Press Release

Frontier Communications Reports Strong 2009 Second-Quarter Results

13,800 High-Speed Internet additions 11,400 DISH Network video customer additions Continued strong operating income and cash flow margins First half free cash flow of $244 million First half operating cash flow margin of 54%, as adjusted First half dividend payout ratio of 64% Data and internet services revenue up 6% year over year 2009 free cash flow estimate unchanged

Company Release - 8/4/2009 7:00 AM ET

STAMFORD, Conn.--(BUSINESS WIRE)-- Frontier Communications (NYSE:FTR) today reported second-quarter 2009 revenue of $532.1 million, operating income of $136.6 million and net income attributable to common shareholders of Frontier of $27.9 million.

"I am very pleased with the strong results that Frontier delivered this quarter," said Maggie Wilderotter, Frontier Communications Chairman and CEO. "We continue to focus on customer acquisition and retention as our primary goal. Our access line trends continued to improve for the fourth consecutive quarter, with absolute access line losses at their lowest level in over two years. Furthermore, our ability to deliver impressive results in our core business while also executing on the Verizon acquisition speaks to the strength and bandwidth of our management team."

Revenue for the second quarter of 2009 was $532.1 million compared to $562.6 million in the second quarter of 2008, a 5 percent decrease. Revenue declined as a result of lower access lines and reduced long distance, switched access and subsidy revenue, partially offset by a 6 percent increase in data and internet services revenue. Despite the decline in access lines, our customer revenue, which is all revenue except switched access and subsidy, has declined by less than 4 percent. The monthly customer revenue per access line has increased approximately $2.19, or 3%, over the prior year's second quarter while the monthly total revenue per access line has increased $1.18, or 2%, over the same period, as the Company has continued to successfully sell additional products and services, partially offset by reductions in regulatory revenue.

Other operating expenses and network access expenses for the second quarter of 2009 were $252.0 million as compared to $256.3 million in the second quarter of 2008, a 2 percent decrease. Expenses in the second quarter of 2009 include non-cash pension costs of $8.2 million, as compared to $(0.5) million in the second quarter of 2008. Excluding these costs, other operating expenses and network access expenses declined $13.1 million, or 5%, in 2009.

Consistent with recently adopted new accounting rules under SFAS No. 141R, "Business Combinations," acquisition related costs of approximately $10.8 million ($0.02 per share after tax) were incurred and expensed during the second quarter of 2009 in connection with our previously announced pending acquisition of approximately 4.8 million access lines (as of December 31, 2008) from Verizon Communications Inc.

Operating income for the second quarter of 2009 was $136.6 million and operating income margin was 25.7 percent compared to operating income of $162.0 million and operating income margin of 28.8 percent in the second quarter of 2008. The second quarter 2009 decrease of $25.4 million is primarily the result of the reduction in revenue and the acquisition related costs incurred in 2009, partially offset by lower expenses.

Investment and other income, net for the second quarter of 2009 reflects a net gain of $3.7 million recognized on repurchases of Company debt. As of June 30, 2009, we retired early approximately $311.7 million principal amount of debt for $308.0 million.

Interest expense for the second quarter of 2009 was $98.7 million as compared to $90.7 million in the second quarter of 2008, an $8.0 million or 9 percent increase ($0.02 per share after tax). Interest expense increased due to the registered offering, completed in April 2009, of $600.0 million aggregate principal amount of 8.25% senior unsecured notes due 2014. We received net proceeds of approximately $538.8 million from the offering which we intend to use to reduce, repurchase or refinance our indebtedness or for general corporate purposes.

The decrease in income tax expense reflects lower taxable income in 2009, partially offset by the favorable impact in the second quarter of 2008 of the reversal of $7.5 million in income tax reserves.

Net income attributable to common shareholders of Frontier was $27.9 million, or $0.09 per share, as compared to $55.8 million, or $0.17 per share, in the second quarter of 2008. The second quarter of 2009 includes acquisition related costs of $10.8 million ($6.8 million or $0.02 per share after tax). The second quarter 2009 decrease is primarily the result of a reduction in operating income and increased interest expense, partially offset by lower income tax expense.

The Company lost approximately 27,700 access lines during the second quarter of 2009 and had 2,189,100 access lines at June 30, 2009.

