrated to
the new system.

      The system remains in the development stage and has required
substantially more time and money to develop than originally anticipated. The
Company currently expects to complete all phases of the new system no later than
mid-2005 at an aggregate capitalized cost in accordance with SOP 98-1 of
approximately $200-215 million (exclusive of previously-disclosed write-offs).
In addition, the Company expects to incur additional costs related to completion
of the project, including (i) approximately $15 million of customer service
related and data conversion costs (the majority of which are expected to be
incurred in 2004) that will be expensed as incurred and (ii) $10 million of
capitalized hardware costs (which will be amortized over a three-year period).
The estimates above do not include any amounts for maintenance or on-going
support of either the old or new system, and are based on assumptions regarding
various future events, several of which are beyond the Company's control. There
is no assurance that the system will be completed in accordance with this
schedule or budget, or that the system will function as anticipated. If the
system does not function as anticipated, the Company may have to write off part
or all of its development costs and further explore its other billing and
customer care system alternatives.


PENSION AND MEDICAL COSTS

      During the past several years, the Company's employee benefit expenses,
including defined benefit pension expenses and pre- and post-retirement medical
expenses, have increased due to rising medical costs, the decline of equity
markets in recent years prior to 2003 and record low interest rates. During
2003, such costs (including the effect of the Verizon acquisitions in 2002)
increased approximately $19.3 million over 2002. As a result of continued
increases in medical costs, the Company discontinued its practice of subsidizing
post-retirement medical benefits for persons hired on or after January 1, 2003.
In addition, the Company announced changes, effective January 1, 2004, that
would decrease its subsidization of benefits provided under its postretirement
medical plan. The amount of the Company's cost savings will be dependent upon
several factors, including the age and years of service of the Company's
retirees. The Company also lowered its expected long-term return on plan assets
for its pension and post-retirement plans to 8.25% for 2003 compared to 10% for
2002. Pension and medical costs are anticipated to increase between $6-8
million in 2004 compared to 2003 levels.


                         LIQUIDITY AND CAPITAL RESOURCES

      Excluding cash used for acquisitions, the Company relies on cash provided
by operations to provide for its cash needs. The Company's operations have
historically provided a stable source of cash flow which has helped the Company
continue its long-term program of capital improvements.

      Operating activities. Net cash provided by operating activities from
continuing operations was $1.068 billion, $793.4 million and $572.9 million in
2003, 2002 and 2001, respectively. The Company's accompanying consolidated
statements of cash flows identify major differences between net income and net
cash provided by operating activities for each of those years. For additional
information relating to the continuing and discontinued operations of the
Company, see Results of Operations.

      Investing activities. Net cash used in investing activities from
continuing operations was $464.6 million, $2.623 billion and $417.2 million in
2003, 2002 and 2001, respectively. Cash used for acquisitions was $86.2 million
in 2003 (primarily due to the acquisitions of fiber transport assets and the
acquisition of an additional 24.3% interest in a telephone company in which the
Company owns a majority interest), $2.245 billion in 2002 (substantially all of
which relates to the 2002 Verizon acquisitions) and $47.1 million in 2001.
Proceeds from the sales of assets were $4.1 million in 2002 (excluding the
Company's 2002 wireless divestiture) and $58.2 million in 2001. Capital
expenditures from continuing operations for 2003 were $317.4 million for
telephone operations and $60.6 million for other operations. Capital
expenditures from continuing operations during 2002 and 2001 were $386.3 million
and $435.5 million, respectively.

      Financing activities. Net cash provided by (used in) financing activities
from continuing operations was ($403.8) million in 2003, $506.3 million in 2002
and ($395.4) million in 2001. Net payments of debt were $432.3 million in 2003.
Proceeds from the issuance of debt, net of debt payments, were $531.4 million
during 2002, compared to net payments of debt of $375.6 million during 2001.

       On May 6, 2002, the Company issued and sold in an underwritten public
offering $500 million of equity units. Net proceeds to the Company from this
issuance were approximately $483.4 million. Each of the 20 million equity units
issued was priced at $25 and consists initially of a beneficial interest in a
CenturyTel senior unsecured note with a principal amount of $25 and a contract
to purchase shares of CenturyTel common stock no later than May 2005. The senior
notes will mature in May 2007. Each stock purchase contract will generally
require the holder to purchase between .6944 and .8741 of a share of CenturyTel
common stock in May 2005 in exchange for $25, subject to certain adjustments and
exceptions. The total distributions on the equity units will be at an initial
annual rate of 6.875%, consisting of interest (6.02%) and contract adjustment
payments (0.855%). For additional information, see Note 6 to the Company's
consolidated financial statements appearing elsewhere in this report.

       On July 22, 2002, the Company entered into $800 million of credit
facilities, consisting of a $533 million three-year facility and a $267 million
364-day revolving facility with a one-year term-out option. The Company did not
renew its $267 million 364-day facility in 2003.

       In the third quarter of 2002, the Company issued $500 million of senior
notes due 2012 (which bear interest at 7.875%) and $165 million of convertible
senior debentures (which bear interest at 4.75% and which may be converted into
shares of CenturyTel common stock at a conversion price of $40.455 per share).
Holders of the convertible senior debentures will have the right to require the
Company to purchase all or a portion of the debentures on August 1, 2006, August
1, 2010 and August 1, 2017 at par plus any accrued and unpaid interest to the
purchase date. For additional information, see Note 6 to the Company's
consolidated financial statements appearing elsewhere in this report.

      On August 1, 2002, the Company sold substantially all of its wireless
operations to Alltel and certain other purchasers for an aggregate of
approximately $1.59 billion cash.

      The Company used proceeds from the sale of equity units, senior notes and
convertible senior debentures, along with the proceeds received from the sale of
the Company's wireless operations and utilization of its $800 million credit
facilities, to finance the third quarter 2002 acquisitions of telephone
properties in Alabama and Missouri from Verizon which aggregated $2.201 billion,
the redemption of $400 million principal amount in remarketable debt securities
(plus an associated $71.1 million premium payment) in October 2002 and the
Company's fourth quarter 2002 estimated tax payment, which aggregated $290
million and included the obligation to pay taxes associated with the sale of
substantially all of its wireless operations.

      In second quarter 2001, the Company completed the sale of 30 PCS operating
licenses for an aggregate of $195 million to Leap Wireless International, Inc.
The Company received approximately $108 million of the purchase price in cash at
closing and the remainder was collected in installments through the fourth
quarter of 2001. Such proceeds, and the proceeds from the Company's
above-described divestiture of its wireless operations in 2002, are included as
net cash provided by discontinued operations on the statements of cash flows
appearing elsewhere in this report. In third quarter 2001, the Company sold its
remaining shares of its investment in Illuminet common stock for an aggregate of
approximately $58.2 million. Proceeds from these sales were used to repay
indebtedness.

      Other. Budgeted capital expenditures for 2004 total $290 million for
telephone operations and $110 million for other operations. The Company
anticipates that capital expenditures in its telephone operations will continue
to include the upgrading of its plant and equipment, including its digital
switches, to provide enhanced services, particularly in its newly acquired
markets, and the installation of fiber optic cable.

      The following table contains certain information concerning the
Company's material contractual obligations as of December 31, 2003.

<TABLE>
<CAPTION>
                                                             Payments due by period
- ---------------------------------------------------------------------------------------------------------
                                                     Less than                                     After
Contractual obligations                    Total      1 year     1-3 years      4-5 years         5 years
- ---------------------------------------------------------------------------------------------------------
                                                             (Dollars in thousands)
<S>                                       <C>           <C>        <C>     <C>    <C>     <C>   <C>
Long-term debt,
  including current maturities and
  capital lease obligations            $  3,181,755     72,453     523,952 (1)    805,397 (2)   1,779,953
- ----------------------------------------------------------------------------------------------------------
</TABLE>
(1)   Includes $165 million aggregate principal amount of the Company's
convertible debentures, Series K, due 2032, which can be put to the Company
at various dates beginning in 2006.
(2)   Includes $500 million aggregate principal amount of the Company's senior
notes, Series J, due 2007, which the Company is committed to remarket in 2005.

      On February 3, 2004, the Company announced that its board of directors
approved a stock repurchase program that will allow the Company to repurchase up
to an aggregate of $400 million of either its common stock or convertible equity
units prior to December 31, 2005. The Company commenced purchases under this
plan on February 6, 2004.

      The Company continually evaluates the possibility of acquiring additional
telecommunications operations and expects to continue its long-term strategy of
pursuing the acquisition of attractive communications properties in exchange for
cash, securities or both. At any given time, the Company may be engaged in
discussions or negotiations regarding additional acquisitions. The Company
generally does not announce its acquisitions or dispositions until it has
entered into a preliminary or definitive agreement. The Company may require
additional financing in connection with any such acquisitions, the consummation
of which could have a material impact on the Company's financial condition or
operations. Approximately 4.1 million shares of CenturyTel common stock and
200,000 shares of CenturyTel preferred stock remain available for future
issuance in connection with acquisitions under CenturyTel's acquisition shelf
registration statement.

      As of December 31, 2003, the Company had available $533.0 million of
undrawn committed bank lines of credit and the Company's telephone subsidiaries
had available for use $123.0 million of commitments for long-term financing from
the Rural Utilities Service and Rural Telephone Bank. The Company has a
commercial paper program that authorizes the Company to have outstanding up to
$1.5 billion in commercial paper at any one time; however, borrowings are
limited to the amount available under its credit facility. As of December 31,
2003, the Company had no commercial paper outstanding under such program. The
Company also has access to debt and equity capital markets, including its shelf
registration statements. At December 31, 2003, the Company held over $203
million of cash and cash equivalents.

      Moody's Investors Service ("Moody's") rates CenturyTel's long-term debt
Baa2 (with a stable outlook) and Standard & Poor's ("S&P") rates CenturyTel's
long-term debt BBB+ (with a stable outlook). The Company's commercial paper
program is rated P2 by Moody's and A2 by S&P. Any downgrade in the Company's
ratings could adversely impact the Company's ability to issue commercial paper
or use its bank facility.

      The following table reflects the Company's debt to total capitalization
percentage and ratio of earnings to fixed charges and preferred stock dividends
as of and for the years ended December 31:

                                               2003       2002        2001
- --------------------------------------------------------------------------
Debt to total capitalization                   47.8%      54.2        57.0
Ratio of earnings from continuing
 operations to fixed charges
 and preferred stock dividends                 3.33       2.33        2.03
- --------------------------------------------------------------------------


                           REGULATION AND COMPETITION

      The communications industry continues to undergo various fundamental
regulatory, legislative, competitive and technological changes. These changes
may have a significant impact on the future financial performance of all
communications companies.

      Events affecting the communications industry. In 1996, the United States
Congress enacted the Telecommunications Act of 1996 (the "1996 Act"), which
obligates LECs to permit competitors to interconnect their facilities to the
LEC's network and to take various other steps that are designed to promote
competition. Under the 1996 Act's rural telephone company exemption,
approximately 50% of the Company's telephone access lines are exempt from
certain of these interconnection requirements unless and until the appropriate
state regulatory commission overrides the exemption upon receipt from a
competitor of a bona fide request meeting certain criteria.

      During 2003, the FCC released new rules which outline the obligations of
incumbent LECs to lease elements of their circuit-switched networks on an
unbundled basis to competitors. The new framework eliminates the prior
obligation of incumbent LECs to lease their high-speed data lines to
competitors. Incumbent LECs will remain obligated to offer other
telecommunications services to resellers at wholesale rates. These wholesale
rates are based on a forward-looking cost model and other terms that
substantially limit the profitability of these arrangements to incumbent LECs.
This new rule also provides for a significant role of state regulatory
commissions in implementing these new guidelines and establishing wholesale
service rates. On March 2, 2004, a federal district court of appeals overturned
the rules previously adopted by the FCC requiring LECs to provide competitors
with discounted access to the LECs networks. The court also ruled that the FCC
should not have given states the authority previously granted. It is expected
that such decision will be appealed to the Supreme Court. During 2003, the FCC
also sought public comments on whether it should make additional changes to its
interconnection regulations, and instituted a comprehensive review of its
methodologies for establishing wholesale rates.

      Prior to and since the enactment of the 1996 Act, the FCC and a number of
state legislative and regulatory bodies have also taken steps to foster local
exchange competition. Coincident with this recent movement toward increased
competition has been the gradual reduction of regulatory oversight of LECs.
These cumulative changes, coupled with various technological developments, have
led to the continued growth of various companies providing services that compete
with LECs' services. Wireless services entities also increasingly constitute a
significant source of competition with LECs.

      As mandated by the 1996 Act, in May 2001 the FCC modified its existing
universal service support mechanism for rural telephone companies. The FCC
adopted an interim mechanism for a five-year period, effective July 1, 2001,
based on embedded, or historical, costs that will provide predictable levels of
support to rural local exchange carriers, including substantially all of the
Company's local exchange carriers. During 2003 and 2002 the Company's telephone
subsidiaries received $199.2 million and $192.4 million, respectively, from the
federal Universal Service High Cost Loop Fund, representing 8.4% and 9.8%,
respectively, of the Company's consolidated revenues from continuing operations
for 2003 and 2002. The Company anticipates its 2004 revenues from the federal
Universal Service High Cost Loop Fund will be lower than 2003 levels due to
increases in the nationwide average cost per loop factor used by the FCC to
allocate funds among all recipients. Wireless and other competitive service
providers continue to seek eligible telecommunications carrier ("ETC") status in
order to be eligible to receive Universal Service Fund support, which is placing
additional financial pressure on the amount of money needed to provide support
to all eligible service providers, including support payments the Company
receives from the High Cost Loop Fund. As a result of the limited growth in the
size of the High Cost Loop Fund and changes in requests for support from the
Universal Service Fund, the Company has no assurance it will continue to
receive payments from the Universal Service Fund commensurate with those
received in the past.

      In 2001, the FCC modified its interstate access charge rules and universal
service support system for rate of return LECs. This order, among other things,
(i) increased the caps on the subscriber line charges ("SLC") to the levels paid
by most subscribers nationwide; (ii) allowed limited SLC deaveraging, which
enhanced the competitiveness of rate of return carriers by giving them pricing
flexibility; (iii) lowered per minute rates collected for federal access
charges; (iv) created a new explicit universal service support mechanism that
replaced other implicit support mechanisms in a manner designed to ensure that
rate structure changes do not affect the overall recovery of interstate access
costs by rate of return carriers serving high cost areas; and (v) preserved the
historic 11.25% authorized interstate return rate for rate of return LECs. The
effect of this order on the Company was revenue neutral for interstate purposes
but did result in a reduction in intrastate revenues in Arkansas and Ohio (where
intrastate access rates must mirror the interstate access rates).

      Technological developments have led to the development of new services
that compete with traditional LEC services. Technological improvements have
enabled cable television companies to provide traditional circuit-switched
telephone service over their cable networks, and several national cable
companies have aggressively pursued this opportunity. Recent improvements in the
quality of "Voice-over-Internet Protocol" ("VoIP") service have led several
large cable television and telephone companies, as well as start-up companies,
to substantially increase their offerings of VoIP service to business and
residential customers. VoIP providers route calls over the Internet, without use
of ILEC's circuit switches and, in certain cases, without use of ILEC's networks
to carry their communications traffic. VoIP providers can offer services at
prices substantially below those currently charged for traditional local and
long distance telephone services for several reasons, including lower network
cost structures and the current ability of VoIP providers to use ILECs' networks
without paying access charges. In December 2003, the FCC initiated rulemaking
that is expected to address the effect of VoIP on intercarrier compensation,
universal service and emergency services. There can be no assurance that this
rulemaking will be on terms favorable to ILECs, or that VoIP providers will not
successfully compete for the Company's customers.

      In November 2003, the FCC adopted rules requiring companies to allow their
customers to keep their wireline or wireless phone number when switching to
another service provider (generally referred to as "local number portability").
For several years, customers have been able to retain their numbers when
switching their local service between wireline carriers. The new rules now
require local number portability between wireline and wireless carriers. This
requirement went into effect November 24, 2003 for wireline carriers in the top
100 Metropolitan Statistical Areas ("MSAs"). The new requirement will go into
effect May 24, 2004 for wireline carriers operating in markets smaller than the
top 100 MSAs. The majority of the Company's wireline operations are conducted in
markets below the top 100 MSAs. Local number portability may increase the number
of customers who chose to completely forego the use of traditional wireline
phone service, although the Company believes that it is too early to fully
assess the rule's impact. The costs to comply with the requirements of local
number portability, net of the amount that is recoverable through the ratemaking
process, are not expected to have a material impact on the Company's results of
operations.

      The FCC is currently examining several issues that could have a
substantial impact on the Company's revenues, including a broad inquiry
initiated in 2001 into all currently regulated forms of intercarrier
compensation. As discussed further below, certain providers of competitive
communications services are not required to compensate ILECs for the use of
their networks. The Company relies on access revenues as an important source of
revenues. Depending on the final outcome of the FCC's intercarrier compensation
issue, the Company could suffer a material loss of access revenues.

      Recent events affecting the Company. During the last few years, several
states in which the Company has substantial operations took legislative or
regulatory steps to further introduce competition into the LEC business. The
number of companies which have requested authorization to provide local exchange
service in the Company's service areas has increased in recent years, especially
in the markets acquired from Verizon in 2002 and 2000, and it is anticipated
that similar action may be taken by others in the future.

      State alternative regulation plans recently adopted by certain of the
Company's LECs have also affected revenue growth recently.

      Certain long distance carriers continue to request that the Company reduce
intrastate access tariffed rates for certain of its LECs. In addition, the
Company has recently experienced reductions in intrastate traffic, partially due
to the displacement of minutes by wireless and electronic mail services. In 2003
the Company incurred a reduction in its intrastate revenues (exclusive of the
properties acquired from Verizon in 2002) of approximately $6.8 million compared
to 2002 primarily due to these factors. The corresponding decrease in 2002
compared to 2001 was $27.7 million. The Company believes such trend of decreased
intrastate minutes will continue in 2004, although the magnitude of such
decrease cannot be precisely estimated.

      In January 2003, the Louisiana Public Service Commission directed its
staff to review the feasibility of converting the $42 million Louisiana Local
Optional Service Fund ("LOS Fund") into a state universal service fund.
Currently, the LOS Fund is funded primarily by BellSouth, which proposes to
expand the base of contributors into the LOS Fund. A recommendation by the
Commission staff is not expected until late 2004. The Company currently receives
approximately $21 million from the LOS Fund each year. There can be no assurance
that this funding will remain at current levels.

      Competition to provide traditional telephone services has thus far
affected large urban areas to a greater extent than rural, suburban and small
urban areas such as those in which the Company's telephone operations are
located. Although the Company does not believe that the increased competition it
has thus far experienced is likely to materially affect it in the near term, the
Company anticipates that regulatory, technological and competitive changes will
result in future revenue reductions. The Company expects its telephone revenues
to decline in 2004 due to continued access line losses and reduced network
access revenues; however, the Company expects its consolidated revenues to
increase in 2004 primarily due to increased revenues from its newly-acquired
LightCore operations and expected increased demand for its long distance, fiber
transport, DSL and other nonregulated product offerings.

      Other matters. The Company's regulated telephone operations (except for
the properties acquired from Verizon in 2002) are subject to the provisions of
Statement of Financial Accounting Standards No. 71, "Accounting for the Effects
of Certain Types of Regulation" ("SFAS 71"). Actions by regulators can provide
reasonable assurance of the recognition of an asset, reduce or eliminate the
value of an asset and impose a liability on a regulated enterprise. Such
regulatory assets are required to be recorded and, accordingly, reflected in the
balance sheet of an entity subject to SFAS 71. The Company is monitoring the
ongoing applicability of SFAS 71 to its regulated telephone operations due to
the changing regulatory, competitive and legislative environments, and it is
possible that changes in regulation, legislation or competition or in the demand
for regulated services or products could result in the Company's telephone
operations no longer being subject to SFAS 71 in the near future.

      Statement of Financial Accounting Standards No. 101, "Regulated
Enterprises - Accounting for the Discontinuance of Application of FASB Statement
No. 71" ("SFAS 101"), specifies the accounting required when an enterprise
ceases to meet the criteria for application of SFAS 71. SFAS 101 requires the
elimination of the effects of any actions of regulators that have been
recognized as assets and liabilities in accordance with SFAS 71 but would not
have been recognized as assets and liabilities by nonregulated enterprises. SFAS
101 further provides that the carrying amounts of property, plant and equipment
are to be adjusted only to the extent the assets are impaired and that
impairment shall be judged in the same manner as for nonregulated enterprises.

      The Company's consolidated balance sheet as of December 31, 2003 included
regulatory assets of approximately $3.3 million (primarily deferred costs
related to financing costs, regulatory proceedings and income taxes) and
regulatory liabilities of approximately $912,000 (related to income taxes). Net
deferred income tax liabilities related to the regulatory assets and liabilities
quantified above were $1.2 million.

      When and if the Company's regulated operations no longer qualify for the
application of SFAS 71, the Company does not expect to record any impairment
charge related to the carrying value of the property, plant and equipment of its
regulated telephone operations. Additionally, upon the discontinuance of SFAS
71, the Company would be required to revise the lives of its property, plant and
equipment to reflect the estimated useful lives of the assets. The Company does
not expect such revisions in asset lives to have a material impact on the
Company's results of operations. For regulatory purposes, the accounting and
reporting of the Company's telephone subsidiaries will not be affected by the
discontinued application of SFAS 71.

      The Company has certain obligations based on federal, state and local laws
relating to the protection of the environment. Costs of compliance through 2003
have not been material, and the Company currently has no reason to believe that
such costs will become material.

Item 7A.      Quantitative and Qualitative Disclosure About Market Risk

      For information pertaining to the Company's market risk disclosure, see
"Item 7 - Management's Discussion and Analysis of Financial Condition and
Results of Operations - Market Risk".

<PAGE>
Item 8.       Financial Statements and Supplementary Data

                              Report of Management
The Shareholders
CenturyTel, Inc.:

      Management has prepared and is responsible for the Company's consolidated
financial statements. The consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
of America and necessarily include amounts determined using our best judgments
and estimates with consideration given to materiality.

      The Company maintains internal control systems and related policies and
procedures designed to provide reasonable assurance that the accounting records
accurately reflect business transactions and that the transactions are in
accordance with management's authorization. The design, monitoring and revision
of the systems of internal control involve, among other things, our judgment
with respect to the relative cost and expected benefits of specific control
measures. Additionally, the Company maintains an internal auditing function
which independently evaluates the effectiveness of internal controls, policies
and procedures and formally reports on the adequacy and effectiveness thereof.

      The Company's consolidated financial statements have been audited by KPMG
LLP, independent certified public accountants, who have expressed their opinion
with respect to the fairness of the consolidated financial statements. Their
audit was conducted in accordance with auditing standards generally accepted in
the United States of America, which include the consideration of the Company's
internal controls to the extent necessary to form an independent opinion on the
consolidated financial statements prepared by management.

      The Audit Committee of the Board of Directors is composed of independent
directors who are not officers or employees of the Company. The Committee meets
periodically with the independent certified public accountants, internal
auditors and management. The Committee considers the independence of the
external auditors and the audit scope and discusses internal control, financial
and reporting matters. Both the independent and internal auditors have free
access to the Committee.

/s/ R. Stewart Ewing, Jr.
- --------------------------
R. Stewart Ewing, Jr.
Executive Vice President and Chief Financial Officer

March 12, 2004

<PAGE>

                          Independent Auditors' Report


The Board of Directors
CenturyTel, Inc.:

      We have audited the consolidated financial statements of CenturyTel, Inc.
and subsidiaries as listed in Item 15a(i). In connection with our audits of the
consolidated financial statements, we also have audited the financial statement
schedule as listed in Item 15a(ii). These consolidated financial statements and
financial statement schedule are the responsibility of the Company's management.
Our responsibility is to express an opinion on these consolidated financial
statements and financial statement schedule based on our audits.

      We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

      In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of CenturyTel,
Inc. and subsidiaries as of December 31, 2003 and 2002, and the results of their
operations and their cash flows for each of the years in the three-year period
ended December 31, 2003, in conformity with accounting principles generally
accepted in the United States of America. Also in our opinion, the related
financial statement schedule, when considered in relation to the basic
consolidated financial statements taken as a whole, presents fairly, in all
material respects, the information set forth therein.

      As discussed in Note 1 to the consolidated financial statements, the
Company changed its method of accounting for goodwill and other intangible
assets in 2002.

/s/ KPMG LLP
- -----------------
KPMG LLP

Shreveport, Louisiana
January 29, 2004


<PAGE>

<TABLE>
<CAPTION>

                                CENTURYTEL, INC.
                        Consolidated Statements of Income

                                                              Year ended December 31,
- -----------------------------------------------------------------------------------------
                                                        2003          2002           2001
- -----------------------------------------------------------------------------------------
                                                       (Dollars, except per share amounts,
                                                             and shares in thousands)
<S>                                                <C>           <C>            <C>
OPERATING REVENUES
   Telephone                                   $   2,071,980     1,733,592      1,505,733
   Other                                             308,765       238,404        173,771
- -----------------------------------------------------------------------------------------
        Total operating revenues                   2,380,745     1,971,996      1,679,504
- -----------------------------------------------------------------------------------------

OPERATING EXPENSES
   Cost of sales and operating expenses
    (exclusive of depreciation and
     amortization)                                 1,159,708       973,689        826,948
   Corporate overhead costs allocable to
    discontinued operations                                -        11,275         20,213
   Depreciation and amortization                     470,641       411,626        407,038
- -----------------------------------------------------------------------------------------
        Total operating expenses                   1,630,349     1,396,590      1,254,199
- -----------------------------------------------------------------------------------------

OPERATING INCOME                                     750,396       575,406        425,305
- -----------------------------------------------------------------------------------------

OTHER INCOME (EXPENSE)
   Interest expense                                 (226,751)     (221,845)      (225,523)
   Income from unconsolidated
    cellular entity                                    6,160         5,582          7,592
   Nonrecurring gains and losses, net                      -         3,709         33,043
   Other income and expense                            2,154       (63,814)            32
- -----------------------------------------------------------------------------------------
        Total other income (expense)                (218,437)     (276,368)      (184,856)
- -----------------------------------------------------------------------------------------

INCOME FROM CONTINUING OPERATIONS
 BEFORE INCOME TAX EXPENSE                           531,959       299,038        240,449
Income tax expense                                   187,252       105,505         91,368
- -----------------------------------------------------------------------------------------

INCOME FROM CONTINUING OPERATIONS                    344,707       193,533        149,081

DISCONTINUED OPERATIONS
   Income from discontinued operations,
    net of $284,459, and $118,657 tax                      -       608,091        193,950
- -----------------------------------------------------------------------------------------
NET INCOME                                     $     344,707       801,624        343,031
=========================================================================================
NET INCOME, AS ADJUSTED FOR GOODWILL
 AMORTIZATION                                  $     344,707       801,624        399,297
=========================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>

                                CENTURYTEL, INC.
                        Consolidated Statements of Income
                                   (Continued)
<TABLE>
<CAPTION>
                                                                Year ended December 31,
- --------------------------------------------------------------------------------------------
                                                             2003        2002        2001
- --------------------------------------------------------------------------------------------
                                                         (Dollars, except per share amounts,
                                                               and shares in thousands)
<S>                                                       <C>         <C>         <C>
BASIC EARNINGS PER SHARE
   From continuing operations                         $      2.40        1.36        1.06
   From continuing operations, as adjusted for
     goodwill amortization                            $      2.40        1.36        1.39
   From discontinued operations                       $         -        4.29        1.38
   From discontinued operations, as adjusted for
     goodwill amortization                            $         -        4.29        1.45
   Basic earnings per share                           $      2.40        5.66        2.43
   Basic earnings per share, as adjusted for
     goodwill amortization                            $      2.40        5.66        2.83
DILUTED EARNINGS PER SHARE
   From continuing operations                         $      2.38        1.35        1.05
   From continuing operations, as adjusted for
     goodwill amortization                            $      2.38        1.35        1.37
   From discontinued operations                       $         -        4.26        1.36
   From discontinued operations, as adjusted for
     goodwill amortization                            $         -        4.26        1.43
   Diluted earnings per share                         $      2.38        5.61        2.41
   Diluted earnings per share, as adjusted for
     goodwill amortization                            $      2.38        5.61        2.81


DIVIDENDS PER COMMON SHARE                            $       .22         .21         .20
============================================================================================
AVERAGE BASIC SHARES OUTSTANDING                          143,583     141,613     140,743
============================================================================================
AVERAGE DILUTED SHARES OUTSTANDING                        144,700     142,879     142,307
============================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>

                                CENTURYTEL, INC.
                 Consolidated Statements of Comprehensive Income
<TABLE>
<CAPTION>
                                                                Year ended December 31,
- -----------------------------------------------------------------------------------------
                                                             2003        2002        2001
- -----------------------------------------------------------------------------------------
                                                                (Dollars in thousands)

<S>                                                       <C>         <C>         <C>
NET INCOME                                            $   344,707     801,624     343,031

OTHER COMPREHENSIVE INCOME, NET OF TAXES
   Unrealized holding gains (losses):
       Unrealized holding gains (losses)
        related to marketable equity
        securities arising during period,
        net of $5,385 tax                                       -           -       9,999
       Less:  reclassification adjustment
        for gains included in net income,
        net of ($19,100) tax                                    -           -     (35,470)
   Minimum pension liability adjustment:
       Minimum pension liability adjustment,
        net of $19,312 and ($19,312) tax                   35,864     (35,864)          -
   Derivative instruments:
       Net losses on derivatives hedging
        variability of cash flows, net of
        ($36) and ($496) tax                                  (67)       (921)          -
       Less:  reclassification adjustment
        for losses included in net income,
        net of $487 and $44 tax                               906          82           -
- -----------------------------------------------------------------------------------------

COMPREHENSIVE INCOME                                  $   381,410     764,921     317,560
=========================================================================================
COMPREHENSIVE INCOME, AS ADJUSTED
  FOR GOODWILL AMORTIZATION                           $   381,410     764,921     373,826
=========================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>


                                CENTURYTEL, INC.
                           Consolidated Balance Sheets
<TABLE>
<CAPTION>
                                                                            December 31,
- -------------------------------------------------------------------------------------------
                                                                         2003        2002
- -------------------------------------------------------------------------------------------
                                                                      (Dollars in thousands)
                                     ASSETS
<S>                                                                 <C>          <C>
CURRENT ASSETS
   Cash and cash equivalents                                    $     203,181        3,661
   Accounts receivable
       Customers, less allowance of $13,862 and $15,314               163,526      161,319
       Interexchange carriers and other, less allowance
         of $9,817 and $18,648                                         72,661      111,673
   Materials and supplies, at average cost                              9,229       10,150
   Other                                                               14,342        9,099
- -------------------------------------------------------------------------------------------
       Total current assets                                           462,939      295,902
- -------------------------------------------------------------------------------------------

NET PROPERTY, PLANT AND EQUIPMENT                                   3,455,481    3,531,645
- -------------------------------------------------------------------------------------------

INVESTMENTS AND OTHER ASSETS
   Goodwill                                                         3,425,001    3,427,281
   Other                                                              552,431      515,580
- -------------------------------------------------------------------------------------------
       Total investments and other assets                           3,977,432    3,942,861
- -------------------------------------------------------------------------------------------

TOTAL ASSETS                                                    $   7,895,852    7,770,408
==========================================================================================

                             LIABILITIES AND EQUITY
CURRENT LIABILITIES
   Current maturities of long-term debt                         $      72,453       70,737
   Accounts payable                                                   113,274       64,825
   Accrued expenses and other current liabilities
       Salaries and benefits                                           83,628       63,937
       Income taxes                                                    43,082       40,897
       Other taxes                                                     35,532       28,183
       Interest                                                        64,247       59,045
       Other                                                           14,555       18,596
   Advance billings and customer deposits                              44,612       41,884
- -------------------------------------------------------------------------------------------
       Total current liabilities                                      471,383      388,104
- -------------------------------------------------------------------------------------------

LONG-TERM DEBT                                                      3,109,302    3,578,132
- -------------------------------------------------------------------------------------------

DEFERRED CREDITS AND OTHER LIABILITIES                                836,651      716,168
- -------------------------------------------------------------------------------------------

STOCKHOLDERS' EQUITY
   Common stock, $1.00 par value, authorized 350,000,000
     shares, issued and outstanding 144,364,168 and
     142,955,839 shares                                               144,364      142,956
   Paid-in capital                                                    576,515      537,804
   Accumulated other comprehensive income (loss),
     net of tax                                                             -      (36,703)
   Retained earnings                                                2,750,162    2,437,472
   Unearned ESOP shares                                                  (500)      (1,500)
   Preferred stock - non-redeemable                                     7,975        7,975
- -------------------------------------------------------------------------------------------
       Total stockholders' equity                                   3,478,516    3,088,004
- -------------------------------------------------------------------------------------------

TOTAL LIABILITIES AND EQUITY                                    $   7,895,852    7,770,408
===========================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>

                                CENTURYTEL, INC.
                      Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
                                                                             Year ended December 31,
- ---------------------------------------------------------------------------------------------------------
                                                                        2003          2002          2001
- ---------------------------------------------------------------------------------------------------------
                                                                             (Dollars in thousands)
<S>                                                                <C>             <C>           <C>
OPERATING ACTIVITIES FROM CONTINUING OPERATIONS
   Net income                                                   $    344,707       801,624       343,031
   Adjustments to reconcile net income to net
     cash provided by operating activities from
     continuing operations
       Income from discontinued operations, net of tax                     -      (608,091)     (193,950)
       Depreciation and amortization                                 470,641       411,626       407,038
       Deferred income taxes                                         128,706        71,112        57,944
       Income from unconsolidated cellular entity                     (6,160)       (5,582)       (7,592)
       Nonrecurring gains and losses, net                                  -        (3,709)      (33,043)
       Changes in current assets and current liabilities
           Accounts receivable                                        37,980       (13,481)       34,266
           Accounts payable                                           47,972         3,769       (29,485)
           Accrued taxes                                              57,709        43,046         1,078
           Other current assets and other current
             liabilities, net                                         17,323        36,316         9,526
       Retirement benefits                                           (14,739)       (9,416)       (5,059)
       Increase in noncurrent assets                                 (23,528)      (30,543)      (65,698)
       Increase (decrease) in other noncurrent liabilities            (6,151)       35,489           691
       Other, net                                                     13,504        61,274        54,139
- ---------------------------------------------------------------------------------------------------------
           Net cash provided by operating activities
             from continuing operations                            1,067,964       793,434       572,886
- ---------------------------------------------------------------------------------------------------------

INVESTING ACTIVITIES FROM CONTINUING OPERATIONS
   Acquisitions, net of cash acquired                                (86,243)   (2,245,026)      (47,131)
   Payments for property, plant and equipment                       (377,939)     (386,267)     (435,515)
   Proceeds from sale of assets                                            -         4,144        58,184
   Distributions from unconsolidated cellular entity                   1,104         5,438         3,713
   Other, net                                                         (1,560)       (1,378)        3,553
- ---------------------------------------------------------------------------------------------------------
           Net cash used in investing activities
               from continuing operations                           (464,638)   (2,623,089)     (417,196)
- ----------------------------------------------------------------------------------------------------------

FINANCING ACTIVITIES FROM CONTINUING OPERATIONS
   Proceeds from issuance of debt                                          -     2,123,618         3,896
   Payments of debt                                                 (432,258)   (1,592,246)     (379,516)
   Proceeds from settlement of interest rate hedge contract           22,315             -             -
   Proceeds from issuance of common stock                             33,980        29,125         7,351
   Payment of debt issuance costs                                          -       (12,999)            -
   Payment of equity unit issuance costs                                   -       (15,867)            -
   Cash dividends                                                    (32,017)      (30,156)      (28,653)
   Other, net                                                          4,174         4,866         1,549
- ---------------------------------------------------------------------------------------------------------
           Net cash provided by (used in) financing activities
               from continuing operations                           (403,806)      506,341      (395,373)
- ----------------------------------------------------------------------------------------------------------

Net cash provided by discontinued operations                               -     1,323,479       231,772
- ---------------------------------------------------------------------------------------------------------

Net increase (decrease) in cash and cash equivalents                 199,520           165        (7,911)
Cash and cash equivalents at beginning of year                         3,661         3,496        11,407
- ---------------------------------------------------------------------------------------------------------

CASH AND CASH EQUIVALENTS AT END OF YEAR                        $    203,181         3,661         3,496
=========================================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>

                                CENTURYTEL, INC.
                 Consolidated Statements of Stockholders' Equity
<TABLE>
<CAPTION>
                                                                      Year ended December 31,
- -------------------------------------------------------------------------------------------------
                                                                 2003          2002          2001
- -------------------------------------------------------------------------------------------------
                                                                (Dollars and shares in thousands)
<S>                                                           <C>           <C>           <C>
COMMON STOCK
   Balance at beginning of year                        $      142,956       141,233       140,667
   Conversion of convertible securities into
    common stock                                                    -             -           254
   Issuance of common stock through dividend
       reinvestment, incentive and benefit plans                1,408         1,723           312
- -------------------------------------------------------------------------------------------------
           Balance at end of year                             144,364       142,956       141,233
- -------------------------------------------------------------------------------------------------

PAID-IN CAPITAL
   Balance at beginning of year                               537,804       524,668       509,840
   Equity unit issuance costs and initial
    contract adjustment liability                                   -       (24,377)            -
   Conversion of convertible securities into
    common stock                                                    -             -         3,046
   Issuance of common stock through dividend
    reinvestment, incentive and benefit plans                  32,572        27,402         7,039
   Amortization of unearned compensation and other              6,139        10,111         4,743
- -------------------------------------------------------------------------------------------------
           Balance at end of year                             576,515       537,804       524,668
- -------------------------------------------------------------------------------------------------

ACCUMULATED OTHER COMPREHENSIVE INCOME
 (LOSS), NET OF TAX
   Balance at beginning of year                               (36,703)            -        25,471
   Change in other comprehensive income
    (loss) (net of reclassification
    adjustment), net of tax                                    36,703       (36,703)      (25,471)
- -------------------------------------------------------------------------------------------------
           Balance at end of year                                   -       (36,703)            -
- -------------------------------------------------------------------------------------------------

RETAINED EARNINGS
   Balance at beginning of year                             2,437,472     1,666,004     1,351,626
   Net income                                                 344,707       801,624       343,031
   Cash dividends declared
       Common stock - $.22, $.21 and
        $.20 per share                                        (31,618)      (29,757)      (28,254)
       Preferred stock                                           (399)         (399)         (399)
- -------------------------------------------------------------------------------------------------
           Balance at end of year                           2,750,162     2,437,472     1,666,004
- -------------------------------------------------------------------------------------------------

UNEARNED ESOP SHARES
   Balance at beginning of year                                (1,500)       (2,500)       (3,500)
   Release of ESOP shares                                       1,000         1,000         1,000
- -------------------------------------------------------------------------------------------------
           Balance at end of year                                (500)       (1,500)       (2,500)
- -------------------------------------------------------------------------------------------------

PREFERRED STOCK - NON-REDEEMABLE
   Balance at beginning and end of year                         7,975         7,975         7,975
- -------------------------------------------------------------------------------------------------

TOTAL STOCKHOLDERS' EQUITY                             $    3,478,516     3,088,004     2,337,380
=================================================================================================

COMMON SHARES OUTSTANDING
   Balance at beginning of year                               142,956       141,233       140,667
   Conversion of convertible securities
    into common stock                                               -             -           254
   Issuance of common stock through
    dividend reinvestment, incentive
    and benefit plans                                           1,408         1,723           312
- -------------------------------------------------------------------------------------------------
           Balance at end of year                             144,364       142,956       141,233
=================================================================================================
</TABLE>

See accompanying notes to consolidated financial statements.

<PAGE>


                                CenturyTel, Inc.
                   Notes to Consolidated Financial Statements
                                December 31, 2003

(1)    Summary of Significant Accounting Policies

Principles of consolidation - The consolidated financial statements of
CenturyTel, Inc. and its subsidiaries (the "Company") include the accounts of
CenturyTel, Inc. ("CenturyTel") and its majority-owned subsidiaries.

Regulatory accounting - The Company's regulated telephone operations (except for
the properties acquired from Verizon in 2002) are subject to the provisions of
Statement of Financial Accounting Standards No. 71, "Accounting for the Effects
of Certain Types of Regulation" ("SFAS 71"). Actions by regulators can provide
reasonable assurance of the recognition of an asset, reduce or eliminate the
value of an asset and impose a liability on a regulated enterprise. Such
regulatory assets are required to be recorded and, accordingly, reflected in the
balance sheet of an entity subject to SFAS 71. The Company is monitoring the
ongoing applicability of SFAS 71 to its regulated telephone operations due to
the changing regulatory, competitive and legislative environments, and it is
possible that changes in regulation, legislation or competition or in the demand
for regulated services or products could result in the Company's telephone
operations no longer being subject to SFAS 71 in the near future.

Estimates - The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results may differ from those estimates.

Revenue recognition - Revenues are generally recognized when services are
provided or when products are delivered to customers. Revenue that is billed in
advance includes monthly recurring network access services, special access
services and monthly recurring local line charges. The unearned portion of this
revenue is initially deferred as a component of advanced billings and customer
deposits on the Company's balance sheet and recognized as revenue over the
period that the services are provided. Revenue that is billed in arrears
includes nonrecurring network access services, nonrecurring local services and
long distance services. The earned but unbilled portion of this revenue is
recognized as revenue in the period that the services are provided.

