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Quar terly Highlights
Third Quarter Fiscal 2005 (Ended December 31, 2004)
Our third quarter results were on plan and continue our momentum as we head into the fourth quarter.
About CSC
We are pleased with the pace of announced awards over the past two years and with the robust nature of
both the global commercial and U.S. federal pipelines. The positive aspects of these pipelines provide us
Founded in 1959,
with increased visibility as we move into our next fiscal year.
Computer Sciences
Corporation is a leading Van B. Honeycutt
information technology Chairman and Chief Executive Officer
Computer Sciences Corporation
(IT) services company.
CSC’s mission is to provide
CSC results for its fiscal 2005 third quarter included: revenue from continuing operations of $3.52 billion,
customers in industry
up 5.6% over last year’s comparable quarter (approximately 3% in constant currency); discontinued operations
and government with
revenue of $474.9 million, up 62.8%; net income of $157.5 million; net earnings per share (diluted) of 82 cents,
solutions crafted to meet including 12 cents from discontinued operations, compared with last year’s 68 cents including a three-cent after-
their specific challenges tax special charge; and major new business announcements of $5.3 billion, all from continuing operations.
and enable them to profit CSC’s global commercial activities, including primarily Europe and North America, were the driver of revenue
from the advanced use growth during the quarter. Trailing 12 months ended December 31, 2004, major business announcements
of technology. totaled approximately $17.5 billion, with approximately $15 billion coming from continuing operations. This
award base served as a positive contribution to the quarter’s performance. Global commercial revenue also
benefited from favorable currency movements.
With approximately
Effective February 11, 2005, CSC’s divestiture of DynCorp International and DynMarine units and selected
79,000 employees, CSC
DynCorp Technical Services contracts allows CSC to increase its focus on those information technology services
provides innovative
which have been core strengths during the company’s long and successful history with the U.S. federal govern-
solutions for customers
ment. CSC will use the net proceeds from this sale to grow its business and strengthen its balance sheet.
around the world by
The 14-month federal pipeline of opportunities for continuing operations is nearly $28 billion, comprised
applying leading tech-
of potential awards across multiple clients from a broad array of federal government departments and agencies.
nologies and CSC’s own More than $2 billion of this total is scheduled for award during the fiscal fourth quarter, ending April 1, 2005.
advanced capabilities. In North America, third quarter revenue derived from shorter-term consulting and systems integration
These include systems services again improved moderately year-over-year. Importantly, in Europe, CSC experienced modest growth
design and integration; compared to last year’s third quarter.
IT and business process Global commercial revenue was up 11.1% (approximately 6% in constant currency) to $2.37 billion from
the year-ago quarter. U.S. commercial revenue was $993.8 million, up 10.8%, compared with last year. European
outsourcing; applications
revenue rose 14.6% (approximately 5% in constant currency) to $1.07 billion from last year’s third quarter.
software development;
Global commercial and European revenue was the beneficiary of meaningful recent IT services engagements
Web and application
and favorable currency exchange rate movements. CSC’s non-European international revenue was $309.3
hosting; and management
million, up slightly (down approximately 4% in constant currency), compared with last year.
consulting.
For the third quarter, revenue from continuing operations derived from CSC’s U.S. federal government
activities declined. Revenue was $1.14 billion, down 4.1% from last year. A negative impact continued during
Headquartered in the third quarter from the previously disclosed completion of the Fort Rucker helicopter-maintenance contract.
El Segundo, California, Revenue from continuing operations generated by CSC’s civil agencies activities was $378.9 million, a decline
CSC reported revenue of 5.5% from last year. CSC’s DoD-related revenue from continuing operations was $732.2 million, down 1.2%,
of $13.9 billion for compared with the third quarter a year ago. Other federal revenue from continuing operations, comprised
the 12 months ended of state and local government as well as commercial contracts performed by the U.S. federal sector reporting
segment, declined to $32.7 million from last year’s third quarter.
December 31, 2004.
FINANCIAL HIGHLIGHTS
3RD QUARTER FISCAL 2005 REVENUES
FROM CONTINUING OPERATIONS (unaudited)
BY BUSINESS SEGMENT
Commercial U.S. Federal Third Quarter Nine Months Ended
$ in millions,except
67% 33% ($ in millions) per-share amounts
12/31/04 12/31/04
01/02/04 01/02/04
U.S. Commercial – $993.8 Revenues
20%
From Continuing
28% Europe – $1,069.9
$ 3,516.8 $10,260.8
Operations $ 3,329.5 $ 9,937.7
Other International – $309.3
12% $ 157.5 $ 398.4
Net Income $ 128.4 $ 328.8
U.S. DoD – $732.2
U.S. Civil Agencies – $378.9
Diluted Earnings
9%
30%
$ 0.82 $ 2.08
Per Share $ 0.68 $ 1.74
Other U.S. Federal – $32.7
1%
Total – $3,516.8

2. 3rdQtr02-05.qxd 2/23/05 12:16 PM Page 2
• U.S. Army – An Expedited Professional
CSC’S SERVICES ENCOMPASS INVESTMENT DATA
and Engineering Support Services
SEVERAL BROAD AREAS NYSE: CSC
• Outsourcing – Involves operating all (EXPRESS) blanket purchase agree- Recent Closing Price: 47.7 (2/14/05)
ment was awarded to CSC as a team
or a portion of a customer’s technology 52-Week Range: 38.07 – 58.00
leader to provide technical domain
infrastructure. CSC also provides Shares Outstanding: 191.1 million
advisory and assistance services to
business process outsourcing, which is Registered Shareholders: 11,730
the U.S. Army Aviation & Missile
the management of a client’s non-core Institutional Ownership: 81%
Command (AMCOM). CSC will sup-
business functions. Average Daily Trading Volume:
port AMCOM’s mission to guarantee 3rd Quarter FY 2005 – 1,083,122
• the Army’s technological superiority
IT & Professional Services – Designing, Market Cap: $9.1 billion
on the battlefield.