The Company added approximately 13,800 net High-Speed Internet customers during the second quarter of 2009 and had 613,800 High-Speed Internet customers at June 30, 2009. The Company added approximately 11,400 video customers during the second quarter of 2009 and had 157,400 video customers at June 30, 2009.

Capital expenditures were $55.8 million for the second quarter of 2009 and $110.4 million for the first six months of 2009.

Operating cash flow, as adjusted, was $288.4 million for the second quarter of 2009 resulting in an operating cash flow margin of 54.2 percent. Operating cash flow, as reported, of $269.4 million has been adjusted to exclude $10.8 million of acquisition related costs and $8.2 million of non-cash pension costs for the second quarter of 2009.

Free cash flow was $98.1 million for the second quarter of 2009 and $244.2 million for the first six months of 2009. The Company's dividend represents a payout of 64 percent of free cash flow for the first six months of 2009.

For the full year of 2009, the Company maintains its previously reported expectations that capital expenditures, excluding acquisition related capital expenditures, will be within a range of $250.0 million to $270.0 million and free cash flow, excluding acquisition related costs, will be within a range of $460.0 million to $485.0 million.

The Company uses certain non-GAAP financial measures in evaluating its performance. These include free cash flow and operating cash flow. A reconciliation of the differences between free cash flow and operating cash flow and the most comparable financial measures calculated and presented in accordance with GAAP is included in the tables that follow. The non-GAAP financial measures are by definition not measures of financial

performance under GAAP and are not alternatives to operating income or net income reflected in the statement of operations or to cash flow as reflected in the statement of cash flows and are not necessarily indicative of cash available to fund all cash flow needs. The non-GAAP financial measures used by the Company may not be comparable to similarly titled measures of other companies.

The Company believes that the presentation of non-GAAP financial measures provides useful information to investors regarding the Company's financial condition and results of operations because these measures, when used in conjunction with related GAAP financial measures, (i) together provide a more comprehensive view of the Company's core operations and ability to generate cash flow, (ii) provide investors with the financial analytical framework upon which management bases financial, operational, compensation and planning decisions and (iii) presents measurements that investors and rating agencies have indicated to management are useful to them in assessing the Company and its results of operations. Management uses these non-GAAP financial measures to plan and measure the performance of its core operations, and its divisions measure performance and report to management based upon these measures. In addition, the Company believes that free cash flow and operating cash flow, as the Company defines them, can assist in comparing performance from period to period, without taking into account factors affecting cash flow reflected in the statement of cash flows, including changes in working capital and the timing of purchases and payments. The Company has shown adjustments to its financial presentations to exclude $10.8 million of acquisition related costs in the second quarter and first six months of 2009, and $8.2 million and $(0.5) million of non-cash pension costs in the second quarters of 2009 and 2008, respectively, and $16.5 million and $(1.1) million of non-cash pension costs in the first half of 2009 and 2008, respectively, because the Company believes that such costs in the second quarters and first six months of 2009 and 2008 are unusual, and that the magnitude of such costs in the second quarter and first six months of 2009 materially exceed the comparable costs in the second quarter and first six months of 2008. In addition, the Company has shown adjustments to its financial presentations to exclude $0.5 million of severance and early retirement costs in the second quarter of 2008, $2.6 million and $3.4 million of severance and early retirement costs in the first half of 2009 and 2008, respectively, and $0.1 million and $0.9 million of legal settlement costs and related expenses in the second quarter and first six months of 2008, respectively, because investors have indicated to management that such adjustments are useful to them in assessing the Company and its results of operations.

Management uses these non-GAAP financial measures to (i) assist in analyzing the Company's underlying financial performance from period to period, (ii) evaluate the financial performance of its business units, (iii) analyze and evaluate strategic and operational decisions, (iv) establish criteria for compensation decisions, and (v) assist management in understanding the Company's ability to generate cash flow and, as a result, to plan for future capital and operational decisions. Management uses these non-GAAP financial measures in conjunction with related GAAP financial measures. The Company believes that the non-GAAP financial measures are meaningful and useful for the reasons outlined above.