       Certain of the Company's telephone subsidiaries participate in revenue
sharing arrangements with other telephone companies for interstate revenue and
for certain intrastate revenue. Such sharing arrangements are funded by toll
revenue and/or access charges within state jurisdictions and by access charges
in the interstate market. Revenues earned through the various sharing
arrangements are initially recorded based on the Company's estimates.

Property, plant and equipment - Telephone plant is stated at original cost.
Normal retirements of telephone plant are charged against accumulated
depreciation, along with the costs of removal, less salvage, with no gain or
loss recognized. Renewals and betterments of plant and equipment are capitalized
while repairs, as well as renewals of minor items, are charged to operating
expense. Depreciation of telephone plant is provided on the straight line method
using class or overall group rates acceptable to regulatory authorities; such
rates range from 1.8% to 25%.

       Non-telephone property is stated at cost and, when sold or retired, a
gain or loss is recognized. Depreciation of such property is provided on the
straight line method over estimated service lives ranging from three to 30
years.

Intangible assets - Effective January 1, 2002, in accordance with Statement of
Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets"
("SFAS 142"), systematic amortization of goodwill is no longer permitted;
instead, SFAS 142 requires goodwill recorded in a business combination to be
reviewed for impairment and to be written down only in periods in which the
recorded amount of goodwill exceeds its fair value. Impairment of goodwill is
tested at least annually by comparing the fair value of the reporting unit to
its carrying value (including goodwill). Estimates of the fair value of the
reporting unit are based on valuation models using criterion such as multiples
of earnings. Each adjustment reflected in the consolidated statements of income
and comprehensive income (or in these notes) by use of the term "as adjusted for
goodwill amortization" reflects the effects of SFAS 142, as more fully described
in Note 4. Prior to January 1, 2002, substantially all of the Company's goodwill
was amortized over 40 years.

Long-lived assets - Effective January 2002, Statement of Financial Accounting
Standards No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets" ("SFAS 144"), addresses financial accounting and reporting for the
impairment or disposal of long-lived assets (exclusive of goodwill) and also
broadens the reporting of discontinued operations to include all components of
an entity with operations that can be distinguished from the rest of the entity
and that will be eliminated from the ongoing operations of the entity in a
disposal transaction. As a result of the Company's agreement in March 2002 to
sell its wireless operations (which was consummated on August 1, 2002) (see Note
3), such operations have been reflected as discontinued operations for the years
ended December 31, 2002 and 2001.

Affiliated transactions - Certain service subsidiaries of CenturyTel provide
installation and maintenance services, materials and supplies, and managerial,
operational, technical, accounting and administrative services to subsidiaries.
In addition, CenturyTel provides and bills management services to subsidiaries
and in certain instances makes interest bearing advances to finance construction
of plant and purchases of equipment. These transactions are recorded by the
Company's telephone subsidiaries at their cost to the extent permitted by
regulatory authorities. Intercompany profit on transactions with regulated
affiliates is limited to a reasonable return on investment and has not been
eliminated in connection with consolidating the results of operations of
CenturyTel and its subsidiaries. Intercompany profit on transactions with
affiliates not subject to SFAS 71 has been eliminated.

Income taxes - CenturyTel files a consolidated federal income tax return with
its eligible subsidiaries. The Company uses the asset and liability method of
accounting for income taxes under which deferred tax assets and liabilities are
established for the future tax consequences attributable to differences between
the financial statement carrying amounts of assets and liabilities and their
respective tax bases. Investment tax credits related to telephone plant have
been deferred and are being amortized as a reduction of federal income tax
expense over the estimated useful lives of the assets giving rise to the
credits.

Derivative financial instruments - Statement of Financial Accounting Standards
No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS
133"), requires all derivative instruments be recognized as either assets or
liabilities at fair value on the balance sheet. The Company uses derivative
instruments to (i) lock-in or swap its exposure to changing or variable interest
rates for fixed interest rates or (ii) swap obligations to pay fixed interest
rates for variable interest rates. The Company has established policies and
procedures for risk assessment and the approval, reporting and monitoring of
derivative instrument activities. The Company does not hold or issue derivative
financial instruments for trading or speculative purposes. Management
periodically reviews the Company's exposure to interest rate fluctuations and
implements strategies to manage the exposure.

Earnings per share - Basic earnings per share amounts are determined on the
basis of the weighted average number of common shares outstanding during the
year. Diluted earnings per share gives effect to all potential dilutive common
shares that were outstanding during the period.

Stock-based compensation - The Company accounts for stock compensation plans
using the intrinsic value method in accordance with Accounting Principles Board
Opinion No. 25, "Accounting for Stock Issued to Employees," as allowed by
Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation" ("SFAS 123"). Options have been granted at a price either equal to
or exceeding the then-current market price. Accordingly, the Company has not
recognized compensation cost in connection with issuing stock options.

       During 2003 the Company granted 1,720,317 options (the "2003 Options") at
market price. The weighted average fair value of each of the 2003 Options was
estimated as of the date of grant to be $9.94 using an option-pricing model with
the following assumptions: dividend yield - .7%; expected volatility - 30%;
weighted average risk-free interest rate - 3.4%; and expected option life -
seven years.

       During 2002 the Company granted 1,983,150 options (the "2002 Options") at
market price. The weighted average fair value of each of the 2002 Options was
estimated as of the date of grant to be $11.66 using an option-pricing model
with the following assumptions: dividend yield - .7%; expected volatility - 30%;
weighted average risk-free interest rate - 3.4%; and expected option life -
seven years.

       During 2001 the Company granted 1,971,750 options (the "2001 Options") at
market price. The weighted average fair value of each of the 2001 Options was
estimated as of the date of grant to be $11.16 using an option-pricing model
with the following assumptions: dividend yield - .6%; expected volatility - 30%;
weighted average risk-free interest rate - 4.8%; and expected option life -
seven years.

       If compensation cost for CenturyTel's options had been determined
consistent with SFAS 123, the Company's net income and earnings per share on a
pro forma basis for 2003, 2002 and 2001 would have been as follows:

<TABLE>
<CAPTION>
Year ended December 31,                                 2003          2002         2001
- ---------------------------------------------------------------------------------------
                                                           (Dollars in thousands,
                                                         except per share amounts)

<S>                                                  <C>           <C>          <C>
Net income, as reported                          $   344,707       801,624      343,031
Less:  Total stock-based compensation
  expense determined under fair value based
  method, net of tax                             $   (13,183)      (15,001)      (8,971)
                                                 --------------------------------------
Pro forma net income                             $   331,524       786,623      334,060
                                                 ======================================

Basic earnings per share
     As reported                                 $      2.40          5.66         2.43
     Pro forma                                   $      2.31          5.56         2.37
Diluted earnings per share
     As reported                                 $      2.38          5.61         2.41
     Pro forma                                   $      2.29          5.51         2.35
- ---------------------------------------------------------------------------------------
</TABLE>

Cash equivalents - The Company considers short-term investments with a maturity
at date of purchase of three months or less to be cash equivalents.

Discontinued operations - On August 1, 2002, the Company sold substantially all
of its wireless operations to an affiliate of ALLTEL Corporation ("Alltel") and
certain other purchasers for an aggregate of approximately $1.59 billion in
cash. As a result, the Company's wireless operations have been reflected as
discontinued operations for 2002 and 2001. See Note 3 for additional
information.

Reclassifications - Certain amounts previously reported for prior years have
been reclassified to conform with the 2003 presentation, including the
reclassification of an investment in a cellular partnership from discontinued
operations to continuing operations. Such investment was originally planned to
be sold to Alltel in connection with the Company's disposition of its wireless
operations but was subsequently retained.

(2)    AQUISITIONS

       On July 1, 2002, the Company purchased approximately 300,000 telephone
access lines in the state of Alabama from Verizon Communications, Inc.
("Verizon") for approximately $1.022 billion cash. On August 31, 2002, the
Company purchased approximately 350,000 telephone access lines in the state of
Missouri from Verizon for approximately $1.179 billion cash. The assets
purchased in these transactions included (i) the franchise authorizing the
provision of local telephone service, (ii) related property and equipment
comprising Verizon's local exchange operations in predominantly rural markets
throughout Alabama and Missouri and (iii) Verizon's assets used to provide
digital subscriber line ("DSL") and other high speed data services within the
purchased exchanges. For financing arrangements related to these acquisitions,
see Note 6.

       In June and December 2003, the Company acquired certain fiber transport
assets for an aggregate of $55.2 million cash (of which $3.8 million was paid as
a deposit in 2002). In the fourth quarter of 2003, the Company purchased an
additional 24.3% interest in a telephone company in which it owned a majority
interest for $32.4 million cash.

       The results of operations of the acquired properties are included in the
Company's results of operations from and after the respective acquisition dates.

       The following pro forma information represents the consolidated results
of continuing operations of the Company for the years ended December 31, 2002
and 2001 as if the Verizon acquisitions in 2002 had been consummated as of
January 1, 2002 and 2001, respectively.
<TABLE>
<CAPTION>
                                                         2002           2001
                                                    ----------------------------
                                                    (Dollars in thousands, except
                                                         per share amounts)

<S>                                                    <C>            <C>
Operating revenues from continuing operations       $  2,285,866      2,231,631
Income from continuing operations                   $    218,252        186,871
Basic earnings per share from
  continuing operations, as adjusted for
  goodwill amortization                             $       1.54           1.65
Diluted earnings per share from
  continuing operations, as adjusted for
  goodwill amortization                             $       1.53           1.64
</TABLE>

       The pro forma information is based on various assumptions and estimates.
The pro forma information (i) reflects the effect of reduced interest expense
after August 1, 2002 as a result of reducing outstanding indebtedness from
utilization of proceeds received from the August 1, 2002 sale of substantially
all of the Company's wireless operations described in Note 3 and (ii) makes no
pro forma adjustments to reflect any assumed consummation of such sale (or any
use of such sale proceeds) prior to August 1, 2002. The pro forma information is
not necessarily indicative of the operating results that would have occurred if
the Verizon acquisitions had been consummated as of January 1 of each respective
period, nor is it necessarily indicative of future operating results. The pro
forma information does not give effect to any potential revenue enhancements or
cost synergies or other operating efficiencies that could result from the
acquisitions.


(3)    DISCONTINUED OPERATIONS

       On August 1, 2002, the Company sold substantially all of its wireless
operations to Alltel and certain other purchasers for an aggregate of
approximately $1.59 billion in cash. In connection with this transaction, the
Company divested its (i) interests in its majority-owned and operated cellular
systems, which at June 30, 2002 served approximately 783,000 customers and had
access to approximately 7.8 million pops, (ii) minority cellular equity
interests representing approximately 1.8 million pops at June 30, 2002, and
(iii) licenses to provide PCS covering 1.3 million pops in Wisconsin and Iowa.
Proceeds from the sale of the wireless operations were used to partially fund
the Company's acquisitions of telephone properties in Alabama and Missouri
during the third quarter of 2002.

       As a result of the sale, the Company's wireless operations have been
reflected as discontinued operations in the Company's consolidated statements of
income and cash flows for the years ended December 31, 2002 and 2001. In its
December 31, 2002 consolidated balance sheet, the Company reflected as "assets
held for sale" a minority interest in a cellular partnership that it had
previously agreed to sell to Alltel upon the satisfaction of various closing
conditions. In light of the failure of the parties to agree upon whether the
closing conditions were met, the Company determined during the first quarter of
2003 to retain such investment; therefore, for reporting purposes, this
investment (and its related earnings) has been reclassified from discontinued
operations to continuing operations on the accompanying financial statements for
2003. Prior periods have been restated to reflect this investment (and its
related earnings) as part of continuing operations.

       The depreciation and amortization of long-lived and amortizable
intangible assets related to the wireless operations ceased on March 19, 2002,
the date of he definitive agreement to sell such operations.

       The Company had no outstanding indebtedness directly related to its
wireless operations; therefore, no interest expense was allocated to
discontinued operations. The following table represents certain summary income
statement information related to the Company's wireless operations that is
reflected in discontinued operations.

<TABLE>
<CAPTION>
Year ended December 31,                                    2002            2001
- --------------------------------------------------------------------------------
                                                          (Dollars in thousands)

<S>                                                      <C>            <C>
Operating revenues                                     $  246,705        437,965
- --------------------------------------------------------------------------------
Operating income (1)                                   $   71,258        132,614
Nonrecurring gains and losses, net                              -        166,928
Income from unconsolidated cellular entities               25,768         19,868
Minority interest expense                                  (8,569)       (11,510)
Gain on sale of discontinued operations                   803,905              -
Other income                                                  188          4,707
- --------------------------------------------------------------------------------
Pre-tax income from discontinued operations            $  892,550        312,607
Income tax expense                                       (284,459)      (118,657)
- --------------------------------------------------------------------------------
Income from discontinued operations                    $  608,091        193,950
================================================================================
</TABLE>
(1)  Excludes corporate overhead costs of $11.3 million and $20.2 million for
2002 and 2001, respectively, allocated to the wireless operations.  Included as
a reduction in operating income for 2002 is a $30.5 million charge associated
with the write-off of all amounts expended to develop the wireless portion of
the Company's billing system currently in development.

       The following table represents certain summary cash flow statement
information related to the Company's wireless operations reflected as
discontinued operations:

<TABLE>
<CAPTION>
Year ended December 31,                                       2002              2001
- -------------------------------------------------------------------------------------
                                                              (Dollars in thousands)

<S>                                                       <C>        <C>      <C>
Net cash provided by (used in) operating activities     $  (248,716) (1)       90,242
Net cash provided by investing activities                 1,572,195  (2)      141,530
Net cash provided by financing activities                         -                 -
- -------------------------------------------------------------------------------------
       Net cash provided by discontinued operations     $ 1,323,479           231,772
=====================================================================================
</TABLE>
(1) Includes approximately $305 million estimated tax payment related to sale
of wireless operations.
(2) Includes cash proceeds of $1.59 billion from the sale of substantially all
of the Company's wireless operations.


(4)    INVESTMENTS AND OTHER ASSETS

       Investments and other assets at December 31, 2003 and 2002 were composed
of the following:

<TABLE>
<CAPTION>
December 31,                                                       2003           2002
- ---------------------------------------------------------------------------------------
                                                                 (Dollars in thousands)

<S>                                                            <C>            <C>
Goodwill                                                   $   3,425,001      3,427,281
Billing system development costs, less accumulated
  amortization of $508 in 2003                                   162,980        139,451
Cash surrender value of life insurance contracts                  93,960         93,664
Prepaid pension asset                                             59,055         26,046
Franchise costs                                                   35,300         35,300
Customer base, less accumulated amortization of
  $2,242 and $729                                                 20,458         21,971
Deferred interest rate hedge contracts                            31,239         33,635
Debt issuance costs, net                                          19,317         23,491
Fair value of interest rate swap                                       -         22,163
Other                                                            130,122        119,859
- ---------------------------------------------------------------------------------------
                                                           $   3,977,432      3,942,861
=======================================================================================
</TABLE>

       The following information relates to the Company's goodwill as of
December 31, 2003 and 2002:
<TABLE>
<CAPTION>
December 31,                                                2003           2002
- --------------------------------------------------------------------------------
                                                           (Dollars in thousands)
<S>                                                     <C>            <C>
Carrying amount of goodwill
   Telephone segment                                  $ 3,369,242      3,382,113
   Other operations                                        55,759         45,168
- --------------------------------------------------------------------------------
       Total goodwill                                 $ 3,425,001      3,427,281
================================================================================
</TABLE>

       Amortization of goodwill and other intangibles from continuing operations
of $1.5 million, $729,000 and $58.4 million for 2003, 2002 and 2001,
respectively, is included in "Depreciation and amortization" in the Company's
Consolidated Statements of Income. In accordance with SFAS 142, effective
January 1, 2002, goodwill is no longer subject to amortization but instead is
tested for impairment at least annually. As of September 30, 2003, the Company
completed the required annual test under SFAS 142 and determined its goodwill
was not impaired.

       The following is a reconciliation of reported net income and reported
earnings per share to the amounts that would have been reported had the Company
been subject to SFAS 142 during 2001.

<TABLE>
<CAPTION>
Year ended December 31,                                           2001
- -------------------------------------------------------------------------------
                                                        (Dollars in thousands,
                                                       except per share amounts)

<S>                                                                    <C>
Net income, as reported                                          $     343,031
Goodwill amortization, net of taxes                                     56,266
- -------------------------------------------------------------------------------
Net income, as adjusted                                          $     399,297
===============================================================================

Basic earnings per share, as reported                            $        2.43
Goodwill amortization, net of taxes                                        .40
- -------------------------------------------------------------------------------
Basic earnings per share, as adjusted                            $        2.83
===============================================================================

Diluted earnings per share, as reported                          $        2.41
Goodwill amortization, net of taxes                                        .40
- -------------------------------------------------------------------------------
Diluted earnings per share, as adjusted                          $       2.81
===============================================================================
</TABLE>

       The Company is in the process of developing an integrated billing and
customer care system. The costs to develop such system have been accounted for
in accordance with Statement of Position 98-1, "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use." Aggregate capitalized
costs (before accumulated amortization) totaled $163.5 million and $139.5
million at December 31, 2003 and 2002, respectively. A portion of such costs
related to the wireless business ($30.5 million) was written off as a component
of discontinued operations in the third quarter of 2002 as a result of the sale
of substantially all of the Company's wireless operations on August 1, 2002.
Excluding this write-off, the Company's aggregate capitalized billing system
costs are expected to approximate $200-215 million upon completion and will be
amortized over a twenty-year period. The Company began amortizing its billing
system in 2003 based on the total number of customers that the Company has
migrated to the new system.

       In connection with the acquisitions of properties from Verizon in 2002,
the Company assigned $35.3 million of the purchase price as an intangible asset
associated with franchise costs (which includes amounts necessary to maintain
eligibility to provide telecommunications services in its licensed service
areas). Such asset has an indefinite life and therefore is not subject to
amortization currently.

       The Company assigned $22.7 million of the purchase price to a customer
base intangible asset in connection with the acquisitions of Verizon properties
in 2002. Such asset is being amortized over 15 years; amortization expense for
2003 and 2002 was $1.5 million and $729,000, respectively, and is expected to be
$1.5 million for each of the full years remaining in the amortization period.

(5)    PROPERTY, PLANT AND EQUIPMENT

       Net property, plant and equipment at December 31, 2003 and 2002 was
composed of the following:

<TABLE>
<CAPTION>
December 31,                                               2003            2002
- --------------------------------------------------------------------------------
                                                          (Dollars in thousands)
<S>                                                <C>                 <C>
Telephone
      Cable and wire                               $   3,801,079       3,643,167
      Central office                                   2,230,943       2,150,217
      General support                                    490,884         474,022
      Information origination/termination                 46,142          44,198
      Construction in progress                            21,289          32,507
      Other                                                6,263           3,789
- --------------------------------------------------------------------------------
                                                       6,596,600       6,347,900
      Accumulated depreciation                        (3,498,298)     (3,136,107)
- --------------------------------------------------------------------------------
                                                       3,098,302       3,211,793
- --------------------------------------------------------------------------------

Other, at cost
      General support                                    320,417         346,037
      Fiber transport                                    141,853          74,305
      Other                                              125,285         100,950
- --------------------------------------------------------------------------------
                                                         587,555         521,292
      Accumulated depreciation                          (230,376)       (201,440)
- --------------------------------------------------------------------------------
                                                         357,179         319,852
- --------------------------------------------------------------------------------

Net property, plant and equipment                  $   3,455,481       3,531,645
================================================================================
</TABLE>

       Depreciation expense was $469.1 million, $410.9 million and $348.6
million in 2003, 2002 and 2001, respectively. The composite depreciation rate
for telephone properties was 7.0% for 2003, 6.9% for 2002 and 6.8% for 2001.

<PAGE>

(6)    LONG-TERM AND SHORT-TERM DEBT

       The Company's long-term debt as of December 31, 2003 and 2002 was as
follows:

<TABLE>
<CAPTION>
December 31,                                                                 2003           2002
- -------------------------------------------------------------------------------------------------
                                                                           (Dollars in thousands)
<S>                                                                      <C>            <C>
CenturyTel
      Senior credit facilities                                       $           -        385,000
      Senior notes and debentures:
          7.75% Series A, due 2004                                          50,000         50,000
          8.25% Series B, due 2024                                         100,000        100,000
          6.55% Series C, due 2005                                          50,000         50,000
          7.20% Series D, due 2025                                         100,000        100,000
          6.15% Series E, due 2005                                         100,000        100,000
          6.30% Series F, due 2008                                         240,000        240,000
          6.875% Series G, due 2028                                        425,000        425,000
          8.375% Series H, due 2010                                        500,000        500,000
          6.02% Series J, due 2007 (remarketable 2005)                     500,000        500,000
          4.75% Series K, due 2032                                         165,000        165,000
          7.875% Series L, due 2012                                        500,000        500,000
          9.38% notes                                                            -          2,800
      6.86%* Employee Stock Ownership
        Plan commitment, due in installments through 2004                      500          1,500
      Unamortized net discount                                              (4,501)        (5,084)
      Fair value of derivative instrument related to
        Series H senior notes                                               19,440         22,163
      Fair value of derivative instruments related to
        Series L senior notes                                              (11,693)             -
      Other                                                                    114            146
- -------------------------------------------------------------------------------------------------
               Total CenturyTel                                          2,733,860      3,136,525
- -------------------------------------------------------------------------------------------------

Subsidiaries
      First mortgage debt
          5.92%* notes, payable to agencies of the U. S.
            government and cooperative lending
            associations, due in installments
            through 2025                                                   234,743        250,325
          7.98% notes, due through 2017                                      5,211          5,500
      Other debt
          6.98%* unsecured medium-term notes, due through 2008             199,613        244,124
          7.11%* notes, due in installments through 2020                     3,739          5,361
          6.55%* capital lease obligations, due through 2008                 4,589          7,034
- -------------------------------------------------------------------------------------------------
               Total subsidiaries                                          447,895        512,344
- -------------------------------------------------------------------------------------------------
Total long-term debt                                                     3,181,755      3,648,869
Less current maturities                                                     72,453         70,737
- -------------------------------------------------------------------------------------------------
Long-term debt, excluding current maturities                         $   3,109,302      3,578,132
=================================================================================================
* weighted average interest rate at December 31, 2003
</TABLE>

       The approximate annual debt maturities for the five years subsequent to
December 31, 2003 are as follows: 2004 - $72.5 million; 2005 - $246.1 million;
2006 - $277.9 million (including $165 million aggregate principal amount of the
Company's convertible debentures, Series K, due 2032, which can be put to the
Company at various dates beginning in 2006); 2007 - $521.7 million; and 2008 -
$283.7 million.

       Certain of the loan agreements of CenturyTel and its subsidiaries contain
various restrictions, among which are limitations regarding issuance of
additional debt, payment of cash dividends, reacquisition of capital stock and
other matters. In addition, the transfer of funds from certain consolidated
subsidiaries to CenturyTel is restricted by various loan agreements.
Subsidiaries which have loans from government agencies and cooperative lending
associations, or have issued first mortgage bonds, generally may not loan or
advance any funds to CenturyTel, but may pay dividends if certain financial
ratios are met. At December 31, 2003, restricted net assets of subsidiaries were
$249.1 million and subsidiaries' retained earnings in excess of amounts
restricted by debt covenants totaled $1.476 billion. At December 31, 2003, all
of the consolidated retained earnings reflected on the balance sheet was
available under CenturyTel's loan agreements for the declaration of dividends.

       Approximately 25% of the Company's telephone property, plant and
equipment is pledged to secure the long-term debt of subsidiaries.

       On May 6, 2002, the Company issued and sold in an underwritten public
offering $500 million of equity units. Net proceeds to the Company from this
issuance were approximately $483.4 million. Each of the 20 million equity units
issued was priced at $25 and consists initially of a beneficial interest in a
CenturyTel senior unsecured note (Series J) with a principal amount of $25 and a
contract to purchase shares of CenturyTel common stock no later than May 2005.
The senior notes will mature in May 2007. Each purchase contract will generally
require the holder to purchase between .6944 and .8741 of a share of CenturyTel
common stock in May 2005 based on the then current stock price of CenturyTel
common stock in exchange for $25, subject to certain adjustments and exceptions.
Accordingly, upon full settlement of the purchase contracts in May 2005, the
Company will receive proceeds of $500 million and will deliver between 13.9
million and 17.5 million common shares in the aggregate. The senior notes are
pledged by the holders to secure their obligations under the purchase contracts.
The total distributions on the equity units will be at an initial annual rate of
6.875%, consisting of interest (6.02%) and contract adjustment payments
(0.855%), each payable quarterly. On or after mid-February 2005, the senior
notes will be remarketed, at which time the remarketing agent will reset the
interest rate on the senior notes in order to generate sufficient proceeds to
secure the holder's obligation under the purchase contract. In the event of an
unsuccessful remarketing, the Company will exercise its right as a secured party
to dispose of the senior notes and satisfy in full the holder's obligation to
purchase common stock under the purchase contract.

       The senior note portion of the equity units is reflected on the balance
sheet as long-term debt in the amount of $500 million. Interest expense on the
senior notes is accrued at a rate of 6.02%, the initial interest rate. The
present value of the aggregate contract adjustment payments has been recorded as
an $11.6 million reduction to paid-in capital and as an equivalent liability.
The Company is amortizing the difference between the aggregate amount of all
payments and the present value thereof as interest expense over the three-year
term of the purchase contracts. Upon making each such payment, the Company will
allocate most of the payment to the reduction of its $11.6 million liability,
and record the remainder as interest expense. The issuance costs of the equity
units have been allocated to the units' debt and equity components. The debt
issuance costs ($3.3 million) were computed based on typical costs of a debt
transaction and will be amortized to interest expense over the term of the
senior notes. The remainder of the issuance costs ($12.6 million) were treated
as a cost of raising equity and recorded as a charge to paid-in capital.

       On July 22, 2002, the Company entered into $800 million of credit
facilities, consisting of a $533 million three-year facility and a $267 million
364-day revolving facility with a one-year term-out option. The 364-day
revolving facility was not renewed in 2003. The Company had no outstanding
borrowings under its facility at December 31, 2003.

       In the third quarter of 2002, the Company issued $500 million of senior
notes, Series L, due 2012 (which bear interest at 7.875%) and $165 million of
convertible senior debentures, Series K, due 2032 (which bear interest at 4.75%
and which may be converted into shares of CenturyTel common stock at a
conversion price of $40.455 per share). Holders of the convertible senior
debentures will have the right to require the Company to purchase all or a
portion of the debentures on August 1, 2006, August 1, 2010 and August 1, 2017.
In each case, the purchase price payable will be equal to 100% of the principal
amount of the debentures to be purchased plus any accrued and unpaid interest to
the purchase date. The Company will pay cash for all debentures so purchased on
August 1, 2006. For any such purchases on or after August 1, 2010, the Company
may choose to pay the purchase price in cash or shares of its common stock, or
any combination thereof (except that the Company will pay any accrued and unpaid
interest in cash).

       On October 15, 2002, the Company redeemed $400 million principal amount
of its Series I Remarketable Senior Notes at par value, plus accrued interest.
In connection with such redemption, the Company also paid a premium of
approximately $71.1 million in accordance with the redemption provisions of the
associated remarketing agreement. Such premium payment (net of $11.1 million of
unamortized net premium primarily associated with the option payment received by
the Company in 2000 in connection with the original issuance of the remarketable
notes) is reflected as an Other Expense in the Company's results of operations
for year ended December 31, 2002.

       At December 31, 2003, the Company had available $533.3 million of undrawn
committed bank lines of credit and the Company's telephone subsidiaries had
available for use $123.0 million of commitments for long-term financing from the
Rural Utilities Service and Rural Telephone Bank.


(7)    DERIVATIVE INSTRUMENTS

       During 2002, the Company entered into a fair value hedge with respect
to the Company's $500 million aggregate principal amount of 8.375% Series H
senior notes, due 2010. This hedge was a "fixed to variable" interest rate swap
that effectively converted the Company's fixed rate interest payment obligations
under these notes into variable rate obligations. The change in the value of
this hedge was reflected as a component of interest expense for the year ended
December 31, 2002. As of December 31, 2002, the Company realized an interest
rate of 4.96% related to such hedge. Interest expense was reduced by $7.8
million in 2002 as a result of this hedge. The fair value of such hedge at
December 31, 2002 was $22.2 million and is reflected on the accompanying balance
sheet as both an asset (included in "Other assets") and as an increase in the
underlying debt (included in "Long-term debt"). In May 2003, the Company
terminated this hedge. In connection with such termination, the Company received
approximately $22.3 million in cash upon settlement, which represented the fair
value of the hedge at the termination date. Such amount is being amortized as a
reduction of interest expense through 2010, the maturity date of the Series H
notes.

       In May and July 2003, the Company entered into four separate fair value
interest rate hedges associated with the full $500 million principal amount of
its Series L senior notes, due 2012, that pay interest at a fixed rate of
7.875%. These hedges are "fixed to variable" interest rate swaps that
effectively convert the Company's fixed rate interest payment obligations under
these notes into obligations to pay variable rates that range from the six-month
London InterBank Offered Rate ("LIBOR") plus 3.229% to the six-month LIBOR plus
3.67%, with settlement and rate reset dates occurring each six months through
the expiration of the hedges in August 2012. As of December 31, 2003, the
Company realized a weighted average interest rate of 4.8% related to these
hedges. Interest expense was reduced by $7.7 million during 2003 as a result of
these hedges. The aggregate fair value of such hedges at December 31, 2003 was
$11.7 million and is reflected on the accompanying balance sheet as both a
liability (included in "Deferred credits and other liabilities") and as a
decrease to the Company's underlying long-term debt.

       During 2002, the Company entered into (i) a cash flow hedge designed to
lock in a fixed interest rate for $100 million of the $500 million senior notes
issued in the third quarter of 2002 which was settled in the third quarter of
2002 for a $1.1 million payment by the Company (which is being amortized as
additional interest expense over a ten-year period, which equates to the term of
the debt issuance hedged) and (ii) a cash flow hedge designed to eliminate the
variability of interest payments for $400 million of variable rate debt under
the Company's $800 million credit facilities. During the second quarter of 2003,
the Company retired all outstanding indebtedness associated with its $800
million credit facilities; therefore, such cash flow hedge was deemed
ineffective in 2003 and resulted in a $722,000 unfavorable pre-tax charge to the
Company's income.


(8)    DEFERRED CREDITS AND OTHER LIABILITIES

       Deferred credits and other liabilities at December 31, 2003 and 2002 were
composed of the following:

<TABLE>
<CAPTION>
December 31,                                               2003              2002
- ----------------------------------------------------------------------------------
                                                           (Dollars in thousands)
<S>                                                      <C>               <C>
Deferred federal and state income taxes             $    528,551           352,161
Accrued postretirement benefit costs                     222,613           208,542
Fair value of interest rate swap                          11,693             1,290
Additional minimum pension liability                           -            56,388
Minority interest                                          7,218            26,067
Other                                                     66,576            71,720
- ----------------------------------------------------------------------------------
                                                    $    836,651           716,168
==================================================================================
</TABLE>

(9)    STOCKHOLDERS' EQUITY

Common stock - Unissued shares of CenturyTel common stock were reserved as
follows:

<TABLE>
<CAPTION>
December 31,                                                       2003
- --------------------------------------------------------------------------
                                                             (In thousands)

<S>                                                              <C>
Incentive compensation programs                                  12,099
Acquisitions                                                      4,064
Employee stock purchase plan                                      4,822
Dividend reinvestment plan                                          454
Conversion of convertible preferred stock                           435
Other employee benefit plans                                      3,717
- --------------------------------------------------------------------------
                                                                 25,591
==========================================================================
</TABLE>

       Under CenturyTel's Articles of Incorporation each share of common stock
beneficially owned continuously by the same person since May 30, 1987 generally
entitles the holder thereof to ten votes per share. All other shares entitle
the holder to one vote per share. At December 31, 2003, the holders of 8.9
million shares of common stock were entitled to ten votes per share.

Preferred stock - As of December 31, 2003, CenturyTel had 2.0 million shares of
authorized convertible preferred stock, $25 par value per share. At December
31,2003 and 2002, there were 319,000 shares of outstanding preferred stock.
Holders of outstanding CenturyTel preferred stock are entitled to receive
cumulative dividends, receive preferential distributions equal to $25 per share
plus unpaid dividends upon CenturyTel's liquidation and vote as a single class
with the holders of common stock.

Shareholders' Rights Plan - In 1996 the Board of Directors declared a dividend
of one preference share purchase right for each common share outstanding. Such
rights become exercisable if and when a potential acquiror takes certain steps
to acquire 15% or more of CenturyTel's common stock. Upon the occurrence of
such an acquisition, each right held by shareholders other than the acquiror
may be exercised to receive that number of shares of common stock or other
securities of CenturyTel (or, in certain situations, the acquiring company)
which at the time of such transaction will have a market value of two times
the exercise price of the right.


(10)   POSTRETIREMENT BENEFITS

       The Company sponsors health care plans (which use a December
31 measurement date) that provide postretirement benefits to all qualified
retired employees.

       On December 8, 2003, President Bush signed into law a bill that expands
Medicare, primarily adding a prescription drug benefit for Medicare-eligible
retirees starting in 2006. The Company anticipates that the benefits it pays
after 2006 will be lower as a result of the new Medicare provisions; however,
the Company's retiree medical obligations and reported costs do not reflect the
impact of this legislation. Deferring recognition of the new medicare
provisions' impact is permitted by Financial Accounting Standards Board Staff
Position 106-1 due to unresolved questions about some of the new Medicare
provisions and a lack of authoritative accounting guidance about certain
matters.

       In 2003, the Company announced changes, effective January 1, 2004, that
would decrease its subsidization of benefits provided under its postretirement
benefit plan.

       The following is a reconciliation of the beginning and ending balances
for the benefit obligation and the plan assets.

<TABLE>
<CAPTION>
December 31,                                                 2003          2002         2001
- ---------------------------------------------------------------------------------------------
                                                                  (Dollars in thousands)
<S>                                                        <C>           <C>          <C>
Change in benefit obligation
     Benefit obligation at beginning of year          $    253,762       215,872      165,266
     Service cost                                            6,176         6,669        6,373
     Interest cost                                          18,216        15,962       14,512
     Participant contributions                               1,199           617          548
     Acquisitions                                                -        56,539            -
     Plan amendments                                       (34,597)            -            -
     Actuarial (gain) loss                                  79,163       (29,534)      40,005
     Benefits paid                                         (12,498)      (12,363)     (10,832)
- ---------------------------------------------------------------------------------------------
Benefit obligation at end of year                     $    311,421       253,762      215,872
=============================================================================================

Change in plan assets
     Fair value of plan assets at beginning of year   $     28,697        36,555       39,873
     Return on assets                                        4,479        (2,896)      (1,379)
     Employer contributions                                  8,000         6,784        8,345
     Participant contributions                               1,199           617          548
     Benefits paid                                         (12,498)      (12,363)     (10,832)
- ---------------------------------------------------------------------------------------------
Fair value of plan assets at end of year              $     29,877        28,697       36,555
=============================================================================================
</TABLE>

       Net periodic postretirement benefit cost for 2003, 2002 and 2001
included the following components:

<TABLE>
<CAPTION>
Year ended December 31,                                      2003          2002         2001
- ---------------------------------------------------------------------------------------------
                                                                  (Dollars in thousands)

<S>                                                         <C>           <C>          <C>
Service cost                                          $      6,176         6,669        6,373
Interest cost                                               18,216        15,962       14,512
Expected return on plan assets                              (2,870)       (3,656)      (3,987)
Amortization of unrecognized actuarial loss                  2,234         1,470        1,337
Amortization of unrecognized prior service cost             (2,447)         (129)        (129)
- ---------------------------------------------------------------------------------------------
Net periodic postretirement benefit cost              $     21,309        20,316       18,106
=============================================================================================
</TABLE>

       The following table sets forth the amounts recognized as liabilities for
postretirement benefits at December 31, 2003, 2002 and 2001.

<TABLE>
<CAPTION>
December 31,                                                 2003          2002         2001
- ---------------------------------------------------------------------------------------------
                                                                  (Dollars in thousands)

<S>                                                       <C>           <C>          <C>
Benefit obligation                                    $   (311,421)     (253,762)    (215,872)
Fair value of plan assets                                   29,877        28,697       36,555
Unamortized prior service cost                             (33,068)         (918)      (1,046)
Unrecognized net actuarial loss                             89,893        14,573       33,925
- ---------------------------------------------------------------------------------------------
Accrued benefit cost                                  $   (224,719)     (211,410)    (146,438)
=============================================================================================
</TABLE>

       Assumptions used in accounting for postretirement benefits as of
December 31, 2003 and 2002 were:
<TABLE>
<CAPTION>
                                                                        2003            2002
- ---------------------------------------------------------------------------------------------
<S>                                                                <C>              <C>
Determination of benefit obligation
    Discount rate                                                         6.0%           6.75
    Healthcare trend rates (Medical/Prescription Drug)
       Following year                                              11.0%/16.0%        4.9/5.7
       Rate to which the cost trend rate is assumed to
        decline (the ultimate trend rate)                            5.0%/5.0%        4.5/4.5
       Year that the rate reaches the ultimate trend rate            2010/2015      2015/2015

Determination of benefit cost
    Discount rate                                                        6.75%           7.00
    Expected return on plan assets                                       8.25%           10.0
- ---------------------------------------------------------------------------------------------
</TABLE>

       The Company employs a total return investment approach whereby a mix of
equities and fixed income investments are used to maximize the long-term return
of plan assets for a prudent level of risk. The intent of this strategy is to
minimize plan expenses by outperforming plan liabilities over the long term.
Risk tolerance is established through careful consideration of plan
liabilities, plan funded status and corporate financial condition. Investment
risk is measured and monitored on an ongoing basis through annual liability
measurements, periodic asset studies and periodic portfolio reviews.

       The Company's postretirement benefit plan weighted-average asset
allocations at December 31, 2003 and 2002 by asset category are as follows:

<TABLE>
<CAPTION>
                                                         2003             2002
- ------------------------------------------------------------------------------
<S>                                                     <C>              <C>
Equity securities                                        80.5%            56.2
Debt securities                                          16.4             36.6
Other                                                     3.1              7.2
- ------------------------------------------------------------------------------
Total                                                   100.0%           100.0
==============================================================================
</TABLE>

       In determining the expected return on plan assets, historical markets
are studied and long-term relationships between equities and fixed income are
preserved consistent with the widely-accepted capital market principle that
assets with higher volatility and risk generate a greater return over the long
term. Current market factors such as inflation and interest rates are evaluated
before long-term capital market assumptions are determined. Peer data and
historical returns are also reviewed to check for reasonableness.

       Assumed health care cost trends have a significant effect on the amounts
reported for postretirement benefit plans. A one-percentage-point change in
assumed health care cost rates would have the following effects:
<TABLE>
<CAPTION>
                                                     1-Percentage      1-Percentage
                                                    Point Increase    Point Decrease
- ------------------------------------------------------------------------------------
                                                         (Dollars in thousands)
<S>                                                      <C>              <C>
Effect on total of service and
 interest cost components                           $     1,588            (1,514)
Effect on postretirement benefit
 obligation                                         $    20,377           (19,126)
- ------------------------------------------------------------------------------------
</TABLE>

       The Company expects to contribute approximately $13 million to its
postretirement benefit plan in 2004.

(11)   RETIREMENT AND SAVINGS PLANS

       CenturyTel and certain subsidiaries sponsor defined benefit pension
plans for substantially all employees. CenturyTel also sponsors an Outside
Directors' Retirement Plan and a Supplemental Executive Retirement Plan to
provide directors and officers, respectively, with supplemental retirement,
death and disability benefits. The Company uses a December 31 measurement date
for its plans.

       The following is a reconciliation of the beginning and ending balances
for the aggregate benefit obligation and the plan assets for the Company's
retirement and savings plans.

<TABLE>
<CAPTION>
December 31,                                               2003          2002         2001
- -------------------------------------------------------------------------------------------
                                                                (Dollars in thousands)
<S>                                                      <C>           <C>          <C>
Change in benefit obligation
    Benefit obligation at beginning of year         $    346,256       271,490      249,835
    Service cost                                          12,840        10,353        7,760
    Interest cost                                         23,617        20,053       17,829
    Plan amendments                                            -             -        1,205
    Acquisitions                                               -        51,428            -
    Settlements                                           (9,962)            -            -
    Actuarial (gain) loss                                 46,221         9,231        9,065
    Benefits paid                                        (28,139)      (16,299)     (14,204)
- -------------------------------------------------------------------------------------------
Benefit obligation at end of year                   $    390,833       346,256      271,490
===========================================================================================

Change in plan assets
    Fair value of plan assets at beginning of year  $    266,420       270,902      315,727
    Return on plan assets                                 52,783       (42,998)     (31,998)
    Employer contributions                                50,437         3,387        1,377
    Acquisitions                                           6,807        51,428            -
    Benefits paid                                        (28,139)      (16,299)     (14,204)
- -------------------------------------------------------------------------------------------
Fair value of plan assets at end of year            $    348,308       266,420      270,902
===========================================================================================
</TABLE>

       At December 31, 2003, the Company's underfunded pension plans (meaning
those with benefit obligations in excess of plan assets) had aggregate benefit
obligations of $138.4 million and aggregate plan assets of $84.4 million. As
of December 31, 2002, all of the pension plans had benefit obligations in
excess of plan assets.

