EL SEGUNDO, Calif., Nov. 1 -- Computer Sciences Corporation (NYSE: CSC) today reported results for its fiscal 2002 second quarter, ended September 28, 2001. Revenues were $2.8 billion and earnings per share (diluted) were 40 cents, in line with the company’s August 1, 2001 projections. The quarter’s results were driven by continuing solid revenue growth from global commercial and U.S. federal government outsourcing activities, as well as revenue growth emanating from the December 2000 acquisition of Mynd Corporation.

For the second quarter (ended September 28):

• Revenues were $2.8 billion, a 10.7% increase over fiscal 2001 (up 12.5% in constant currency);



• Net income was $68.2 million;



• Earnings per share (diluted) were 40 cents;



• and announced major new business awards were $5.3 billion.

For the six months (ended September 28):

• Revenues were $5.5 billion, up 10.4% over the comparable six month period of fiscal 2001 (up 13% in constant currency);



• Net income was $115.9 million;



• Earnings per share (diluted) were 68 cents;



• and announced major new business awards totaled $7.1 billion.

“We are pleased with our second quarter performance,” said Van B. Honeycutt, CSC’s chairman and chief executive officer. “Our geographic balance, diversity and breadth of end-to-end service offerings have served us well during these difficult industry and market conditions. Global outsourcing, now accounting for nearly 50% of CSC’s total revenue, and our financial services vertical, were the principal contributors to our increased quarterly revenue.

“CSC was able to respond swiftly to the instant needs of many clients and other organizations in the wake of the September 11 events. We implemented business continuity plans for clients in the vicinity of the World Trade Center, immediately established a command center to check the status of client requirements and created a list of available space, equipment and staff resources to offer to those affected clients and others.

“In today's environment, CSC’s position as a leading provider of information and physical security services to the U.S. federal government and to commercial clients around the world is more critical than ever. New threats to our clients' information systems appear constantly. CSC has approximately 1,000 professionals focusing on the effort to protect the information and physical security aspects of organizations worldwide, specializing in threat identification, security site surveys, vulnerability and risk assessments, and security system design.

“Our second quarter results also reflect the benefits from our cost reduction efforts,” Honeycutt added. “Targeted headcount reductions and minimized out-of-pocket expenses and capital expenditures are contributing to our performance. We have continued to move toward meaningful improvements in recent outsourcing engagements and are pleased with our progress to date.

“The robust nature of our global commercial outsourcing and U.S. federal opportunity pipelines is a source of encouragement, and we have announced new business awards of $8.4 billion this fiscal year-to-date, and $1.3 billion of that total has been awarded in the first month of the current quarter,” continued Honeycutt.

“As we look at the second half of fiscal 2002, we are well positioned and structured to deal with the current market conditions, and our increased sales and cost containment efforts are clearly taking effect. We are, however, still seeing some areas of softness in revenue growth in our lower margin product business in Asia. We now anticipate earnings per share, diluted, for our third quarter, ending December 28, 2001, to be in the high 40 cent to low 50 cent range. For full fiscal 2002, we now estimate our revenue for the year to be up in the 9% to 11% range. With the success we are experiencing in our cost reduction and other performance improvement efforts, we continue to expect to achieve EPS in the $2.00 to $2.10 range for fiscal 2002, assuming no further currency erosion or significant downturn in the global economy.”

BUSINESS RESULTS

For the second quarter, global commercial revenues grew 12.1% (or approximately 14% in constant currency) to $2.1 billion compared with $1.9 billion in last year’s second quarter. The strong revenue growth from the company's global outsourcing activity and from CSC’s financial services vertical market was moderated by the slowdown in demand for commercial consulting and systems integration project work in North America. Contributing significantly to this global commercial revenue growth was Europe, which reported revenue of $726.3 million, up 24.6% (or approximately 28% in constant currency) from last year's $583.1 million; non-European international revenue was up 13.4% (or approximately 22% in constant currency) to $334.4 million from last year's $294.9 million; and U.S. commercial revenue increased to $1.04 billion from last year's $1 billion.

Revenue derived from CSC’s U.S. federal government activities showed solid growth, increasing to $660.6 million, up 6.4% from the $620.9 million recorded in last year’s second quarter. Department of Defense activities rose 8.7% to $397.6 million from last year's $365.7 million, with contributions from the Army Logistics Modernization award, the Ballistic Missile Defense Program, add-on business from existing awards and revenue from new contract awards over the past several months. CSC’s civil agencies business rose to $263 million, from $255.2 million last year, aided by increases in additional task orders from NASA and other new business, partially offset by the completion during last year's second quarter of Census 2000 activities.

“We are addressing a robust U.S. federal market pipeline of approximately $23 billion of opportunities over the next 29 months,” said Honeycutt.” The U.S. federal government is increasingly looking to the private sector for commercial best practices, such as outsourcing, to help it streamline and modernize its service delivery capabilities, and address heightened security concerns. CSC, as a premier provider of information technology services to both the commercial and U.S. federal markets, is well positioned to benefit from this strong opportunity set.”

As announced in the company’s press release dated October 15, 2001, a teleconference will be held today at 5:00 p.m. EST, to discuss the second quarter results. This teleconference can be accessed from the CSC Web site at www.csc.com/investorrelations, in a listen-only mode.

Computer Sciences Corporation, one of the world’s leading consulting and information technology (IT) services firms, helps clients in industry and government achieve strategic and operational results through the use of technology. The company’s success is based on its culture of working collaboratively with clients to develop innovative technology strategies and solutions that address specific business challenges.

Having guided clients through every major wave of change in information technology since 1959, CSC combines the newest technologies with its capabilities in consulting, systems design and integration, IT and business process outsourcing, applications software, and Web and application hosting to meet the individual needs of global corporations and organizations. With some 68,000 employees in locations worldwide, CSC had revenues of $11.1 billion for the 12 months ended September 28, 2001. It is headquartered in El Segundo, California. For more information, visit the company’s Web site at www.csc.com

All statements in this press release that do not directly and exclusively relate to historical facts constitute “forward-looking statements” within the meaning of the Private Securities Litigation 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 the Company’s control. These factors could cause actual results to differ materially from such forward-looking statements. For a written description of these factors, see the section titled “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” in CSC’s Form 10-Q for the quarter ended June 29, 2001.

Note to Analysts and Editors: Please see attached tables.