While the Company utilizes these non-GAAP financial measures in managing and analyzing its business and financial condition and believes they are useful to management and to investors for the reasons described above, these non-GAAP financial measures have certain shortcomings. In particular, free cash flow does not represent the residual cash flow available for discretionary expenditures, since items such as debt repayments and dividends are not deducted in determining such measure. Operating cash flow has similar shortcomings as interest, income taxes, capital expenditures, debt repayments and dividends are not deducted in determining this measure. Management compensates for the shortcomings of these measures by utilizing them in conjunction with their comparable GAAP financial measures. The information in this press release should be read in conjunction with the financial statements and footnotes contained in our documents filed with the U.S. Securities and Exchange Commission.

About Frontier Communications

Frontier Communications Corporation (NYSE:FTR) offers telephone, video and internet services in 24 states with approximately 5,400 employees. More information is available at www.frontier.com.

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. These statements are made on the basis of management's views and assumptions regarding future events and business performance. Words such as "believe," "anticipate," "expect" and similar expressions are intended to identify forward-looking statements. Forward-looking statements (including oral representations) involve risks and uncertainties that may cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. These risks and uncertainties are based on a number of factors, including but not limited to: Our ability to complete the acquisition of access lines from Verizon; the failure to obtain, delays in obtaining or adverse conditions contained in any required regulatory approvals for the Verizon transaction; the failure to receive the IRS ruling approving the tax-free status of the Verizon transaction; the failure of our stockholders to approve the Verizon transaction; the ability to successfully integrate the Verizon operations into Frontier's existing operations; the effects of increased expenses due to activities related to the Verizon transaction; the ability to migrate Verizon's West Virginia operations from Verizon owned and operated systems and processes to Frontier owned and operated systems and processes successfully; the risk that the growth opportunities and cost synergies from the Verizon transaction may not be fully realized or may take longer to realize than expected; the sufficiency of the assets to be acquired from Verizon to enable us to operate the acquired business; disruption from the Verizon transaction making it more difficult to maintain relationships with customers, employees or suppliers; the effects of greater than anticipated competition requiring new pricing, marketing strategies or new product or service offerings and the risk that we will not respond on a timely or profitable basis; reductions in the number of our access lines and High-Speed Internet subscribers; our ability to sell enhanced and data services in order to offset ongoing declines in revenue from local services, switched access services and subsidies; the effects of ongoing changes in the regulation of the communications industry as a result of federal and state legislation and regulation; the effects of competition from cable, wireless and other wireline carriers (through voice over internet protocol (VOIP) or otherwise); our ability to adjust successfully to changes in the communications industry and to implement strategies for improving growth; adverse changes in the credit markets or in the ratings given to our debt securities by nationally accredited ratings organizations, which could limit or restrict the availability, or increase the cost, of financing; reductions in switched access revenues as a result of regulation, competition and/or technology substitutions; the effects of changes in both general and local economic conditions on the markets we serve, which can impact demand for our products and services, customer purchasing decisions, collectability of revenue and required levels of capital expenditures related to new construction of residences and businesses; our ability to effectively manage service quality; our ability to successfully introduce new product offerings, including our ability to offer bundled service packages on terms that are both profitable to us and attractive to our customers; changes in accounting policies or practices adopted voluntarily or as required by generally accepted accounting principles or regulators; our ability to effectively manage our operations, operating expenses and capital expenditures, to pay dividends and to repay, reduce or refinance our debt; the effects of bankruptcies and home foreclosures, which could result in increased bad debts; the effects of technological changes and competition on our capital expenditures and product and service offerings, including the lack of assurance that our ongoing network improvements will be sufficient to meet or exceed the capabilities and quality of competing networks; the effects of increased medical, retiree and pension expenses and related funding requirements; changes in income tax rates, tax laws, regulations or rulings, and/or federal or state tax assessments; the effects of state regulatory cash management policies on our ability to transfer cash among our subsidiaries and to the parent company; our ability to successfully renegotiate union contracts expiring in 2009 and thereafter; further declines in the value of our pension plan assets, which could require us to make contributions to the pension plan beginning no earlier than 2010; our ability to pay dividends in respect of our common shares, which may be affected by our cash flow from operations, amount of capital expenditures, debt service requirements, cash paid for income taxes (which will increase in 2009) and our liquidity; the effects of increased cash taxes in 2009 and thereafter; the effects of any unfavorable outcome with respect to any of our current or future legal, governmental or regulatory proceedings, audits or disputes; the possible impact of adverse changes in political or other external factors over which we have no control; and the effects of hurricanes, ice storms or other severe weather. These and other uncertainties related to our business are described in greater detail in our filings with the Securities and Exchange Commission, including our reports on Forms 10-K and 10-Q, and the foregoing information should be read in conjunction with these filings. We do not intend to update or revise these forward-looking statements to reflect the occurrence of future events or circumstances.