       Net periodic pension expense (benefit) for 2003, 2002 and 2001 included
the following components:

<TABLE>
<CAPTION>
Year ended December 31,                                    2003          2002         2001
- -------------------------------------------------------------------------------------------
                                                                (Dollars in thousands)
<S>                                                      <C>           <C>          <C>
Service cost                                       $      12,840        10,353        7,760
Interest cost                                             23,617        20,053       17,829
Expected return on plan assets                           (22,065)      (28,575)     (30,803)
Settlements                                                2,233             -            -
Recognized net (gains) losses                              7,214         1,248       (2,399)
Net amortization and deferral                                397           395          301
- -------------------------------------------------------------------------------------------
Net periodic pension expense (benefit)             $      24,236         3,474       (7,312)
===========================================================================================
</TABLE>

       The following table sets forth the combined plans' funded status and
amounts recognized in the Company's consolidated balance sheet at December 31,
2003, 2002 and 2001.

<TABLE>
<CAPTION>
December 31,                                               2003          2002         2001
- -------------------------------------------------------------------------------------------
                                                                (Dollars in thousands)
<S>                                                     <C>           <C>          <C>
Benefit obligation                                 $    (390,833)     (346,256)    (271,490)
Fair value of plan assets                                348,308       266,420      270,902
Unrecognized transition asset                               (900)       (1,152)      (1,404)
Unamortized prior service cost                             3,721         4,370        5,017
Unrecognized net actuarial (gain) loss                    98,759       102,664       23,121
- -------------------------------------------------------------------------------------------
Prepaid pension cost                               $      59,055        26,046       26,146
===========================================================================================
</TABLE>

       The Company's accumulated benefit obligation as of December 31, 2003 and
2002 was $329.0 million and $284.8 million, respectively.

       Amounts recognized on the balance sheet consist of:

<TABLE>
<CAPTION>
December 31,                                               2003         2002         2001
- ------------------------------------------------------------------------------------------
                                                               (Dollars in thousands)

<S>                                                       <C>         <C>           <C>
Prepaid pension cost                               $      59,055       26,046       26,146
Additional minimum pension liability
  (reflected in Deferred Credits and
  Other Liabilities)                                           -      (56,388)           -
Intangible asset (reflected in Other Assets)                   -        1,212            -
Accumulated Other Comprehensive Loss                           -       55,176            -
- ------------------------------------------------------------------------------------------
                                                   $      59,055       26,046       26,146
==========================================================================================
</TABLE>

       Assumptions used in accounting for the pension plans as of December 2003
and 2002 were:

<TABLE>
<CAPTION>
                                                                        2003          2002
- ------------------------------------------------------------------------------------------
<S>                                                                <C>            <C>
Determination of benefit obligation
    Discount rate                                                       6.0%          6.75
    Weighted average rate of compensation increase                      4.0%          4.50

Determination of benefit cost
    Discount rate                                                      6.75%           7.0
    Weighted average rate of compensation increase                     4.50%          4.50
    Expected long-term rate of return on assets                        8.25%          10.0
- ------------------------------------------------------------------------------------------
</TABLE>

       The Company employs a total return investment approach whereby a mix of
equities and fixed income investments are used to maximize the long-term return
of plan assets for a prudent level of risk. The intent of this strategy is to
minimize plan expenses by outperforming plan liabilities over the long term.
Risk tolerance is established through careful consideration of plan
liabilities, plan funded status and corporate financial condition. Investment
risk is measured and monitored on an ongoing basis through annual liability
measurements, periodic asset studies and periodic portfolio reviews.

       The Company's pension plans weighted-average asset allocations at
December 31, 2003 and 2002 by asset category are as follows:

<TABLE>
<CAPTION>
                                                        2003         2002
- -------------------------------------------------------------------------
<S>                                                   <C>           <C>
Equity securities                                      54.0%         66.5
Debt securities                                        11.0           5.7
Cash and cash equivalents                              32.3          24.4
Other                                                   2.7           3.4
- -------------------------------------------------------------------------
Total                                                 100.0%        100.0
=========================================================================
</TABLE>

     In determining the expected return on plan assets, historical markets are
studied and long-term relationships between equities and fixed income are
preserved consistent with the widely-accepted capital market principle that
assets with higher volatility and risk generate a greater return over the long
term. Current market factors such as inflation and interest rates are evaluated
before long-term capital market assumptions are determined. Peer data and
historical returns are also reviewed to check for reasonableness.

       The amount of the 2004 contribution will be determined based on a number
of factors, including the results of the 2004 actuarial valuation report. At
this time, the amount of the 2004 contribution is not known.

       CenturyTel sponsors an Employee Stock Ownership Plan ("ESOP") which
covers most employees with one year of service with the Company and is funded
by Company contributions determined annually by the Board of Directors. The
Company's expense related to the ESOP during 2003, 2002 and 2001 was $8.9
million, $9.3 million, and $7.5 million, respectively. At December 31, 2003,
the ESOP owned an aggregate of 7.2 million shares of CenturyTel common stock.

       CenturyTel and certain subsidiaries also sponsor qualified profit
sharing plans pursuant to Section 401(k) of the Internal Revenue Code (the
"401(k) Plans") which are available to substantially all employees of the
Company. The Company's matching contributions to the 401(k) Plans were $8.2
million in 2003, $6.7 million in 2002 and $6.6 million in 2001.
<PAGE>

(12)   INCOME TAX

       Income tax expense from continuing operations included in the
Consolidated Statements of Income for the years ended December 31, 2003, 2002
and 2001 was as follows:

<TABLE>
<CAPTION>
Year ended December 31,                               2003          2002         2001
- --------------------------------------------------------------------------------------
                                                           (Dollars in thousands)
<S>                                                 <C>           <C>           <C>
Federal
     Current                                    $    58,659        22,987       26,689
     Deferred                                       118,600        80,056       62,164
State
     Current                                           (113)       11,406        6,735
     Deferred                                        10,106        (8,944)      (4,220)
- --------------------------------------------------------------------------------------
                                                $   187,252       105,505       91,368
======================================================================================
</TABLE>

       Income tax expense for 2003 was reduced by $21.6 million primarily as a
result of reducing the valuation allowance related to net state operating loss
carryforwards as it is more likely than not that future taxable income will be
sufficient to enable the Company to utilize this portion of the operating loss
carryforwards.

       Income tax expense from continuing operations was allocated as follows:

<TABLE>
<CAPTION>
Year ended December 31,                                    2003         2002        2001
- -----------------------------------------------------------------------------------------
                                                               (Dollars in thousands)

<S>                                                      <C>          <C>         <C>
Income tax expense in the consolidated
  statements of income                                $  187,252      105,505      91,368
Stockholders' equity:
     Compensation expense for tax purposes
       in excess of amounts recognized for
       financial reporting purposes                       (4,385)      (7,471)     (1,051)
     Tax effect of the change in accumulated
       other comprehensive income (loss)                  19,763      (19,763)    (13,715)
- -----------------------------------------------------------------------------------------
</TABLE>

       The following is a reconciliation from the statutory federal income tax
rate to the Company's effective income tax rate from continuing operations:

<TABLE>
<CAPTION>
Year ended December 31,                                     2003         2002       2001
- ------------------------------------------------------------------------------------------
                                                           (Percentage of pre-tax income)
<S>                                                         <C>          <C>         <C>
Statutory federal income tax rate                           35.0%        35.0        35.0
State income taxes, net of federal income
  tax benefit                                                1.2           .5          .7
Amortization of nondeductible goodwill                         -            -         3.4
Amortization of investment tax credits                         -          (.1)        (.2)
Amortization of regulatory liability                         (.1)         (.3)        (.7)
Other, net                                                   (.9)          .2         (.2)
- ------------------------------------------------------------------------------------------
Effective income tax rate                                   35.2%        35.3        38.0
==========================================================================================
</TABLE>

       In accordance with SFAS 142, effective January 1, 2002, goodwill
amortization for financial reporting purposes ceased.

       The tax effects of temporary differences that gave rise to significant
portions of the deferred tax assets and deferred tax liabilities at December
31, 2003 and 2002 were as follows:

<TABLE>
<CAPTION>
December 31,                                                    2003              2002
- ---------------------------------------------------------------------------------------
                                                                (Dollars in thousands)
<S>                                                          <C>               <C>
Deferred tax assets
    Postretirement benefit costs                         $     59,215            40,852
    Regulatory support                                         12,464            11,414
    Net state operating loss carryforwards                     41,358            28,380
    Other employee benefits                                    10,160            28,697
    Other                                                      24,819            18,720
- ---------------------------------------------------------------------------------------
       Gross deferred tax assets                              148,016           128,063
       Less valuation allowance                               (19,735)          (28,380)
- ---------------------------------------------------------------------------------------
       Net deferred tax assets                                128,281            99,683
- ---------------------------------------------------------------------------------------

Deferred tax liabilities
    Property, plant and equipment, primarily
      due to depreciation differences                        (291,482)         (189,663)
    Goodwill                                                 (350,812)         (256,801)
    Deferred debt costs                                        (2,470)           (2,400)
    Intercompany profits                                       (3,485)           (2,980)
    Other                                                      (8,583)                -
- ---------------------------------------------------------------------------------------
       Gross deferred tax liabilities                        (656,832)         (451,844)
- ---------------------------------------------------------------------------------------
Net deferred tax liability                               $   (528,551)         (352,161)
=======================================================================================
</TABLE>

       As of December 31, 2003, the Company had available tax benefits
associated with net state operating loss carryforwards, which expire through
2023, of $41.4 million. In assessing whether the Company can realize the
benefits of its net state operating loss carryforwards, the Company considers
whether it is more likely than not that some portion or all of the carry-
forwards will not be realized. The ultimate realization of the benefits of the
carryforwards is dependent upon the generation of future taxable income during
the periods in which those temporary differences become deductible. The Company
considers its scheduled reversal of deferred tax liabilities, projected future
taxable income and tax planning strategies in making this assessment. As a
result of such assessment, $19.7 million was reserved through the valuation
allowance as of December 31, 2003 as it is likely that this amount of net
operating loss carryforwards will not be utilized prior to expiration.


(13)   NONRECURRING GAINS AND LOSSES, NET

       In the second quarter of 2002, the Company recorded a pre-tax gain of
$3.7 million from the sale of a PCS license.

       In the third quarter of 2001, the Company recorded a pre-tax gain on the
sale of its remaining common shares of Illuminet Holdings, Inc. aggregating
$54.6 million ($35.5 million after-tax; $.25 per diluted share). The Company
also recorded a pre-tax gain of $4.0 million ($2.6 million after-tax; $.02 per
diluted share) on the sale of certain other assets. Additionally in 2001, the
Company recorded pre-tax charges of $25.5 million ($16.6 million after-tax;
$.12 per diluted share) due to the write-down in the value of certain non-
operating investments in which the Company owns a minority interest.


(14)   EARNING PER SHARE

       The following is a reconciliation of the numerators and denominators of
the basic and diluted earnings per share computations:

<TABLE>
<CAPTION>
Year ended December 31,                                       2003        2002        2001
- --------------------------------------------------------------------------------------------
                                                               (Dollars, except per share
                                                            amounts, and shares in thousands)
<S>                                                         <C>         <C>         <C>
Income (Numerator):
     Income from continuing operations                   $  344,707     193,533     149,081
     Discontinued operations, net of tax                          -     608,091     193,950
- --------------------------------------------------------------------------------------------
Net income                                                  344,707     801,624     343,031
Dividends applicable to preferred stock                        (399)       (399)       (399)
- --------------------------------------------------------------------------------------------
Net income applicable to common stock for
  computing basic earnings per share                        344,308     801,225     342,632
Dividends applicable to preferred stock                         399         399         399
- --------------------------------------------------------------------------------------------
Net income as adjusted for purposes of computing
  diluted earnings per share                             $  344,707     801,624     343,031
============================================================================================

Net income applicable to common stock for
  computing basic earnings per share, as
  adjusted for goodwill amortization                     $  344,308     801,225     398,898
============================================================================================

Net income as adjusted for purposes of computing
  diluted earnings per share, as adjusted for
  goodwill amortization                                  $  344,707     801,624     399,297
============================================================================================

Shares (Denominator):
Weighted average number of shares outstanding
  during period                                             143,673     141,796     141,021
Employee Stock Ownership Plan shares not
  committed to be released                                      (90)       (183)       (278)
- --------------------------------------------------------------------------------------------
Weighted average number of shares outstanding during
  period for computing basic earnings per share             143,583     141,613     140,743
Incremental common shares attributable to
  dilutive securities:
     Shares issuable under convertible securities               435         435         435
     Shares issuable under outstanding stock options            682         831       1,129
- --------------------------------------------------------------------------------------------
Number of shares as adjusted for purposes of
  computing diluted earnings per share                      144,700     142,879     142,307
============================================================================================

Basic earnings per share
     From continuing operations                          $     2.40        1.36        1.06
     From continuing operations, as adjusted for
       goodwill amortization                             $     2.40        1.36        1.39
     From discontinued operations                        $        -        4.29        1.38
     From discontinued operations, as adjusted for
       goodwill amortization                             $        -        4.29        1.45
     Basic earnings per share                            $     2.40        5.66        2.43
     Basic earnings per share, as adjusted for
       goodwill amortization                             $     2.40        5.66        2.83

Diluted earnings per share
     From continuing operations                          $     2.38        1.35        1.05
     From continuing operations, as adjusted for
       goodwill amortization                             $     2.38        1.35        1.37
     From discontinued operations                        $        -        4.26        1.36
     From discontinued operations, as adjusted for
       goodwill amortization                             $        -        4.26        1.43
     Diluted earnings per share                          $     2.38        5.61        2.41
     Diluted earnings per share, as adjusted for
       goodwill amortization                             $     2.38        5.61        2.81

</TABLE>
       The weighted average number of options to purchase shares of common
stock that were excluded from the computation of diluted earnings per share
because the exercise price of the option was greater than the average market
price of the common stock was 2.6 million for 2003, 3.3 million for 2002 and
1.3 million for 2001.

(15)   STOCK OPTION PROGRAMS

       CenturyTel maintains programs which allow the Board of Directors, through
the Compensation Committee, to grant (i) incentives to certain employees in any
one or a combination of several forms, including incentive and non-qualified
stock options; stock appreciation rights; restricted stock; and performance
shares and (ii) stock options to outside directors. As of December 31, 2003,
CenturyTel had reserved 12.1 million shares of common stock which may be issued
under CenturyTel's current incentive compensation programs.

       Under the Company's programs, options have been granted to employees and
directors at a price either equal to or exceeding the then-current market price.
All of the options expire ten years after the date of grant and the vesting
period ranges from immediate to three years.

       Stock option transactions during 2003, 2002 and 2001 were as follows:

<TABLE>
<CAPTION>
                                                           Number        Average
                                                         of options       price
- --------------------------------------------------------------------------------
<S>                                                    <C>                 <C>
Outstanding December 31, 2000                           4,681,159      $   21.16
      Exercised                                          (149,806)         15.91
      Granted                                           1,971,750          28.14
      Forfeited                                          (135,583)         18.42
- -----------------------------------------------------------------
Outstanding December 31, 2001                           6,367,520          23.51
      Exercised                                        (1,366,560)         13.97
      Granted                                           1,983,150          32.28
      Forfeited                                           (88,308)         28.59
- -----------------------------------------------------------------
Outstanding December 31, 2002                           6,895,802          27.95
      Exercised                                        (1,059,414)         22.30
      Granted                                           1,720,317          27.36
      Forfeited                                          (822,133)         33.34
- -----------------------------------------------------------------
Outstanding December 31, 2003                           6,734,572          28.14
=================================================================

Exercisable December 31, 2003                           3,807,355          27.21
=================================================================

Exercisable December 31, 2002                           3,991,753          25.68
=================================================================
</TABLE>

       The following tables summarize certain information about CenturyTel's
stock options at December 31, 2003.

<TABLE>
<CAPTION>
                                   Options outstanding
- -------------------------------------------------------------------------------------------
                                                 Weighted average
     Range of                                  remaining contractual       Weighted average
  exercise prices       Number of options        life outstanding           exercise price
- -------------------------------------------------------------------------------------------

     <C>                     <C>                         <C>                      <C>
$    11.67-17.64               931,324                   1.9                $     14.90
     24.10-26.31               230,308                   7.6                      25.20
     26.62-31.56             3,061,468                   7.9                      27.73
     31.75-38.50             2,469,563                   8.4                      33.66
     39.00-46.19                41,909                   5.3                      42.47
                             ---------
     11.67-46.19             6,734,572                   7.5                      28.14
                             =========
</TABLE>
<TABLE>
<CAPTION>
                                    Options exercisable
- --------------------------------------------------------------------------------------------
     Range of                            Number of                          Weighted average
  exercise prices                   options exercisable                     exercise price
- --------------------------------------------------------------------------------------------

     <C>                                  <C>                                     <C>
$    11.67-17.64                            931,324                         $     14.90
     24.10-26.31                            178,753                               25.14
     26.62-31.56                          1,179,303                               28.15
     31.75-38.50                          1,476,066                               34.04
     39.00-46.19                             41,909                               42.47
                                          ---------
     11.67-46.19                          3,807,355                               27.21
                                          =========
</TABLE>


(16)   SUPPLEMENTAL CASH FLOW DISCLOSURES

       The amount of interest actually paid by the Company, net of amounts
capitalized of $488,000, $1.2 million and $3.5 million during 2003, 2002 and
2001, respectively, was $221.1 million, $210.9 million and $224.7 million during
2003, 2002 and 2001, respectively. Income taxes paid were $91.6 million in 2003,
$325.5 million in 2002 and $128.3 million in 2001. Income tax refunds totaled
$85.7 million in 2003, $2.7 million in 2002 and $5.0 million in 2001.

       The Company has consummated the acquisitions of various operations, along
with certain other assets, during the three years ended December 31, 2003. In
connection with these acquisitions, the following assets were acquired and
liabilities assumed:

<TABLE>
<CAPTION>
Year ended December 31,                          2003         2002         2001
- --------------------------------------------------------------------------------
                                                     (Dollars in thousands)

<S>                                             <C>       <C>             <C>
Property, plant and equipment, net           $  46,390      866,575            -
Goodwill                                        21,743    1,335,157       33,183
Deferred credits and other liabilities          21,754      (56,897)      13,948
Other assets and liabilities, excluding
  cash and cash equivalents                     (3,644)     100,191            -
- --------------------------------------------------------------------------------
Decrease in cash due to acquisitions         $  86,243    2,245,026       47,131
================================================================================
</TABLE>

       The Company has disposed of various operations reflected within
continuing operations, along with certain other assets, during the three years
ended December 31, 2003. In connection with these dispositions, the following
assets were sold, liabilities eliminated, assets received and gain recognized:

<TABLE>
<CAPTION>
Year ended December 31,                          2003         2002         2001
- -------------------------------------------------------------------------------
                                                     (Dollars in thousands)

<S>                                                 <C>     <C>         <C>
Property, plant and equipment, net           $      -            -       (2,447)
Marketable equity securities                        -            -       (3,614)
Other assets and liabilities,
  excluding cash and cash equivalents               -         (435)     (19,080)
Gain on sale of assets                              -       (3,709)     (33,043)
- -------------------------------------------------------------------------------
Increase in cash due to dispositions         $      -       (4,144)     (58,184)
===============================================================================
</TABLE>

       For information on the Company's discontinued operations, see Note 3.

(17)   FAIR VALUE OF FINANCIAL INSTRUMENTS

       The following table presents the carrying amounts and estimated fair
values of certain of the Company's financial instruments at December 31, 2003
and 2002.

<TABLE>
<CAPTION>
                                                          Carrying         Fair
                                                           Amount          value
- -------------------------------------------------------------------------------------
                                                          (Dollars in thousands)
December 31, 2003
- -----------------
<S>                                                      <C>           <C>        <C>
Financial assets
   Other                                             $      54,605        54,605  (2)

Financial liabilities
   Long-term debt (including current maturities)     $   3,181,755     3,440,279  (1)
   Interest rate swaps                               $      11,693        11,693  (2)
   Other                                             $      44,612        44,612  (2)
- -------------------------------------------------------------------------------------

December 31, 2002
- -----------------

Financial assets
   Interest rate swaps                               $      22,163        22,163  (2)
   Other                                             $      33,637        33,637  (2)

Financial liabilities
   Long-term debt (including current maturities)     $   3,648,869     3,937,535  (1)
   Interest rate swaps                                       1,290         1,290  (2)
   Other                                             $      41,884        41,884  (2)
- -------------------------------------------------------------------------------------
</TABLE>
(1)    Fair value was estimated by discounting the scheduled payment streams to
       present value based upon rates currently available to the Company for
       similar debt.
(2)    Fair value was estimated by the Company to approximate carrying value.

       The carrying amount of cash and cash equivalents, accounts receivable,
accounts payable and accrued expenses approximates the fair value due to the
short maturity of these instruments and have not been reflected in the above
table.

(18)   BUSINESS SEGMENTS

       The Company's only separately reportable business segment is its
telephone operations. The operating income of this segment is reviewed by the
chief operating decision maker to assess performance and make business
decisions. Due to the sale of the Company's wireless operations, such operations
(which were previously reported as a separate segment) are classified as
discontinued operations. Other operations include, but are not limited to, the
Company's non-regulated long distance operations, Internet operations,
competitive local exchange carrier operations, fiber transport business and
security monitoring operations.

       The Company's telephone operations are conducted in rural, suburban and
small urban communities in 22 states. Approximately 70% of the Company's
telephone access lines are in Wisconsin, Missouri, Alabama, Arkansas and
Washington.
<TABLE>
<CAPTION>
                                                                   Depreciation
                                                        Operating       and       Operating
                                                         revenues  amortization    income
- -------------------------------------------------------------------------------------------
                                                              (Dollars in thousands)

Year ended December 31, 2003
<S>                                                     <C>           <C>         <C>
Telephone                                           $   2,071,980       450,851     688,114
Other operations                                          308,765        19,790      62,282
- -------------------------------------------------------------------------------------------
Total                                               $   2,380,745       470,641     750,396
===========================================================================================


Year ended December 31, 2002

Telephone                                           $   1,733,592       396,866     543,113
Other operations                                          238,404        14,760      43,568
Corporate overhead costs allocable to
  discontinued operations                                       -             -     (11,275)
- -------------------------------------------------------------------------------------------
Total                                               $   1,971,996       411,626     575,406
===========================================================================================


Year ended December 31, 2001

Telephone                                           $   1,505,733       398,284     423,420
Other operations                                          173,771         8,754      22,098
Corporate overhead costs allocable to
  discontinued operations                                       -             -     (20,213)
- -------------------------------------------------------------------------------------------
Total                                               $   1,679,504       407,038     425,305
===========================================================================================


Year ended December 31,                                     2003          2002        2001
- -------------------------------------------------------------------------------------------
                                                                (Dollars in thousands)

Operating income                                    $     750,396       575,406     425,305
Interest expense                                         (226,751)     (221,845)   (225,523)
Income from unconsolidated cellular entity                  6,160         5,582       7,592
Nonrecurring gains and losses, net                              -         3,709      33,043
Other income and expense                                    2,154       (63,814)         32
- -------------------------------------------------------------------------------------------
Income from continuing operations
  before income tax expense                         $     531,959       299,038     240,449
===========================================================================================


Year ended December 31,                                     2003          2002        2001
- -------------------------------------------------------------------------------------------
                                                                (Dollars in thousands)
Capital expenditures
     Telephone                                      $     317,357       319,536     351,010
     Other operations                                      60,582        66,731      84,505
- -------------------------------------------------------------------------------------------
Total                                               $     377,939       386,267     435,515
===========================================================================================


December 31,                                                2003          2002        2001
- -------------------------------------------------------------------------------------------
                                                                (Dollars in thousands)
Total assets
     Telephone                                      $   6,747,036     6,962,713   4,754,522
     Other operations                                   1,148,816       807,695     730,395
     Assets held for sale                                       -             -     833,767
- -------------------------------------------------------------------------------------------
Total assets                                        $   7,895,852     7,770,408   6,318,684
===========================================================================================
</TABLE>

       Interexchange carriers and other accounts receivable on the balance
sheets are primarily amounts due from various long distance carriers,
principally AT&T, and several large local exchange operating companies.

(19)   COMMITMENTS AND CONTINGENCIES

       Construction expenditures and investments in vehicles, buildings and
equipment during 2004 are estimated to be $290 million for telephone operations
and $110 million for other operations.

       In Barbrasue Beattie and James Sovis, on behalf of themselves and all
others similarly situated, v. CenturyTel, Inc., filed on October 29, 2002 in the
United States District Court for the Eastern District of Michigan (Case No.
02-10277), the plaintiffs allege that the Company unjustly and unreasonably
billed customers for inside wire maintenance services, and seek unspecified
money damages and injunctive relief under various legal theories on behalf of a
purported class of over two million customers in the Company's telephone
markets. The Court has not yet ruled on the plaintiffs' certification motion,
and has not yet set a date to resolve this issue. Given the current status of
this case, the Company cannot estimate the potential impact, if any, that this
case will have on its results of operations.

       AT&T filed a petition with the FCC in December 2003 seeking forbearance
from enforcing certain provisions of the Telecommunications Act of 1996 that
allows LECs to file access tariffs on a streamlined basis and, if certain
criteria are met, deems those tariffs lawful. Certain of the Company's
telephone subsidiaries file interstate tariffs directly with the FCC using this
streamlined filing approach. As a result of recent court rulings, tariffs that
have been "deemed lawful" in effect nullify an interexchange carrier's ability
to seek refunds should the earnings from the tariffs ultimately result in
earnings above the authorized rate of return prescribed by the FCC. The Company
has not recognized any revenues in excess of the authorized rate of return
applicable to those carriers who historically have requested refunds pending
resolution of the "deemed lawful" tariff issue. The Company will continue to
monitor the status of the AT&T petition with the FCC. Although it is possible
the Company could benefit favorably upon resolution of this issue, there is no
assurance that a favorable outcome will occur.

       From time to time, the Company is involved in various other claims and
legal actions relating to the conduct of its business. In the opinion of
management, the ultimate disposition of these matters will not have a material
adverse effect on the Company's consolidated financial position or results of
operations.

(20) SUBSEQUENT EVENT

       On February 3, 2004, the Company announced that its board of directors
approved a stock repurchase program that will allow the Company to repurchase up
to an aggregate of $400 million of either its common stock or convertible equity
units prior to December 31, 2005. The Company commenced purchases under this
plan on February 6, 2004.


                                * * * * * * * * *

                                CENTURYTEL, INC.
               Consolidated Quarterly Income Statement Information
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                      First      Second       Third      Fourth
                                                     quarter     quarter     quarter     quarter
- ---------------------------------------------------------------------------------------------------------
                                                  (Dollars in thousands, except per share amounts)
2003                                                                 (unaudited)
- ---------------------------------------------------------------------------------------------------------

<S>                                                  <C>         <C>         <C>         <C>
Operating revenues                               $   580,530     590,148     603,752     606,315
Operating income                                 $   184,773     188,381     190,781     186,461
Net income                                       $    83,919      87,367      90,979      82,442
Basic earnings per share                         $       .59         .61         .63         .57
Diluted earnings per share                       $       .58         .60         .63         .57

2002
- ------------------------------------------------------------------------------------------------

Operating revenues                               $   422,918     438,702     524,497     585,879
Operating income                                 $   119,049     109,531     157,716     189,110
Income from continuing operations                $    43,117      41,482      64,589      44,345
Net income                                       $    70,767      78,763     607,749      44,345
Basic earnings per share from
  continuing operations                          $       .30         .29         .46         .31
Basic earnings per share                         $       .50         .56        4.29         .31
Diluted earnings per share from
  continuing operations                          $       .30         .29         .45         .31
Diluted earnings per share                       $       .50         .55        4.26         .31

2001
- ------------------------------------------------------------------------------------------------

Operating revenues                               $   411,602     409,250     423,973     434,679
Operating income                                 $   104,309      99,209     105,991     115,796
Income from continuing operations                $    27,708      22,533      60,994      37,846
Net income                                       $    46,722     154,241      92,305      49,763
Basic earnings per share from
  continuing operations                          $       .20         .16         .43         .27
Basic earnings per share from
  continuing operations, as adjusted             $       .28         .24         .51         .35
Basic earnings per share                         $       .33        1.10         .65         .35
Basic earnings per share, as adjusted            $       .43        1.20         .75         .45
Diluted earnings per share from
  continuing operations                          $       .19         .16         .43         .27
Diluted earnings per share from
  continuing operations, as adjusted             $       .28         .24         .51         .35
Diluted earnings per share                       $       .33        1.09         .65         .35
Diluted earnings per share, as adjusted          $       .43        1.19         .75         .45
- ------------------------------------------------------------------------------------------------
</TABLE>

       Diluted earnings per share for the fourth quarter of 2003 included a $.06
per share charge related to operating taxes, net of related revenue effect, and
interest associated with various operating tax audits.

       Diluted earnings per share for the third quarter of 2002 included $3.72
per share related to the gain on the sale of substantially all of the Company's
wireless operations, net of amounts written off for costs expended related to
the wireless portion of the new billing system currently in development. Diluted
earnings per share for the fourth quarter of 2002 was negatively impacted by
$.27 per share related to the redemption premium on the Company Series I
remarketable notes that were redeemed in October 2002. On July 1 and August
31, 2002, the Company acquired nearly 650,000 telephone access lines and
related assets from Verizon. See Note 2 for additional information.


Item 9.    Changes in and Disagreements With Accountants on Accounting
           and Financial Disclosure.

      None.

Item 9A.   Controls and Procedures

       The Company maintains disclosure controls and procedures designed to
provide reasonable assurances that information required to be disclosed by the
Company in the reports it files under the Securities Exchange Act of 1934 is
timely recorded, processed, summarized and reported as required. The Company's
Chief Executive Officer, Glen F. Post, III, and the Company's Chief Financial
Officer, R. Stewart Ewing, Jr., have evaluated the Company's disclosure controls
and procedures as of December 31, 2003. Based on the evaluation, Messrs. Post
and Ewing concluded that the Company's disclosure controls and procedures have
been effective in providing reasonable assurance that they have been timely
alerted of material information required to be filed in this annual report.
Since the date of Messrs. Post's and Ewing's most recent evaluation, there have
been no significant changes in the Company's internal controls or in other
factors that could significantly affect these controls. The design of any system
of controls is based in part upon certain assumptions about the likelihood of
future events and contingencies, and there can be no assurance that any design
will succeed in achieving its stated goals.


                                    PART III

Item 10.   Directors and Executive Officers of the Registrant.

       The name, age and office(s) held by each of the Registrant's executive
officers are shown below. Each of the executive officers listed below serves at
the pleasure of the Board of Directors.

Name                        Age         Office(s) held with CenturyTel
- ----                        ---         ------------------------------

Glen F. Post, III           51          Chairman of the Board of Directors
                                          and Chief Executive Officer

Karen A. Puckett            43          President and Chief Operating Officer

R. Stewart Ewing, Jr.       52          Executive Vice President and
                                          Chief Financial Officer

David D. Cole               46          Senior Vice President -
                                          Operations Support

Stacey W. Goff              38          Senior Vice President, General Counsel
                                          and Corporate Secretary

Michael Maslowski           56          Senior Vice President and
                                          Chief Information Officer

       Each of the Registrant's executive officers, except for Ms. Puckett and
Mr. Goff, has served as an officer of the Registrant and one or more of its
subsidiaries in varying capacities for more than the past five years.

       Ms. Puckett has served as President and Chief Operating Officer of the
Company since August 2002, as Executive Vice President and Chief Operating
Officer of the Company from July 2000 through August 2002, as Sales and
Marketing Senior Officer of BroadStream Communications from July 1999 through
July 2000 and as Texas Region President for GTE Wireless from 1996 to mid-1999.
Commco Technology LLC (formerly BroadStream Communications) filed for bankruptcy
on December 18, 2000 in the United States Bankruptcy Court, District of
Connecticut (Bridgeport). Ms. Puckett was an officer of BroadStream
Communications from July 1999 through July 2000.

       Mr. Post has served as Chairman of the Board since June 2002, and
previously served as Vice Chairman of the Board from 1993 to 2002 and President
from 1990 to 2002. In May 1999, Mr. Ewing was promoted from Senior Vice
President to Executive Vice President. In August 2003, Mr. Goff was promoted to
Senior Vice President, General Counsel and Secretary. He previously served as
Vice President and Assistant General Counsel from 2000 to July 2003 and as
Director-Corporate Legal from 1998 to 2000.

       The balance of the information required by Item 10 is incorporated by
reference to the Registrant's definitive proxy statement relating to its 2004
annual meeting of stockholders (the "Proxy Statement"), which Proxy Statement
will be filed pursuant to Regulation 14A within the first 120 days of 2004.


Item 11.   Executive Compensation.

       The information required by Item 11 is incorporated by reference to the
Proxy Statement.


Item 12.   Security Ownership of Certain Beneficial Owners and Management.

       The following table provides information as of December 31, 2003,
concerning shares of CenturyTel common stock authorized for issuance under
CenturyTel's existing equity compensation plans.
<TABLE>
<CAPTION>
                                                                                            (c)
                                                                                   Number of securities
                                                                                  remaining available for
                                        (a)                        (b)             future issuance under
                              Number of securities to       Weighted-average         plans (excluding
                            be issued upon conversion       exercise price of    securities reflected in
  Plan category             of outstanding options          outstanding options         column (a))
- -----------------         ----------------------------      -------------------   ------------------------

<S>                                  <C>                          <C>                    <C>
Equity compensation
 plans approved by
 security holders                    6,734,572                    $28.14                 3,712,002

Employee Stock Purchase
 Plan approved by
 shareholders                                -                         -                 4,822,491

Equity compensation
 plans not approved by
 security holders                            -                         -                         -
- ----------------------------------------------------------------------------------------------------------
Totals                               6,734,572                    $28.14                 8,534,493
==========================================================================================================
</TABLE>

       The balance of the information required by Item 12 is incorporated by
reference to the Proxy Statement.

Item 13.   Certain Relationships and Related Transactions.

       The information required by Item 13 is incorporated by reference to the
Proxy Statement.


Item 14.   Principal Accounting Fees and Services

           The information required by Item 14 is incorporated by reference to
the Proxy Statement.


                                     PART IV

Item 15.       Exhibits, Financial Statement Schedules, and Reports on Form 8-K.

          a.   Financial Statements

               (i)   Consolidated Financial Statements:

                         Independent Auditors' Report on Consolidated Financial
                         Statements and Financial Statement Schedule

                         Consolidated Statements of Income for the years ended
                         December 31, 2003, 2002 and 2001

                         Consolidated Statements of Comprehensive Income for
                         the years ended December 31, 2003, 2002 and 2001

                         Consolidated Balance Sheets - December 31, 2003
                         and 2002

                         Consolidated Statements of Cash Flows for the years
                         ended December 31, 2003, 2002 and 2001

                         Consolidated Statements of Stockholders' Equity for the
                         years ended December 31, 2003, 2002 and 2001

                         Notes to Consolidated Financial Statements

                         Consolidated Quarterly Income Statement
                         Information (unaudited)

               (ii)  Schedules:*

                         II   Valuation and Qualifying Accounts

                         *    Those schedules not listed above are
                              omitted as not applicable or not required.

          b.   Reports on Form 8-K.

               The following items were reported in a Form 8-K filed October
               30, 2003: Item 12. Results of Operations and Financial
               Condition - News release announcing third quarter 2003
               operating results.


          c.   Exhibits:

               3.1   Amended and Restated Articles of Incorporation of
                     Registrant, dated as of May 6, 1999,
                     (incorporated by reference to Exhibit 3(i) to
                     Registrant's Quarterly Report on Form 10-Q for
                     the quarter ended June 30, 1999).

               3.2   Registrant's Bylaws, as amended through August
                     26, 2003 (incorporated by reference to Exhibit
                     3.1 of Registrant's Current Report on Form 8-K
                     dated August 26, 2003 and filed on December 2, 2003).

               3.3   Governance Guidelines and Charters, as amended through
                     February 25, 2004, all included elsewhere herein.

                     (a) Corporate Governance Guidelines

                     (b) Charter of the Audit Committee of the
                         Board of Directors

                     (c) Charter of the Compensation Committee of
                         the Board of Directors

                     (d) Charter of the Nominating and Corporate
                         Governance Committee of the Board of
                         Directors

                     (e) Charter of the Risk Evaluation Committee of the
                         Board of Directors

               4.1   Note Purchase Agreement, dated September 1, 1989,
                     between Registrant, Teachers Insurance and
                     Annuity Association of America and the Lincoln
                     National Life Insurance Company (incorporated by
                     reference to Exhibit 4.23 to Registrant's
                     Quarterly Report on Form 10-Q for the quarter
                     ended September 30, 1989).

               4.2   Rights Agreement, dated as of August 27, 1996, between
                     Registrant and Society National Bank, as Rights Agent,
                     including the form of Rights Certificate (incorporated by
                     reference to Exhibit 1 of Registrant's Current Report on
                     Form 8-K filed August 30, 1996) and Amendment No.1 thereto,
                     dated May 25, 1999 (incorporated by reference to Exhibit
                     4.2(ii) to Registrant's Report on Form 8-K dated May 25,
                     1999) and Amendment No. 2 thereto, dated and effective as
                     of June 30, 2000, by and between the Registrant and
                     Computershare Investor Services, LLC, as rights agent
                     (incorporated by reference to Exhibit 4.1 of Registrant's
                     Quarterly report on 10-Q for the quarter ended September
                     30, 2000).

               4.3   Form of common stock certificate of the Registrant
                     (incorporated by reference to Exhibit 4.3 of the
                     Registrant's Annual Report on Form 10-K for the year
                     ended December 31, 2000).

               4.4   Instruments relating to the Company's public senior debt

                     (a) Indenture dated as of March 31, 1994
                         between the Company and Regions Bank
                         (formerly First American Bank & Trust of
                         Louisiana), as Trustee (incorporated by
                         reference to Exhibit 4.1 of the Company's
                         Registration Statement on Form S-3,
                         Registration No. 33-52915).

                     (b) Resolutions designating the terms and
                         conditions of the Company's 7-3/4% Senior
                         Notes, Series A, due 2004 and 8-1/4% Senior
                         Notes, Series B, due 2024 (incorporated by
                         reference to Exhibit 4.1 to Registrant's
                         Quarterly Report on Form 10-Q for the
                         quarter ended March 31, 1994).

                     (c) Resolutions designating the terms and
                         conditions of the Company's 6.55% Senior
                         Notes, Series C, due 2005 and 7.2% Senior
                         Notes, Series D, due 2025 (incorporated by
                         reference to Exhibit 4.27 to Registrant's
                         Annual Report on Form 10-K for the year
                         ended December 31, 1995).

                     (d) Resolutions designating the terms and
                         conditions of the Company's 6.15% Senior
                         Notes, Series E, due 2005; 6.30% Senior
                         Notes, Series F, due 2008; and 6.875%
                         Debentures, Series G, due 2028,
                         (incorporated by reference to Exhibit 4.9
                         to Registrant's Annual Report on Form 10-K
                         for the year ended December 31, 1997).

                     (e) Form of Registrant's 8.375% Senior Notes,
                         Series H, Due 2010, issued October 19, 2000
                         (incorporated by reference to Exhibit 4.2
                         of Registrant's Quarterly Report on Form
                         10-Q for the Quarter ended September 30,
                         2000).

                     (f) For information on Registrant's Series J
                         notes and related First Supplemental
                         Indenture, see Item 4.7 below.

                     (g) Second Supplemental Indenture dated as of August
                         20, 2002 between CenturyTel and Regions Bank
                         (successor-in-interest to First American Bank &
                         Trust of Louisiana and Regions Bank of Louisiana),
                         as Trustee, designating and outlining the terms and
                         conditions of CenturyTel's 4.75% Convertible Senior
                         Debentures, Series K, due 2032 (incorporated by
                         reference to Exhibit 4.3 of CenturyTel's registration
                         statement on Form S-4, File No. 333-100480).

                     (h) Form of 4.75% Convertible Debentures, Series K,
                         due 2032 (included in Exhibit 4.4(g)).

                     (i) Board resolutions designating the terms and
                         conditions of CenturyTel's 7.875% Senior Notes,
                         Series L, due 2012 (incorporated by reference to
                         exhibit 4.2 of CenturyTel's registration statement
                         on Form S-3, File No. 333-100481).

                     (j) Form of 7.875% Senior Notes, Series L, due 2012
                         (included in Exhibit 4.4(i)).

                     (k) Registration Rights Agreement dated as of
                         August 26, 2002 by and among CenturyTel,
                         and Banc of America Securities LLC, J.P.
                         Morgan Securities Inc. and Wachovia
                         Securities, Inc. (incorporated by reference
                         to Exhibit 4.5 of CenturyTel's registration
                         statement on Form S-4, File No.
                         333-100480).