developing, implementing and integrat-
ing complete information systems, as RESEARCH COVERAGE
• U.S. Navy – DynCorp Technical
well as advising clients on the strategic A.G. Edwards (Timothy Willi)
Services, a CSC company, won a
acquisition and utilization of IT. Bear, Stearns ( Jim Kissane)
contract for the operation and mainte- Bernstein (Rod Bourgeois)
nance of the U.S. Navy’s Atlantic
RECENT ENGAGEMENTS INCLUDE: CS First Boston (Dris Upitis)
• Internal Revenue Service (IRS) – Undersea Test and Evaluation Center Deutsche Bank (Brandt Sakakeeny)
(AUTEC). CSC’s Federal Sector busi-
Under a new task order received from Goldman Sachs (Greg Gould)
ness unit will provide services that
the IRS, CSC will perform work on the J.P. Morgan Securities (Tien-tsin Huang)
include the scheduling and conduct
next phase of the Customer Account Jefferies & Co. ( Joe Vafi)
of test programs; operation of range
Data Engine (CADE) project. CADE, KeyBanc Capital Markets (Michael Keller)
instrumentation and test support
the cornerstone of the IRS’ Business Legg Mason (Bill Loomis)
systems; and performance of all base
Systems Modernization program, Lehman Brothers (Louis Miscioscia)
operations functions.
will eventually replace the agency’s Merrill Lynch (Greg Smith)
antiquated Individual Master File system Morgan Stanley (David Togut)
• U.S. Patent and Trademark Office
and become the single database for Prudential Securities (Bryan Keane)
(USPTO) – CSC won a systems
account and tax return data. Robert W. Baird (Timothy Byrne)
development and integration contract SG Cowen & Co. (Moshe Katri)
• to provide services to the USPTO.
Sun Microsystems – Sun Microsystems Smith Barney Citigroup (Pat Burton)
The agreement is one of the largest
selected CSC for a global IT applications Standard & Poor’s ( Richard Stice)
IT contracts ever awarded by the
management services agreement. CSC Thomas Weisel Partners (David Grossman)
USPTO. Since 1997, CSC has helped
will assume responsibility for the provi- UBS Warburg (Adam Frisch)
the USPTO develop and maintain
sion of all applications development and Value Line (George Niemond)
information systems that are modern-
support services for Sun’s global opera-
izing business processes and moving
tions in the U.S., Europe and Asia Pacific. SHAREHOLDER SERVICES
the agency steadily forward into world-
CSC will manage Sun’s full portfolio of For more information regarding CSC:
class e-government operations.
internal business systems applications.
• Shareholder services and literature
request line – (800)542-3070
CSC REVENUE GROWTH FIRST NINE MONTHS FISCAL 2005
•
FROM CONTINUING OPERATIONS REVENUES FROM CONTINUING Web site – www.csc.com
FY 2000-2004* OPERATIONS BY BUSINESS SERVICE*
• Registrar and transfer agent –
$ in billions
$ 14 Mellon Investor Services
19%
P.O. Box 3315
12
47% S. Hackensack, New Jersey 07606
10 30% (800)676- 0654 or (201)329- 8660
www.MellonInvestor.com
8
4%
•
6 CSC Investor Relations –
OUTSOURCING . . . . . . . . . . . . . . . . . . . . 51%
Bill Lackey
Global Commercial 47%
4
U.S. Federal Sector 4% Director, Investor Relations
2 IT & PROFESSIONAL SERVICES . . . . . . . . 49% (310)615-1700
Global Commercial 19%
U.S. Federal Sector 30%
FY00 FY01 FY02 FY03 FY04 Lisa Runge
Manager, Investor Relations
* CSC’s fiscal year ends the Friday closest to March 31. * Based on CSC estimates.
(310)615-1680
All statements in this document that do not directly and exclusively relate to historical facts
constitute “forward-looking statements” within the meaning of the Private Securities Litigation
Email: InvestorRelations@csc.com
Reform Act of 1995. These statements represent the Company’s intentions, plans, expectations
and beliefs, and are subject to risks, uncertainties and other factors, many of which are outside
• Headquarters
the Company’s control. These factors could cause actual results to differ materially from such
2100 East Grand Avenue
forward-looking statements. For a description of these factors, see the section titled “Forward-
El Segundo, California 90245, USA
Looking Statements” in the Company’s Quarterly Report on Form 10-Q for the fiscal quarter
(310)615-0311
ended December 31, 2004.
Printed in U.S.A. WH# CC-3Q05