Additional Information and Where to Find it

This press release is not a substitute for the prospectus/proxy statement included in the Registration Statement on Form S-4 that Frontier filed with the SEC on July 24, 2009 in connection with the proposed transactions described in the prospectus/proxy statement. We urge investors to read the prospectus/proxy statement, which contains important information, including detailed risk factors, and any amendments thereto when they become available. The prospectus/proxy statement and other documents filed or to be filed by Frontier with the SEC are or will be available free of charge at the SEC's website, www.sec.gov, or by directing a request when such a filing is made to Frontier, 3 High Ridge Park, Stamford, CT 06905-1390, Attention: Investor Relations.

This communication shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

Frontier and certain of its directors, executive officers and other members of management and employees may, under SEC rules, be deemed to be "participants" in the solicitation of proxies in connection with the proposed transactions. Information about the directors and executive officers of Frontier is set forth in the Registration Statement on Form S-4 referred to above. Investors may obtain additional information regarding the interests of such participants in the proposed transactions by reading the prospectus/proxy statement and any amendments thereto when they become available.


Frontier Communications Corporation

Consolidated Financial Data

                For the quarter ended             For the six months ended

                June 30,                  %       June 30,                      %

(Amounts in
thousands,      2009         2008         Change  2009           2008           Change
except per
share amounts)

Income
Statement Data

Revenue         $ 532,142    $ 562,550    -5  %   $ 1,070,098    $ 1,131,755    -5  %

Network access    59,203       53,998     10  %     119,887        114,547      5   %
expenses

Other
operating         192,754      202,333    -5  %     392,958        405,597      -3  %
expenses

Depreciation
and               132,818      144,250    -8  %     270,376        285,330      -5  %
amortization

Acquisition       10,751       -          100 %     10,751         -            100 %
related costs

Total
operating         395,526      400,581    -1  %     793,972        805,474      -1  %
expenses

Operating         136,616      161,969    -16 %     276,126        326,281      -15 %
income

Investment and
other income,     4,618        6,841      -32 %     12,865         5,934        117 %
net (1)

Interest          98,670       90,710     9   %     187,419        181,570      3   %
expense

Income before     42,564       78,100     -46 %     101,572        150,645      -33 %
income taxes

Income tax        14,254       21,874     -35 %     36,307         48,502       -25 %
expense

Net income        28,310       56,226     -50 %     65,265         102,143      -36 %

Less: Income
attributable
to the
noncontrolling
interest in a

partnership       392          448        -13 %     1,044          776          35  %

Net income
attributable
to common       $ 27,918     $ 55,778     -50 %   $ 64,221       $ 101,367      -37 %
shareholders
of Frontier

Weighted
average shares    310,095      320,838    -3  %     309,943        323,340      -4  %
outstanding

Basic net
income per
share
attributable
to

common
shareholders    $ 0.09       $ 0.17       -47 %   $ 0.20         $ 0.31         -35 %
of Frontier(2)

Other
Financial Data

Capital         $ 55,792     $ 75,737     -26 %   $ 110,364      $ 123,723      -11 %
expenditures

Operating cash
flow, as          288,404      306,206    -6  %     576,274        614,781      -6  %
adjusted (3)

Free cash flow    98,079       96,085     2   %     244,227        268,365      -9  %
(3)

Dividends paid    78,099       80,221     -3  %     156,184        162,324      -4  %

Dividend
payout ratio      80      %    83      %  -4  %     64        %    60        %  7   %
(4)




(1)  Includes gain on debt repurchases of $3.7 million for the quarter and six
     months ended June 30, 2009, and premium on debt

     repurchases of $6.3 million for the six months ended June 30, 2008.

(2)  Calculated based on weighted average shares outstanding. FSP EITF No.
     03-6-1, "Determining Whether Instruments Granted in

     Share-Based Payment Transactions are Participating Securities" was adopted
     in the first quarter of 2009 on a retrospective basis.

(3)  A reconciliation to the most comparable GAAP measure is presented at the
     end of these tables.