                     (l) Exchange and Registration Rights Agreement
                         dated as of August 26, 2002 by and among
                         CenturyTel and Banc of America Securities
                         LLC, J.P. Morgan Securities Inc. and
                         Wachovia Securities, Inc., as
                         representatives of the initial purchasers
                         named therein (incorporated by reference to
                         Exhibit 4.4 of CenturyTel's registration
                         statement on Form S-3, File No.
                         333-100481).


               4.5   $533 Million Three-Year Revolving Credit Facility, dated
                     July 22, 2002, between CenturyTel, Inc. and the lenders
                     named therein (incorporated by reference to Exhibit 10.1
                     of Registrant's Quarterly Report on Form 10-Q for the
                     period ended June 30, 2002).

               4.6   First Supplemental Indenture, dated as of
                     November 2, 1998, to Indenture between CenturyTel
                     of the Northwest, Inc. and The First National
                     Bank of Chicago (incorporated by reference to
                     Exhibit 10.2 to Registrant's Quarterly Report on
                     Form 10-Q for the quarter ended September 30,
                     1998).

               4.7   Agreements relating to equity units issued by
                     CenturyTel in May 2002:

                     (a) Purchase Contract Agreement, dated as of May
                         1, 2002, between CenturyTel and Wachovia
                         Bank, National Association, as Purchase
                         Contract Agent (incorporated by reference to
                         Exhibit 4.13 to CenturyTel's Registration
                         Statement on Form S-3, File No. 333-84276).

                     (b) Pledge Agreement, dated as of May 1, 2002,
                         by and among CenturyTel, JPMorgan Chase
                         Bank, as Collateral Agent, Custodial Agent,
                         and Securities Intermediary, and Wachovia
                         Bank, National Association, as Purchase
                         Contract Agent (incorporated by reference to
                         Exhibit 4.15 to CenturyTel's Registration
                         Statement on Form S-3, File No. 333-84276).

                     (c) First Supplemental Indenture, dated as of
                         May 1, 2002, between CenturyTel and Regions
                         Bank, as Trustee, to the Indenture, dated as
                         of March 31, 1994, between CenturyTel and
                         Regions Bank, as Trustee, relating to
                         CenturyTel's Senior Notes, Series J, due
                         2007 issued in connection with the equity
                         units (incorporated by reference to Exhibit
                         4.2(b) to CenturyTel's Registration
                         Statement on Form S-3, File No. 333-84276).

               10.1  Qualified Employee Benefit Plans (excluding several
                     narrow-based qualified plans that cover union
                     employees or other limited groups of Company employees)

                     (a) Registrant's Employee Stock Ownership Plan
                         and Trust, as amended and restated February
                         28, 2002 and amendment thereto dated
                         December 31, 2002 (incorporated by
                         reference to Exhibit 10.1(a) of
                         Registrant's Annual Report on Form 10-K for
                         the year ended December 31, 2002).

                     (b) Registrant's Dollars & Sense Plan and
                         Trust, as amended and restated, effective
                         September 1, 2000 and amendment thereto
                         dated December 31, 2002 (incorporated by
                         reference to Exhibit 10.1(b) of
                         Registrant's Annual Report on Form 10-K for
                         the year ended December 31, 2002).

                     (c) Registrant's Amended and Restated
                         Retirement Plan, effective as of February
                         28, 2002, and amendment thereto dated
                         December 31, 2002 (incorporated by
                         reference to Exhibit 10.1(c) of
                         Registrant's Annual Report on Form 10-K for
                         the year ended December 31, 2002).

                     (d) Merger Agreement, dated September 18, 2001,
                         between Registrant and Regions Bank of
                         Louisiana, pursuant to which Registrant's
                         Stock Bonus Plan and PAYSOP were merged
                         into Registrant's Employee Stock Ownership
                         Plan (incorporated by reference to Exhibit
                         10(b) of Registrant's Quarterly Report on
                         Form 10-Q for the quarter ended September
                         30, 2001).

               10.2  Stock-based Incentive Plans

                     (a) Registrant's 1983 Restricted Stock Plan, dated
                         February 21, 1984, as amended and restated as of
                         November 16, 1995 (incorporated by reference to
                         Exhibit 10.1(e) to Registrant's Annual Report on
                         Form 10-K for the year ended December 31, 1995)
                         and amendment thereto dated November 21,
                         1996, (incorporated by reference to Exhibit 10.1
                         (e) to Registrant's Annual Report on Form 10-K for
                         the year ended December 31, 1996), and amendment
                         thereto dated February 25, 1997 (incorporated by
                         reference to Exhibit 10.3 to Registrant's Quarterly
                         Report on Form 10-Q for the quarter ended March 31,
                         1997), and amendment thereto dated April 25,
                         2001 (incorporated by reference to Exhibit 10.1 of
                         Registrant's Quarterly Report on Form 10-Q for the
                         quarter ended March 31, 2001), and amendment thereto
                         dated April 17, 2000 (incorporated by reference to
                         Exhibit 10.2(a) to Registrant's Annual Report on
                         Form 10-K for the year ended December 31, 2001).

                     (b) Registrant's 1988 Incentive Compensation Program,
                         as amended and restated August 22, 1989 (incorporated
                         by reference to Exhibit 19.8 to Registrant's Quarterly
                         Report on Form 10-Q for the quarter ended September
                         30, 1989) and amendment thereto dated November 21,
                         1996 (incorporated by reference to Exhibit
                         10.1(g) to Registrant's Annual Report on Form 10-K
                         for the year ended December 31, 1996).

                     (c) Registrant's 1995 Incentive Compensation Plan approved
                         by Registrant's shareholders on May 11, 1995
                         (incorporated by reference to Exhibit 4.4 to
                         Registration No. 33-60061) and amendment thereto dated
                         November 21, 1996 (incorporated by Reference to
                         Exhibit 10.1 (l) to Registrant's Annual Report on Form
                         10-K for the year ended December 31, 1996), and
                         amendment thereto dated February 25, 1997
                         (incorporated by reference to Exhibit 10.1 to
                         Registrant's Quarterly Report on Form 10-Q for the
                         quarter ended March 31, 1997) and amendment thereto
                         dated May 29, 2003 (incorporated by reference to
                         Exhibit 10.1 to Registrant's Quarterly Report on Form
                         10-Q for the quarter ended June 30, 2003).

                         (i)  Form of Stock Option Agreement,
                              pursuant to 1995 Incentive Compensation
                              Plan and dated as of May 22, 1995, entered
                              into by Registrant and its officers
                              (incorporated by reference to Exhibit 10.5
                              to Registrant's Quarterly Report on Form
                              10-Q for the quarter ended June 30, 1995).

                         (ii) Form of Stock Option Agreement,
                              pursuant to 1995 Incentive Compensation
                              Plan and dated as of June 23, 1995, entered
                              into by Registrant and certain key
                              employees (incorporated by reference to
                              Exhibit 10.6 to Registrant's Quarterly
                              Report on Form 10-Q for the quarter ended
                              June 30, 1995).

                         (iii)Form of Stock Option Agreement,
                              pursuant to 1995 Incentive Compensation
                              Plan and dated as of February 24, 1997,
                              entered into by Registrant and its officers
                              (incorporated by reference to Exhibit 10.4
                              to Registrant's Quarterly Report on Form
                              10-Q for the quarter ended June 30, 1997).

                         (iv) Form of Stock Option Agreement,
                              pursuant to 1995 Incentive Compensation
                              Plan and dated as of February 21, 2000,
                              entered into by Registrant and its officers
                              (incorporated by reference to Exhibit 10.1
                              (t) to Registrant's Annual Report on Form
                              10-K for the year ended December 31, 1999).

                         (v)  Form of Restricted Stock and
                              Performance Share Agreement, dated as of
                              February 22, 1999, relating to equity
                              incentive awards granted in 1999 pursuant
                              to the Registrant's 1995 Incentive
                              Compensation Plan that were vested or
                              earned wholly or in part in early 2004
                              (incorporated by reference to Exhibit
                              10.1(x) to Registrant's Annual Report on
                              Form 10-K for the year ended December 31,
                              1999).

                     (d) Amended and Restated Registrant's
                         2000 Incentive Compensation Plan,
                         as amended through May 23, 2000
                         (incorporated by reference to
                         Exhibit 10.2 to Registrant's
                         Quarterly Report on Form 10-Q for
                         the quarter ended June 30, 2000)
                         and amendment thereto dated May 29,
                         2003 (incorporated by reference to
                         Exhibit 10.2 to Registrant's
                         Quarterly Report on Form 10-Q for
                         the quarter ended June 30, 2003).

                         (i)  Form of Stock Option Agreement,
                              pursuant to the 2000 Incentive
                              Compensation Plan and dated as of
                              May 21, 2001, entered into by
                              Registrant and its officers
                              (incorporated by reference to
                              Exhibit 10.2(e) to Registrant's
                              Annual Report on Form 10-K for the
                              year ended December 31, 2001).

                         (ii) Form of Stock Option Agreement,
                              pursuant to the 2000 Incentive
                              Compensation Plan and dated as of
                              February 25, 2002, entered into by
                              Registrant and its officers
                              (incorporated by reference to
                              Exhibit 10.2(d)(ii) of Registrant's
                              Annual Report on Form 10-K for the
                              year ended December 31, 2002).

                     (e) Amended and Restated CenturyTel,
                         Inc. 2002 Directors Stock Option
                         Plan, dated as of February 25,
                         2004, included elsewhere herein.

                         (i)  Form of Stock Option Agreement,
                              pursuant to the foregoing plan,
                              entered into by CenturyTel in
                              connection with options granted to
                              the outside directors as of May 10,
                              2002 (incorporated by reference to
                              Exhibit 10.2 of Registrant's
                              Quarterly Report on Form 10-Q for
                              the period ended September 30,
                              2002).

                         (ii) Form of Stock Option Agreement,
                              pursuant to the foregoing plan,
                              entered into by CenturyTel in
                              connection with options granted to
                              the outside directors as of May 9,
                              2003, included elsewhere herein.

                     (f) Amended and Restated CenturyTel, Inc. 2002
                         Management Incentive Compensation Plan,
                         dated as of February 25, 2004, included
                         elsewhere herein.

                         (i)  Form of Stock Option Agreement,
                              pursuant to the foregoing plan,
                              entered into between CenturyTel and
                              certain of its officers and key
                              employees at various dates since
                              May 9, 2002 (incorporated by
                              reference to Exhibit 10.4 of
                              Registrant's Quarterly Report on
                              Form 10-Q for the period ended
                              September 30, 2002).

                         (ii) Form of Stock Option Agreement,
                              pursuant to the foregoing plan and
                              dated as of February 24, 2003,
                              entered into by Registrant and its
                              officers (incorporated by reference
                              to Exhibit 10.2(f)(ii) of
                              Registrant's Annual Report on Form
                              10-K for the year ended December
                              31, 2002).

                         (iii)Form of Stock Option Agreement,
                               pursuant to the foregoing plan and
                               dated as of February 25, 2004,
                               entered into by Registrant and its
                               officers, included elsewhere
                               herein.

                         (iv) Form of Restricted Stock Agreement,
                              pursuant to the foregoing plan and
                              dated as of February 24, 2003,
                              entered into by Registrant and its
                              executive officers (incorporated by
                              reference to Exhibit 10.1 of
                              Registrant's Quarterly Report on
                              Form 10-Q for the period ended
                              March 31, 2003).


               10.3  Other Non-Qualified Employee Benefit Plans

                     (a) Registrant's Key Employee Incentive Compensation
                         Plan, dated January 1, 1984, as amended and restated
                         as of November 16, 1995 (incorporated by reference
                         to Exhibit 10.1(f) to Registrant's Annual Report on
                         Form 10-K for the year ended December 31, 1995)
                         and amendment thereto dated November 21, 1996
                         (incorporated by reference to Exhibit 10.1 (f) to
                         Registrant's Annual Report on Form 10-K for the
                         year ended December 31, 1996), amendment thereto
                         dated February 25, 1997 (incorporated by
                         reference to Exhibit 10.2 to Registrant's Quarterly
                         Report on Form 10-Q for the quarter ended March 31,
                         1997), amendment thereto dated April 25, 2001
                         (incorporated by reference to Exhibit 10.2 of
                         Registrant's Quarterly Report on Form 10-Q for the
                         quarter ended March 31, 2001) and amendment thereto
                         dated April 17, 2000 (incorporated by reference to
                         Exhibit 10.3(a) to Registrant's Annual Report
                         on Form 10-K for the year ended December 31, 2001).

                     (b) Registrant's Restated Supplemental
                         Executive Retirement Plan, dated April 3,
                         2000 (incorporated by reference to Exhibit
                         10.1(d) to Registrant's Quarterly Report on
                         Form 10-Q for the quarter ended March 31,
                         2000).

                     (c) Registrant's Restated Supplemental Defined
                         Contribution Plan, restated as of July 17,
                         2001, (incorporated by reference to Exhibit
                         10.1 of Registrant's Quarterly Report on
                         Form 10-Q for the quarter ended June 30,
                         2001).

                     (d) Registrant's Amended and Restated
                         Supplemental Dollars & Sense Plan,
                         effective as of January 1, 1999
                         (incorporated by reference to Exhibit 10.1
                         (q) to Registrant's Annual Report on Form
                         10-K for the year ended December 31, 1998).

                     (e) Registrant's Supplemental Defined Benefit
                         Plan, effective as of January 1, 1999
                         (incorporated by reference to Exhibit 10.1
                         (y) to Registrant's Annual Report on Form
                         10-K for the year ended December 31, 1998),
                         and amendment thereto dated February 28,
                         2002 (incorporated by reference to Exhibit
                         10.3(e) to Registrant's Annual Report on
                         Form 10-K for the year ended December 31,
                         2001).

                     (f) Registrant's Amended and Restated Salary
                         Continuation (Disability) Plan for
                         Officers, dated November 26, 1991
                         (incorporated by reference to Exhibit 10.16
                         of Registrant's Annual Report on Form 10-K
                         for the year ended December 31, 1991).

                     (g) Registrant's Restated Outside Directors' Retirement
                         Plan, dated as of November 16, 1995 (incorporated
                         by reference to Exhibit 10.1(t) to Registrant's
                         Annual Report on Form 10-K for the year ended
                         December 31, 1995) and amendment thereto dated April
                         17, 2000 (incorporated by reference to Exhibit 10.3(g)
                         to Registrant's Annual Report on Form 10-K for the
                         year ended December 31, 2001) and amendment thereto
                         dated December 31, 2002 (incorporated by reference
                         to Exhibit 10.3(g) of Registrant's Annual Report on
                         Form 10-K for the year ended December 31, 2002).

                     (h) Registrant's Restated Deferred Compensation
                         Plan for Outside Directors, dated as of
                         November 16, 1995 (incorporated by
                         reference to Exhibit 10.1(u) to
                         Registrant's Annual Report on Form 10-K for
                         the year ended December 31, 1995) and
                         amendment thereto dated April 17, 2000
                         (incorporated by reference to Exhibit
                         10.3(h) to Registrant's Annual Report on
                         Form 10-K for the year ended December 31,
                         2001).

                     (i) Registrant's Chairman/Chief Executive
                         Officer Short-Term Incentive Program
                         (incorporated by reference to Exhibit 10.6
                         to Registrant's Quarterly Report on Form
                         10-Q for the quarter ended June 30, 1997).

                     (j) Registrant's 2001 Employee Stock Purchase
                         Plan (incorporated by reference to
                         Registrant's 2001 Proxy Statement).

               10.4  Employment, Severance and Related Agreements

                     (a) Change of Control Agreement, dated
                         February 22, 2000 by and between Glen F.
                         Post, III and Registrant (incorporated by
                         reference to Exhibit 10.1(b) to Registrant's
                         Quarterly Report on Form 10-Q for the
                         quarter ended March 31, 2000).

                     (b) Form of Change of Control Agreement, dated
                         February 22, 2000, by and between Registrant
                         and David D. Cole, R. Stewart Ewing and
                         Michael E. Maslowski (incorporated by
                         reference exhibit 10.1(c) to the
                         Registrant's Quarterly Report on Form 10-Q
                         for the quarter ended March 31, 2000).(a)

                     (c) Form of Change of Control Agreement dated
                         July 24, 2000, by and between the Registrant
                         and Karen A. Puckett (incorporated by
                         reference to Exhibit 10.1(c) of Registrant's
                         Quarterly Report on Form 10-Q for the
                         quarter ended March 31, 2000).

                     (d) Form of Change of Control Agreement dated
                         August 26, 2003 by and between Registrant
                         and Stacey W. Goff (incorporated by
                         reference to Exhibit 10.1(c) of
                         Registrant's Quarterly Report on Form 10-Q
                         for the period ended March 31, 2000).

               14    Registrant's Corporate Compliance Program, included
                     elsewhere herein.

               21    Subsidiaries of the Registrant, included elsewhere herein.

               23    Independent Auditors' Consent, included elsewhere herein.

               31.1  Registrant's Chief Executive Officer certification
                     pursuant to Section 302 of the Sarbanes-Oxley Act of
                     2002, included elsewhere herein.

               31.2  Registrant's Chief Financial Officer certification
                     pursuant to Section 302 of the Sarbanes-Oxley Act of
                     2002, included elsewhere herein.

               32    Registrant's Chief Executive Officer and Chief Financial
                     Officer certification pursuant to Section 906 of the
                     Sarbanes-Oxley Act of 2002, included elsewhere herein.


                                   SIGNATURES


       Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                               CenturyTel, Inc.,


Date:  March 12, 2004                          By: /s/ Glen F. Post, III
                                                   ----------------------------
                                                   Glen F. Post, III
                                                   Chairman of the Board and
                                                   Chief Executive Officer

       Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the date indicated.



                                  Chairman of the Board and
/s/ Glen F. Post, III             Chief Executive Officer
- ----------------------------
Glen F. Post, III                                                March 12, 2004


                                  Executive Vice President and
/s/ R. Stewart Ewing, Jr.         Chief Financial Officer
- ----------------------------
R. Stewart Ewing, Jr.                                            March 12, 2004



/s/ Neil A. Sweasy                Vice President and Controller
- ----------------------------
Neil A. Sweasy                                                   March 12, 2004



/s/ William R. Boles, Jr.         Director
- ----------------------------
William R. Boles, Jr.                                            March 12, 2004



/s/ Virginia Boulet               Director
- ----------------------------
Virginia Boulet                                                  March 12, 2004



                                  Director
- ----------------------------
Calvin Czeschin



/s/ James B. Gardner              Director
- ----------------------------
James B. Gardner                                                 March 12, 2004



/s/ W. Bruce Hanks                Director
- ----------------------------
W. Bruce Hanks                                                   March 12, 2004



/s/ R. L. Hargrove, Jr.           Director
- ----------------------------
R. L. Hargrove, Jr.                                              March 12, 2004



/s/ Johnny Hebert                 Director
- ----------------------------
Johnny Hebert                                                    March 12, 2004



/s/ C. G. Melville, Jr.           Director
- ----------------------------
C. G. Melville, Jr.                                              March 12, 2004



/s/ Fred Nichols                  Director
- ----------------------------
Fred Nichols                                                     March 12, 2004



/s/ Harvey P. Perry               Director
- ----------------------------
Harvey P. Perry                                                  March 12, 2004



                                  Director
- ----------------------------
Jim D. Reppond



/s/ Joseph R. Zimmel              Director
- ----------------------------
Joseph R. Zimmel                                                 March 12, 2004



                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                                CENTURYTEL, INC.

              For the years ended December 31, 2003, 2002 and 2001

<TABLE>
<CAPTION>
                                                    Additions
                                       Balance at  charged to   Deductions                    Balance
                                        beginning   costs and      from           Other       at end
Description                             of period   expenses    allowance        changes     of period
- ------------------------------------------------------------------------------------------------------------
                                                            (Dollars in thousands)
<S>                                        <C>         <C>         <C>      <C>    <C>    <C>   <C>
Year ended December 31, 2003
    Allowance for doubtful accounts    $   33,962      31,910      (42,193) (1)        -        23,679
    Valuation allowance for
      deferred tax assets              $   28,380      12,978      (21,623) (2)                 19,735

Year ended December 31, 2002
    Allowance for doubtful accounts    $   13,908      34,045      (17,134) (1)    3,143 (3)    33,962
    Valuation allowance for
      deferred tax assets              $   19,691       8,689            -             -        28,380

Year ended December 31, 2001
    Allowance for doubtful accounts    $    9,968      22,533      (18,593) (1)        -        13,908
    Valuation allowance for
      deferred tax assets              $    6,211      13,480            -             -        19,691

</TABLE>

(1)    Customers' accounts written-off, net of recoveries.

(2)    Change in the valuation allowance allocated to income tax expense.

(3)    Allowance for doubtful accounts at the date of acquisition of purchased
       subsidiaries, net of allowance for doubtful accounts at the date of
       disposition of subsidiaries sold.






</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>3
<FILENAME>exhibit33a.txt
<DESCRIPTION>EXHIBIT 3.3(A)
<TEXT>
                                                                  Exhibit 3.3(a)
                                CENTURYTEL, INC.

                         CORPORATE GOVERNANCE GUIDELINES
                     (as amended through February 25, 2004)

1.       Director Qualifications

         The Board will have a majority of independent directors. The Nominating
and Corporate Governance Committee is responsible for reviewing with the Board,
on an annual basis, the requisite skills and characteristics of new Board
members as well as the composition of the Board as a whole. This assessment will
include members' independence qualifications, as well as consideration of
diversity, age, character, skills and experience in the context of the needs of
the Board. All directors must meet any additional qualifications established
under the Company's organizational documents.

         Nominees for directorship will be selected in accordance with
the qualifications and criteria described in these guidelines, as well as the
policies and principles in the Committee's charter and any selection guidelines
or criteria adopted thereunder. The invitation to join the Board should be
extended on behalf of the full Board by the Chairman of the Nominating and
Corporate Governance Committee and the Chairman of the Board.

         The Board presently has 13 members. It is the sense of the
Board that a size of 11 to 13 is about right. However, the Board would be
willing to go to a somewhat larger size in order to accommodate the availability
of an outstanding candidate. It is the general sense of the Board that no more
than two management directors should serve on the Board.

         The Board expects directors who change the job or responsibility they
held when they were elected to the Board to volunteer to resign from the Board.
It is not the sense of the Board that in every such instance the director should
necessarily leave the Board. There should, however, be an opportunity for the
Board, following a review by the Nominating and Corporate Governance Committee,
to determine the continued appropriateness of Board membership under the
circumstances.

         No director may serve on more than two other unaffiliated public
company boards, unless this prohibition is waived by the Board. Directors should
advise the Chairman of the Board and the Chairman of the Nominating and
Corporate Governance Committee in advance of accepting an invitation to serve on
another public company board. No director may be appointed or nominated to a new
term if he or she would be age 72 or older at the time of the election or
appointment.

         The Board does not believe it should establish term limits. While term
limits could help insure that there are fresh ideas and viewpoints available to
the Board, they hold the disadvantage of losing the contribution of directors
who have been able to develop, over a period of time, increasing insight into
the Company and its operations and, therefore, provide an increasing
contribution to the Board as a whole. As an alternative to term limits, the
Nominating and Corporate Governance Committee will review each director's
continuation on the Board every three years. This will allow each director the
opportunity to conveniently confirm his or her desire to continue as a member of
the Board.

         Directors will be deemed to be "independent" if (i) the Board
affirmatively confirms that neither the director nor any organization with which
the director is affiliated receives any payments from the Company other than
Permissible Directors Compensation (as defined below) and (ii) none of the
disqualifying events or conditions specified in Rule 303A(2)(b) of the NYSE
Listed Company Manual apply to the director. For purposes hereof, "Permissible
Directors Compensation" means (i) director and committee fees, (ii)
reimbursement for an annual physical, continuing education, travel and other
out-of-pocket expenses in accordance with the Company's applicable policies and
(iii) a pension or other form of deferred compensation for prior service,
provided such compensation is not contingent in any way on continued service.
The Board may make determinations or interpretations under this paragraph,
provided that they are consistent with the foregoing standards.

         Once the Board has determined that a director is independent, the
director may not engage in any transaction with the Company, either directly or
indirectly through an immediate family member or related entity, without such
transaction being approved by the Board.

2.       Director Responsibilities

         The basic responsibility of the directors is to exercise their business
judgment to act in what they reasonably believe to be in the best interests of
the Company and its shareholders. In discharging that obligation, directors
should be entitled to rely on the honesty and integrity of the Company's senior
executives and its outside advisors and auditors. The directors shall also be
entitled to have the Company purchase reasonable directors' and officers'
liability insurance on their behalf, to the benefits of indemnification to the
fullest extent permitted by law and the Company's articles of incorporation,
by-laws and any indemnification agreements, and to exculpation as provided by
state law and the Company's articles of incorporation.

         Directors are expected to attend Board meetings and meetings
of committees on which they serve, and to spend the time needed and meet as
frequently as necessary to properly discharge their responsibilities.
Information and data that are important to the Board's understanding of the
business to be conducted at a Board or committee meeting should generally be
distributed in writing to the directors before the meeting, and directors should
review these materials in advance of the meeting.

         The Board has no policy with respect to the separation of the offices
of Chairman and the Chie Executive Officer. The Board believes that this issue
is part of the succession planning process and that it is in the best interests
of the Company for the Board to make a determination when it elects a new chief
executive officer.

         The Chairman will establish the agenda for each Board meeting. Each
Board member is free to suggest the inclusion of items on the agenda. Each Board
member is free to raise at any Board meeting subjects that are not on the agenda
for that meeting. The Board will review the Company's long-term strategic plans
and the principal issues that the Company will face in the future during at
least one Board meeting each year.

         The non-management directors will meet in executive session at least
quarterly. The director who presides at each of these meetings will be an
independent director chosen annually by the non-management directors, and will
be disclosed in the annual proxy statement.

         The Board believes that management speaks for the Company. Individual
Board members may, from time to time, meet or otherwise communicate with various
constituencies that are involved with the Company. However, it is expected that
Board members would do this with the knowledge of the management and, absent
unusual circumstances or as contemplated by the committee charters, only at the
request of management.

3.       Board Committees

         The Board will have at all times an Audit Committee, a Compensation
Committee and a Nominating and Corporate Governance Committee. All of the
members of these committees will be independent directors, as defined in Section
1 above.

         Committee members will be appointed by the Board upon
recommendation of the Nominating and Corporate Governance Committee with
consideration of the desires of individual directors. It is the sense of the
Board that consideration should be given to rotating committee members
periodically, but the Board does not believe that rotation should be mandated as
a policy. Any appointments or removals of committee members will be made by the
Board in accordance with the Company's bylaws.

         Each key committee will have its own charter. The charters will set
forth the purposes, goals and responsibilities of the committees as well as
qualifications for committee membership, procedures for committee member
appointment and removal, committee structure and operations and committee
reporting to the Board. The charters will also provide that each key committee
will annually evaluate its performance.

         The Chair of each committee, in consultation with the committee
members, will determine the frequency and length of the committee meetings
consistent with any requirements set forth in the committee's charter. The Chair
of each committee, in consultation with members of the committee and others
specified in the committee's charter, will develop the committee's agenda.

         The Board and each committee have the power to hire independent legal,
financial or other advisors as they may deem necessary, without consulting or
obtaining the approval of any officer of the Company in advance.

         Each committee may meet in executive session as often as it deems
appropriate, and shall have the power to obtain and review any information that
the committee deems necessary to perform the functions described in its charter.

         The Board may, from time to time, establish or maintain additional
committees as necessary or appropriate.

4.       Director Access to Officers and Employees

         Directors have full and free access to officers and employees of the
Company. Any meetings or contacts that a director wishes to initiate may be
arranged through the CEO or the Secretary or directly by the director. The
directors will use their judgment to ensure that any such contact is not
disruptive to the business operations of the Company and will, to the extent not
inappropriate, copy the CEO on any written communications between a director and
an officer or employee of the Company.

         The Board welcomes regular attendance at each Board meeting of
senior officers of the Company. If the CEO wishes to have additional Company
personnel attendees on a regular basis, this suggestion should be brought to the
Board for approval.

5.       Director Compensation

         The form and amount of director compensation will be determined by the
Nominating and Corporate Governance Committee in accordance with the policies
and principles set forth in its charter, and such Committee will conduct an
annual review of director compensation. The Nominating and Corporate Governance
Committee will consider whether directors' independence may be jeopardized if
director compensation and perquisites exceed customary levels, or if the Company
makes substantial charitable contributions to organizations with which a
director is affiliated.

6.       Director Orientation and Continuing Education

         The Nominating and Corporate Governance Committee shall maintain an
Orientation Program for new directors. All new directors must participate in the
Company's Orientation Program, which should be conducted as soon as practicable
after new directors are elected or appointed. This orientation may include
presentations by senior management to familiarize new directors with the
Company's strategic plans, its significant financial, accounting and risk
management issues, its corporate compliance programs (which include its code of
business conduct and ethics), its principal officers, and its internal and
independent auditors. All other directors are also invited to attend the
Orientation Program.

         The Company will also maintain a Continuing Education Program
for directors, pursuant to which it will endeavor to periodically update
directors on industry, technological and regulatory developments, and to provide
adequate resources to support directors in understanding the Company's business
and matters to be acted upon at board and committee meetings.

7.       CEO Evaluation and Management Succession

         The Nominating and Corporate Governance Committee will conduct an
annual review of the CEO's performance. The Nominating and Corporate Governance
Committee will provide a report of its findings to the Board of Directors (with
appropriate recusals of the CEO and other management directors, as necessary) to
enable the Board to ensure that the CEO is providing the best leadership for the
Company in the long- and short-term.

         The Nominating and Corporate Governance Committee should
report periodically to the Board on succession planning. The entire Board will
consult periodically with the Nominating and Corporate Governance Committee
regarding potential successors to the CEO. The CEO should at all times make
available his or her recommendations and evaluations of potential successors,
along with a review of any development plans recommended for such individuals.

8.       Annual Performance Evaluation

         The Board of Directors will conduct an annual self-evaluation to
determine whether it and its committees are functioning effectively. The
Nominating and Corporate Governance Committee will receive comments from all
directors and report annually to the Board with an assessment of the Board's
performance, which will be discussed with the full Board. The assessment will
focus on the Board's contribution to the Company and specifically focus on areas
in which the Board or management believes that the Board could improve.

9.       Standards of Business Conduct and Ethics

         All of the Company's directors, officers and employees are required to
abide by the Company's long-standing Corporate Compliance Program, which
includes standards of business conduct and ethics. The Company's program and
related procedures cover all areas of professional conduct, including employment
policy, conflicts of interests, protection of confidential information, as well
as strict adherence to all laws and regulations applicable to the conduct of the
Company's business.

         Any waiver of the Company's policies, principles or guidelines
relating to business conduct or ethics for executive officers or directors may
be made only by the Audit Committee, and will be promptly disclosed as required
by law or stock exchange regulation.



                               * * * * * * * * * *



o        Originally adopted by the Nominating and Corporate Governance
         Committee and the Board of Directors on February 17, 2003 and
         February 25, 2003, respectively.

o        Sections 1, 3, 6 and 7 amended by the Nominating and Corporate
         Governance Committee and the Board of Directors on November 18, 2003
         and November 20, 2003, respectively.

o        Sections 1, 3 and 9 amended by the Nominating and Corporate Governance
         Committee and the Board of Directors on February 19, 2004 and February
         25, 2004, respectively.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>4
<FILENAME>exhibit33b.txt
<DESCRIPTION>EXHIBIT 3.3(B)
<TEXT>
                                                                  Exhibit 3.3(b)
                                CENTURYTEL, INC.

                           CHARTER OF AUDIT COMMITTEE
                            OF THE BOARD OF DIRECTORS
                     (as amended through February 25, 2004)


I.       SCOPE OF RESPONSIBILITY

         A.    General

         Subject to the limitations noted in Section VI, the primary function of
the Audit Committee is to assist the Board of Directors (the "Board") in
fulfilling its oversight responsibilities by (1) overseeing the Company's system
of financial reporting, auditing, controls and legal compliance, (2) monitoring
the operation of such system and the integrity of the Company's financial
statements, (3) monitoring the qualifications and independence of the outside
auditors, and the performance of the outside and internal auditors, and (4)
reporting to the Board periodically concerning activities of the Audit
Committee.

         B.    Relationship to Other Groups

         The management of the Company is responsible primarily for developing
the Company's accounting practices, preparing the Company's financial
statements, maintaining internal controls, maintaining disclosure controls and
procedures, and preparing the Company's disclosure documents in compliance with
applicable law. The internal auditors are responsible primarily for objectively
assessing the Company's internal controls. The outside auditors are responsible
primarily for auditing and attesting to the Company's financial statements and
evaluating the Company's internal controls. Subject to the limitations noted in
Section VI, the Audit Committee, as the delegate of the Board, is responsible
for overseeing this process and discharging such other functions as are assigned
by law, the Company's organizational documents, or the Board. The functions of
the Audit Committee are not intended to duplicate, certify or guaranty the
activities of management or the internal or outside auditors.

         The Audit Committee will strive to maintain an open and free avenue of
communication among management, the outside auditors, the internal auditors, and
the Board. The outside and internal auditors will report directly to the Audit
Committee. The Audit Committee will report regularly to the Board.

II.      COMPOSITION

         The Audit Committee will be comprised of three or more directors, each
of whom will be appointed and replaced by the Board in accordance with the
Company's bylaws. Each member of the Audit Committee will meet the standards of
independence or other qualifications required from time to time by the New York
Stock Exchange, Section 10A(m)(3) of the Securities Exchange Act of 1934 (the
"Exchange Act") and the rules and regulations of the Securities and Exchange
Commission (the "SEC"), and at least one member will in the judgment of the
Board have accounting or related financial management expertise in accordance
with New York Stock Exchange listing standards. The Audit Committee's
chairperson shall be designated by the Board. The Audit Committee may form and
delegate authority to subcommittees consisting of one or more members when
appropriate, including the authority to grant preapprovals of audit and
permitted non-audit services by the outside auditors, subject to any limitations
or reporting requirements established by law or the Company's procedures.

III.     MEETINGS

         The Audit Committee will meet at least four times annually, or more
frequently if the Committee determines it to be necessary. To foster open
communications, the Audit Committee may invite to its meetings other directors
or representatives of management, the outside auditors, the internal auditors,
counsel or other persons whose pertinent advice or counsel is sought by the
Committee. The agenda for meetings will be prepared in consultation among the
Committee chairperson (with input from Committee members), management, the
outside auditors, the internal auditors and counsel. The Audit Committee will
maintain written minutes of all its meetings and provide a copy of all such
minutes to every member of the Board.

IV.      POWERS

         The Audit Committee shall have the sole authority to appoint or replace
the outside auditors, provided that the Audit Committee may submit its
appointment to the Company's shareholders for ratification on terms and
conditions acceptable to it. The Audit Committee shall be directly responsible
for the compensation and oversight of the work of the outside auditors
(including resolution of disagreements between management and the outside
auditors regarding financial reporting) for the purpose of preparing or issuing
an audit report or related work. The Audit Committee shall also have the sole
authority to (a) appoint or replace the head of internal auditing, (b) appoint
or replace any firm engaged to provide internal auditing services and (c) grant
waivers to directors or executive officers from the code of ethics and business
conduct contained in the Company's corporate compliance procedures.

         The Audit Committee shall have the authority, to the extent it deems
necessary or appropriate, to retain independent legal, accounting or other
advisors. The Company shall provide appropriate funding, as determined by the
Audit Committee, for payment of (a) compensation to the outside auditor or any
other advisors employed by the Audit Committee and (b) ordinary administrative
expenses of the Audit Committee that are necessary or appropriate in carrying
out its duties.

         The Audit Committee shall have the power to (a) obtain and review any
information that the Audit Committee deems necessary to perform its oversight
functions and (b) conduct or authorize investigations into any matters within
the Audit Committee's scope of responsibilities.

         The Audit Committee shall have the power to issue any reports or
perform any other duties required by (a) the Company's articles of incorporation
or bylaws, (b) applicable law or (c) rules or regulations of the SEC, the New
York Stock Exchange, or any other self-regulatory organization having
jurisdiction over the affairs of the Audit Committee. The Audit Committee may
adopt any policies or procedures required under any such articles, bylaws, laws,
rules or regulations, or that it, in its discretion, may determine to be
advisable in connection with its oversight functions.

         The Audit Committee shall have the power to consider and act upon any
other matters concerning the financial affairs of the Company as the Audit
Committee, in its discretion, may determine to be advisable in connection with
its oversight functions.

V.       PERIODIC OVERSIGHT TASKS

         The Audit Committee, to the extent it deems necessary or appropriate or
to the extent required by applicable laws or regulations, will perform the
oversight tasks delineated in the Audit Committee Checklist. The checklist will
be updated annually to reflect changes in regulatory requirements, authoritative
guidance, and evolving oversight practices. The most recently updated checklist
will be considered to be an addendum to this charter.

VI.      LIMITATIONS

         The Committee's failure to investigate any matter, to resolve any
dispute or to take any other actions or exercise any of its powers in connection
with the good faith exercise of its oversight functions shall in no way be
construed as a breach of its duties or responsibilities to the Company, its
directors or its shareholders.

         The Audit Committee is not responsible for preparing the Company's
financial statements, planning or conducting the audit of such financial
statements, determining that such financial statements are complete and accurate
or prepared in accordance with generally accepted accounting standards, or
assuring compliance with applicable laws or the Company's policies, procedures
and controls, all of which are the responsibility of management or the outside
auditors. The Audit Committee's oversight functions involve substantially lesser
responsibilities than those associated with the audit performed by the outside
auditors. In connection with the Audit Committee's oversight functions, the
Committee may rely on (i) management's representations that the financial
statements have been prepared with integrity and objectivity and in conformity
with accounting principles generally accepted in the United States and (ii) the
representations of the internal or outside auditors.

         In carrying out its oversightfunctions, the Audit Committee believes
its policies and procedures should remain flexible in order to best react to a
changing environment.


                               * * * * * * * * * *


o        Originally adopted and approved by the Audit Committee and Board on
         November 18, 1999.

o        Amended by the Board on February 28, 2001, February 26, 2002, February
         25, 2003 and February 25, 2004, in each case following prior approval
         thereof by the Audit Committee.



<PAGE>


                                                                    ADDENDUM

                            AUDIT COMMITTEE CHECKLIST
<TABLE>
<CAPTION>
                                                                      First     Second      Third     Fourth       As
                                                                     Quarter    Quarter    Quarter    Quarter    Needed
Annual Audit Planning
- ---------------------
<S>                                                                     <C>        <C>        <C>        <C>        <C>

   1.   appoint or replace the outside auditors and approve the         X
compensation and other terms of the outside auditors'
annual engagement

   2.   pre-approve all auditing services                               X                                           X

   3.   review significant relationships between the outside            X                                           X
auditors and the Company, including those described in written
statements of the outside auditors furnished underISB Standard
No. 1 and employment relationships proscribed under Rule
2-01(c)(2) of Regulation S-X1 (1)

   4.   discuss the scope and comprehensiveness of the audit            X                                X
plan, including changes from prior years and the coordination of
the efforts of the outside and internal auditors

Review Earnings Releases and Other Non-SEC Reports
- --------------------------------------------------

   5.   discuss the Company's earnings release with management          X          X          X          X
and the outside auditors prior to its release

   6.   discuss with management the Company's financial                 X          X          X          X
information and earnings guidance provided to analysts and rating
agencies

Review of Financial Information in SEC Reports
- ----------------------------------------------

   7.   review with management and the outside auditors the             X          X          X          X
Company's financial information, including

        (a)  any report, opinion or review rendered on the financial
statements by management or the outside auditors (including under
SAS No. 61 or 71),

        (b)  any analysis prepared by management or the outside
auditors setting forth significant financial reporting issues and
judgments made in connection with the preparation of the financial
statements and

        (c)  the effect of regulatory and accounting initiatives

   8.   review and discuss reports from the outside auditors on:        X                                           X

        (a)  the Company's critical accounting policies

        (b)  all alternative treatments of financial information
within GAAP that have been discussed with management, ramifications
of the use of such alternative treatments, and the treatment
preferred by the outside auditors

        (c)  other material written communications between the
outside auditors and management, such as any management letter or
schedule of unadjusted differences

   9.   review and discuss reports from the outside auditors on:        X          X          X          X          X

        (a)  conditions or matters, if any, that must be reported
under generally accepted auditing standards (including SAS No.
61), including:

             (i)  difficulties or disputes with management or the
internal auditors encountered during the audit

             (ii) the outside auditors' views regarding the
Company's financial disclosures, the quality of the Company's
accounting principles as applied, the underlying estimates and
other significant judgments made by management in preparing the
financial statements, and the compatibility of the Company's
principles and judgments with prevailing practices and standards

        (b)  matters, if any, that must be reported under the
federal securities laws (including Section 10A of the
Exchange Act)

        (c)  communications, if any, with the national office
of the outside auditors pertaining to the Company's financial
affairs

   10.  review with management and the outside auditors major           X          X          X          X
issues regarding accounting principles and financial statement
presentations, including any

        (a)  significant changes in the Company's selection
or application of accounting principles,

        (b)  major issues as to the adequacy of the Company's
internal controls, its disclosure controls and procedures,
or its financial reporting processes, and

        (c)  special audit steps adopted in light of material
control deficiencies

   11.  discuss with management and the outside auditors the            X          X          X          X
effect of regulatory and accounting initiatives as well as
off-balance sheet structures on the Company's financial statements

   12.  discuss the Company's major financial risk exposures and        X          X          X          X          X
the steps management has taken to monitor and control such
exposures

   13.  review the accounting implications of significant new           X          X          X          X          X
transactions, if any

Conduct of Meetings
- -------------------

   14.  in connection with each periodic report of the Company,
review:

   (a)  management's required disclosure, if any, to the Audit                                                      X
Committee under ss.302 of the Sarbanes-Oxley Act regarding
significant deficiencies in internal controls over financial
reporting or reportable fraud

   (b)  the contents of the certifications of the Company's CEO         X          X          X          X
and CFO included in such report

   15.  receive reports, if any, regarding (a) non-audit                X          X          X          X
services that the Chairman (or any  subcommittee) pre-cleared the
outside  auditor to perform since the last meeting, (b) letters
received by the Chairman under the Company's  accounting complaint
procedures and (c) any other "whistle blower" reports alleging
material violations within the purview of the Audit Committee's
functions

   16.  review the extent to which the Company has implemented                                                      X
changes in practices or controls that were previously  recommended
to or approved by the Audit Committee

   17.  receive reports regarding significant changes to GAAP or                                                    X
regulations impacting the Audit Committee

   18.  meet in executive session with the outside auditors,            X          X          X          X          X
internal auditors and management, as necessary

Annual Reports
- --------------

   19.  recommend to the Board whether the audited financial            X
statements should be included in the Company's 10-K report

   20.  approve the annual proxy statement report of the Audit          X
Committee required by the rules of the SEC

   21.  review and approve the disclosures in each 10-K report          X
regarding management's internal control report (effective First
Quarter 2005)

Oversight of the Company's Outside Auditors
- -------------------------------------------

   22.  pre-clear the engagement of the outside auditors to                                                         X
conduct any  non-audit  services not  pre-cleared  by the Chairman
(or a subcommittee)

   23.  obtain and review a report from the outside auditors                                             X
regarding (a) the outside auditor's internal quality-control
procedures, (b) any material issues raised by the most recent
internal quality-control review, or peer review, of the firm, or
by any inquiry or investigation by governmental or professional
authorities within the preceding five years respecting any audit
engagement, (c) any steps taken to deal with any such issues, and
(d)  assurances that the outside auditing firm is registered in
good standing with the Public Company Accounting Oversight Board

   24.  review and evaluate the lead audit partner and ensure           X
his rotation as required by law

   25.  monitor the effectiveness of the Company's hiring                                                X
policies  for  employees  or  former   employees  of  the  outside
auditors  (maintained under Section 10A(l) of the Exchange Act and
NYSE Rule 303A(7))

Oversight of the Company's Internal Auditors
- --------------------------------------------

   26.  review the performance of the head of the internal audit                              X
department, and replace if necessary

   27.  meet, if possible, with the entire internal auditing            X
staff

   28.  review significant reports to management prepared by the        X          X          X          X          X
internal auditing department and management's responses

   29.  discuss with the outside auditors and management the                                             X
internal audit department's plans, responsibilities, preliminary
budget, independence and staffing for the upcoming year
(including the use of third party firms) and any recommended
changes thereto

Compliance Oversight Responsibilities
- -------------------------------------

   30.  monitor the effectiveness of the Company's procedures                                                       X
for receiving, retaining, and handling confidential, anonymous
complaints regarding accounting, controls or auditing matters
(maintained under SEC Rule 10A-3)

   31.  discuss any correspondence with regulators or                                                               X
governmental agencies and any published reports which raise
material issues regarding the Company's financial statements or
accounting policies

   32.  review the adequacy of the Company's disclosure controls                                                    X
and procedures

   33.  review reports on "related party" transactions                 X

   34.  solicit, as necessary, germane reports or information                                                       X
from other committees with related oversights functions

   35.  review periodically the procedures established by the                                                       X
Company to monitor its compliance with debt covenants

   36.  consult periodically with counsel concerning the Audit                                                      X
Committee's responsibilities or legal matters that may have a
material impact on the Company's financial statements, controls,
or corporate compliance procedures

Self Assessment
- ---------------

   37.  review annually the Audit Committee's self-review                                     X
criteria

   38.  conduct self-review; verify that all Committee members                                           X
remain eligible to serve

Charter
- -------

   39.  review this checklist and the related Audit Committee                                            X
charter annually, and consider, adopt and submit to the Board any
proposed changes

   40.  include a copy of the Audit Committee charter as an                                                         X
appendix to the proxy statement at least once every three years

   41.  periodically review the charter of the internal audit                                                       X
department, and consider and adopt necessary changes
</TABLE>

                               * * * * * * * * * *

Last Revised:   February 25, 2004.

* * * * * *

(1 ) The Audit Committee may request verification that no employee of the
Company in a financial reporting oversight role is a former partner, principal,
shareholder or professional employee of the outside auditors, and may review any
additional records or certifications necessary to verify the outside auditors'
independence under Regulation S-X.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>5
<FILENAME>exhibit33c.txt
<DESCRIPTION>EXHIBIT 3.3(C)
<TEXT>
                                                                  Exhibit 3.3(c)
                                CENTURYTEL, INC.
                                ----------------

                      CHARTER OF THE COMPENSATION COMMITTEE
                            OF THE BOARD OF DIRECTORS
                     (as amended through February 25, 2004)

                                ----------------

I.      PURPOSE

        The Compensation Committee is appointed by the Board principally to
discharge the Board's responsibilities relating to compensation of the Company's
executive officers, to oversee the administration of the Company's equity
incentive and executive compensation programs, and to produce an annual report
on executive compensation for inclusion in the Company's proxy statement.

II.     COMPOSITION

        The Committee will consist of at least three directors, each of whom
will be appointed and replaced by the Board in accordance with the Company's
bylaws. Each member of the Committee will meet the independence requirements of
the New York Stock Exchange and Rule 16b-3 promulgated under the Securities
Exchange Act of 1934. The Committee's chairman will be designated by the Board.
The Committee may form and delegate authority to subcommittees when appropriate.

III.    MEETINGS

        The chairman of the Committee will preside at each meeting and, in
consultation with the other members of the Committee and management, will set
the frequency of, and the agenda for, each meeting.

IV.     AUTHORITY AND RESPONSIBILITIES

        In furtherance of the purpose of the Committee described above, the
Committee will have the following authority and responsibilities:

       1.   The Committee will periodically review and approve goals and
objectives relating to compensation of the executive officers and evaluate the
performance of the executive officers in light of these goals and objectives.
Based on this evaluation, the Committee will approve the CEO's compensation
level, and will recommend to the Board the compensation levels of the other
executive officers (and any other officer subject to Section 16 of the
Securities Exchange Act of 1934). The Committee will also oversee the annual
evaluation of all other members of management.

       2.   The Committee will periodically review the Company's incentive
compensation plans and equity-based plans, and will oversee the administration
of the Company's other executive compensation plans and programs.

       3.   The Committee will review, adopt and submit to the Board for its
approval (i) any proposed plan or arrangement offering or providing any
incentive, retirement or other compensation, benefits or perquisites to one or
more of the Company's executive officers (other than any plan or arrangement
offering benefits that do not discriminate in scope, terms or operation in favor
of executive officers and that are generally available to all salaried
employees) and (ii) any significant amendment or change to any such plan or
arrangement.

       4.   The Committee will review, adopt and submit to the Board for its
approval (i) any proposed employment, severance or change-in-control contract
between the Company and an executive officer or proposed executive officer and
(ii) any proposed extension or significant amendment thereto.

       5.   The Committee will exercise all powers allocated to it under the
Company's benefit plans, including the powers to (i) grant stock options and
other equity-based awards thereunder and (ii) establish performance goals
thereunder and determine whether such goals have been attained. The Committee
will also have the authority to delegate responsibility in accordance with the
terms and conditions of each such applicable plan.

       6.   The Committee, in consultation with management, will oversee
compliance with regulations governing executive compensation, including Rule
16b-3 and Section 162(m) of the Internal Revenue Code.

       7.   The Committee will issue executive compensation reports to the
Company's shareholders in the manner required under the rules and regulations of
the U.S. Securities and Exchange Commission.

       8.   The Committee will make regular reports to the Board.

       9.   The Committee will have the sole authority to retain and terminate
any compensation consultant retained to assist the Committee in discharging its
functions, and may, to the extent it deems necessary or appropriate, retain
independent legal, financial or other advisors. The Committee will approve
related fees and other retention terms.

      10.   The Committee will oversee, monitor, review or approve such other
employment or compensation-related matters, and will perform such other
services, as may be delegated to it from time to time by the Board.

      11.   The Committee will review and reassess the adequacy of this Charte
annually and recommend any proposed changes to the Board for approval. The
Committee will annually review its own performance.

                               * * * * * * * * * *
- ------------------

o       Originally adopted and approved by the Committee and the Board on
        February 11, 2003, and February 25, 2003, respectively.

o       Section II amended by the Committee and the Board on May 27, 2003, and
        May 29, 2003, respectively.

o       Sections I, II and IV amended by the Committee and the Board on
        February 25, 2004.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>6
<FILENAME>exhibit33d.txt
<DESCRIPTION>EXHIBIT 3.3(D)
<TEXT>
                                                                  Exhibit 3.3(d)
                                CENTURYTEL, INC.
                                ----------------

               CHARTER OF THE NOMINATING AND CORPORATE GOVERNANCE
                       COMMITTEE OF THE BOARD OF DIRECTORS
                     (as amended through February 25, 2004)
                                ----------------

I.       PURPOSE

         The Nominating and Corporate Governance Committee is appointed by the
Board principally to (1) assist the Board by identifying individuals qualified
to serve as directors and officers of the Company, and to recommend to the Board
nominees for such positions, (2) monitor the composition of the Board and its
committees, (3) recommend to the Board a set of corporate governance guidelines
applicable to the Company and (4) lead the Board in its annual review of the
Board's performance.

II.      COMPOSITION

         The Committee shall consist of at least three directors, each of whom
will be appointed and replaced by the Board in accordance with the Company's
bylaws. Each member of the Committee shall meet the independence requirements of
the New York Stock Exchange. The Committee's chairperson shall be designated by
the Board. The Committee may form and delegate authority to subcommittees when
appropriate.

III.     MEETINGS

         The chairperson of the Committee will preside at each meeting and, in
consultation with the other members of the Committee, will set the frequency of,
and the agenda for, each meeting.

IV.      AUTHORITY AND RESPONSIBILITIES

         In furtherance of the purpose of the Committee described above, the
Committee shall have the following authority and responsibilities:

        1.    The Committee shall lead the search for individuals qualified to
serve as directors, and to recommend to the Board a slate of directors to be
elected annually by the shareholders. In connection therewith, the Committee (i)
shall consider candidates submitted by shareholders in accordance with the
Company's bylaws, (ii) shall monitor the performance and contributions of
incumbent directors and (iii) may, to the extent it deems necessary or
appropriate, develop and recommend to the Board specific criteria for selecting
director nominees. The Committee shall also recommend to the Board a slate of
officers to be elected annually by the Board and individuals to fill vacancies
as the need arises.

        2.    The Committee shall monitor the operation of the Board's
committees. In connection therewith, the Committee (i) shall recommend to the
Board a slate of directors to be elected annually to serve as committee members
and directors to fill committee vacancies as needed and (ii) may recommend to
the Board changes in committee structure and operations, including the creation
and elimination of committees.

        3.    The Committee shall, no less than annually, review and reassess
the adequacy of the corporate governance guidelines applicable to the Company
and recommend any proposed changes to the Board for approval.

        4.    The Committee shall receive comments from all directors and
report annually to the Board with an assessment of the Board's performance, to
be discussed with the full Board.

        5.    The Committee may make recommendations to the Board concerning
the size and composition of the Board, the term of membership of directors, and
the frequency, content and structure of Board meetings.

        6.    The Committee shall review and oversee any director orientation
or continuing director education programs established by the Company.

        7.    The Committee shall conduct an annual review of the CEO's
performance, and report its findings to the Board. The Committee shall also
periodically report to the Board on succession planning for the senior executive
officers.

        8.    The Committee shall review annually director compensation and
benefits (except that the Compensation Committee shall administer the Company's
director stock option plans).

        9.    The Committee shall make regular reports to the Board.

        10.   The Committee shall have the sole authority to retain and
terminate any search firm to be used to identify director or officer candidates
and may, to the extent it deems necessary or appropriate, retain independent
legal, financial or other advisors. The Committee shall approve related fees and
other retention terms.

        11.   The Committee shall also discharge any additional functions that
may be delegated or assigned to it by the Board from time to time, including (i)
considering questions of conflict of interest of directors or executive
officers, (ii) reviewing the functions and responsibilities of the senior
officers and (iii) considering significant corporate governance issues or
shareholder relations issues that may arise from time to time.

        12.   The Committee shall review and reassess the adequacy of this
Charter annually and recommend any proposed changes to the Board for approval.
The Committee shall annually review its own performance.

                               * * * * * * * * * *

- ------------------

o      Originally adopted and approved by the Committee and the Board on
       January 30, 2003 and February 25, 2003, respectively.

o      Sections II and IV amended by the Committee and the Board on February
       19, 2004 and February 25, 2004, respectively.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>7
<FILENAME>exhibit33e.txt
<DESCRIPTION>EXHIBIT 3.3(E)
<TEXT>
                                                                  Exhibit 3.3(e)
                                CENTURYTEL, INC.
                                ----------------

                      CHARTER FOR RISK EVALUATION COMMITTEE
                            OF THE BOARD OF DIRECTORS
                     (as amended through February 25, 2004)
                                ----------------

I.       PURPOSE

         The Risk Evaluation Committee is appointed by the Board to identify,
monitor and manage risks to the Company's business, properties and employees.

II.      COMPOSITION

         The Committee will consist of at least three directors, each of whom
will be appointed and replaced by the Board in accordance with the Company's
bylaws. The Committee's chairman will be designated by the Board. The Committee
may form and delegate authority to subcommittees when appropriate.

III.     MEETINGS

         The chairman of the Committee will preside at each meeting and, in
consultation with the other members of the Committee and management, will set
the frequency of, and the agenda for, each meeting; provided, however, that any
member of the Committee may call a meeting in his or her discretion. To assist
it in discharging its functions, the Committee may invite to its meetings other
directors or representatives of management, counsel and other persons whose
pertinent advice or counsel is sought by the Committee.

IV.      AUTHORITY AND RESPONSIBILITIES

         In furtherance of the purpose of the Committee described above, the
Committee will have the following authority and responsibilities:

         1.   The Committee will review periodically the Company's major risk
exposures in the areas listed below:

              (a)  risks to the Company's properties (including its information
         systems) posed by casualty events, terrorism, sabotage or theft

              (b)  risks to the Company's business caused by potential or actual
         regulatory developments or the Company's failure to comply with
         applicable telecommunications regulations

              (c)  risks to the Company's business caused by the failure to
         comply with environmental, safety, health or other similar laws

              (d)  risks of injury to the Company's employees

              (e)  risks of potential, threatened or pending rate cases or
         lawsuits.

         2.   The Committee will review periodically the steps that the
Company has taken or could take to mitigate major risks identified above or any
others subsequently identified. In connection therewith, the Committee will
periodically review and adjust the scope and coverage of the Company's insurance
programs, subject to receiving the approval or ratification of the Board for
material changes to such programs.

         3.   The Committee will oversee the operation of the Company's
corporate compliance program and procedures. In connection therewith, the
Committee (i) will review periodically the effectiveness and adequacy of the
Company's corporate compliance program and procedures and recommend to the Board
any necessary proposed changes thereto and (ii) may, to the extent it deems
necessary or appropriate, investigate or cause to be investigated any material
instance of noncompliance.

         4.   The Committee will oversee the Company's risk management, loss
prevention and safety programs and activities.

         5.   The Committee will monitor the functions of the Board to ensure
that management (or the chairpersons of other Board committees) are periodically
making presentations to the Board regarding other major risk exposures not
directly monitored by the Committee.

         6.   The Committee will make regular reports to the Board summarizing
the Company's insurance programs and the Committee's activities.

         7.   The Committee will also discharge any additional functions that
may be delegated or assigned to it by the Board from time to time.

         8.   The Committee will review and reassess the adequacy of this
Charter annually and recommend any proposed changes to the Board for approval.
The Committee will annually review its own performance.

                               * * * * * * * * * *
- ------------------

o        Originally adopted and approved by the Committee and the Board on
         February 18, 2003 and February 25, 2003, respectively.

o        Sections II and IV amended by the Committee and the Board on February
         19, 2004 and February 25, 2004, respectively.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>8
<FILENAME>exhibit102e.txt
<DESCRIPTION>EXHIBIT 10.2(E)
<TEXT>
                                                                 Exhibit 10.2(e)
                                                                 CONFORMED COPY


                              AMENDED AND RESTATED
                                CENTURYTEL, INC.
                        2002 DIRECTORS STOCK OPTION PLAN


         WHEREAS, the CenturyTel, Inc. 2002 Directors Stock Option Plan (the
"Plan") was adopted by the Board of Directors of CenturyTel, Inc. (the
"Company") on February 26, 2002 and approved by the shareholders of the Company
on May 9, 2002, and Amendment No. 1 to the Plan was approved by the Board of
Directors of the Company on May 29, 2003; and


         WHEREAS, the Board of Directors now wishes to amend Section 10.2 of the
Plan to provide that no Awards may be granted under the Plan later than May 9,
2012, which is ten years after the Plan was approved by the Company's
stockholders.


         NOW THEREFORE, Section 10.2 of the Plan is hereby amended to read as
provided herein and the Plan is hereby restated in its entirety reflecting such
amendment to read as follows:

1.       Purpose of the Plan.

         The purpose of the CenturyTel, Inc. 2002 Directors Stock Option Plan is
to promote the interests of the Company and its shareholders by strengthening
the Company's ability to attract, motivate and retain Directors of experience
and ability, and to encourage the highest level of Directors performance by
providing Directors with a proprietary interest in the Company's financial
success and growth.

2.       Definitions.

         2.1  "Board" means the Board of Directors of the Company.

         2.2  "Committee" means the Compensation Committee of the Board or a
subcommittee thereof. The Committee shall consist of not fewer than two members
of the Board of Directors, each of whom shall (a) qualify as a "non-employee
director" under Rule 16b-3 promulgated under the Securities Exchange Act of 1934
(the "1934 Act"), or any successor rule, and (b) qualify as an "outside
director" under Section 162(m) of the Internal Revenue Code of 1986, as amended
(the "Code"), and the regulations promulgated thereunder (collectively, "Section
162(m)").

         2.3  "Common Stock" means the common stock, $1.00 par value per share
of the Company.

         2.4  "Company" or "CenturyTel" means CenturyTel, Inc., a Louisiana
corporation.

         2.5  "Director" means a member of the Board who is not employed by
the Company or any of its subsidiaries.

         2.6  "Fair Market Value" means (i) if the Common Stock or other
security is listed on an established stock exchange or any automated quotation
system that provides sale quotations, the closing sale price for a share thereof
on such exchange or quotation system on the applicable date, and if shares are
not traded on such day, on the next preceding trading date, (ii) if the Common
Stock or other security is not listed on any exchange or quotation system, but
bid and asked prices are quoted and published, the mean between the quoted bid
and asked prices on the applicable date, and if bid and asked prices are not
available on such day, on the next preceding day on which such prices were
available, and (iii) if the Common Stock or other security is not regularly
quoted, the fair market value of a share thereof on the applicable date as
established by the Committee in good faith.

         2.7  "Participant" means each Director (as defined in Section 2.5).

         2.8  "Option" means a stock option that does not satisfy the
requirements of Section 422 of the Code.

         2.9  "Plan" means the CenturyTel, Inc. 2002 Directors Stock Option
Plan as set forth herein and as amended, restated, supplemented or
otherwise modified from time to time.

3.       Shares of Common Stock Subject to the Plan.

         3.1  The Company may issue up to 400,000 shares of Common Stock,
subject to the adjustment provisions of Section 7, pursuant to the exercise of
Options granted hereunder. Such shares may be either authorized but unissued
shares or shares issued and thereafter acquired by the Company.

         3.2  To the extent any shares of Common Stock subject to an Option
are not issued because the Option is forfeited or cancelled, such shares shall
again be available for grant pursuant to Options granted under the Plan. If the
exercise price of any Option granted under this Plan is satisfied by tendering
shares of Common Stock to the Company (by either actual delivery or by
attestation), only the number of shares of Common Stock issued net of the shares
of Common Stock tendered shall be deemed delivered for purposes of determining
the maximum number of shares of Common Stock available for delivery under the
Plan.

4.       Administration of the Plan.

         4.1  The Plan shall be administered by the Committee, which shall have
the power to interpret the Plan and, subject to its provisions, to prescribe,
amend and rescind Plan rules and to make all other determinations necessary for
the Plan's administration.

         4.2  All action taken by the Committee in the administration and
interpretation of the Plan shall be final and binding upon all parties. No
member of the Committee will be liable for any action or determination made in
good faith by the Committee with respect to the Plan or any Option.

         4.3  The Committee does not have the authority to make discretionary
grants of stock options under the Plan.  Grants may be made only as provided
in Section 5 hereof.

5.       Grant of Options.

         5.1  Beginning with the 2002 annual meeting of shareholders and for
as long as the Plan remains in effect and shares of Common Stock remain
available for issuance hereunder, each Participant shall be automatically
granted an Option to acquire up to 6,000 shares of Common Stock on the day
following each annual meeting of shareholders. The Committee shall determine the
size of the Option grants to be made to the Participants each year, within the
limitations provided herein.

         5.2  While the Plan remains in effect and shares of Common Stock
remain available for issuance hereunder, any person who becomes a Director other
than by election at an annual meeting of shareholders shall be granted an Option
to acquire a pro rata number of shares of Common Stock calculated as follows:

Number of shares subject to               Number of full calendar months
Options granted to each Director          between the date the person becomes a
on the day following the                  Director and the next annual meeting
preceding annual meeting                  ------------------------------------
                                    X                    12

6.       Terms and Conditions of Options.

         6.1  Unless exercisability is accelerated as provided in Sections
6.4 or 8.2 hereof, the Options shall become exercisable beginning one year
following the date of grant.

         6.2  Unless terminated earlier as provided in Section 6.5 or 8.3,
the Options shall expire ten years following the date of grant.

         6.3  The exercise price of the Options granted to Directors shall be
equal to the Fair Market Value, as defined herein, of a share of Common Stock
on the date of grant.

         6.4  The Committee may accelerate the exercisability of any Option at
any time in its discretion.

         6.5  In the event a Director ceases to serve on the Board
because such Director is ineligible to stand for re-election to the Board under
the CenturyTel Directors Retirement Policy (or any comparable successor
retirement policy), the exercisable Options granted hereunder and held by such
Director shall continue to be outstanding and exercisable for the remaining
terms of such Options, subject to the rights of the Committee under Section 8.3
hereof. In the event a Director ceases to serve on the Board for any other
reason, the Options granted hereunder must be exercised, to the extent otherwise
exercisable at the time of termination of Board service, within two years from
the date of termination of Board service. Subject to Section 6.4 hereof, Options
that are not exercisable at the time of termination of Board service shall be
forfeited.

         6.6  An Option may be exercised, in whole or in part, by giving
written notice to the Company, specifying the number of shares of Common Stock
to be purchased. The exercise notice shall be accompanied by tender of the full
purchase price for such shares, which may be paid or satisfied by (a) cash; (b)
check; (c) delivery of shares of Common Stock, which shares shall be valued for
this purpose at the Fair Market Value on the business day immediately preceding
the date such option is exercised and, unless otherwise determined by the
Committee, shall have been held by the optionee for at least six months; (d)
delivery of irrevocable written instructions to a broker approved by the Company
(with a copy to the Company) to immediately sell a portion of the shares
issuable under the Option and to deliver promptly to the Company the amount of
sale proceeds (or loan proceeds if the broker lends funds to the participant for
delivery to the Company) to pay the exercise price; or (e) in such other manner
as may be authorized from time to time by the Committee, provided that all such
payments shall be made or denominated in United States dollars. In the case of
delivery of an uncertified check, no shares shall be issued until the check has
been paid in full. Prior to the issuance of shares of Common Stock upon the
exercise of an Option, a Participant shall have no rights as a shareholder.

         6.7  Except for adjustments pursuant to Section 7 or actions permitted
to be taken by the Committee under Section 8.3 in the event of a Change of
Control, unless approved by the shareholders of the Company, (a) the exercise
price for any outstanding Option granted under this Plan may not be decreased
after the date of grant and (b) an outstanding Option that has been granted
under this Plan may not, as of any date that such Option has a per share
exercise price that is less than the then current Fair Market Value of a share
of Common Stock, be surrendered to the Company as consideration for the grant of
a new Option with a lower exercise price or any payment of cash or Common Stock.


         6.8  Upon approval of the Committee, the Company may repurchase all
or a portion of a previously granted Option from a Participant by mutual
agreement before such option has been exercised by payment to the Participant of
cash or Common Stock or a combination thereof with a value equal to the amount
per share by which: (a) the Fair Market Value of the Common Stock subject to the
Option on the business day immediately preceding the date of purchase exceeds
(b) the exercise price.

7.       Adjustment Provisions.

         In the event of any recapitalization, reclassification, stock dividend,
stock split, combination of shares or other change in the Common Stock, all
limitations on numbers of shares of Common Stock provided in this Plan, and the
number of shares subject to outstanding Options, shall be equitably adjusted in
proportion to the change in outstanding shares of Common Stock. In addition, in
the event of any such change in the Common Stock, the Committee shall make any
other adjustment that it determines to be equitable, including without
limitation adjustments to the exercise price of any Option in order to provide
Participants with the same relative rights before and after such adjustment.

8.       Change of Control.

         8.1  A Change of Control shall mean:

              (a)  the acquisition by any person of beneficial ownership of 30%
or more of the outstanding shares of the Common Stock or 30% or more of the
combined voting power of CenturyTel's then outstanding securities entitled to
vote generally in the election of directors; provided, however, that for
purposes of this subsection (a), the following acquisitions shall not constitute
a Change of Control:

                   (i)    any acquisition (other than a Business Combination
(as defined below) which constitutes a Change of Control under Section 8.1(c)
hereof) of Common Stock directly from the Company,

                   (ii)   any acquisition of Common Stock by the Company,

                   (iii)  any acquisition of Common Stock by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, or

                   (iv)   any acquisition of Common Stock by any corporation
pursuant to a Business Combination that does not constitute a Change of Control
under Section 8.1(c) hereof; or

              (b)  individuals who, as of January 1, 2002,
constituted the Board of Directors of CenturyTel (the "Incumbent Board") cease
for any reason to constitute at least a majority of the Board of Directors;
provided, however, that any individual becoming a director subsequent to such
date whose election, or nomination for election by CenturyTel's shareholders,
was approved by a vote of at least two-thirds of the directors then comprising
the Incumbent Board shall be considered a member of the Incumbent Board, unless
such individual's initial assumption of office occurs as a result of an actual
or threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by
or on behalf of a person other than the Incumbent Board; or

              (c)  consummation of a reorganization, share exchange, merger or
consolidation (including any such transaction involving any direct or indirect
subsidiary of CenturyTel) or sale or other disposition of all or substantially
all of the assets of the Company (a "Business Combination"); provided, however,
that in no such case shall any such transaction constitute a Change of Control
if immediately following such Business Combination:

                   (i)    the individuals and entities who were the beneficial
owners of CenturyTel's outstanding Common Stock and CenturyTel's voting
securities entitled to vote generally in the election of directors immediately
prior to such Business Combination have direct or indirect beneficial ownership,
respectively, of more than 50% of the then outstanding shares of Common Stock,
and more than 50% of the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors of the
surviving or successor corporation, or, if applicable, the ultimate parent
company thereof (the "Post-Transaction Corporation"), and

                   (ii)   except to the extent that such ownership existed
prior to the Business Combination, no person (excluding the Post-Transaction
Corporation and any employee benefit plan or related trust of either CenturyTel,
the Post-Transaction Corporation or any subsidiary of either corporation)
beneficially owns, directly or indirectly, 20% or more of the then outstanding
shares of Common Stock of the corporation resulting from such Business
Combination or 20% or more of the combined voting power of the then outstanding
voting securities of such corporation, and

                   (iii)  at least a majority of the members of the board of
directors of the Post-Transaction Corporation were members of the Incumbent
Board at the time of the execution of the initial agreement, or of the action of
the Board of Directors, providing for such Business Combination; or

              (d)  approval by the shareholders of CenturyTel of a complete
liquidation or dissolution of CenturyTel.

For purposes of this Section 8, the term "person" shall mean a natural person or
entity, and shall also mean the group or syndicate created when two or more
persons act as a syndicate or other group (including, without limitation, a
partnership or limited partnership) for the purpose of acquiring, holding, or
disposing of a security, except that "person" shall not include an underwriter
temporarily holding a security pursuant to an offering of the security.

         8.2  Upon a Change of Control of the type described in clause 8.1(a)
or 8.1(b) or upon the approval by the Board of Directors of CenturyTel of any
Change of Control of the type described in clause 8.1(c) or 8.1(d), all
outstanding Options granted pursuant to this Plan shall automatically become
fully vested and exercisable.

         8.3  No later than 30 days after a Change of Control of the type
described in subsections 8.1(a) or 8.1(b) and no later than 30 days after the
approval by the Board of a Change of Control of the type described in
subsections 8.1(c) or 8.1(d), the Committee, acting in its sole discretion
without the consent or approval of any Participant (and notwithstanding any
removal or attempted removal of some or all of the members thereof as Directors
or Committee members), may act to effect one or more of the alternatives listed
below, which may vary among individual Participants and which may vary among
Options held by any individual Participant:

              (a)  require that all outstanding Options be exercised on or
before a specified date (before or after such Change of Control) fixed by the
Committee, after which specified date all unexercised Options and all rights of
Participants thereunder shall terminate,

              (b)  make such equitable adjustments to Options then outstanding
as the Committee deems appropriate to reflect such Change of Control (provided,
however, that the Committee may determine in its sole discretion that no
adjustment is necessary),

              (c)  provide for mandatory conversion or exchange of some or all
of the outstanding Options held by some or all Participants as of a date, before
or after such Change of Control, specified by the Committee, in which event such
Options shall be deemed automatically cancelled and the Company shall pay, or
cause to be paid, to each such Participant an amount of cash per share equal to
the excess, if any, of the Change of Control Value of the shares subject to such
Option, as defined and calculated below, over the per share exercise price of
such Options or, in lieu of such cash payment, the issuance of Common Stock or
securities of an acquiring entity having a Fair Market Value equal to such
excess, or

              (d)  provide that thereafter, upon any exercise of an Option that
entitles the holder to receive Common Stock, the holder shall be entitled to
purchase or receive under such Option, in lieu of the number of shares of Common
Stock then covered by such Option, the number and class of shares of stock or
other securities or property (including, without limitation, cash) to which the
holder would have been entitled pursuant to the terms of the agreement providing
for the reorganization, share exchange, merger, consolidation or asset sale, if,
immediately prior to such Change of Control, the holder had been the record
owner of the number of shares of Common Stock then covered by such Option.

         8.4  For the purposes of any conversions or exchanges under paragraph
(c) of Section 8.3, the "Change of Control Value" shall equal the amount
determined by whichever of the following items is applicable:

         (a)  the per share price to be paid to holders of Common Stock in any
such merger, consolidation or other reorganization,

         (b)  the price per share offered to holders of Common Stock in
any tender offer or exchange offer whereby a Change of Control takes place, or

         (c)  in all other events, the Fair Market Value of a share of Common
Stock, as determined by the Committee as of the date determined by the
Committee to be the date of conversion or exchange.

         8.5  in the event that the consideration offered
to shareholders of CenturyTel in any transaction described in this Section 8
consists of anything other than cash, the Committee shall determine the fair
cash equivalent of the portion of the consideration offered that is other than
cash.

9.       General Provisions.

         9.1  Nothing in the Plan or in any instrument executed pursuant to the
Plan will confer upon any Participant any right to continue as a Director or
affect the right of the Company to terminate the services of any Participant.

         9.2  No shares of Common Stock will be issued or transferred pursuant
to an Option unless and until all then-applicable requirements imposed by
federal and state securities and other laws, rules and regulations and by any
regulatory agencies having jurisdiction, and by any stock exchanges upon which
the Common Stock may be listed, have been fully met. As a condition precedent to
the issuance of shares pursuant to the exercise of an Option, the Company may
require the Participant to take any reasonable action to meet such requirements.

         9.3  No Participant and no beneficiary or other person claiming under
or through such Participant will have any right, title or interest in or to any
shares of Common Stock allocated or reserved under the Plan or subject to any
Option except as to such shares of Common Stock, if any, that have been issued
or transferred to such Participant.

         9.4  No Options granted hereunder may be transferred, pledged,
assigned or otherwise encumbered by an optionee except:

                   (a)    by will;

                   (b)    by the laws of descent and distribution; or

                   (c)    if permitted by the Committee and so provided in
              the stock option agreement or an amendment thereto, (i)
              pursuant to a domestic relations order, as defined in the
              Code, (ii) to Immediate Family Members (as defined below),
              (iii) to a partnership in which the Participant and/or the
              Participant's Immediate Family Members, or entities in which
              the Participant and/or the Participant's Immediate Family
              Members are the owners, members or beneficiaries, as
              appropriate, are the sole partners, (iv) to a limited
              liability company in which the Participant and/or the
              Participant's Immediate Family Members, or entities in which
              the Participant and/or the Participant's Immediate Family
              Members are the sole owners, members or beneficiaries, as
              appropriate, are the sole members, (v) to a trust for the
              benefit solely of the Participant and/or the Participant's
              Immediate Family Members, or (vi) to non-Immediate Family
              Members following the death of the Participant to whom the
              stock option was granted. "Immediate Family Members" means the
              spouses and natural or adopted children or grandchildren of
              the Participants and their spouses.

                          Any attempted assignment, transfer, pledge,
              hypothecation or other disposition of an Option or levy of
              attachment, or similar process upon an Option not specifically
              permitted herein, shall be null and void and without effect.


         9.5  Each Option shall be evidenced by a written stock option
agreement or notice, including terms and conditions consistent with the Plan,
as the Committee may determine.

         9.6  Anything in the Plan to the contrary notwithstanding:

              (a)  the Company may, if it shall determine it necessary or
desirable for any reason, at the time of grant of any Option or the issuance of
any shares of Common Stock pursuant to any Option, require the recipient of the
Option, as a condition to the receipt thereof or to the receipt of shares of
Common Stock issued pursuant thereto, to deliver to the Company a written
representation of present intention to acquire the Option or the shares of
Common Stock issued pursuant thereto for his own account for investment and not
for distribution; and (b) if at any time the Company further determines, in its
sole discretion, that the listing, registration or qualification (or any
updating of any such document) of any Option or the shares of Common Stock
issuable pursuant thereto is necessary on any securities exchange or under any
federal or state securities or blue sky law, or that the consent or approval of
any governmental regulatory body is necessary or desirable as a condition of, or
in connection with the grant of any Option, the issuance of shares of Common
Stock pursuant thereto, or the removal of any restrictions imposed on such
shares, such Option shall not be granted or such shares of Common Stock shall
not be issued or such restrictions shall not be removed, as the case may be, in
whole or in part, unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Company.

10.      Amendment, Discontinuance or Termination of the Plan.

         10.1 The Board may amend or discontinue the Plan at any time;
provided, however, that no such amendment may

              (a)  without the approval of the shareholders, (i)
increase, subject to adjustments permitted herein, the maximum number of shares
of Common Stock that may be issued through the Plan, (ii) materially increase
the benefits accruing to Participants under the Plan, (iii) materially expand
the classes of persons eligible to participate in the Plan, or (iv) amend
Section 6.7 to permit repricing of Options, or

              (b)  materially impair, without the consent of the recipient,
an Option previously granted, except that the Company retains all rights under
Section 8 hereof.

         10.2 Subject to Section 10.1, no Options may be granted under the Plan
later than May 9, 2012, which is ten years after the Plan was approved by the
Company's shareholders; provided, however, that Options granted prior to such
date shall remain in effect until all such Options have either been exercised,
expired or canceled under the terms of the Plan.

11.      Effective Date of Plan.

         The Plan shall become effective upon adoption by the Board, subject to
approval by the holders of a majority of the shares of Common Stock represented
in person or by proxy and entitled to vote on the subject at the 2002 annual
meeting of shareholders of the Company.

                                  * * * * * * *

         IN WITNESS WHEREOF, the undersigned Secretary of CenturyTel, Inc.
hereby certifies that the foregoing CenturyTel 2002 Directors Stock Option Plan
was (i) recommended to the Board of Directors of CenturyTel, Inc. (the "Board")
by its Compensation Committee at a meeting of the Compensation Committee duly
held on February 25, 2002, (ii) approved by the Board at a meeting duly held on
February 26, 2002, (iii) approved by the affirmative vote of the holders of a
majority of the voting power present at the 2002 Annual Meeting of Shareholders
of the Company held on May 9, 2002, (iv) amended by the Board on May 29, 2003,
and (v) amended and restated by the Board at a meeting duly held on February 25,
2004.


Dated February 25, 2004                       /s/ Stacey W. Goff
                                            ---------------------
                                              Stacey W. Goff
                                              Secretary




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>9
<FILENAME>exhibit102eii.txt
<DESCRIPTION>EXHIBIT 10.2(E)(II)
<TEXT>
                                                             Exhibit 10.2(e)(ii)

                             [CENTURYTEL LETTERHEAD]


       THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS COVERING SECURITIES
           THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.

                                   May 9, 2003


                             STOCK OPTION AGREEMENT
                           UNDER THE CENTURYTEL, INC.
                        2002 DIRECTORS STOCK OPTION PLAN


[Name and Address of Recipient]


         Re:   Option to purchase 6,000 shares of Common Stock of
               CenturyTel, Inc. at $32.18 per share granted on
               May 9, 2003.

Dear ________________:

         In consideration of your agreement to serve on the Board of Directors
of CenturyTel, Inc. (the "Company"), on May 9, 2003 you were granted an option
(the "Option") to purchase of 6,000 shares of common stock of the Company, $1.00
par value per share (the "Common Stock"), under the CenturyTel, Inc. 2002
Directors Stock Option Plan (the "Plan"), subject to all of the terms and
conditions set forth in the Plan. You hereby acknowledge that the Company has
furnished you with a copy of the Plan and the Memorandum/ Prospectus for the
Plan.

         The Option exercise price is $32.18 per share (the Fair Market Value of
a share of Common Stock on the date of grant) payable in full at the time of
exercise, either in the form of cash, check, Common Stock held for six months
(unless otherwise permitted by the Compensation Committee) or through a
broker-assisted exercise, as described in the Plan. Under the terms of the Plan,
your Option becomes exercisable beginning on May 9, 2004 and expires on May 9,
2013 unless it terminates earlier under the circumstances described in Sections
6.5 and 8.3 of the Plan. Appropriate adjustments will be made to the number and
class of shares of Common Stock subject to the Option and to the exercise price
in certain situations described in Section 7 of the Plan. When you wish to
exercise an Option, in whole or in part, please refer to the provisions of the
Plan dealing with the procedures for exercise.

         Upon exercise of your Option you will receive one preference share
purchase right for each share of Common Stock issued. These rights are described
in more detail in the Memorandum/Prospectus for the Plan.

         The Options granted hereby are non-qualified stock options and shall
not be treated as Incentive Stock Options under Section 422 of the Internal
Revenue Code of 1986, as amended.

         In the event any provision of this agreement conflicts with the
provisions of the Plan, the Plan shall control.

         Please indicate your acceptance of this Option and your agreement to
comply with the provisions of the Plan and Memorandum/Prospectus for the Plan by
signing and returning the enclosed copy of this agreement to the Company.

                                  Sincerely,

                                  CENTURYTEL, INC.



                               By:
                                  ------------------------------
                                  Glen F. Post, III
                                  President and Chief Executive Officer


ACCEPTED as of the date hereof.



                                  ------------------------------
                                  Optionee


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>10
<FILENAME>exhibit102f.txt
<DESCRIPTION>EXHIBIT 10.2(F)
<TEXT>
                                                                 Exhibit 10.2(f)
                                                                 CONFORMED COPY



                              AMENDED AND RESTATED
                                CENTURYTEL, INC.
                   2002 MANAGEMENT INCENTIVE COMPENSATION PLAN

         WHEREAS, the CenturyTel, Inc.2002 Management Incentive Compensation
Plan (the "Plan") was adopted by the Board of Directors of CenturyTel, Inc. (the
"Company") on February 26, 2002 and approved by the shareholders of the Company
on May 9, 2002, and Amendment No. 1 to the Plan was approved by the Board of
Directors of the Company on May 29, 2003; and

         WHEREAS, the Board of Directors now wishes to amend Section 9.1 of the
Plan to provide that no Incentives may be granted under the Plan later than May
9, 2012, which is ten years after the Plan was approved by the Company's
stockholders.