(4)  Represents dividends paid divided by free cash flow.




Frontier Communications Corporation

Consolidated Financial and Operating Data

               For the quarter ended             For the six months ended

               June 30,                  %       June 30,                  %

(Amounts in
thousands,
except         2009         2008         Change  2009         2008         Change
operating
data)

Select Income
Statement
Data

Revenue

 Local         $ 198,296    $ 214,703    -8  %   $ 399,192    $ 431,861    -8  %
 services

 Data and
 internet        160,551      151,655    6   %     316,944      297,637    6   %
 services

 Access          87,427       101,003    -13 %     177,492      208,821    -15 %
 services

 Long
 distance        40,560       46,912     -14 %     81,972       93,365     -12 %
 services

 Directory       27,211       29,070     -6  %     54,916       57,698     -5  %
 services

 Other           18,097       19,207     -6  %     39,582       42,373     -7  %

Total revenue    532,142      562,550    -5  %     1,070,098    1,131,755  -5  %

Expenses

 Network
 access          59,203       53,998     10  %     119,887      114,547    5   %
 expenses

 Other
 operating       192,754      202,333    -5  %     392,958      405,597    -3  %
 expenses (1)

 Depreciation
 and             132,818      144,250    -8  %     270,376      285,330    -5  %
 amortization

 Acquisition
 related         10,751       -          100 %     10,751       -          100 %
 costs

Total
operating        395,526      400,581    -1  %     793,972      805,474    -1  %
expenses

Operating      $ 136,616    $ 161,969    -16 %   $ 276,126    $ 326,281    -15 %
Income

Other
Financial and
Operating
Data

Revenue:

 Residential   $ 227,580    $ 239,633    -5  %   $ 458,046    $ 480,995    -5  %

 Business        217,135      221,914    -2  %     434,560      441,939    -2  %

 Total
 customer        444,715      461,547    -4  %     892,606      922,934    -3  %
 revenue

 Regulatory
 (Access         87,427       101,003    -13 %     177,492      208,821    -15 %
 services)

Total revenue  $ 532,142    $ 562,550    -5  %   $ 1,070,098  $ 1,131,755  -5  %

Access lines:

 Residential     1,405,258    1,516,402  -7  %     1,405,258    1,516,402  -7  %

 Business        783,869      824,310    -5  %     783,869      824,310    -5  %

Total access     2,189,127    2,340,712  -6  %     2,189,127    2,340,712  -6  %
lines

Other data:

 Employees       5,417        5,734      -6  %     5,417        5,734      -6  %

 High-Speed
 Internet        613,810      559,345    10  %     613,810      559,345    10  %
 (HSI)
 subscribers

 Video           157,353      107,596    46  %     157,353      107,596    46  %
 subscribers

 Switched
 access
 minutes of      2,213        2,538      -13 %     4,589        5,141      -11 %
 use (in
 millions)

 Average
 monthly
 total
 revenue per

 access line   $ 80.52      $ 79.34      2   %   $ 80.33      $ 79.08      2   %

 Average
 monthly
 customer
 revenue per

 access line   $ 67.29      $ 65.10      3   %   $ 67.01      $ 64.49      4   %




(1)  Includes severance and early retirement costs of $0.5 million for the
     quarter ended June 30, 2008, and $2.6 million and $3.4 million

     for the six months ended June 30, 2009 and 2008, respectively. Includes
     non-cash pension costs of $8.2 million and $(0.5) million

     for the quarters ended June 30, 2009 and 2008, respectively, and $16.5
     million and $(1.1) million for the six months ended June 30,

     2009 and 2008, respectively. Includes legal settlement costs of $0.1
     million for the quarter ended June 30, 2008 and $0.9 million

     for the six months ended June 30, 2008.