         NOW THEREFORE, Section 9.1 of the Plan is hereby amended to read as
provided herein and the Plan is hereby restated in its entirety reflecting such
amendment to read as follows:

         1.   Purpose. The purpose of the 2002 Management Incentive
Compensation Plan (this "Plan") of CenturyTel, Inc. ("CenturyTel") is to
increase shareholder value and to advance the interests of CenturyTel and its
subsidiaries (collectively, the "Company") by furnishing a variety of equity
incentives (the "Incentives") designed to attract, retain and motivate officers,
key employees, consultants and advisors and to strengthen the mutuality of
interests between such persons and CenturyTel's shareholders. Incentives may
consist of options to purchase shares of CenturyTel's common stock, $1.00 par
value per share (the "Common Stock"), shares of restricted stock or other
stock-based awards the value of which is based upon the value of the Common
Stock, all on terms determined under this Plan. As used in this Plan, the term
"subsidiary" means any corporation, limited liability company or other entity of
which CenturyTel owns (directly or indirectly) within the meaning of Section
425(f) of the Internal Revenue Code of 1986, as amended (the "Code"), 50% or
more of the total combined voting power of all classes of stock, membership
interests or other equity interests issued thereby.

         2.    Administration.

               2.1  Composition. This Plan shall be administered by the
         compensation committee of the Board of Directors of CenturyTel, or by
         a subcommittee of the compensation committee. The committee or
         subcommittee that administers this Plan shall hereinafter be referred
         to as the "Committee." The Committee shall consist of not fewer than
         two members of the Board of Directors, each of whom shall (a) qualify
         as a "non-employee director" under Rule 16b-3 under the Securities
         Exchange Act of 1934 (the "1934 Act"), or any successor rule, and
         (b) qualify as an "outside director" under Section 162(m) of the Code
         and the regulations thereunder (collectively, "Section 162(m)").

               2.2  Authority. The Committee shall have authority to award
         Incentives under this Plan, to interpret this Plan, to establish any
         rules or regulations relating to this Plan that it determines to be
         appropriate, to enter into agreements with or provide notices to
         participants as to the terms of the Incentives (the "Incentive
         Agreements") and to make any other determination that it believes
         necessary or advisable for the proper administration of this Plan.
         Its decisions concerning matters relating to this Plan shall be final,
         conclusive and binding on the Company and participants. The Committee
         may delegate its authority hereunder to the extent provided in Section
         3 hereof. The Committee shall not have authority to award Incentives
         under this Plan to directors in their capacities as such.

         3.    Eligible Participants. Key employees and officers of the Company
(including officers who also serve as directors of the Company) and consultants
and advisors to the Company shall become eligible to receive Incentives under
this Plan when designated by the Committee. Employees may be designated
individually or by groups or categories, as the Committee deems appropriate.
With respect to participants not subject to Section 16 of the 1934 Act or
Section 162(m), the Committee may delegate to appropriate personnel of the
Company its authority to designate participants, to determine the size, type and
terms of the Incentives to be received by those participants and to determine
any performance objectives for those participants; provided; however that the
exercise price of any stock options granted pursuant to such delegation of
authority shall be, unless otherwise determined by the Committee, equal to the
Fair Market Value of a share of Common Stock on the later of the date of grant
or the date the participant's employment with the Company commences. Any such
delegation by the Committee shall not include the authority to change or modify
in any way the terms of a previously granted Incentive or to take any other
action authorized herein to be taken by the Committee and not specifically
permitted to be delegated in this Section 3.

         4.    Shares Subject to this Plan. The shares of Common Stock with
respect to which Incentives may be granted under this Plan shall be subject to
the following:

               4.1  Type of Common Stock. The shares of Common Stock with
         respect to which Incentives may be granted under this Plan may be
         currently authorized but unissued shares or shares currently held or
         subsequently acquired by the Company as treasury shares, including
         shares purchased in the open market or in private transactions.

               4.2  Maximum Number of Shares. Subject to the other provisions
         of this Section 4, the maximum number of shares of Common Stock that
         may be delivered to participants and their beneficiaries under this
         Plan shall be 4,500,000 shares of Common Stock.

               4.3  Share Counting. To the extent any shares of Common Stock
         covered by an Incentive are not delivered to a participant or
         beneficiary because the Incentive is forfeited or canceled, or the
         shares of Common Stock are not delivered because the Incentive is paid
         or settled in cash or used to satisfy the applicable tax withholding
         obligation, such shares shall not be deemed to have been delivered for
         purposes of determining the maximum number of shares of Common Stock
         available for delivery under this Plan. In the event that shares of
         Common Stock are issued as Incentives and thereafter are forfeited or
         reacquired by the Company pursuant to rights reserved upon issuance
         thereof, such forfeited and reacquired Shares may again be issued
         under this Plan. If the exercise price of any stock option granted
         under this Plan or the applicable withholding taxes are satisfied by
         tendering shares of Common Stock to the Company (by either actual
         delivery or by attestation), only the number of shares of Common Stock
         issued net of the shares of Common Stock tendered shall be deemed
         delivered for purposes of determining the maximum number of shares of
         Common Stock available for delivery under this Plan.

               4.4  Limitations on Number of Shares. Subject to Section  4.5,
         the following additional limitations are imposed under this Plan:

                    (a)   The maximum number of shares of Common Stock that may
               be issued upon exercise of stock options intended to qualify as
               incentive stock options under Section 422 of the Code shall be
               4,500,000 shares. Notwithstanding any other provision herein to
               the contrary, (i) all shares issuable under incentive stock
               options shall be counted against this limit and (ii) shares that
               are issued and are later forfeited, cancelled or reacquired by
               the Company, shares withheld to satisfy withholding tax
               obligations and shares delivered in payment of the Incentive
               price or applicable withholding taxes shall have no effect on
               this limitation.

                    (b)   The maximum number of shares of Common Stock that
               may be covered by Incentives granted under this Plan to any one
               individual during any one calendar-year period shall be 600,000.

                    (c)   The maximum number of shares of Common Stock that may
               be issued as restricted stock or Other Stock-Based Awards (as
               defined below) shall be 500,000 shares.

                    (d)   If, after shares have been earned under an Incentive,
               the delivery is deferred, any additional shares attributable to
               dividends paid during the deferral period shall be disregarded
               for purposes of the limitations of this Section 4.

               4.5  Adjustment. In the event of any recapitalization,
               reclassification, stock dividend, stock split, combination of
               shares or other change in the Common Stock, all limitations on
               numbers of shares of Common Stock provided in this Section 4 and
               the number of shares of Common Stock subject to outstanding
               Incentives shall be equitably adjusted in proportion to the
               change in outstanding shares of Common Stock. In addition, in the
               event of any such change in the Common Stock, the Committee shall
               make any other adjustment that it determines to be equitable,
               including without limitation adjustments to the exercise price of
               any option and any per share performance objectives of any
               Incentive in order to provide participants with the same relative
               rights before and after such adjustment.

         5.    Stock Options. The Committee may grant incentive stock options
(as such term is defined in Section 422 of the Code) or non-qualified stock
options. Any option that is designated as a non-qualified stock option shall not
be treated as an incentive stock option. Each stock option granted by the
Committee under this Plan shall be subject to the following terms and
conditions:

               5.1  Price. The exercise price per share shall be determined by
         the Committee, subject to adjustment under Section 4.5; provided that
         in no event shall the exercise price be less than the Fair Market
         Value (as defined below) of a share of Common Stock on the date of
         grant, except in the case of a stock option granted in assumption of
         or in substitution for an outstanding award of a company acquired by
         the Company or with which the Company combines.

               5.2  Number. The number of shares of Common Stock subject to the
         option shall be determined by the Committee, subject to the limitations
         and adjustments provided in Section 4 hereof.

               5.3  Duration and Time for Exercise. Subject to earlier
         termination as provided in Section 9.4 and 9.13, the term of each
         stock option shall be determined by the Committee, but may not exceed
         ten years. Each stock option shall become exercisable at such time or
         times during its term as shall be determined by the Committee. The
         Committee may accelerate the exercisability of any stock option at any
         time.

               5.4  Repurchase. Upon approval of the Committee, the Company may
         repurchase all or a portion of a previously granted stock option from
         a participant by mutual agreement before such option has been
         exercised by payment to the participant of cash or Common Stock or a
         combination thereof with a value equal to the amount per share by
         which: (a) the Fair Market Value of the Common Stock subject to the
         option on the business day immediately preceding the date of purchase
         exceeds (b) the exercise price.

               5.5  Manner of Exercise. A stock option may be exercised, in
         whole or in part, by giving written notice to the Company, specifying
         the number of shares of Common Stock to be purchased. The exercise
         notice shall be accompanied by tender of the full purchase price for
         such shares, which may be paid or satisfied by (a) cash; (b) check;
         (c) delivery of shares of Common Stock, which shares shall be valued
         for this purpose at the Fair Market Value on the business day
         immediately preceding the date such option is exercised and, unless
         otherwise determined by the Committee, shall have been held by the
         optionee for at least six months; (d) delivery of irrevocable written
         instructions to a broker approved by the Company (with a copy to the
         Company) to immediately sell a portion of the shares issuable under
         the option and to deliver promptly to the Company the amount of sale
         proceeds (or loan proceeds if the broker lends funds to the
         participant for delivery to the Company) to pay the exercise price; or
         (e) in such other manner as may be authorized from time to time by the
         Committee, provided that all such payments shall be made or
         denominated in United States dollars. In the case of delivery of an
         uncertified check, no shares shall be issued until the check has been
         paid in full. Prior to the issuance of shares of Common Stock upon the
         exercise of a stock option, a participant shall have no rights as a
         shareholder.

               5.6  Repricing. Except for adjustments pursuant to Section 4.5
         or actions permitted to be taken by the Committee under Section
         9.13(c) in the event of a Change of Control, unless approved by the
         shareholders of the Company, (a) the exercise price for any
         outstanding option granted under this Plan may not be decreased after
         the date of grant and (b) an outstanding option that has been granted
         under this Plan may not, as of any date that such option has a per
         share exercise price that is less than the then current Fair Market
         Value of a share of Common Stock, be surrendered to the Company as
         consideration for the grant of a new option with a lower exercise
         price, shares of restricted stock, an Other Stock-Based Award (as
         defined in Section 7.1), a cash payment or Common Stock.

               5.7  Incentive Stock Options.  Notwithstanding anything in this
         Plan to the contrary, the following additional provisions shall apply
         to the grant of stock options that are intended to qualify as
         incentive stock options.

                    (a)   Any incentive stock option authorized under this
               Plan shall contain such other provisions as the Committee shall
               deem advisable, but shall in all events be consistent with and
               contain or be deemed to contain all provisions required in order
               to qualify the options as incentive stock options;

                    (b)   All incentive stock options must be granted within
               ten years from the date on which this Plan was adopted by the
               Board of Directors;

                    (c)   No incentive stock option shall be granted to any
               participant who, at the time such option is granted, would own
               (within the meaning of Section 422 of the Code) stock possessing
               more than 10% of the total combined voting power of all classes
               of stock of the employer corporation or of its parent or
               subsidiary corporation; and

                    (d)   The aggregate Fair Market Value (determined with
               respect to each incentive stock option as of the time such
               incentive stock option is granted) of the Common Stock with
               respect to which incentive stock options are exercisable for the
               first time by a participant during any calendar year (under this
               Plan or any other plan of the Company) shall not exceed $100,000.
               To the extent that such limitation is exceeded, such options
               shall not be treated, for federal income tax purposes, as
               incentive stock options.

               5.8  Equity Maintenance. If a participant exercises an option
         during the term of his employment with the Company, and pays the
         exercise price (or any portion thereof) through the surrender of shares
         of outstanding Common Stock owned by the participant, the Committee
         may, in its discretion, grant to such participant an additional option
         to purchase the number of shares of Common Stock equal to the shares
         of Common Stock so surrendered by such participant. Any such
         additional options granted by the Committee shall be exercisable at
         the Fair Market Value of the Common Stock determined as of the
         business day immediately preceding the respective dates such
         additional options may be granted. The grant of such additional
         options under this Section 5.8 shall be made upon such other terms and
         conditions as the Committee may from time to time determine.

         6.    Restricted Stock.

               6.1  Grant of Restricted Stock. An award of restricted stock may
         be subject to the attainment of specified performance goals or
         targets, restrictions on transfer, forfeitability provisions and such
         other terms and conditions as the Committee may determine, subject to
         the provisions of this Plan. To the extent restricted stock is
         intended to qualify as performance based compensation under Section
         162(m), it must be granted subject to the attainment of performance
         goals as described in Section 8 and meet the additional requirements
         by imposed by Section 162(m).

               6.2  Restricted Period. At the time an award of restricted stock
         is made, the Committee shall establish a period of time during which
         the transfer of the shares of restricted stock shall be restricted
         (the "Restricted Period"). Each award of restricted stock may have a
         different Restricted Period. A Restricted Period of at least three
         years is required, except that if vesting of the shares is subject to
         the attainment of specified performance goals, the Restricted Period
         may be one year or more. Incremental periodic vesting of portions of
         the award during the Restricted Period is permitted. Unless otherwise
         provided in the Incentive Agreement, the Committee may in its
         discretion declare the Restricted Period terminated upon a
         participant's death, disability, retirement or other termination by
         the Company and permit the sale or transfer of the restricted stock.
         The expiration of the Restricted Period shall also occur as provided
         under Section 9.13 upon a Change of Control of the Company.

               6.3  Escrow. The participant receiving restricted stock shall
         enter into an Incentive Agreement with the Company setting forth the
         conditions of the grant. Certificates representing shares of
         restricted stock shall be registered in the name of the participant
         and deposited with the Company, together with a stock power endorsed
         in blank by the participant. Each such certificate shall bear a legend
         in substantially the following form:

               The transferability of this certificate and the shares of
               Common Stock represented by it is subject to the terms and
               conditions (including conditions of forfeiture) contained in
               the CenturyTel, Inc. 2002 Management Incentive Compensation
               Plan (the "Plan") and an agreement entered into between the
               registered owner and CenturyTel, Inc. thereunder. Copies of
               this Plan and the agreement are on file and available for
               inspection at the principal office of the Company.

               6.4  Dividends on Restricted Stock. Any and all cash and stock
         dividends paid with respect to the shares of restricted stock shall be
         subject to any restrictions on transfer, forfeitability provisions or
         reinvestment requirements as the Committee may, in its discretion,
         prescribe in the Incentive Agreement.

               6.5  Forfeiture. In the event of the forfeiture of any shares of
         restricted stock under the terms provided in the Incentive Agreement
         (including any additional shares of restricted stock that may result
         from the reinvestment of cash and stock dividends, if so provided in
         the Incentive Agreement), such forfeited shares shall be surrendered
         and the certificates cancelled. The participants shall have the same
         rights and privileges, and be subject to the same forfeiture
         provisions, with respect to any additional shares received pursuant to
         Section 4.5 due to a recapitalization, stock split or other change in
         capitalization.

               6.6  Expiration of Restricted Period. Upon the expiration or
         termination of the Restricted Period and the satisfaction of any other
         conditions prescribed by the Committee or at such earlier time as
         provided for in Section 6.2 and in the Incentive Agreement or an
         amendment thereto, the restrictions applicable to the restricted stock
         shall lapse and a stock certificate for the number of shares of
         restricted stock with respect to which the restrictions have lapsed
         shall be delivered, free of all such restrictions and legends other
         than those required by law, to the participant or the participant's
         estate, as the case may be.

               6.7  Rights as a Shareholder. Subject to the restrictions
         imposed under the terms and conditions of this Plan and subject to any
         other restrictions that may be imposed in the Incentive Agreement,
         each participant receiving restricted stock shall have all the rights
         of a shareholder with respect to shares of Common Stock during any
         period in which such shares are subject to forfeiture and restrictions
         on transfer, including without limitation, the right to vote such
         shares.

         7.    Other Stock-Based Awards.

               7.1  Grant of Other Stock-Based Awards. Subject to the
         limitations described in Section 7.2 hereof, the Committee may grant
         to eligible participants "Other Stock-Based Awards," which shall
         consist of awards, other than options or restricted stock provided for
         in Sections 5 and 6, the value of which is based in whole or in part
         on the value of shares of Common Stock. Other Stock-Based Awards may
         be awards of shares of Common Stock or may be denominated or payable
         in, valued in whole or in part by reference to, or otherwise based on
         or related to, shares of, or appreciation in the value of, Common
         Stock (including, without limitation, securities convertible or
         exchangeable into or exercisable for shares of Common Stock), as
         deemed by the Committee consistent with the purposes of this Plan. The
         Committee shall determine the terms and conditions of any Other
         Stock-Based Award (including which rights of a shareholder, if any,
         the recipient shall have with respect to Common Stock associated with
         any such award) and may provide that such award is payable in whole or
         in part in cash. An Other Stock-Based Award may be subject to the
         attainment of such specified performance goals or targets as the
         Committee may determine, subject to the provisions of this Plan. To
         the extent that an Other Stock-Based Award is intended to qualify as
         "performance-based compensation" under Section 162(m), it must be
         granted subject to the attainment of performance goals as described in
         Section 8 and meet the additional requirements imposed by Section
         162(m).

               7.2  Limitations. Other Stock-Based Awards granted under this
         Section 7 shall be subject to a vesting period of at least three
         years, except that if vesting of the award is subject to the
         attainment of specified performance goals, a minimum vesting period of
         one year is allowed. Incremental periodic vesting of portions of the
         award over the required vesting period is permitted. Notwithstanding
         the minimum vesting periods described in this Section 7.2, the
         Committee may make special grants of Other Stock-Based Awards with
         respect to an aggregate of no more than 225,000 shares of Common
         Stock, as adjusted under Section 4.5, which special awards shall not
         be subject to any minimum vesting requirements.

         8.    Section 162(m) Awards. To the extent that shares of restricted
stock or Other Stock-Based Awards granted under the Plan are intended to qualify
as "performance-based compensation" under Section 162(m), the vesting, grant or
payment of such awards shall be conditioned on the achievement of one or more
performance goals and must satisfy the other requirements of Section 162(m). The
performance goals pursuant to which such awards shall vest, be granted or be
paid out shall be any or a combination of the following performance measures
applied to the Company, a subsidiary or a division: earnings per share, return
on assets, an economic value added measure, stockholder return, earnings, return
on equity, return on investment, cash provided by operating activities, increase
in cash flow, increase in revenues or operating revenues, or customer growth.
The performance goals may be subject to such adjustments as are specified in
advance by the Committee. For any performance period, the performance objectives
may be measured on an absolute basis or relative to a group of peer companies
selected by the Committee, relative to internal goals or relative to levels
attained in prior years.

         9.    General.

               9.1  Duration. Subject to Section 9.10, no Incentives may be
         granted under the Plan later than May 9, 2012, which is ten years
         after the Plan was approved by the Company's shareholders; provided,
         however, that Incentives granted prior to such date shall remain in
         effect until all such Incentives granted under this Plan have either
         been satisfied by the issuance of shares of Common Stock or the
         payment of cash or been terminated under the terms of this Plan or the
         applicable Incentive Agreement and all restrictions imposed on shares
         of Common Stock in connection with their issuance under this Plan have
         lapsed.

               9.2  Transferability of Incentives. No Incentive granted
         hereunder may be transferred, pledged, assigned or otherwise
         encumbered by the holder thereof except:


                    (a)   by will;

                    (b)   by the laws of descent and distribution; or

                    (c)   pursuant to a domestic relations order, as
               defined in the Code; or

                    (d)   in the case of stock options only, if permitted
               by the Committee and so provided in the Incentive Agreement or
               an amendment thereto, (i) to Immediate Family Members (as
               defined below), (ii) to a partnership in which the participant
               and/or Immediate Family Members, or entities in which the
               participant and/or Immediate Family Members are the sole
               owners, members or beneficiaries, as appropriate, are the sole
               partners, (iii) to a limited liability company in which the
               participant and/or Immediate Family Members, or entities in
               which the participant and/or Immediate Family Members are the
               sole owners, members or beneficiaries, as appropriate, are the
               sole members, (iv) to a trust for the sole benefit of the
               participant and/or Immediate Family Members, or (v) to
               non-Immediate Family Members following the death of the Plan
               participant to whom the stock option was granted. "Immediate
               Family Members" means the spouse and natural or adopted
               children or grandchildren of the participant and their
               respective spouses. To the extent that an incentive stock
               option is permitted to be transferred during the lifetime of
               the participant, it shall be treated thereafter as a
               non-qualified stock option.

               Any attempted assignment, transfer, pledge, hypothecation or
         other disposition of an Incentive, or levy of attachment or similar
         process upon the Incentive not specifically permitted herein, shall be
         null and void and without effect.

               9.3  Dividend Equivalents. In the sole and complete discretion
         of the Committee, an Incentive may provide the holder thereof with
         dividends or dividend equivalents, payable in cash, shares, other
         securities or other property on a current or deferred basis.

               9.4  Effect of Termination of Employment or Death. In the event
         that a participant ceases to be an employee of the Company for any
         reason, including death, disability, early retirement or normal
         retirement, any Incentives may be exercised, shall vest or shall
         expire at such times as may be determined by the Committee and set
         forth in the Incentive Agreement.

               9.5  Additional Condition. Anything in this Plan to the contrary
         notwithstanding: (a) the Company may, if it shall determine it
         necessary or desirable for any reason, at the time of award of any
         Incentive or the issuance of any shares of Common Stock pursuant to any
         Incentive, require the recipient of the Incentive, as a condition to
         the receipt thereof or to the receipt of shares of Common Stock issued
         pursuant thereto, to deliver to the Company a written representation of
         present intention to acquire the Incentive or the shares of Common
         Stock issued pursuant thereto for his own account for investment and
         not for distribution; and (b) if at any time the Company further
         determines, in its sole discretion, that the listing, registration or
         qualification (or any updating of any such document) of any Incentive
         or the shares of Common Stock issuable pursuant thereto is necessary on
         any securities exchange or under any federal or state securities or
         blue sky law, or that the consent or approval of any governmental
         regulatory body is necessary or desirable as a condition of, or in
         connection with the award of any Incentive, the issuance of shares of
         Common Stock pursuant thereto, or the removal of any restrictions
         imposed on such shares, such Incentive shall not be awarded or such
         shares of Common Stock shall not be issued or such restrictions shall
         not be removed, as the case may be, in whole or in part, unless such
         listing, registration, qualification, consent or approval shall have
         been effected or obtained free of any conditions not acceptable to the
         Company.

               9.6  Incentive Agreements. An Incentive under this Plan shall be
         subject to such terms and conditions, not inconsistent with this Plan,
         as the Committee may, in its sole discretion, prescribe and set forth
         in the Incentive Agreement. Such terms and conditions may provide for
         the forfeiture of an Incentive or the gain associated with an
         Incentive under certain circumstances to be set forth in the Incentive
         Agreement, including if the participant competes with the Company or
         engages in other activities that are harmful to the Company. All terms
         and conditions of any Incentive shall be reflected in such form of
         Incentive Agreement as is determined by the Committee. A copy of such
         document shall be provided to the participant, and the Committee may,
         but need not, require that the participant duly execute and deliver to
         the Company a copy of such document as a condition precedent to the
         effectiveness of the grant of the Incentive. Such document is referred
         to in this Plan as an "Incentive Agreement" regardless of whether a
         participant's signature is required.

               9.7  Withholding.

                    (a)   The Company shall have the right to withhold from any
               payments or stock issuances under this Plan, or to collect as a
               condition of payment, any taxes required by law to be withheld.

                    (b)   Any  participant may, but is not required to, satisfy
               his or her withholding tax obligation in whole or in part by
               electing (the "Election") to deliver currently owned shares of
               Common Stock or to have the Company withhold from the shares the
               participant otherwise would receive shares of Common Stock having
               a value equal to the minimum amount required to be withheld. The
               value of the shares to be delivered or withheld shall be based on
               the Fair Market Value of the Common Stock on the date that the
               amount of tax to be withheld shall be determined (the "Tax
               Date"). Each Election must be made prior to the Tax Date. The
               Committee may disapprove of any Election, may suspend or
               terminate the right to make Elections, or may provide with
               respect to any Incentive that the right to make Elections shall
               not apply to such Incentive.

               9.8  No Continued Employment. No participant under this Plan
         shall have any right, because of his or her participation, to continue
         in the employ of the Company for any period of time or to any right to
         continue his or her present or any other rate of compensation.

               9.9  Deferral Permitted. Payment of cash or distribution of any
         shares of Common Stock to which a participant is entitled under any
         Incentive shall be made as provided in the Incentive Agreement.
         Payment may be deferred at the option of the participant if provided
         in the Incentive Agreement.

               9.10 Amendment or Discontinuance of this Plan. The Board may
         amend or discontinue this Plan at any time; provided, however, that no
         such amendment may:

                    (a)  without the approval of the shareholders, (i) increase,
               subject to adjustments permitted herein, the maximum number of
               shares of Common Stock that may be issued through this Plan,
               (ii) materially increase the benefits accruing to participants
               under this Plan, (iii) materially expand the classes of
               persons eligible to participate in this Plan, or (iv) amend
               Section 5.6 to permit repricing of options, or

                    (b)   materially impair, without the consent of the
               recipient, an Incentive previously granted, except that the
               Company retains all rights under Section 9.13 hereof.

               9.11 Definition of Fair Market Value. Whenever the "Fair Market
         Value" of Common Stock or some other specified security must be
         determined for purposes of this Plan, it shall be determined as
         follows: (i) if the Common Stock or other security is listed on an
         established stock exchange or any automated quotation system that
         provides sale quotations, the closing sale price for a share thereof
         on such exchange or quotation system on the applicable date and if
         shares are not traded on such day, on the next preceding trading date,
         (ii) if the Common Stock or other security is not listed on any
         exchange or quotation system, but bid and asked prices are quoted and
         published, the mean between the quoted bid and asked prices on the
         applicable date and if bid and asked prices are not available on such
         day, on the next preceding day on which such prices were available;
         and (iii) if the Common Stock or other security is not regularly
         quoted, the fair market value of a share thereof on the applicable
         date as established by the Committee in good faith.

               9.12 Loans. In order to assist a participant in acquiring shares
         of Common Stock pursuant to an Incentive granted under this Plan, the
         Committee may authorize, at either the time of the grant of the
         Incentive, at the time of the acquisition of Common Stock pursuant to
         the Incentive, or at the time of the lapse of restrictions on shares
         of restricted stock granted under this Plan, the extension of a loan
         to the participant by the Company. The terms of any loans, including
         the interest rate, collateral and terms of repayment, will be subject
         to the discretion of the Committee. The maximum credit available
         hereunder shall be equal to the aggregate purchase price of the shares
         of Common Stock to be acquired pursuant to the Incentive plus the
         maximum tax liability that may be incurred in connection with the
         Incentive.

               9.13 Change of Control

                    (a)   A Change of Control shall mean:

                          (i)    the acquisition by any person of beneficial
                    ownership of 30% or more of the outstanding shares of the
                    Common Stock or 30% or more of the combined voting power of
                    CenturyTel's then outstanding securities entitled to vote
                    generally in the election of directors; provided, however,
                    that for purposes of this subsection (i), the following
                    acquisitions shall not constitute a Change of Control:

                                 (A)   any acquisition (other than a Business
                          Combination (as defined below) which constitutes a
                          Change of Control under Section 9.13(a)(iii) hereof)
                          of Common Stock directly from the Company,

                                 (B)   any acquisition of Common Stock by the
                          Company,

                                 (C)   any acquisition of Common Stock by any
                          employee benefit plan (or related trust) sponsored
                          or maintained by the Company or any corporation
                          controlled by the Company, or

                                 (D)   any acquisition of Common Stock by any
                          corporation pursuant to a Business Combination that
                          does not constitute a Change of Control under
                          Section 9.13(a)(iii) hereof; or

                          (ii)   individuals who, as of January 1, 2002,
                    constituted the Board of Directors of CenturyTel (the
                    "Incumbent Board") cease for any reason to constitute at
                    least a majority of the Board of Directors; provided,
                    however, that any individual becoming a director subsequent
                    to such date whose election, or nomination for election by
                    CenturyTel's shareholders, was approved by a vote of at
                    least two-thirds of the directors then comprising the
                    Incumbent Board shall be considered a member of the
                    Incumbent Board, unless such individual's initial assumption
                    of office occurs as a result of an actual or threatened
                    election contest with respect to the election or removal of
                    directors or other actual or threatened solicitation of
                    proxies or consents by or on behalf of a person other than
                    the Incumbent Board; or

                          (iii)  consummation of a reorganization, share
                    exchange, merger or consolidation (including any such
                    transaction involving any direct or indirect subsidiary of
                    CenturyTel) or sale or other disposition of all or
                    substantially all of the assets of the Company (a "Business
                    Combination"); provided, however, that in no such case shall
                    any such transaction constitute a Change of Control if
                    immediately following such Business Combination:

                                 (A)   the individuals and entities who were
                          the beneficial owners of CenturyTel's
                          outstanding Common Stock and CenturyTel's
                          voting securities entitled to vote generally
                          in the election of directors immediately prior
                          to such Business Combination have direct or
                          indirect beneficial ownership, respectively,
                          of more than 50% of the then outstanding
                          shares of common stock, and more than 50% of
                          the combined voting power of the then
                          outstanding voting securities entitled to vote
                          generally in the election of directors of the
                          surviving or successor corporation, or, if
                          applicable, the ultimate parent company thereof
                          (the "Post-Transaction Corporation"), and

                                 (B)   except to the extent that such ownership
                          existed prior to the Business Combination, no person
                          (excluding the Post-Transaction Corporation and any
                          employee benefit plan or related trust of either
                          CenturyTel, the Post-Transaction Corporation or any
                          subsidiary of either corporation) beneficially owns,
                          directly or indirectly, 20% or more of the then
                          outstanding shares of common stock of the corporation
                          resulting from such Business Combination or 20% or
                          more of the combined  voting power of the then
                          outstanding voting securities of such corporation, and

                                 (C)   at least a majority of the members of the
                          board of directors of the Post-Transaction Corporation
                          were members of the Incumbent Board at the time of
                          the execution of the initial agreement, or of the
                          action of the Board of Directors, providing for such
                          Business Combination; or

                          (iv)   approval by the shareholders of CenturyTel
                    of a complete liquidation or dissolution of CenturyTel.

               For purposes of this Section 9.13, the term "person" shall
               mean a natural person or entity, and shall also mean the group
               or syndicate created when two or more persons act as a
               syndicate or other group (including, without limitation, a
               partnership or limited partnership) for the purpose of
               acquiring, holding, or disposing of a security, except that
               "person" shall not include an underwriter temporarily holding
               a security pursuant to an offering of the security.

                    (b)   Upon a Change of Control of the type described in
               clause (a)(i) or (a)(ii) of this Section 9.13 or upon the
               approval by the Board of Directors of CenturyTel of any Change of
               Control of the type described in clause (a)(iii) or (a)(iv) of
               this Section 9.13, all outstanding Incentives granted pursuant to
               this Plan shall automatically become fully vested and
               exercisable, all restrictions or limitations on any Incentives
               shall automatically lapse and, unless otherwise provided in the
               applicable Incentive Agreement, all performance criteria and
               other conditions relating to the payment of Incentives shall be
               deemed to be achieved or waived by CenturyTel without the
               necessity of action by any person.

                    (c)   No later than 30 days after a Change of Control of
               the type described in subsections (a)(i) or (a)(ii) of this
               Section 9.13 and no later than 30 days after the approval by the
               Board of a Change of Control of the type described in subsections
               (a)(iii) or (a)(iv) of this Section 9.13, the Committee, acting
               in its sole discretion without the consent or approval of any
               participant (and notwithstanding any removal or attempted removal
               of some or all of the members thereof as directors or Committee
               members), may act to effect one or more of the alternatives
               listed below, which may vary among individual participants and
               which may vary among Incentives held by any individual
               participant:

                          (i)    require that all outstanding options or Other
                    Stock-Based Awards be exercised on or before a specified
                    date (before or after such Change of Control) fixed by the
                    Committee, after which specified date all unexercised
                    options and Other Stock-Based Awards and all rights of
                    participants thereunder shall terminate,

                          (ii)   make such equitable adjustments to Incentives
                    then outstanding as the Committee deems appropriate to
                    reflect such Change of Control (provided, however, that the
                    Committee may determine in its sole discretion that no
                    adjustment is necessary),

                          (iii)  provide for mandatory conversion or exchange
                    of some or all of the outstanding options or Other
                    Stock-Based Awards held by some or all participants as of a
                    date, before or after such Change of Control, specified by
                    the Committee, in which event such options and Other
                    Stock-Based Awards shall be deemed automatically cancelled
                    and the Company shall pay, or cause to be paid, to each such
                    participant an amount of cash per share equal to the excess,
                    if any, of the Change of Control Value of the shares subject
                    to such option or Other Stock-Based Award, as defined and
                    calculated below, over the per share exercise price of such
                    options or the per share exercise or base price of such
                    Other Stock-Based Awards or, in lieu of such cash payment,
                    the issuance of Common Stock or securities of an acquiring
                    entity having a Fair Market Value equal to such excess, or

                          (iv)   provide that thereafter, upon any exercise of
                    an option or Other Stock-Based Award that entitles the
                    holder to receive Common Stock, the holder shall be entitled
                    to purchase or receive under such option or Other
                    Stock-Based Award, in lieu of the number of shares of Common
                    Stock then covered by such option or Other Stock-Based
                    Award, the number and class of shares of stock or other
                    securities or property (including, without limitation, cash)
                    to which the holder would have been entitled pursuant to the
                    terms of the agreement providing for the reorganization,
                    share exchange, merger, consolidation or asset sale, if,
                    immediately prior to such Change of Control, the holder had
                    been the record owner of the number of shares of Common
                    Stock then covered by such option or Other Stock-Based
                    Award.

                    (d)   For the purposes of conversions or exchanges under
               paragraph (iii) of Section 9.13(c), the "Change of Control Value"
               shall equal the amount determined by whichever of the following
               items is applicable:

                          (i)    the per share price to be paid to holders of
                    Common Stock in any such merger, consolidation or other
                    reorganization,

                          (ii)   the price per share offered to holders of
                    Common Stock in any tender offer or exchange offer whereby
                    a Change of Control takes place, or

                          (iii)  in all other events, the fair market value of
                    a share of Common Stock, as determined by the Committee as
                    of the date determined by the Committee to be the date of
                    conversion or exchange.

                    (e)   In the event that the consideration offered to
               shareholders of CenturyTel in any transaction described in this
               Section 9.13 consists of anything other than cash, the Committee
               shall determine the fair cash equivalent of the portion of the
               consideration offered that is other than cash.

                               * * * * * * * * * *

<PAGE>

         IN WITNESS WHEREOF, the undersigned Secretary of CenturyTel, Inc.
hereby certifies that the foregoing CenturyTel 2002 Management Incentive
Compensation Plan was (i) recommended to the Board of Directors of CenturyTel,
Inc. (the "Board") by its Compensation Committee at a meeting of the
Compensation Committee duly held on February 25, 2002, (ii) approved by the
Board at a meeting duly held on February 26, 2002, (iii) approved by the
affirmative vote of the holders of a majority of the voting power present at the
2002 Annual Meeting of Shareholders of the Company held on May 9, 2002, (iv)
amended by the Board on May 29, 2003, and (v) amended and restated by the Board
at a meeting duly held on February 25, 2004.





Dated February 25, 2004                  /s/ Stacey W. Goff
                                         -------------------
                                         Stacey W. Goff
                                         Secretary



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>11
<FILENAME>exhibit102fiv.txt
<DESCRIPTION>EXHIBIT 10.2(F)(III)
<TEXT>
                                                            Exhibit 10.2(f)(iii)


                  FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT
                 UNDER THE AMENDED AND RESTATED CENTURYTEL, INC.
                   2002 MANAGEMENT INCENTIVE COMPENSATION PLAN
                           (February 25, 2004 Grants)


         THIS AGREEMENT is entered into as of February 25, 2004 by and between
CenturyTel, Inc., a Louisiana corporation ("CenturyTel"), and _________________
("Optionee").

         WHEREAS, Optionee is a key employee of CenturyTel or one of its
subsidiaries (collectively, the "Company") and CenturyTel considers it desirable
and in its best interest that Optionee be given an incentive to advance the
interests of CenturyTel by possessing an option to purchase shares of the common
stock, $1.00 par value per share, of CenturyTel (the "Common Stock") under the
Amended and Restated CenturyTel, Inc. 2002 Management Incentive Compensation
Plan (the "Plan"), which was approved by the Board of Directors of CenturyTel on
February 26, 2002, approved by the shareholders at CenturyTel's 2002 Annual
Meeting of Shareholders on May 9, 2002 and most recently amended and restated by
the Board of Directors of CenturyTel on February 25, 2004;

         NOW, THEREFORE, in consideration of the premises, it is agreed
as follows:

                                       1.
                                 Grant of Option

         1.01   In consideration of future services, CenturyTel hereby grants
to Optionee, effective February 25, 2004 (the "Date of Grant"), the right,
privilege and option to purchase _______ shares of Common Stock (the "Option")
at an exercise price of $28.34 per share.

         1.02   The Option is a non-qualified stock option and shall not be
treated as an incentive stock option under Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code").

                                       2.
                                Time of Exercise

         2.01   Subject to the provisions of the Plan and the other provisions
of this Agreement, the Optionee shall be entitled to exercise the Option as
follows:

                With respect to 1/3 of
                the shares covered by
                the Option.................... beginning on the Date of Grant

                With respect to 2/3 of
                the shares covered by
                the Option, less any
                shares previously issued ..... beginning February 25, 2005

                With respect to all of
                the shares covered by
                the Option, less any
                shares previously issued...... beginning February 25, 2006.

The Option shall expire and may not be exercised later than ten years after the
Date of Grant.

         2.02   Notwithstanding the foregoing, the Option shall become
accelerated and immediately exercisable in full (a) if Optionee dies while he is
employed by the Company, (b) if Optionee becomes disabled within the meaning of
Section 22(e)(3) of the Code ("Disability") while he is employed by the Company,
(c) if Optionee retires from employment with the Company on or after attaining
the age of 55 ("Retirement") or (d) pursuant to the provisions of the Plan.

                                       3.
                        Conditions for Exercise of Option

         During Optionee's lifetime, the Option may be exercised only by him or
by his legal representative. The Option must be exercised while Optionee is
employed by the Company, or, to the extent exercisable at the time of
termination of employment, within 190 days of the date on which he ceases to be
an employee, except that (a) if he ceases to be an employee because of
Retirement, the Option may be exercised within three years from the date on
which he ceases to be an employee, (b) if an Optionee's employment is terminated
for cause, the unexercised portion of the Option is immediately terminated, and
(c) in the event of Optionee's Disability or death, the Option may be exercised
by the Optionee or, in the case of death, by his estate or by the person to whom
such right devolves from him by reason of his death within two years after the
date of his Disability or death; provided, however, that the Option and all
option gain, as defined in Section 4.01, shall at all times be subject to the
forfeiture provisions of Section 4 hereof; and provided further that no rights
to purchase Common Stock under this Option may be exercised later than ten years
after the Date of Grant.

                                       4.
                      Forfeiture of Option and Option Gain

         4.01   If, at any time during Optionee's employment by the Company or
within 18 months after termination of employment, Optionee engages in any
activity in competition with any activity of the Company, or inimical, contrary
or harmful to the interests of the Company, including but not limited to: (a)
conduct relating to Optionee's employment for which either criminal or civil
penalties against Optionee may be sought, (b) conduct or activity that results
in termination of Optionee's employment for cause, (c) violation of Company
policies, including, without limitation, the Company's insider trading policy
and corporate compliance program, (d) accepting employment with, acquiring a 5%
or more equity or participation interest in, serving as a consultant, advisor,
director or agent of, directly or indirectly soliciting or recruiting any
employee of the Company who was employed at any time during Optionee's tenure
with the Company, or otherwise assisting in any other capacity or manner any
company or enterprise that is directly or indirectly in competition with or
acting against the interests of the Company or any of its lines of business (a
"competitor"), except for (A) any isolated, sporadic accommodation or assistance
provided to a competitor, at its request, by Optionee during Optionee's tenure
with the Company, but only if provided in the good faith and reasonable belief
that such action would benefit the Company by promoting good business relations
with the competitor and would not harm the Company's interests in any
substantial manner or (B) any other service or assistance that is provided at
the request or with the written permission of the Company, (e) disclosing or
misusing any confidential information or material concerning the Company, (f)
engaging in, promoting, assisting or otherwise participating in a hostile
takeover attempt of the Company or any other transaction or proxy contest that
could reasonably be expected to result in a Change of Control (as defined in the
Plan) not approved by the Company's Board of Directors or (g) making any
statement or disclosing any information to any customers, suppliers, lessors,
lessees, licensors, licensees, regulators, employees or others with whom the
Company engages in business that is defamatory or derogatory with respect to the
business, operations, technology, management, or other employees of the Company,
or taking any other action that could reasonably be expected to injure the
Company in its business relationships with any of the foregoing parties or
result in any other detrimental effect on the Company, then (i) the Option shall
automatically terminate without any payment to Optionee effective the date on
which Optionee engages in such activity, unless terminated sooner by operation
of another term or condition of this Agreement or the Plan, and (ii) Optionee
shall pay in cash to the Company, without interest, any option gain realized by
Optionee from exercising all or a portion of the Option during the period
beginning one year prior to termination of employment (or one year prior to the
date Optionee first engages in such activity if no termination occurs) and
ending on the date on which the Option terminates. For purposes hereof, "option
gain" shall mean the difference between the closing market price of the Common
Stock on the date of exercise minus the exercise price, multiplied by the number
of shares purchased.

         4.02   If Optionee owes any amount to the Company under Section 4.01
above, Optionee acknowledges that the Company may deduct such amount from any
amounts the Company owes Optionee from time to time for any reason (including
without limitation amounts owed to Optionee as salary, wages or other
compensation, fringe benefits, or vacation pay). Whether or not the Company
elects to make any such set-off in whole or in part, if the Company does not
recover by means of set-off the full amount Optionee owes it, Optionee hereby
agrees to pay immediately the unpaid balance to the Company.

         4.03   Optionee may be released from Optionee's obligations under
Sections 4.01 and 4.02 above only if the Compensation Committee (the
"Committee") determines in its sole discretion that such action is in the best
interests of the Company.

                                       5.
                        Preference Share Purchase Rights

         Upon exercise of an Option at a time when preference share purchase
rights to purchase shares of Series BB Participating Cumulative Preference Stock
or other securities or property of the Company (the "Rights" and each a "Right")
remain outstanding pursuant to that certain Rights Agreement dated as of August
27, 1996 between CenturyTel and the Rights Agent named therein, as amended by
Amendment No. 1 to Rights Agreement dated May 25, 1999 and Amendment No. 2 to
Rights Agreement dated June 30, 2000, and as may be further amended (the "Rights
Agreement"), or any successor rights agreement, then Optionee shall receive
Rights in conjunction with Optionee's receipt of shares of Common Stock on the
terms and conditions of the Rights Agreement.

                                       6.
                              Additional Conditions

         Anything in this Agreement to the contrary notwithstanding, if at any
time CenturyTel further determines, in its sole discretion, that the listing,
registration or qualification (or any updating of any such document) of the
shares of Common Stock issuable pursuant to the exercise of an Option is
necessary on any securities exchange or under any federal or state securities or
blue sky law, or that the consent or approval of any governmental regulatory
body is necessary or desirable as a condition of, or in connection with the
issuance of shares of Common Stock pursuant thereto, or the removal of any
restrictions imposed on such shares, such shares of Common Stock shall not be
issued, in whole or in part, unless such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to CenturyTel. CenturyTel agrees to promptly take any and all
actions necessary or desirable in order that all shares of Common Stock issuable
hereunder shall be issued as provided herein.

                                       7.
                          Attorneys' Fees and Expenses

         Should any party hereto retain counsel for the purpose of enforcing,
or preventing the breach of, any provision hereof, including, but not limited
to, the institution of any action or proceeding in court to enforce any
provision hereof, to enjoin a breach of any provision of this Agreement, to
obtain specific performance of any provision of this Agreement, to obtain
monetary or liquidated damages for failure to perform any provision of this
Agreement, or for a declaration of such parties' rights or obligations
hereunder, or for any other judicial remedy, then the prevailing party shall be
entitled to be reimbursed by the losing party for all costs and expenses
incurred thereby, including, but not limited to, attorneys' fees (including
costs of appeal).

                                       8.
                       No Contract of Employment Intended

         Nothing in this Agreement shall confer upon Optionee any right to
continue in the employment of the Company or to interfere in any way with the
right of the Company to terminate Optionee's employment relationship with the
Company at any time.

                                       9.
                                     Taxes

         The Company may make such provisions as it may deem appropriate for
the withholding of any federal, state and local taxes that it determines are
required to be withheld on any exercise of the Option. In accordance with the
terms of the Plan, Optionee may satisfy the tax withholding obligation by
delivering currently owned shares of Common Stock or electing to have CenturyTel
withhold from the shares Optionee otherwise would receive shares of Common Stock
having a value equal to the minimum amount required to be withheld.

                                      10.
                                 Binding Effect

         This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, administrators, legal
representatives and successors. Without limiting the generality of the
foregoing, whenever the word "Optionee" is used in any provision of this
Agreement under circumstances where the provision appropriately applies to the
heirs, executors, administrators or legal representatives to whom this Option
may be transferred by will or by the laws of descent and distribution, the word
"Optionee" shall be deemed to include such person or persons.

                                      11.
                            Inconsistent Provisions

         Optionee agrees that the Option granted hereby is subject to the
provisions of the Plan as fully as if all such provisions were set forth in
their entirety in this Agreement. If any provision of this Agreement conflicts
with a provision of the Plan, the Plan provision shall control. Optionee
acknowledges that a copy of the Plan was distributed or made available to
Optionee and that Optionee was advised to review such Plan prior to entering
into this Agreement. Optionee waives the right to claim that the provisions of
the Plan are not binding upon Optionee and Optionee's heirs, executors,
representatives and administrators.

                                      12.
                             Adjustments to Options

         The parties acknowledge that (i) appropriate adjustments shall be made
to the number and class of shares of Common Stock subject to the Option and to
the exercise price in certain situations described in Section 4.5 of the Plan
and (ii) adjustments to the rights of the Optionee might be made in the event of
a Change of Control, as defined in Section 9.13 of the Plan.

                                      13.
                              Termination of Option

         The Committee, in its sole discretion, may terminate the Option.
However, no termination may adversely affect the rights of Optionee to the
extent that the Option is currently exercisable on the date of such termination.

                                      14.
                                  Severability

         If any term or provision of this Agreement, or the application thereof
to any person or circumstance, shall at any time or to any extent be invalid,
illegal or unenforceable in any respect as written, Optionee and CenturyTel
intend for any court construing this Agreement to modify or limit such provision
so as to render it valid and enforceable to the fullest extent allowed by law.
Any such provision that is not susceptible of such reformation shall be ignored
so as to not affect any other term or provision hereof, and the remainder of
this Agreement, or the application of such term or provision to persons or
circumstances other than those as to which it is held invalid, illegal or
unenforceable, shall not be affected thereby and each term and provision of this
Agreement shall be valid and enforced to the fullest extent permitted by law.

                                      15.
                         Entire Agreement; Modification

         The Plan and this Agreement contain the entire agreement between the
parties with respect to the subject matter contained herein and may not be
modified, except as provided in the Plan, as it may be amended from time to time
in the manner provided therein, or in this Agreement, as it may be amended from
time to time by a written document signed by each of the parties hereto. Any
oral or written agreements, representations, warranties, written inducements, or
other communications with respect to the subject matter contained herein made
prior to the execution of the Agreement shall be void and ineffective for all
purposes.


         IN WITNESS WHEREOF the parties hereto have caused this Agreement to be
executed as of the day and year first above written.

                                          CENTURYTEL, INC.



                                          By:
                                             -------------------------
                                                Name:
                                                Title:


                                             -------------------------
                                                   {insert name}
                                                     Optionee


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>12
<FILENAME>exhibit14.txt
<DESCRIPTION>EXHIBIT 14
<TEXT>
                                                                      Exhibit 14
                                   CORPORATE

                                   COMPLIANCE

                                    PROGRAM

                                    HANDBOOK


                                   CENTURYTEL

                                   March 2003

                               _________________


Dear CenturyTel Employees,

CenturyTel's Compliance Program outlines the moral, legal and ethical standards
which govern the business conduct of CenturyTel employees. It also provides a
framework to help employees prevent, detect and report violations of these
standards.

As employees of CenturyTel we all must make daily decisions regarding how we
will do our jobs and how we will work with our fellow employees, customers and
members of the public. Our success as individuals -- and as a company --
requires that we conduct all our business activities with integrity and the
highest standards of ethical behavior.

You are responsible for reading and following the principles contained in this
handbook. Although the handbook cannot address every situation you may have to
deal with, it underscores the basic principles that should guide all our conduct
- -- good judgment, personal honesty and sound business ethics. Those principles
require that we avoid any conflict of interest between work and personal
interests, comply with laws that govern our business, and be honest and fair in
all our work activities and relationships.

The Vice President, Employee & Labor Relations has been assigned to serve as the
Corporate Compliance Officer and is available to supervise the confidential
investigation of alleged Program violations, or to answer any questions about
the Company's policies and procedures. If you have a good faith belief that a
violation of laws, company policies or business ethics has occurred, you may
arrange a personal meeting with the Corporate Compliance Officer. If you prefer,
you may make an oral telephone report by calling (360) 905-6861, a private,
confidential extension for this purpose, or you may seek guidance from your
supervisor, manager, or the Office of the General Counsel. If you have any
concerns, complaints or questions about the Company's accounting, internal
accounting controls or auditing, you may contact the Audit Committee of the
Board of Directors by sending a letter to the Chairman of the Audit Committee,
c/o Post Office Box 4364, Monroe, Louisiana 71211. All information that you
provide will be held in strictest confidence.

Keep this handbook handy and refer to it. We must be committed to safeguarding
our own personal integrity and that of the Company.

Sincerely,



Glen F. Post, III
Chairman and Chief Executive Officer




                                CENTURYTEL, INC.

                          CORPORATE COMPLIANCE PROGRAM

                                TABLE OF CONTENTS


1.  INTRODUCTION..............................................................3

2.  PRINCIPLES OF BUSINESS CONDUCT............................................3
(a)   General Principles......................................................3
(b)   Conflicts of Interest...................................................4
                      Examples................................................6
(c)   Loans to Directors, Officers or Employees...............................6
(d)   Use of Company Name/Special Discounts...................................6
                      Examples................................................6
(e)   Use of Company Resources................................................6
                      Examples................................................7
(f)   Confidential and Proprietary Information................................8
(g)   Intellectual Property Rights............................................8
                      Examples................................................8
(h)   Entertainment, Gifts and Favors.........................................8
                      Examples................................................9
(i)   Marketing and Advertising..............................................10
(j)   Employment of Family Members...........................................10
                      Examples...............................................10
(k)   Employment-Related Laws and Regulations................................11
(l)   Outside Employment and Business Activities.............................11
                      Examples...............................................11
(m)   Political Contributions & Activities...................................12
(n)   Accountability.........................................................12
(o)   Honesty and Integrity in All Matters and Things........................13

3.  POLICY STATEMENT ON INSIDER TRADING......................................13
(a)   Penalties for Insider Trading..........................................13
(b)   The Company's Policies and Procedures on Insider Trading...............13
                      Prohibition against Trading on or
                      Disclosing Material Nonpublic Information..............14
                      Material Information...................................14
(c)   Policy on When Information is Public...................................15
                      "Window Period"........................................15
                      Additional Prohibited Transactions for All Employees...15
(d)   Sanctions for Violations of Policy Statement...........................15

4.  DISCLOSURE POLICY........................................................16

5.  POLICY ON CONFIDENTIALITY................................................16

6.  COMPETITION AND FAIR DEALING.............................................17

7.  COMPANY COMMUNICATIONS...................................................17
(a)   Statement of Philosophy................................................17
(b)   Electronic Communications - General Principles.........................18
(c)   Company E-mail.........................................................18
(d)   Use of Company Computers...............................................19
(e)   Software Copying and Other Types of Unlawful Copying...................19
(f)   Internet and Other External Electronic Communications..................20

8.  POLICY STATEMENT EQUAL EMPLOYMENT OPPORTUNITY............................20

9.  POLICY ON UNLAWFUL DISCRIMINATION AND HARASSMENT.........................21

10. APPLICABILITY OF OTHER COMPANY POLICIES..................................22

11. COMPLIANCE WITH
LAW..........................................................................22
(a)   Clean Water Act; Resource Conservation and Recovery Act;
                      Toxic Substances Control Act; Comprehensive
                      Environmental Response, Compensation and
                      Liability Act..........................................22
(b)   Occupational Safety and Health Act.....................................22
(c)   Sherman Act; Clayton Act; Robinson-Patman Act..........................23
(d)   Procurement Integrity..................................................23
(e)   False Statements or Entries............................................23
(f)   Unauthorized Publication or Use of Communications......................23
(g)   Records and Reports on Monetary Instruments Transactions...............24
(h)   Willful Failure to File Return, Supply Information or Pay Tax..........24
(i)   Securities Act of 1933; Securities Exchange Act of 1934................24
(j)   Foreign Corrupt Practices Act..........................................24
(k)   Government Inquiries...................................................24

12. WAIVERS    ..............................................................24

13. ACCOUNTING COMPLAINT PROCEDURES..........................................25

14. INQUIRIES REGARDING ALL OTHER POSSIBLE COMPLIANCE PROGRAM
    VIOLATIONS...............................................................25


<PAGE>




1.   INTRODUCTION

CenturyTel requires its directors, officers, and employees to comply with all
laws, rules and standards of conduct applicable to our business. To assist you
in understanding these obligations, CenturyTel has prepared the Corporate
Compliance Program included in this handbook, along with a companion book
entitled "Corporate Compliance Program Procedures." This program sets forth or
summarizes CenturyTel's policies and guidelines regarding appropriate business
conduct, and also summarizes certain laws with which we expect you to be
familiar. The program also summarizes CenturyTel's Corporate Compliance Program
Procedures, which explain in detail how CenturyTel responds to alleged policy
violations and otherwise administers its corporate compliance program. If you
are unable to resolve a specific ethical or legal issue after reviewing this
handbook, please talk to your supervisor, consult with the Corporate Compliance
Officer or call the compliance telephone number included below. Please contact
your supervisor or the Vice President of Employee & Labor Relations if you would
like a personal copy of these procedures, or a complete copy of any policies
that are summarized below. The program, procedures and the policies are also
published on the Company's intranet website under Human Resources Department,
Policies.

Please note that neither this handbook nor the procedures booklet is intended to
address how to handle every type of business encounter. If a law conflicts with
any policies or guidelines set forth or summarized in this Program, you must
comply with the law; however, if a local custom or policy conflicts with this
Program, you must comply with this Program.

Please note that no representative of CenturyTel has authority to give an order
or direction that would result in a violation of the policies or guidelines set
forth or summarized below. Violations of these policies or guidelines by any
employee or supervisor of CenturyTel could result in discharge, legal liability,
criminal prosecution or other appropriate disciplinary action.

This handbook is applicable to all directors, officers and employees of
CenturyTel and its subsidiaries. As explained further in the Corporate
Compliance Program Procedures, this handbook is also generally applicable to
certain of Company's agents and independent contractors, subject to certain
exceptions.

2.   PRINCIPLES OF BUSINESS CONDUCT

CenturyTel is committed to providing the highest level of quality services and
products to our customers. In pursuing our corporate goals, we must concurrently
have the highest moral standards and ethical behavior. This handbook
communicates the moral, legal, and ethical standards by which you should govern
your business conduct.

(a)  General Principles

Although a business enterprise is usually thought of in broad economic terms, it
is more importantly an institution of people. As such, a business has moral and
ethical responsibilities in addition to its basic economic role. The business
must operate in a manner that conforms to laws, to customs, and to human values.
Consequently, the Company is publishing this Program to guide employees in their
conduct as representatives of CenturyTel.

CenturyTel will, through its directors, officers and employees, conduct its
affairs with honesty and integrity. These qualities are characterized by
truthfulness and freedom from deception or fraud and do not vary by business,
product, country, or by culture. These qualities dictate one standard of conduct
company wide. If we are steadfast in this belief, questions of ethical behavior
are easily answered in most situations and questionable acts that can open the
door to serious violations will be avoided.

No "code of conduct" can hope to spell out the appropriate moral conduct and
ethical behavior for every situation with which we, as employees, might be
confronted. Whenever we are faced with a difficult ethical decision, we must
seek counsel - from our colleagues and our management - and, most importantly,
exercise our own good judgment. Further, whenever we find ourselves in
situations that represent possible violations of these principles, we must
disclose the facts immediately to our supervisors or take any of the other steps
listed below.

CenturyTel prospers to the degree - and only to the degree - that we serve our
customers well. We are committed to: the provision of high-quality
telecommunications services at fair prices; strong growth and attractive returns
for our stockholders; competitive income and benefits for our family of
employees; good community citizenship in our service areas; and the
accomplishment of these goals within an environment of honesty and integrity.

In dealing with the public, we will be responsive and responsible. While we do
not control our environment, we have a significant impact on it and the
communities we serve. We believe that obligates us to be open and timely in our
communications to the public and to play an important citizenship role in the
communities in which we operate.

These are the overriding business principles that must guide us in the conduct
of our businesses. What follows is more specific and deals with the ways in
which the Company will implement these policies and how your responsibilities
are affected by these principles.

(b)  Conflicts of Interest and Corporate Opportunities

CenturyTel requires its directors, officers and employees to avoid conflicts of
interest. A conflict of interest occurs when an employee's personal or financial
interests interfere with or appear to interfere with their duties and
responsibilities to the organization.

o    The term "conflict of interest" describes any circumstance that could
     cast doubt on our ability to act with total objectivity with regard to
     CenturyTel's best interests. We not only want to be loyal to CenturyTel,
     we want that loyalty to come easily and free from any conflicting
     interests.

o    While CenturyTel respects the privacy of its employees in the conduct of
     their personal affairs, it does insist that we discharge our obligations to
     CenturyTel. Activities that involve the unauthorized use of CenturyTel
     time, equipment, or information, or that significantly interfere with job
     performance, or that could damage our good reputation, or that otherwise
     conflict with CenturyTel's business interests are to be avoided. Of
     particular concern are situations in which our personal interests may
     conflict with the interests of CenturyTel in relations with present or
     prospective suppliers, customers, or competitors. In essence, we should not
     use our positions or the assets or influence of the organization for
     personal advantage or for the advantage of others, and we should always act
     in the best interests of CenturyTel.

o    By policy, CenturyTel prohibits certain types of personal involvement in
     time or money where a conflict or perceived conflict may exist.

o    Sometimes conflicts of interest will develop accidentally or
     unexpectedly. If this happens, any employee having knowledge of the
     situation must report the matter directly to his or her supervisor.
     Usually these problems can be resolved if they are handled quickly and
     openly.

While it is not possible to describe all the circumstances and conditions which
might develop, the following is set forth for your guidance:

>>   You may not take advantage of opportunities which rightfully belong to
     the Company. For example, you may not acquire property or stock that you
     know the Company is interested in purchasing, divert business from
     CenturyTel or receive a commission or fee, except from the Company, for a
     transaction which you have conducted for the Company.

>>   Corporate opportunities include the chance to purchase or receive stock
     or options from other companies (including "IPO allocations"). If you
     receive any such offer or similar opportunity from a company with whom
     CenturyTel does business, you must seek the permission of your
     supervisor. Directors and officers of CenturyTel must receive approval of
     the Board of Directors.

>>   You may not directly or indirectly work for, hold a financial interest
     in, or otherwise be associated with, a competitor or supplier (except if
     such financial interest is less than one percent of the publicly traded
     stock of a corporation or unless you have received the approval of the
     Company's Chairman, CEO or President).

>>   The best policy is to avoid any direct or indirect business connection
     with our suppliers or competitors, except on our behalf.

>>   You may not make credit, purchase, lease or other agreements for the
     Company if you have a personal or family financial interest in the
     individual or organization seeking credit or other agreements from
     CenturyTel.

>>   If you, your spouse or other immediate family member are engaged in a
     business similar in nature to the Company's, it must be disclosed in full
     to the Corporate Compliance Officer.

>>   You may not acquire any interest in property or assets of any kind for
     the purpose of selling or leasing it to the Company, or commit the
     Company without proper authorization to give its financial or other
     support to any outside activity or organization.

>>   You may not develop a personal relationship with a subordinate employee
     or with any employee of a competitor, customer or supplier that might
     interfere with the exercise of impartial judgment in decisions affecting
     the Company or any employees of the Company.

>>   If you or someone with whom you have a close relationship (an immediate
     family member or close companion) has a financial or employment
     relationship with a current or prospective competitor or supplier, the
     employee must disclose this fact in writing to the Corporate Compliance
     Officer.

If you enter into a personal relationship with a subordinate employee or with an
employee of a competitor or supplier, a conflict of interest may exist that
requires full disclosure to the Company.

Examples: *

>>   You own 25% of "XYZ Company" and XYZ owns equipment which it offers to
     lease to the Company for a construction project. To ensure that no
     conflict in your duties or the Company's interests will occur, you are
     obligated at the outset to fully disclose your financial interest in XYZ
     and not participate in any decisions whether to utilize XYZ's services.

>>   Your spouse is soliciting a consulting contract with a Company department
     unrelated to your work responsibilities. Although this may not be a
     conflict of interest, it could appear as such to others. It is your
     responsibility to ensure that the relationship and financial interest of
     your spouse are disclosed to managers involved in the decision.

     *Examples are offered to help understand general principles. The examples
     are not meant to cover all issues that might arise.

Employees unsure as to whether a certain transaction, activity or relationship
constitutes a conflict of interest should discuss it with the their supervisor
or the Corporate Compliance Officer at (360) 905-6861.

(c)  Loans to Directors, Officers or Employees

It is against the law for the Company to make personal loans to any director or
executive officer. No other employee may receive a loan from the Company unless
the loan is approved by the employee's supervisor and is in accordance with all
other Company policies and procedures.

(d)  Use of Company Name/Special  Discounts

You may not use the Company's name, influence or purchasing power to obtain
personal discounts or rebates unless communicated and made available to
employees in general. The Company's policy is to make available to all employees
any Company discounts with suppliers or other businesses which may be passed on
to employees.

Examples:

>>   You work in the Company's information services department and contact
     "Computer Inc.," a frequent Company supplier. You use the Company's
     purchasing power to obtain a special discount only for yourself. This
     would be improper use of the influence of your Company position for
     personal gain.

>>   You are a member of a frequent flyer program and receive mileage bonuses
     and other discounts as a result of travel for Company business.
     Acceptance of such bonuses and discounts from airlines, hotels, and
     restaurants are proper when offered to travelers generally. However, it
     would be improper to make travel arrangements to receive travel bonuses
     if suitable, alternative arrangements are available at lower cost to the
     Company.

Test: Do you have any question as to whether your use of the Company name or
Company discount may be improper or conflict with the Company's best interests?
If so, discuss the matter promptly with your supervisor or the Corporate
Compliance Officer so the situation can be evaluated before problems develop.

(e)  Use of Company Resources

Loss, destruction or improper use of any Company resources can increase the cost
of doing business, make the Company less efficient, and ultimately less
competitive. Employees are responsible for using Company resources -- including
vehicles, planes, computers, equipment, materials, services and supplies -- for
Company business.

All computer equipment, files, data, programs and capabilities (such as EMail),
and all telephones and related equipment and records (such as voice mail),
including all back-up disks, tapes and the like, are considered Company records
and are the property of the Company.

Employees are expected to utilize electronic communication, electronic records,
and computer resources in accordance with applicable CenturyTel policies,
including those set forth below under the heading "Company Communications."

Employees must adhere to internal controls, licensing agreements and copyright
laws protecting computer software. Computer software products may not be used or
copied in a manner contrary to the terms of the license agreement.

Use of Company tools and facilities for personal use is discouraged, and
employees should seek alternate commercially available resources. If an employee
has an appropriate personal need to use Company resources, prior authorization
must be obtained from the appropriate local manager or designee.

Examples:

>>   You have access to a Company pick-up that is not used on the weekends and
     wish to use it to move dirt to landscape your yard. If you pay for the
     gas, can you use the pick-up? No, unless you have prior authorization.
     Personal use puts additional wear on the vehicle, exposes the Company to
     potential liability for accidents, and gives the impression to members of
     the public that property paid for by customers and shareholders is being
     used improperly.

>>   You are required to spend several days on Company business away from your
     normal workplace and have been authorized to use a Company vehicle for
     the trip. Is it appropriate to take a "side trip" to sightsee at the
     business location or on your return home? The more personal trips and
     detours you mix with business, the more questionable your conduct and
     integrity in using a Company vehicle (or in charging rental car costs to
     the Company). If such personal use is more than incidental, it is
     necessary that the personal use be discussed and approved as part of the
     prior travel authorization process, to include reimbursement to the
     Company for non-incidental personal mileage and any other related costs.

>>   Can I use my Company telephone to make personal telephone calls? To
     ensure that personal telephone calls do not interfere with your work
     duties, they should generally be made during non-working time or should
     be infrequent and brief.

     Further, you should avoid making personal long distance or cellular phone
     calls at the Company's cost. If you must make such a call except for an
     emergency or similar reason, you should charge the call to your home
     phone or promptly notify your supervisor so any costs to the Company can
     be reimbursed.

>>   Listed below are examples of questions concerning the personal use of
     Company resources. May I:

     - borrow a Company tool overnight to do repair work at my house?

     - use the shop or its tools and equipment to do work on my car or
     other personal projects?

     - use office equipment (e.g. copiers, computers, printers) for my
     personal use?

Test: Is your use of a Company resource, facility, tool or business machine for
profit purposes? Or in non-compliance with locally established written
procedures? If so, the use would be improper.

(f)  Confidential and Proprietary Information

Confidential and proprietary business information relating to CenturyTel may not
be provided to unauthorized persons or used to the Company's detriment or for
the purpose of furthering a private interest or making a personal profit. All
material non-public information concerning the business, securities, financial
condition, earnings, or prospects of CenturyTel remains confidential until fully
and properly disseminated to the public (e.g., current, interim earnings figures
or trends, possible acquisitions or divestitures, projections, business plans,
new products or processes). For further information, see below the "Policy
Statement on Insider Trading."

It is Company policy that all confidential business information relating to
CenturyTel will be used solely for Company purposes and will not be provided to
unauthorized persons or used for the purpose of furthering a private interest or
making a personal profit.

Employees who leave CenturyTel may not:

o    Use any Company confidential information for their own or
     another's gain; or

o    Keep any originals or copies of notebooks, proposals, documents,
     drawings, reports, other documents or property belonging to CenturyTel.

(g)  Intellectual Property Rights

If during your employment with CenturyTel, you generate, author or contribute to
any invention, design, product, program, method, process, copyrightable work,
trade secret, proprietary information or other intellectual property, such
intellectual property will be the exclusive property of CenturyTel and you must
cooperate in obtaining in CenturyTel's name any patent, copyright or other
proprietary right in such intellectual property (including signing and filing of
appropriate documents and forms).

Examples:

>>   Ideas, inventions, or discoveries conceived, developed, or made by
     employees that relate to Company business, research or development, or
     arise through the use of Company facilities, shall be the property of the
     Company, and appropriate measures shall be taken to protect such
     property.

(h)  Entertainment, Gifts and Favors

The primary rule to remember regarding gifts and gratuities is that they must
not influence or appear to influence the recipient's judgment, or to violate any
laws.

No CenturyTel employee may offer or accept any levels of entertainment, gifts,
favors, or gratuities which:

o    May reasonably be construed as intended to affect the judgment of the
     recipient so as to secure preferential treatment.

o    Are not of such limited nature and value that they could not be
     reasonably perceived by anyone to affect the judgment of the recipient.

o    Would be embarrassing to CenturyTel or the recipient if publicly disclosed.

o    Would violate any laws or regulations.

No employee should give or offer to give any entertainment, gifts, favors, or
gratuities to any government official, even if lawful, if the action might
reasonably be construed as an attempt to influence a government decision in any
matter affecting CenturyTel. All relations with government or public officials
should be conducted in a manner that will not adversely reflect on CenturyTel or
the official's integrity and with the expectation that all such actions will
become a matter of public knowledge.

Examples:

>>   Your job is to evaluate car lease bids. One of the bidders offers to lend
     you at no cost a car for your personal use for several days. Accepting
     this offer would be improper. (Evaluation of the bidder's product can be
     done on the job or by other means that would not raise the question of
     whether your actions have compromised your ability to make an independent
     business decision.)

>>   A parts vendor you do business with offers to take you to a professional
     basketball game as his guest. A ticket costs $40. Should you accept? You
     should carefully review all the circumstances with your supervisor. Is
     there a business decision pending by you that could lead others to
     believe the vendor's ticket influenced your decision? If so, you should
     decline the ticket. Employees who have decision- making authority over
     pending or prospective business with a vendor must ensure that their
     decisions are not influenced, or perceived to be influenced, by a
     vendor's gratuities or hospitality.

>>   You occasionally have need for certain consulting services and have
     retained a consultant who is currently providing services. The consultant
     invites you to a professional sports event as his guest. A ticket costs
     $40. If you and your supervisor determine that the event will enhance
     "responsible business relations", acceptance would be appropriate since
     the hospitality is of reasonable cost under the circumstances.

>>   Your facility wants to hold an employee picnic. Would it be appropriate
     to solicit or accept a financial contribution or gratuity (e.g., food,
     entertainment, transportation, etc.) from a supplier or subcontractor?
     The Company does not want a reputation of having its activities supported
     by the finances or gifts of its suppliers or others doing or seeking to
     do business with the Company. Accepting a supplier's gratuities for a
     Company-approved activity could be perceived as obligating the Company to
     give "favored status" to contributing suppliers to the exclusion of other
     non-contributing suppliers who may be more competitive. A supplier's
     contributions to a Company-approved activity should not be accepted
     without officer approval.

Test: Before accepting any gratuity (including forms of hospitality), you
should ask yourself the following questions:

o    Would accepting a gratuity affect or appear to affect my ability
     to make an impartial decision with respect to the products or
     services of the individual or company giving the gift? It must
     not. If you have any doubts, contact your supervisor or manager
     for assistance.

o    Would the Company offer the same gratuity or business courtesy? If
     not, then it is likely that the gratuity is inappropriate under
     the circumstances and should not be accepted.

The Company will not pay any bribe, gratuity, kick-back, or any similar payment
to anyone, including agents of our customers or members of their family, in
connection with the sale of any of our products. Should any such payments be
requested, the Company's lawyers should be contacted immediately. Company policy
is to forego any business which can only be obtained by improper or illegal
payments. The Company will not pay "push money" or secret payments to employees
of our customers in order to induce them to purchase our products or services.

(i)  Marketing and Advertising

In marketing our products, we must, of course, observe all of the basic
antitrust laws summarized below under the heading "Compliance with Law." There
are, however, some additional legal and ethical principles that should govern
our conduct.

Our advertising should always be truthful. If we make specific claims about our
products or the performance of our products, we should have evidence to
substantiate those claims. We should not label or market our products in any way
that might cause confusion between our products and those of any of our
competitors. Similarly, we should be alert to any situation where a competitor
may be attempting to mislead potential customers as to the origin of products
and inform appropriate management or the Company's Legal Department of any such
cases.

All of our advertising will be in full compliance with all laws, and will not
discriminate with regards to race, creed, sex, color, national origin,
disability, or otherwise.

If we offer advertising or promotional allowances, we should generally offer
them on a proportionately equal basis to all of our customers. Advertising and
promotional allowances are subject to very detailed and technical regulation
under the Robinson-Patman Act and, therefore, should only be offered after it is
clear that the allowances are proper and in conformance with law.

We should not unfairly disparage any of the products, services, or employees of
any of our competitors. If we do engage in any comparison of our products
against those of our competitors, such comparisons should be fair. Comparative
advertising is also subject to some regulation and should, therefore, be cleared
with the Company's lawyers beforehand. All use of the Company's trademarks and
trade names should be in accordance with our policies governing such use.

(j)  Employment of Family Members

Your relatives and friends may apply for employment with the Company and, if
employed, are eligible for job changes (e.g., promotions, transfers) to
positions for which they are qualified as long as it will not create what
CenturyTel considers an inappropriate employment relationship among friends or
relatives (as described further below). However, relatives and friends are not
entitled to preferential consideration.

For the purposes of this policy, "relative" is defined to include spouses,
children, grandchildren, parents, brothers, sisters, in-laws, aunts, uncles,
nieces, nephews, stepparents or stepchildren and other dependents whether or not
living in the same household. The definition also includes all others living in
the same household, including persons who live in non-marital, non-related
arrangements (e.g., roommates and domestic partners).

Examples:

An inappropriate employment relationship may exist where:

>>   One relative is in a position to exercise supervisory, appointment,
     promotional or grievance adjustment authority over another, or to audit
     the other's cash handling or accounts; or

>>   It would constitute a violation of any federal or state law or regulation
     with which we are required to comply; or

>>   It would constitute a violation of the conditions of our eligibility for
     government contracts or financial assistance; or

>>   It would cause disregard of a bona fide occupational requirement
     reasonably necessary to the normal operation of business.

If after hiring, two employees become "relatives" and the Company feels the
circumstance of their positions may create an inappropriate employment
relationship, the employees will be notified and requested to make a
recommendation as to who will be transferred or reassigned if an appropriate
position is available, or laid off or terminated. CenturyTel will make the final
decision consistent with business needs.

(k)  Employment-Related Laws and Regulations

Brief descriptions of a few of the federal statutes generally applicable to
CenturyTel are included in the section below entitled "Compliance with Law".
Also included in this Program are the Company's employment policies regarding
Equal Employment Opportunity and Unlawful Discrimination and Harassment. If you
need advice with regard to laws and regulations relating to your job, you should
consult with your supervisor. If a situation arises where you feel a need to
consult privately or anonymously about such a matter, you may contact the
Corporate Compliance Officer at (360) 905-6861.

(l)  Outside Employment and Business Activities

Employees are expected to devote full time to CenturyTel's interests during
regular working hours and during any additional work time that is required. In
addition, no Company assets or labor are to be used for personal business.
Although the Company discourages outside employment (including working as a
consultant), this activity is allowed if it does not interfere, compete or
conflict with the Company's interests. Any outside employment which in any way
competes or conflicts with CenturyTel's interests must be approved in advance by
your manager, division executive and the Vice President of Human Resources.

No outside work may be done during your regular work hours and no Company
facilities, equipment, labor, information or supplies are to be used to conduct
this outside activity. Any employee doing any outside work is under obligation
to advise their client that the work is in no way by, for, or in the name of
CenturyTel.

Examples:

>>   It is improper and against Company policy to accept employment or a
     consulting position with any competitor of the Company or with a
     contractor who will use your services to perform work for the competitor.
     It is also improper to work for an outside consultant or other employer
     which provides goods or services to or solicits business from the
     Company. If you are uncertain what constitutes a "competitor" of the
     Company, you should seek assistance through your supervisor.

>>   You work in the engineering department and a consultant (or contractor)
     who performs work for your department offers you a part-time job on
     weekends or during your vacation. You should decline the offer to avoid
     the appearance of a conflict of interest unless you have reviewed the
     circumstances with your supervisor and received the approvals specified
     above. No matter how innocently the offer of part-time work might be made
     or accepted, others might see it as a kickback paid to you in return for
     Company business or for helpful "inside information" of special value to
     the consultant not available to his or her competitors.

>>   You sell sports equipment after hours which presents no conflict with
     your job. However, you now want to contact co-workers during your work
     time to sell or promote your products. It would be improper to use your
     work time or interrupt the work time of other employees to conduct or
     promote your personal business interests.

>>   You are developing software programs after work hours and now want to
     sell those programs to the Company. This raises a potential conflict of
     interest. It is necessary that you demonstrate to your supervisor, and
     the supervisor involved in the transaction, that the development of the
     product occurred outside the performance of your job and without the use
     of Company materials. Products and designs developed as part of your job
     are the property of the Company.

>>   Your job involves use of testing equipment. Based on information and
     knowledge obtained through your job, you feel you can design and build
     testing equipment used by the Company far better and more inexpensively
     than the supplier the Company is now using. If you work on your own time,
     would it be acceptable if you started your own business and competed for
     Company work? No. As an employee who has received money and training from
     the Company, you are expected to give the Company the best of your
     creativity and energy. You might consider suggesting how the design and
     construction of the testing equipment could be incorporated into your
     job.

Test: Would the outside employment or personal business enterprise compete with
products or services provided by the Company? If so, you should reject the
opportunities. Also, you should not conduct or promote outside business during
work time paid by the Company.

(m)  Political Contributions & Activities

The Company may not make any political contributions of any kind without the
express approval of the General Counsel or the Chief Executive Officer.

o    CenturyTel recognizes that employees will participate in the political
     process, including voluntary contributions to any appropriate political
     action committee and to candidates and parties of their choice. However, no
     influence shall be exerted by any employee on another employee to make any
     personal politicalo contribution or to engage in any political activity
     inconsistent with that employee's own personal inclination.

o    Corporate contributions, direct or indirect, and of whatever amount or
     type, to any political candidate or party, or to any other organization
     that might use the contributions for a political candidate or party, are
     illegal for all federal elections and may be illegal for state and local
     elections except in certain situations. No permissible corporate
     contributions are to be made for political purposes without review by the
     General Counsel or the Chief Executive Officer.

o    CenturyTel may from time to time take stands on issues of public policy,
     particularly those that affect its interest or those of its
     constituencies. In such cases, CenturyTel may elect to express its views
     publicly and spend Company authorized funds to ensure that its position
     is broadly disseminated. It may also provide authorized financial support
     to groups that advocate essentially consistent positions.

(n)  Accountability

The law requires that CenturyTel keep accurate books, records, and accounts to
fairly reflect CenturyTel's transactions and that CenturyTel maintain an
adequate system of internal accounting controls. Therefore, it cannot be
over-emphasized that our books and records should have the highest degree of
integrity. Employees should fulfill their responsibilities to ensure that
CenturyTel's books, records, and accounts are complete, accurate, and supported
by appropriate documents in auditable form. All vouchers, bills, invoices,
expense accounts, and other business records should be prepared with care and
complete candor. No false or misleading entries should be permitted for any
reason. Unrecorded or "off the books" funds or assets should not be maintained
unless permitted by applicable law or regulation. No payment is to be made for
purposes other than those described in the documents supporting the payment.
Records should always be retained or destroyed according to the Company's record
retention policies. You are expected to be familiar with the Company's record
retention policies, and strictly adhere to the procedures outlined therein. You
may obtain a copy of these policies by contacting the Records and Information
Management Department.

(o)  Honesty and Integrity in All Matters and Things

Unfortunately, there is no formula or set of rigid guidelines that can "define"
appropriate ethical and moral judgment in every situation which an employee
might face. Thus, CenturyTel must depend upon the good judgment and common sense
of each of its employees and their willingness to seek advice from others within
the Company when difficult or ambiguous situations arise.

Our absolute and unwavering expectation is that all of our directors, officers
and employees, regardless of position or responsibilities, will conduct
themselves and their affairs with honesty and integrity in all matters and
things. This not only means that falsification, misrepresentations and
untruthfulness will not be tolerated, but that we also cannot accept conduct,
statements, and "omissions" which are misleading or result in impressions or
conclusions which distort the larger reality. Of necessity, this also means that
we expect you to courteously and candidly cooperate in all Company-initiated
investigations or inquiries.

A violation of the law or compromise of the Company's principles of conduct can
result in serious disciplinary actions (including dismissal and criminal or
civil proceedings where appropriate). No director, officer or employee is exempt
from the principles, guidelines and policies expressed herein. The cooperation
of each and every person in the organization is required to ensure that
violations of these principles, guidelines or policies are called to the
attention of appropriate representatives of the Company. Furthermore, if we are
to hold ourselves to these high standards, we must also understand that the
Company's best interests are our best interests and that we are expected to
exercise good judgment, as well as ethical courage, in matters of reporting
violations covered in this policy.

Company policy allows the use of any lawful method of investigation which the
Company deems necessary to determine whether any person has engaged in any
conduct which interferes or adversely affects its business. This includes the
theft of any company property or any property of any employee or visitor. It
also includes suspicion of possession of drugs, alcohol, firearms, or anything
else that is prohibited or restricted on company property. All employees are
expected to participate in the Company's reasonable security efforts.


3.   POLICY STATEMENT ON INSIDER TRADING

Excerpts from the Company's Policy Statement on Insider Trading are reproduced
below:

(a)  Penalties for Insider Trading

The consequences of insider trading violations are extremely serious. For
individuals who trade on inside information or tip information to others, the
sanctions may include:

     (i)    a civil penalty of up to three times the profit gained or loss
            avoided;
     (ii)   a criminal fine (no matter how small the benefit) of up to
            $1 million; and
     (iii)  a jail term of up to ten years.

In addition, any director or supervisory employee who fails to take appropriate
steps to prevent illegal trading by another employee over whom he exercises
control could be sued for the greater of $1 million or three times the profit
gained or loss avoided as a result of the subordinate employee's violation.

In addition to the criminal and civil penalties, persons who buy from or sell to
a CenturyTel employee or who buy from or sell to persons who have been "tipped"
by a CenturyTel employee, have a civil cause of action for damages against the
trading or tipping employee. Moreover, as discussed further below, any violation
by an employee of CenturyTel's insider trading policies and procedures set forth
herein could result in Company-imposed sanctions, including dismissal for cause.

(b)  The Company's Policies and Procedures on Insider Trading

Prohibition against Trading on or Disclosing Material Nonpublic Information
- ---------------------------------------------------------------------------

If any employee is in possession of material nonpublic information relating to
CenturyTel, it is the Company's policy that neither that person nor any family
members or other person living in the employee's household may buy or sell
securities of the Company or engage in any other action to take advantage of, or
disclose to others, that information. Employees will be deemed responsible for
compliance by members of their household. This prohibition also applies to
material nonpublic information obtained in the course of employment that relates
to any other company that has publicly-traded stock. Transactions that may be
necessary or justifiable for independent reasons (such as the need to raise
money for an emergency expenditure) are no exception. Even the appearance of an
improper transaction must be avoided to preserve Century's reputation for
adhering to the highest standard of conduct.