Frontier Communications Corporation

Condensed Consolidated Balance Sheet Data

(Amounts in thousands)

                                               June 30, 2009  December 31, 2008

   ASSETS

Current assets:

 Cash and cash equivalents                     $ 454,102      $ 163,627

 Accounts receivable and other current assets    304,919        304,332

  Total current assets                           759,021        467,959

Property, plant and equipment, net               3,165,917      3,239,973

Other long-term assets                           3,093,246      3,180,744

   Total assets                                $ 7,018,184    $ 6,888,676

   LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

 Long-term debt due within one year            $ 7,266        $ 3,857

 Accounts payable and other current              351,460        378,918
 liabilities

  Total current liabilities                      358,726        382,775

Deferred income taxes and other liabilities      1,266,308      1,254,610

Long-term debt                                   4,944,989      4,721,685

Shareholders' equity                             448,161        529,606

   Total liabilities and equity                $ 7,018,184    $ 6,888,676




Frontier Communications Corporation

Consolidated Cash Flow Data

(Amounts in thousands)

                                              For the six months ended June 30,

                                              2009          2008

Cash flows provided by (used in) operating
activities:

Net income                                    $ 65,265      $ 102,143

Adjustments to reconcile net income to net
cash provided

by operating activities:

 Depreciation and amortization expense          270,376       285,330

 Stock based compensation expense               4,561         6,164

 Pension expense                                16,454        (1,060   )

 (Gain)/loss on extinguishment of debt          (3,664   )    6,290

 Other non-cash adjustments                     (1,702   )    (8,079   )

 Deferred income taxes                          8,319         (8,996   )

 Change in accounts receivable                  10,231        8,039

 Change in accounts payable and other           (21,287  )    (57,537  )
 liabilities

 Change in other current assets                 (18,223  )    6,561

Net cash provided by operating activities       330,330       338,855

Cash flows provided from (used by) investing
activities:

 Capital expenditures                           (110,364 )    (123,723 )

 Other assets (purchased) distributions         628           (1,277   )
 received, net

Net cash used by investing activities           (109,736 )    (125,000 )

Cash flows provided from (used by) financing
activities:

 Long-term debt borrowings                      538,830       135,000

 Long-term debt payments                        (309,954 )    (130,281 )

 Settlement of interest rate swaps              -             15,521

 Financing costs paid                           (911     )    (857     )

 Premium paid to retire debt                    -             (6,290   )

 Issuance of common stock                       680           955

 Common stock repurchased                       -             (112,659 )

 Dividends paid                                 (156,184 )    (162,324 )

 Repayment of customer advances for
 construction and distributions

 to noncontrolling interests                    (2,580   )    (512     )

Net cash provided from (used by) financing      69,881        (261,447 )
activities

Increase (decrease) in cash and cash            290,475       (47,592  )
equivalents

Cash and cash equivalents at January 1,         163,627       226,466

Cash and cash equivalents at June 30,         $ 454,102     $ 178,874

Cash paid during the period for:

 Interest                                     $ 181,066     $ 184,552

 Income taxes                                 $ 40,458      $ 49,585




                                                            Schedule A

Reconciliation of Non-GAAP Financial Measures

                 For the quarter ended June 30,  For the six months ended June
                                                 30,

(Amounts in      2009         2008               2009       2008
thousands)

Net Income to
Free Cash Flow
;

Net Cash
Provided by
Operating
Activities

Net income       $ 28,310     $ 56,226           $ 65,265   $ 102,143

Add back:

Depreciation
and                132,818      144,250            270,376    285,330
amortization

Income tax         14,254       21,874             36,307     48,502
expense

Acquisition        10,751       -                  10,751     -
related costs

Pension expense    8,208        (530    )          16,454     (1,060  )
(non-cash) (1)

Stock based        2,439        3,145              4,561      6,164
compensation

Subtract:

Cash paid for      39,203       47,726             40,458     49,585
income taxes

Other income       3,706        5,417              8,665      (594    )
(loss), net (2)

Capital            55,792       75,737             110,364    123,723
expenditures

Free cash flow     98,079       96,085             244,227    268,365

Add back:

Deferred income    4,194        (8,714  )          8,319      (8,996  )
taxes

Non-cash
(gains)/losses,    9,040        (3,723  )          15,649     3,315
net

Other income       3,706        5,417              8,665      (594    )
(loss), net (2)

Cash paid for      39,203       47,726             40,458     49,585
income taxes

Capital            55,792       75,737             110,364    123,723
expenditures

Subtract:

Changes in
current assets     (8,893  )    (9,305  )          29,279     42,937
and liabilities

Income tax         14,254       21,874             36,307     48,502
expense

Acquisition        10,751       -                  10,751     -
related costs

Pension expense    8,208        (530    )          16,454     (1,060  )
(non-cash)(1)

Stock based        2,439        3,145              4,561      6,164
compensation

Net cash
provided by      $ 183,255    $ 197,344          $ 330,330  $ 338,855
operating
activities




     Includes pension expense of $10.2 million and $(0.7) million, less amounts
(1)  capitalized into the cost of capital expenditures of $2.0 million and $
     (0.2)

     million, for the quarters ended June 30, 2009 and 2008, respectively, and
     pension expense of $20.4 million and $(1.3) million, less amounts
     capitalized

     into the cost of capital expenditures of $3.9 million and $(0.2) million,
     for the six months ended June 30, 2009 and 2008, respectively.

(2)  Includes gain on debt repurchases of $3.7 million for the quarter and six
     months ended June 30, 2009, and premium on debt repurchases of $6.3 million

     for the six months ended June 30, 2008.




                                                                                                                       Schedule B

Reconciliation of Non-GAAP Financial Measures

              For the quarter ended June 30, 2009                                 For the quarter ended June 30, 2008

(Amounts in
thousands)

                                          Severance                                              Severance

                             Acquisition  and Early   Non-cash                                   and Early   Non-cash  Legal

Operating
Cash Flow     As             Related      Retirement  Pension      As             As             Retirement  Pension   Settlement  As
and

Operating
Cash Flow     Reported       Costs        Costs       Costs(1)     Adjusted       Reported       Costs       Costs(1)  Costs       Adjusted
Margin

Operating     $ 136,616      $ (10,751 )  $ (11    )  $ (8,208  )  $ 155,586      $ 161,969      $ (480   )  $ 530     $ (37  )    $ 161,956
Income

Add back:

Depreciation
and

amortization    132,818        -            -           -            132,818        144,250        -           -         -           144,250

Operating     $ 269,434      $ (10,751 )  $ (11    )  $ (8,208  )  $ 288,404      $ 306,219      $ (480   )  $ 530     $ (37  )    $ 306,206
cash flow

Revenue       $ 532,142                                            $ 532,142      $ 562,550                                        $ 562,550

Operating
income
margin

(Operating
income          25.7      %                                          29.2      %    28.8      %                                      28.8      %
divided by
revenue)

Operating
cash flow
margin

(Operating
cash flow       50.6      %                                          54.2      %    54.4      %                                      54.4      %
divided by
revenue)

              For the six months ended June 30, 2009                              For the six months ended June 30, 2008

                                          Severance                                              Severance

                             Acquisition  and Early   Non-cash                                   and Early   Non-cash  Legal

Operating
Cash Flow     As             Related      Retirement  Pension      As             As             Retirement  Pension   Settlement  As
and

Operating
Cash Flow     Reported       Costs        Costs       Costs(1)     Adjusted       Reported       Costs       Costs(1)  Costs       Adjusted
Margin

Operating     $ 276,126      $ (10,751 )  $ (2,567 )  $ (16,454 )  $ 305,898      $ 326,281      $ (3,371 )  $ 1,060   $ (859 )    $ 329,451
Income

Add back:

Depreciation
and

amortization    270,376        -            -           -            270,376        285,330        -           -         -           285,330

Operating     $ 546,502      $ (10,751 )  $ (2,567 )  $ (16,454 )  $ 576,274      $ 611,611      $ (3,371 )  $ 1,060   $ (859 )    $ 614,781
cash flow

Revenue       $ 1,070,098                                          $ 1,070,098    $ 1,131,755                                      $ 1,131,755

Operating
income
margin

(Operating
income          25.8      %                                          28.6      %    28.8      %                                      29.1      %
divided by
revenue)

Operating
cash flow
margin

(Operating
cash flow       51.1      %                                          53.9      %    54.0      %                                      54.3      %
divided by
revenue)




     Includes pension expense of $10.2 million and $(0.7) million, less amounts
(1)  capitalized into the cost of capital expensitures of $2.0 million and $
     (0.2) million, for the

     quarters ended June 30, 2009 and 2008, respectively, and pension expense of
     $20.4 million and $(1.3) million, less amounts capitalized into the cost of
     capital

     expenditures of $3.9 million and $(0.2) million, for the six months ended
     June 30, 2009 and 2008, respectively.




    Source: Frontier Communications
Contact: Frontier Communications David Whitehouse, 203-614-5708 Senior Vice President & Treasurer david.whitehouse@frontiercorp.com