Serious problems could be caused for CenturyTel by unauthorized disclosure of
internal information about CenturyTel or other companies with which it does
business, whether or not for the purpose of facilitating improper trading in
stock. Company personnel should not discuss internal Company matters or
developments with anyone outside the Company, except as required in the
performance of regular corporate duties. This prohibition against disclosing
nonpublic information to others will apply regardless of whether or not the
director or employee derives any monetary benefit therefrom.

Material Information
- --------------------

Material information includes any information, whether positive or negative,
that a reasonable investor would consider important in a decision to buy, hold
or sell CenturyTel stock. Information is material even if it alone would not
determine the investor's decision; the fact that a reasonable investor would
want to know it in connection with his decision to buy, hold or sell securities
will suffice. Examples of material information include annual and quarterly
financial results, a significant change in earnings or earnings projections,
internal financial information that departs in any way from what the market
would expect (such as the potential payment of a special dividend, including a
stock split, or an increase in regular dividends), a potential merger or
acquisition, the acquisition or disposition of a significant amount of assets,
the initiation or settlement of a significant lawsuit, or a transaction that is
likely to significantly affect the financial condition or performance of
CenturyTel.

(c)  Policy on When Information is Public

Employees will be free to trade in CenturyTel stock whenever there is no
material nonpublic information concerning the Company. If any such person,
however, is in possession of any such information, he or she may not trade until
this information is disseminated to the investing public. Even when material
information has been publicly disclosed, CenturyTel employees must continue to
refrain from trading in CenturyTel stock until such information has been
adequately disseminated to the public and investors have been able to evaluate
it. Generally, information regarding relatively simple matters, such as earnings
results, will be deemed to have been adequately disseminated and absorbed by the
marketplace two business days after its release. When more complex matters such
as a prospective major acquisition or disposition are announced, it may be
necessary to allow additional time for information to be digested by the
investors. In such circumstances, employees desiring to trade CenturyTel stock
should consult with the Office of the General Counsel regarding a suitable
waiting period before trading.

Window Period
- -------------

As a general guideline, CenturyTel employees should note that the most
appropriate time to trade in CenturyTel stock is during the twenty business day
period commencing on the third business day following the release of quarterly
or annual financial results. This period of time is frequently referred to as
the "window period." It is permissible to trade at other times (except as noted
below for directors and certain officers). However, you may not trade in
CenturyTel stock (whether during or outside of a window period) if you are in
possession of material, non-public information.

Additional Prohibited Transactions for All Employees
- ----------------------------------------------------

Because CenturyTel believes it is improper and inappropriate for any employees
to engage in short-term or speculative transactions involving CenturyTel stock,
it is the Company's policy that employees should not engage in any of the
following activities with respect to CenturyTel stock:

     (i)   purchases or sales of short-term options (that is, options with
           expiration periods of less than six months) with respect to
           CenturyTel stock; or

     (ii)  sales of CenturyTel stock not owned or not delivered within 20
           days of the sale, i.e. "short sales."

(d)  Sanctions for Violations of Policy Statement

CenturyTel will expect the strictest compliance with the terms of this Policy
Statement by all personnel at every level. Failure to observe these procedures
may result in serious legal problems for you, as well as the Company. A failure
to follow the letter and spirit of this Policy Statement will be considered a
matter of grave concern and Company-imposed sanctions, including dismissal for
cause, could result.

It should be remembered that if an employee's transactions in CenturyTel stock
become the subject of scrutiny the transactions would be viewed after the fact
with the benefit of hindsight. As a result, before engaging in any transaction
an employee should carefully consider how regulators and others might view the
transaction in hindsight. Any employee who has any questions about specific
transactions or this Policy Statement in general may obtain additional guidance
from the Office of the General Counsel; telephone (318) 388-9000 or Email
harvey.perry@centurytel.com. Remember, however, the ultimate responsibility for
adhering to this Policy Statement and avoiding improper transactions rests with
you. In this regard, it is imperative that you use your best judgment.

                                    * * * * *

The Company's Policy Statement on Insider Trading imposes additional trading
restrictions on directors and certain officers. For a complete copy of this
policy, please contact the General Counsel's office.

4.   DISCLOSURE POLICY

CenturyTel is committed to providing timely, accurate and complete information
to the investment community consistent with all applicable legal and regulatory
requirements. To assist in this process, CenturyTel's Board of Directors has
adopted a Disclosure Policy. The Disclosure Policy provides that the Chief
Executive Officer ("CEO"), the Chief Financial Officer ("CFO"), in conjunction
with others, will be primarily responsible for determining when material
developments justify public disclosure, and will be the primary spokespersons
for the Company. The CEO and CFO may from time to time designate other officers
or employees to speak on behalf of the Company or to respond to specific
inquiries from the investment community or the media. Employees, other than the
authorized spokespersons, should not respond to inquiries from the investment
community or the media without specific authority to do so from an authorized
spokesperson specified above.

For a complete copy of CenturyTel's Disclosure Policy, please contact the
General Counsel's office.

CenturyTel has also adopted Disclosure Controls and Procedures that are intended
to, among other things, enhance the accuracy and completeness of the Company's
reports under the Securities Exchange Act. For a copy of these procedures,
please contact the General Counsel's office

5.   POLICY ON CONFIDENTIALITY

CenturyTel requires employees to respect the confidentiality of any and all
customer and supplier information obtained in the course of business, except
when disclosure is authorized by the General Counsel's office or required by
laws or regulations. Employees are prohibited from disclosing information
obtained from our customers and suppliers and shall not engage in any conduct in
the non-exclusive list set forth below:

1.   Employees must not disclose the contents, or any part thereof, of any
     letter, telephone, or Fax message addressed to another person without the
     permission of such person, or willfully alter the purport or effect or
     meaning of any such message to the injury of another.

2.   Employees must not use for any unauthorized purpose any information
     derived by them from any private message passing through their hands and
     addressed to another person, or acquired in any other manner by them as
     employees of the Company.

3.   Employees must not permit any unauthorized person to listen to any
     telephone conversation. Employees must not monitor any connection beyond
     the requirements for its proper supervision.

4.   Employees must not divulge the existence or the nature of any message,
     except as required for the proper handling thereof.

5.   Employees must not discuss communication arrangements made between the
     Company and its customers, except as required for the proper handling
     thereof.

6.   Employees must not give any unauthorized person any information whatever
     regarding the location of equipment, trunks, circuits, cables, or similar
     equipment, or regarding local or toll ticket records of calls, telegraph
     messages, or similar communications.

7.   Employees must not disclose any proprietary information concerning a
     customer's business, operations, costs, plans, trade secrets or other
     confidential matters. See "Policy Statement on Insider Trading" for
     related information.

8.   Employees must not disclose to unauthorized persons information gathered
     in response to a lawful request by an administrative or governmental
     agency.

The secrecy of communications is protected by laws that impose civil and
criminal penalties for violations. See the section below entitled "Compliance
with Law - Unauthorized Publication or Use of Communications."

As discussed further in Section 2 above, all confidential business information
relating to CenturyTel should be used solely for company business and should not
be provided to unauthorized persons or used for the purpose of furthering the
private financial or other interests of any employee or his family, friends, or
others with whom he comes in contact.

The obligations to preserve confidential information continues even after
employment ends.

6.   COMPETITION AND FAIR DEALING

We expect to outperform our competition fairly and honestly. We seek competitive
advantages through superior performance, never through unethical or illegal
business practices. Stealing proprietary information, possessing trade secret
information that was obtained without the owner's consent, or inducing such
disclosures by past or present employees of other companies is prohibited. Each
employee should endeavor to respect the rights of and deal fairly with the
Company's customers, suppliers, competitors and employees. No employee should
take unfair advantage of anyone through manipulation, concealment, abuse of
privileged information, misrepresentation of material facts, or any other
intentional unfair-dealing practice.

7.   COMPANY COMMUNICATIONS

(a)  Statement of Philosophy

All computer equipment, files, data, programs and capabilities (including
e-mail), and all telephones and related equipment and records (including voice
mail) are the property of the Company. Computer files, e-mail messages, voice
mail messages, group-ware messages and other recordings of electronic
communications, including all back-up disks, tapes and the like ("Electronic
Records"), are considered Company records.

The primary purpose of electronic communications is to facilitate the timely and
efficient conduct of business, and further to encourage and facilitate the free
exchange of business-related communications and ideas.

This policy is applicable to all employees of CenturyTel and its wholly owned
domestic subsidiaries, as well as all consultants, contractors or other persons
who may utilize the Company's computers or other electronic communications
media. References in this policy to the Information Services ("IS") Department
shall mean the IS staff which have day to day information services management
responsibility for the particular CenturyTel subsidiary, business unit or staff
function, as well as any contractors or consultants authorized by such persons.

(b)  Electronic Communications - General Principles

o    The Company owns all Electronic Records, and reserves the right to
     review, audit, intercept, access and disclose to others all electronic
     communications and Electronic Records at any time, with or without
     employee notice. To ensure compliance with this Policy, the Company's IS
     Department may designate certain Company personnel to audit the
     operation, utilization or content of the Company's communications
     resources, computer resources and Electronic Records. As a result,
     employees should not expect or assume personal privacy with respect to
     any electronic communications or Electronic Records.

o    Although Electronic Records are not private, all employees should respect
     the confidentiality of electronic communications or Electronic Records.
     Accordingly, no employee may review, audit, intercept, access or disclose
     any electronic communications or Electronic Records without authorization
     from the author, the intended recipient or an executive officer of the
     Company.

o    All Electronic Records, including e-mail, voice mail messages, and
     group-ware communications, are routinely backed up or otherwise saved so
     that data can later be restored. This means that computer and telephone
     records and messages are not destroyed even though they may have been
     "deleted" or "erased" by the user, but will instead be preserved in
     accordance with the Company's record retention policies.

o    For purposes of lawsuits, Electronic Records, including e-mail, voice
     mail messages, and group-ware communi- cations are accorded the same
     treatment as paper documents; that is, they could be treated as evidence
     in lawsuits involving the Company.

o    Accordingly, employees should use discretion and good judgment in
     creating Electronic Records. All Electronic Records should be created
     with the same care and consideration as a paper report or memorandum.

(c)  Company E-mail

o    E-mail is an important part of the Company's business communications. All
     employees are responsible for adhering to the standards set forth in this
     Policy when e-mail is created, sent, forwarded or saved. The failure to
     do so can put both the Company and the individual at risk for legal
     liabilities, embarrassment or other problems.

o    Employees should compose e-mail messages with the same care and
     discretion that they would use for Company memoranda, reports, and
     letters presented in paper form. All messages should be composed with the
     expectation that they could be made public. Appropriate uses of internal
     e-mail include routine scheduling, exchanges of basic information, and
     updates. E-mail is generally not a suitable format for discussion of
     extremely sensitive or highly confidential information. Instead,
     sensitive and confidential matters should be handled through in-person
     meetings and formal memoranda and reports, where there is more
     opportunity for dialogue, analysis and necessary clarifications.

o    E-mail communications should be businesslike, courteous and civil. Use of
     the e-mail system or any other Company-owned medium of communication to
     transmit obscene or pornographic material or derogatory or discriminatory
     statements of any kind about co-workers, customers, or competitors,
     including but not limited to those based on age, gender, physical
     attributes, sexual orientation, race, color, creed, citizenship status,
     national origin, religion, mental or physical disability or veteran
     status or any other status protected under applicable local, state or
     federal nondiscrimination law is strictly prohibited.

o    To avoid the excessive expense of tracking, storing, administering and
     retrieving e-mail, the Company will periodically purge all e-mail from
     the Company's computer systems and backup tapes in accordance with the
     Company's record retention schedule. (Please refer to the Company's
     current Records Retention Policy for the retention/destruction schedule
     of e-mail.) Any e-mail that contains information which needs to be
     preserved for a significant period of time should be modified and stored
     in another, more permanent format.

o    Employees may not install any e-mail system except as specifically
     authorized by the IS Department.

o    The Company's e-mail system may not be used to solicit or proselytize for
     commercial ventures, non-profit organizations, religious or political
     causes, or other purposes unrelated to Company business, except in regard
     to Company sponsored programs or such other activity as may be approved
     in advance by the Company's executive officers.

o    In some instances, Company employees may be connected to the Company's
     e-mail system through the Internet. Such employees must be aware of and
     adhere to the Internet policies described below.

(d)  Use of Company Computers

o    Generally, copyright laws provide that anyone who purchases a copy of
     software has the right to load that software onto a single computer and
     make another copy for archival purposes only. In some cases, a software
     license may also authorize a copy for other limited uses. Violation of
     software copyright laws can result in significant civil and criminal
     penalties, and trade organizations have become much more aggressive about
     enforcement of the law. As such, employees may acquire, use, copy and
     distribute software only in accordance with the policies and procedures
     of the IS Department and any applicable software license.

o    Employees may not use encryption capabilities for purposes of internal
     communications unless approved by the IS Department.

o    The Company's computer system, including hardware, software and
     accessories, is Company property to be used for business purposes.

(e)  Software Copying and Other Types of Unlawful Copying

U.S. and International copyright laws prohibit the copying, distribution, use,
and display of a copyrighted work without the prior permission of the copyright
owner. These restrictions apply to software as well as written material and
extend to the making of derivative works or compilation of any copyrighted
material. Violations can result in civil and criminal penalties for the Company
and its employees. To ensure compliance, address any concerns to the IS
Department or Legal Department.

Neither the Company nor its employees should make or use unauthorized copies of
computer software programs in violation of U.S. copyright laws or the relevant
software license agreement.

(f)  Internet and Other External Electronic Communications

o    The Internet and other external electronic communications are not secure.
     Any message sent over the Internet, even if addressed to only one
     specific address, may potentially be intercepted and read by anyone.
     Also, Internet communications are not anonymous. Each message will
     generally contain information that will identify the source of the
     message by employee and company name.

o    Accordingly, employees should avoid communicating extremely confidential,
     proprietary or sensitive information via the Internet or other comparable
     electronic communications media.

Internet communications, as well as other comparable communications media,
should not be used for business purposes.

8.   POLICY STATEMENT EQUAL EMPLOYMENT OPPORTUNITY

The Company's Policy Statement on Equal Employment Opportunity is reproduced in
full below:

It is the policy of CenturyTel to employ qualified personnel and to provide
equal employment opportunity for all applicants and employees. This policy
applies to recruitment, hiring, training, promotion and other terms and
conditions of employment. It will be administered without regard to race, color,
religion, creed, national origin, age or sex; mental or physical disability
(except where disability is a bona fide occupational disqualification); marital
status, change in marital status, parenthood, pregnancy, or family relationship;
status as a disabled veteran, or a veteran of the Vietnam Era; or any other
impermissible characteristic as defined by federal or state law.

Accordingly, all employment decisions shall be consistent with these principles.
Selection decisions will rely on valid qualifications. Other personnel actions
or programs such as, but not limited to, compensation, benefits, transfers,
layoffs, returns from layoff, company sponsored training, education, tuition
assistance, social, and recreational programs, will be administered in a
nondiscriminatory manner.

An employee who believes that he or she (or a coworker) may not have been
provided equal employment opportunity or may have been the subject of unlawful
discrimination or believes he or she may have witnessed some violation of this
policy, should promptly report the facts to his or her supervisor. An employee
who is not comfortable discussing the matter with his or her supervisor may
report it directly to the manager/department head, Human Resources Manager or
Corporate Employee Relations at (360) 905-5943. Human Resources will ensure that
all claims are investigated promptly and that appropriate corrective action is
taken. Any supervisor or employee, who after appropriate investigation, is found
to have engaged in unlawful discrimination, will be subject to appropriate
sanctions, which may, depending upon the circumstances, include termination.

Employees who report possible incidents of unlawful discrimination or Equal
Employment Opportunity violations will be treated courteously and all such
reports will be swiftly and thoroughly investigated in as confidential a manner
as is possible under the circumstances. No employee will be discriminated or
retaliated against in any way for bringing a question or complaint to the
Company's attention.

CenturyTel is committed to a policy of equal employment opportunity. The Company
believes that such a policy is a proper concern of business and we encourage
each employee to sincerely support this policy. For further information, you may
contact Employee Relations at (360) 905-5943.

9.   OUR POLICY ON UNLAWFUL DISCRIMINATION AND HARASSMENT

The Company's Policy on Unlawful Discrimination and Harassment is reproduced in
full below:

Our Commitment
- --------------

We are committed to providing equal employment opportunities to all persons
regardless of race, color, religion, ancestry, sex, national origin, marital or
veteran status, physical or mental disability, on-the-job injuries, age, or any
other legally protected status, unless it is a bona fide occupational
requirement reasonably necessary to the operation of our business. We are also
absolutely committed to providing a work environment that is free of ALL forms
of unlawful harassment. We will not tolerate the harassment of our employees by
anyone -- supervisors, co-workers, customers, or vendors. It is each employee's
responsibility to eliminate all forms of prohibited harassment. It is every
supervisor's responsibility to prevent such behavior from occurring within his
or her work jurisdiction and provide a work environment free from harassment.

Sexual Harassment
- -----------------

Sexual harassment consists of unwelcome sexual advances, requests for sexual
favors, and other verbal or physical conduct of a sexual nature if (1)
submission to the conduct is in any way made a term or condition of employment;
(2) submission to (or rejection of) the conduct is used as the basis for any
employment-related decisions; or (3) the conduct has the purpose or effect of
unreasonably interfering with an individual's work performance or creating an
intimidating, hostile or offensive work environment. This means no sexual or
sexist language, jokes or innuendo; nude, profane, or obscene cartoons, drawings
or photographs; whistling or cat-calling; staring or leering; pinching, patting,
inappropriate touching, unwelcome hugging or kissing; etc.; or other conduct
that might create or contribute to a hostile or offensive working atmosphere.

Other Forms of Unlawful Harassment
- ----------------------------------

We want to maintain a working environment free from all forms of unlawful
harassment, whether based upon race, color, religion, ancestry, national origin,
age, marital or veteran status, physical or mental disabilities, on-the-job
injuries, sex, or any other legally protected characteristic or status. This
means no "ethnic jokes"; religious slurs; use of offensive "slang" or derogatory
terms or slurs denoting race, age, national origin, disability, etc.; mimicking
one's speech, accent or disability; derogatory comments regarding protected
statuses or characteristics; or other conduct that might create or contribute to
a hostile or offensive working atmosphere.

Reporting Unlawful Discrimination or Harassment
- -----------------------------------------------

If you believe that you have been harassed, witness or suspect any violation of
this policy, you may report the matter to your supervisor, manager or to the
next level of management. If you are uncomfortable doing so at those levels,
regardless of the reason, you should report it directly to the Manager of Human
Resources. No employee will be discriminated or retaliated against in any way
for bringing a question or complaint to our attention or for bypassing the chain
of command.

All employees, supervisors and managers are required to support both the letter
and spirit of this policy. The Human Resources Department is responsible for
ensuring that all complaints are promptly and thoroughly investigated in as
confidential a manner as is possible under the circumstances. (If the matter
includes employees within the Human Resources Department, the investigation will
be performed by the Legal Department.) Appropriate corrective action will be
taken, up to and including termination, when violations have occurred. For
further information, or to report any problems or complaints relating to
discrimination or harassment, contact your Manager, Human Resource Department.

(10) APPLICABILITY OF OTHER COMPANY POLICIES

Employees should note that this handbook does not set forth all of the policies
or guidelines governing your employment relationship with CenturyTel or the
particular region, division, group or business unit for which you work. Please
consult CenturyTel's Employee Handbook, CenturyTel's Intranet site or with your
supervisor for information on such other policies and guidelines.

(11) COMPLIANCE WITH LAW

CenturyTel has a policy of strict compliance with all laws that are applicable
to our business, wherever conducted. Compliance with the law means not only
observing the law, but conducting our business affairs so that we will deserve
and receive recognition as a law-abiding organization. No employee should assume
that CenturyTel's interest ever requires some other course of conduct. Moreover,
no individual within CenturyTel has authority to give any order or direction
that would result in a violation of this policy. Following are brief
descriptions of a few of the federal statutes that may significantly affect
CenturyTel's operations. This list is not intended to be exclusive, as there
exist many other federal statutes that may affect CenturyTel's operations. As
many of these statutes are complex and difficult to interpret, employees should
take the initiative to consult the responsible manager or officer, or the Legal
Department, when the proper course of action is in doubt.

(a)  Clean Water Act; Resource Conservation and Recovery Act; Toxic Substances
     Control Act; Comprehensive Environmental Response, Compensation and
     Liability Act.

Federal environmental statutes govern the storage, transportation, release and
disposal of hazardous and toxic substances (such as gasoline, asbestos, lead,
sulfuric acid, cadmium and materials found in certain vacuum tubes and
capacitors) and impose certain record keeping and reporting requirements in
connection with such hazardous and toxic substances.

In addition, Department of Transportation regulations require that certain
emergency response information be provided at the time hazardous material is
shipped, that the material be properly classified, documented, packaged and
labeled, and that the material be in the proper condition for shipment. Many
substances are included within the definition of "hazardous materials," such as
paints (including aerosol paints), corrosives, compressed or liquefied gases,
dyes, disinfectants, insecticides, poisons, refrigerants, flammable materials
and explosives.

(b)  Occupational Safety and Health Act

This statute provides criminal penalties for: willful violations that result in
the death of an employee; giving advance notice of an inspection conducted
pursuant to the statute; and knowingly making a false statement, representation
or certification in connection with records or reports required under the
statute. The Company strives to provide each employee with a safe and healthy
work environment. Each employee has responsibility for maintaining a safe and
healthy workplace for all employees by following safety and health rules and
practices and reporting accidents, injuries and unsafe equipment, practices or
conditions.

(c)  Sherman Act; Clayton Act; Robinson-Patman Act

In broad terms, these federal antitrust statutes prohibit the following:

1.   Agreements, associations or conspiracies between two or more companies
     that unreasonably restrain interstate or foreign trade or commerce;

2.   The monopolization or attempted monopolization of any market for a
     particular product or service, except in certain circumstances; and

3 .  Price discrimination in the sale of goods (such as telephone equipment)
     purchased for resale.

Certain activities are considered violations of the antitrust laws whether or
not there exists a business reason for such activity. These include:

1.   Price fixing, which includes agreements among competitors that fix key
     terms of an agreement that affect price;

2.   Customer and territorial allocation, such as agreements among companies
     that they will not compete as to certain business; and

3.   Agreements among companies to refuse to deal with particular customers or
     suppliers.

It must be emphasized that the laws regarding granting price and promotional
allowances to some but not other customers is complex. Please take extra care in
this area, consult with your supervisors and refer all legal questions that you
may have to the Legal Department.

(d)  Procurement Integrity

Generally, these laws prohibit the following in connection with any federal
agency procurement of property or services:

1.   Making any offer of future employment or business opportunity to, or
     discussing such matters with, a procurement official of the agency;

2.   Giving or offering any money or thing of value to a procurement official
     of the agency; and

3.   Soliciting or obtaining from the agency, prior to the award of a
     contract, any proprietary or source selection information regarding such
     contract.

(e)  False Statements or Entries

These laws prohibit the making of any false, fictitious or fraudulent
statements, representations or entries, or the use of any writing or document
containing any such statements, representations or entries, in connection with
any matter within the jurisdiction of any department or agency of the United
States.

(f)  Unauthorized Publication or Use of Communications

These laws prohibit the disclosure of the existence, contents, effect or meaning
of any wire or radio communication to any person other than the addressee,
except under certain statutorily defined circumstances. Fines of as much as
$10,000 and imprisonment for as long as five years and in some instances longer
may be imposed for breaking these laws.

(g)  Records and Reports on Monetary Instruments Transactions

These laws require the filing of a report when monetary instruments of more than
$10,000 are transported at one time into or out of the United States.

(h)  Willful Failure to File Return, Supply Information or Pay Tax

In addition to other proscribed actions, applicable tax statutes make it a crime
to fail to keep any records or make any returns required by the Internal Revenue
Code (including returns relating to receipt of more than $10,000 in cash in a
single transaction or related transactions), or to structure a transaction so as
to avoid such reporting requirements.

(i)  Securities Act of 1933; Securities Exchange Act of 1934

The federal securities laws regulate the issuance and sale of securities
(stocks, bonds, notes, investment contracts, etc.), prohibit fraudulent or
deceptive practices in the offer or sale of securities and impose disclosure and
other requirements on publicly-held corporations. Also prohibited is "insider
trading" -- purchases or sales by persons who have access to information that is
not available to the public. For additional information, see above Sections 3
and 4, "Policy Statement on Insider Trading" and "Disclosure Policy".

(j)  Foreign Corrupt Practices Act

This statute, generally speaking, prohibits bribes or other "corrupt" payments
by a U.S. company to a foreign official who exercises discretionary
decision-making authority for the purpose of obtaining or retaining business.

(k)  Government Inquiries

It is the Company's policy to cooperate with governmental authorities in the
proper performance of their functions in conducting investigations of our
Company or other companies, or in gathering information in preparation for
making a decision as to whether to conduct such an investigation. However, it is
important that all such matters be properly coordinated within the Company and
that all inquiries or investigations from the government be handled in an
orderly manner.

Therefore, if a representative of the Department of Justice, the Federal Trade
Commission, a member of the FBI, or any representative of any other government
agency requests an interview with any Company personnel, seeks data or copies of
documents, or seeks access to files, he should be told that the Company will
cooperate, but the matter must first be referred to the Legal Department (unless
the matter is a routine tax audit, OSHA inspection, employment law review or any
other similar routine matter of which the Legal Department is already aware).
This procedure should be followed whether the request is by letter or oral. It
is not necessary to get the government's request in writing. All requests,
written or oral, must be reported to the General Counsel by telephone
immediately. The Legal Department will then provide advice as to further action.

12.  WAIVERS OF THE CODE OF BUSINESS CONDUCT AND ETHICS

Any waiver of any of the above-described policies, principles or guidelines
relating to business conduct and ethics for executive officers or directors may
be made only by the Board of Directors or an authorized Board committee, and
will be promptly disclosed as required by law or stock exchange regulation.

13.  ACCOUNTING COMPLAINT PROCEDURES

Any person who has any concerns, complaints or questions about the Company's
accounting, internal accounting controls or auditing may contact the Audit
Committee of the Board of Directors by sending a letter to the Chairman of the
Audit Committee, c/o Post Office Box 4364, Monroe, Louisiana 71211. Employees
may send any such letter on an anonymous basis, and may request that their
letter be handled on a confidential basis. Copies of all such letters will be
retained for a five-year period.

14.  INQUIRIES REGARDING ALL OTHER POSSIBLE COMPLIANCE PROGRAM VIOLATIONS

For any concern, complaint or question not covered by Section 13, please note
that the Vice President of Employee & Labor Relations serves as the Corporate
Compliance Officer (CCO) and supervises the confidential investigation of
alleged Compliance Program violations. If you have a good faith belief that a
violation of laws, company policies or business ethics has occurred, you may
arrange a personal meeting or teleconference with the Corporate Compliance
Officer.

If you prefer, you may make an oral telephone report by calling (360) 905-6861,
a private, confidential extension maintained for this purpose, you may send a
letter to the Corporate Compliance Officer or you may also seek guidance from
your supervisor or manager. You may make or send any such report or seek any
such guidance on an anonymous basis. If follow up investigations are necessary,
they will be handled confidentially to the maximum extent possible.

It is recognized that an employee who encounters a violation or possible
violation of laws, policies or ethics by another employee is in a sensitive
situation. However, an employee who reports such information in good faith will
not be penalized or suffer reprisals of any form as a result.

For additional information regarding how CenturyTel responds to alleged policy
violations and otherwise administers its corporate compliance program, please
consult the Corporate Compliance Program Procedures, copies of which may be
obtained from your supervisor, the Corporate Compliance Officer or on the
Company's intranet site.


<PAGE>


                             EMPLOYEE ACKNOWLEDGMENT

                          CORPORATE COMPLIANCE PROGRAM
                                    HANDBOOK



I have received the March 2003 information relating to CenturyTel's Corporate
Compliance Program, Equal Employment Opportunity, and Policy on Unlawful
Discrimination and Harassment.






- ----------------------------
Employee Name (please print)




- -------------------------------------------------------
Company/Division                Social  Security Number



- ------------------------------------
Employee Signature              Date


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-21
<SEQUENCE>13
<FILENAME>exh21.txt
<DESCRIPTION>EXHIBIT 21 - SUBSIDIARY LISTING
<TEXT>
                                                                 EXHIBIT 21
                                CENTURYTEL, INC.
                         SUBSIDIARIES OF THE REGISTRANT
                             AS OF DECEMBER 31, 2003

                                                                 State of
Subsidiary                                                     incorporation

Actel, LLC                                                        Delaware
Century Business Communications, LLC                              Louisiana
Century Interactive Fax, Inc.                                     Louisiana
CenturyTel Arkansas Holdings, Inc.                                Arkansas
CenturyTel Fiber Company II, LLC                                  Louisiana
CenturyTel Holdings, Inc.                                         Louisiana
CenturyTel Holdings Missouri, Inc.                                Missouri
CenturyTel Interactive Company, Inc.                              Louisiana
CenturyTel Internet Services, LLC                                 Louisiana
CenturyTel Investments, LLC                                       Louisiana
CenturyTel Investments of Texas, Inc.                             Delaware
CenturyTel Long Distance, Inc.                                    Louisiana
CenturyTel Michigan Network, LLC                                  Louisiana
CenturyTel Midwest - Michigan, Inc.                               Michigan
CenturyTel of Adamsville, Inc.                                    Tennessee
CenturyTel of Alabama, LLC                                        Louisiana
CenturyTel of Arkansas, Inc.                                      Arkansas
CenturyTel of Central Arkansas, LLC                               Arkansas
CenturyTel of Central Indiana, Inc.                               Indiana
CenturyTel of Central Louisiana, LLC                              Louisiana
CenturyTel of Central Wisconsin, LLC                              Delaware
CenturyTel of Chatham, LLC                                        Louisiana
CenturyTel of Chester, Inc.                                       Iowa
CenturyTel of Claiborne, Inc.                                     Tennessee
CenturyTel of Colorado, Inc.                                      Colorado
CenturyTel of Cowiche, Inc.                                       Washington
CenturyTel of Eagle, Inc.                                         Colorado
CenturyTel of East Louisiana, LLC                                 Louisiana
CenturyTel of Eastern Oregon, Inc.                                Oregon
CenturyTel of Evangeline, LLC                                     Louisiana
CenturyTel of Fairwater-Brandon-Alto, LLC                         Delaware
CenturyTel of Forestville, LLC                                    Delaware
CenturyTel of Idaho, Inc.                                         Delaware
CenturyTel of Inter Island, Inc.                                  Washington
CenturyTel of Lake Dallas, Inc.                                   Texas
CenturyTel of Larsen-Readfield, LLC                               Delaware
CenturyTel of Michigan, Inc.                                      Michigan
CenturyTel of Minnesota, Inc.                                     Minnesota
CenturyTel of Missouri, LLC                                       Louisiana
CenturyTel of Monroe County, LLC                                  Wisconsin
CenturyTel of Montana, Inc.                                       Oregon
CenturyTel of Mountain Home, Inc.                                 Arkansas
CenturyTel of North Louisiana, LLC                                Louisiana
CenturyTel of North Mississippi, Inc.                             Mississippi
CenturyTel of Northern Michigan, Inc.                             Michigan
CenturyTel of Northern Wisconsin, LLC                             Delaware
CenturyTel of Northwest Arkansas, LLC                             Delaware
CenturyTel of Northwest Louisiana, Inc.                           Louisiana
CenturyTel of Northwest Wisconsin, LLC                            Delaware
CenturyTel of Odon, Inc.                                          Indiana
CenturyTel of Ohio, Inc.                                          Ohio
CenturyTel of Ooltewah-Collegedale, Inc.                          Tennessee
CenturyTel of Oregon, Inc.                                        Oregon
CenturyTel of Port Aransas, Inc.                                  Texas
CenturyTel of Postville, Inc.                                     Iowa
CenturyTel of Redfield, Inc.                                      Arkansas
CenturyTel of Ringgold, LLC                                       Louisiana
CenturyTel of San Marcos, Inc.                                    Texas
CenturyTel of South Arkansas, Inc.                                Arkansas
CenturyTel of Southeast Louisiana, LLC                            Louisiana
CenturyTel of Southern Wisconsin, LLC                             Louisiana
CenturyTel of Southwest Louisiana, LLC                            Louisiana
CenturyTel of the Gem State, Inc.                                 Idaho
CenturyTel of the Midwest-Kendall, LLC                            Delaware
CenturyTel of the Midwest-Wisconsin, LLC                          Delaware
CenturyTel of the Northwest, Inc.                                 Washington
CenturyTel of the Southwest, Inc.                                 New Mexico
CenturyTel of Upper Michigan, Inc.                                Michigan
CenturyTel of Washington, Inc.                                    Washington
CenturyTel of Wisconsin, LLC                                      Louisiana
CenturyTel of Wyoming, Inc.                                       Wyoming
CenturyTel Security Systems Holding Company, LLC                  Louisiana
CenturyTel Service Group, LLC                                     Louisiana
CenturyTel Solutions, LLC                                         Louisiana
CenturyTel Supply Group, Inc.                                     Louisiana
CenturyTel Web Solutions, LLC                                     Louisiana
CenturyTel/Area Long Lines, Inc.                                  Wisconsin
CenturyTel/Tele-Max, Inc.                                         Texas
CenturyTel TeleVideo, Inc.                                        Louisiana
CenturyTel/Teleview of Wisconsin, Inc.                            Wisconsin
Spectra Communications Group, LLC                                 Delaware
Telephone USA of Wisconsin, LLC                                   Delaware

      Certain of the Company's smaller subsidiaries have been intentionally
omitted from this exhibit pursuant to rules and regulations of the Securities
and Exchange Commission.



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23
<SEQUENCE>14
<FILENAME>exh23.txt
<DESCRIPTION>EXHIBIT 23
<TEXT>
                                                                      EXHIBIT 23




                          Independent Auditors' Consent



The Board of Directors
CenturyTel, Inc.:


We consent to incorporation by reference in the Registration Statements
(No. 333-91361, No. 333-84276 and No. 333-100481) on Form S-3, the
Registration Statements (No. 33-46562, No. 33-60061, No. 333-37148,
No. 333-60806, No. 333-64992, No. 333-65004, No. 333-89060, No. 333-105090 and
No. 333-109181) on Form S-8, the Registration Statement (No. 33-31314) on
combined Form S-8 and Form S-3, and the Registration Statements (No. 33-48956
and No. 333-17015) on Form S-4 of CenturyTel, Inc. of our report dated
January 29, 2004, relating to the consolidated balance sheets of CenturyTel,
Inc. and subsidiaries as of December 31, 2003 and 2002, and the related
consolidated statements of income, comprehensive income, cash flows, and
stockholders' equity and related financial statement schedule for each of the
years in the three-year period ended December 31, 2003, which report appears in
the December 31, 2003 annual report on Form 10-K of CenturyTel, Inc.


/s/  KPMG LLP

KPMG LLP

Shreveport, Louisiana
March 12, 2004





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>15
<FILENAME>exhibit311.txt
<DESCRIPTION>EXHIBIT 31.1
<TEXT>
                                                                   Exhibit 31.1

                                 CERTIFICATIONS

I, Glen F. Post, III, Chairman of the Board and Chief Executive Officer,
certify that:

1.   I have reviewed this annual report on Form 10-K of CenturyTel, Inc.;

2.   Based on my knowledge, this report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary
     to make the statements made, in light of the circumstances under which
     such statements were made, not misleading with respect to the period
     covered by this report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this report, fairly present in all material
     respects the financial condition, results of operations and cash flows
     of the registrant as of, and for, the periods present in this report;

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as
     defined in Exchange Act Rules 13a-15(e) and 15d-15 (e)) for the
     registrant and have:

     a)  designed such disclosure controls and procedures, or caused such
         disclosure controls and procedures to be designed under our
         supervision, to ensure that material information relating to the
         registrant, including its consolidated subsidiaries, is made known to
         us by others within those entities, particularly during the period in
         which this report is being prepared;
     b)  evaluated the effectiveness of the registrant's disclosure controls and
         procedures and presented in this report our conclusions about the
         effectiveness of the disclosure controls and procedures, as of the end
         of the period covered by this report based on such evaluation; and
     c)  disclosed in this report any change in the registrant's internal
         control over financial reporting that occurred during the registrant's
         most recent fiscal quarter (the registrant's fourth fiscal quarter in
         the case of an annual report) that has materially affected, or is
         reasonably likely to materially affect, the registrant's internal
         control over financial reporting; and

5.   The registrant's other certifying officers and I have disclosed, based
     on our most recent evaluation of internal control over financial
     reporting, to the registrant's auditors and the audit committee or
     registrant's board of directors (or persons performing the equivalent
     functions):

     a)  all significant deficiencies and material weaknesses in the design or
         operation of internal control over financial reporting which are
         reasonably likely to adversely affect the registrant's ability to
         record, process, summarize and report financial information; and
     b)  any fraud, whether or not material, that involves management or other
         employees who have a significant role in the registrant's internal
         control over financial reporting.


Date:    March 12, 2004                    /s/  Glen F. Post, III
                                           -------------------------
                                           Glen F. Post, III
                                           Chairman of the Board and
                                            Chief Executive Officer


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31
<SEQUENCE>16
<FILENAME>exhibit312.txt
<DESCRIPTION>EXHIBIT 31.2
<TEXT>
                                                                   Exhibit 31.2

                                            CERTIFICATIONS


I, R. Stewart Ewing, Jr., Executive Vice President and Chief Financial Officer,
certify that:

1.   I have reviewed this annual report on Form 10-K of CenturyTel, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material fact or omit to state a material fact necessary to make the
     statements made, in light of the circumstances under which such statements
     were made, not misleading with respect to the period covered by this
     report;

3.   Based on my knowledge, the financial statements, and other financial
     information included in this report, fairly present in all material
     respects the financial condition, results of operations and cash flows
     of the registrant as of, and for, the periods present in this report;

4.   The registrant's other certifying officers and I are responsible for
     establishing and maintaining disclosure controls and procedures (as
     defined in Exchange Act Rules 13a-15(e) and 15d-15 (e)) for the
     registrant and have:

     a)  designed such disclosure controls and procedures, or caused such
         disclosure controls and procedures to be designed under our
         supervision, to ensure that material information relating to the
         registrant, including its consolidated subsidiaries, is made known to
         us by others within those entities, particularly during the period in
         which this report is being prepared;
     b)  evaluated the effectiveness of the registrant's disclosure controls and
         procedures and presented in this report our conclusions about the
         effectiveness of the disclosure controls and procedures, as of the end
         of the period covered by this report based on such evaluation; and
     c)  disclosed in this report any change in the registrant's internal
         control over financial reporting that occurred during the registrant's
         most recent fiscal quarter (the registrant's fourth fiscal quarter in
         the case of an annual report) that has materially affected, or is
         reasonably likely to materially affect, the registrant's internal
         control over financial reporting; and

5.   The registrant's other certifying officers and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee or registrant's board of
     directors (or persons performing the equivalent functions):

     a)  all significant deficiencies and material weaknesses in the design or
         operation of internal control over financial reporting which are
         reasonably likely to adversely affect the registrant's ability to
         record, process, summarize and report financial information; and
     b)  any fraud, whether or not material, that involves management or other
         employees who have a significant role in the registrant's internal
         control over financial reporting.


Date:    March 12, 2004                          /s/  R. Stewart Ewing, Jr.
                                                 --------------------------
                                                 R. Stewart Ewing, Jr.
                                                 Executive Vice President and
                                                 Chief Financial Officer



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-32
<SEQUENCE>17
<FILENAME>exhibit32.txt
<DESCRIPTION>EXHIBIT 32
<TEXT>
                                                                     Exhibit 32

                                CenturyTel, Inc.

                                 March 12, 2004



Securities and Exchange Commission
450 Fifth Street, NW
Washington, D.C. 20549

     Re: CenturyTel, Inc.
         Certification of Contents of Form 10-K for the year
         ending December 31, 2003, pursuant to Section 906
         of the Sarbanes-Oxley Act of 2002

Ladies and Gentlemen:

     The undersigned, acting in their capacities as the Chief Executive
Officer and the Chief Financial Officer of CenturyTel, Inc. (the "Company"),
certify that the Form 10-K for the year ended December 31, 2003 of the Company
fully complies with the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, and that the information contained in the Form 10-K fairly
presents, in all material respects, the financial condition and results of
operations of the Company for the period covered by such report.

     This certification is being furnished as an exhibit to the Form 10-K
solely to comply with the requirements of Section 906 of the Sarbanes-Oxley Act
of 2002, Pub. L. No. 107-204, and should not be deemed to be filed with the
Securities and Exchange Commission, either as a part of the Form 10-K or
otherwise.

     A signed original of this written statement required by Section 906 has
been provided to the Company and will be retained by the Company and furnished
to the Securities and Exchange Commission or its staff upon request.

Very truly yours,



/s/ Glen F. Post, III                        /s/  R. Stewart Ewing, Jr.
- ----------------------------                 -------------------------------
  Glen F. Post, III                            R. Stewart Ewing, Jr.
  Chairman of the Board and                    Executive Vice President and
   Chief Executive Officer                      Chief Financial Officer


</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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