Good afternoon everyone and welcome to the CSC fiscal year 2008 fourth quarter conference. Today’s call is being recorded, and for opening remarks and introductions I would like to turn the program over to Mr. Bill Lackey, director of Investor Relations. Please go ahead sir.

Thank you operator, and good afternoon everyone. Welcome to CSCs fourth quarter fiscal year 2008 earnings conference call. I trust you have had an opportunity to review our financial results issued earlier this afternoon. Mike Laphen, Chairman and CEO will begin with some opening remarks, and Don DeBuck, CFO will review the quarters’ financials. As usual, this call is being webcast live at CSC.com and we also welcome those joining us via that process. Any information we cover that does not directly and exclusively relate to historical facts constitute forward-looking statements under Federal Securities’ laws. For a written description of the factors that could cause actual results to vary from these statements, please refer to the section titled Risk Factors. CSC’s Form 10-K for the year ended March 30, 2007. On today’s call, we will reference certain non-GAAP financial measures. Reconciliation of these non-GAAP measures are provided in the tables attached to the earnings press release and will be posted on the investor relations portion of CSCs website. The non-GAAP financial measures referred to in this conference call are not meant to be considered in isolation or as a substitute for results prepared in accordance with GAAP. Finally, we assume no obligation to update the information presented on this conference call. And now please to turn the call over to Mike Laphen.

Thank you Bill, and good afternoon everyone. I am pleased to again have the opportunity to again discuss CSCs current business position, as well as our fiscal 08’ results. As many of you know, last year was challenging with respect to our reporting, and of course that impacted your analysis during the year. I am delighted these issues are behind us, affording better clarity with improved transparency going forward. Throughout fiscal year 08’, we have focused on both the implementation of our strategic plan and the delivery of improved operational and financial results. Several of the years’ accomplishments are of particular note. First, we have now completed the integration of Covansys and CSE. The result is CSC India. The go-to market that enables CSC to compete directly for India pure-play business. And a totally integrated operation in India of some 15,000 professionals who support all of CSCs business as part of our world sourcing strategy. With CSC India, CSC offers its clients a compelling value proposition of local presence, global delivery, and the best of India. Several vary recent new logo wins demonstrate that CSC is now able to compete successfully within the India pure-play market. Provided CSC with a new high-growth market as well as increased operating leverage. Second, we acquired and are not integrating First Consulting Group Health Services sector. CSCs health services sectors fiscal year 08’ revenues were $1 billion which nicely complements our $400 million + health services business within our North American public sector. CSC offers a broad portfolio of IP based solutions and service offerings to an impressive array of clients across the public and private health services spectrum. On our UK NHS contract, we made strong progress last quarter with deployments in both primary and secondary care. I am particularly pleased to note…

Thank you Mike, and thanks everyone for joining us today for our year end fiscal 2008 conference call. Financial highlights include double digit revenue growth reported for both the fourth quarter and full year; earnings-per-share before special items of $1.44 for the quarter, above our prior guidance, and $3.84 for the full year, at the high end of our previously announced range; and an adjusted free cash flow of $306 million for the full year, in line with our prior guidance. Before moving on, I would like to remind everyone that unless indicated otherwise, all data and comparisons will be on a re-stated basis and will exclude the impact of special items. Special items totaling $155.8 million for the full year consisted of: a restructuring charge of $133.4 million, with the remaining $22.4 million charge in our first quarter related to the retirement of the companies former chairman and CEO. So, let’s start with our focus first on revenues. Fourth quarter revenues were $4.5 billion, representing 11% growth as reported, and 7% growth in constant currency. Full year revenues were $16.5 billion, also representing 11% growth as reported, and 7.5% growth in constant currency. Our North American public sector, or NPS, generating $1.5 billion of fourth quarter revenue, resulting in growth of 1%. This slower growth was due to the conclusion of several contracts of defense related customers, and some programs that were and others that slipped to the right. For the full year, NPS revenues of $5.8 billion grew 6% over last year. Results for the full year were driven by new business awarded during fiscal 2008 and 2007; increases on existing Department of Defense contracts; and new contracts as a major provider of relief aid. The Data Track acquisition, which closed late in the third quarter fiscal year…

Operator, before beginning questions, let me again, as Mike referenced in his remarks, say we are holding an institutional investor conference in New York on June 5th, and those people needing assistance with registration just please call my office and we will help you. Ok, Operator, now we are ready for the first question.

Operator Instructions Our first question is from Adam Frisch of UBS. Please go ahead.

I wanted to ask you about NHS a little bit. If you can give an update on the program; and the reason we heard that the government initiated a new rule, not making it mandatory for all providers to participate in the program. I wanted you to comment on that, and if that has hurt your revenues at all?

The update on the program as I reflected earlier, we made very good progress on our deliveries during the past quarter. We brought the release one of Lorenzo software off to our integration environment for preparation of the live fielding. We are anticipating that live fielding to go forward in the month of June. So we are both pleased and excited about that. We had a few integration issues that we worked through, but we are pretty comfortable that we are through those now. I think you are talking about the new framework contract relative to NHS, and we are included in that award and all line items of the additional services. As far as we see right now we don’t anticipate any impact.

Did the government change the original construct of the program?

No.

Are they still mandating all the providers to be in the program?

To the best of my knowledge, Adam.

OK. Two quick housekeeping items. One, how much of the $11.2 billion in government bookings was IDIQ; and what is the outlook for commercial in 09’? I know you said you already had $1.6 billion in the first quarter, but what should we expect in commercial in 09’ because that was pretty weak in 08’?

I don’t have the break-out of the IDIQ. If you call Bill Lackey or Don afterward we will get that for you. We’ve got a robust pipeline right now, my best guess for the first quarter is somewhere of a total booking around $4 billion. I think at least half of that would be commercial. And we have good prospects for the second quarter as well. As I said, the pipeline is robust, but to go out more than two quarters is a bit risky, Adam. We are feeling pretty good about it right now.

If I could just sneak in one more for Don. The 09’ growth rate on the top line, XM & A, what would that be? How much of the acquisitions you made in 08’, what are those acquisitions adding to in 09’?

Probably maybe two percentage points or so.

So the organic rate would be somewhere in the 5-10% range?

Yes, if you do the twelve month anniversary effect.

The next question will come from Brian Keane with Credit Suisse.

Just following up on that; the federal awards had a pretty good year at $11.2, it is up about 22%. Yet in the fourth quarter here revenue slowed down quite a bit. I am just trying to reconcile the two. Should we see that pick back up, or is it that a lot of these awards haven’t actually taken place yet?

We are anticipating it to pick back up in the first quarter to the mid-to-upper single digits. The anomaly in the fourth quarter was actually twofold: One was two significant awards that we were expecting to contribute to the revenue base in the quarter. One was . There was a protest on that. We have a significant revenue contribution on that. That has started now as we go into fiscal year 09’. That was a delay in the start-up. There is another major program that was included there and that has not been awarded yet, and that will be awarded in June. And then we had a couple of programs that came to conclusion that had a negative impact on revenue. From our perspective it was a one quarter anomaly.

On our organic basis, taking that 5-7%, will federal be pretty similar to commercial, or do you expect federal to be a little stronger next year?

I think federal will be as it typically is: upper single digits.

Don, just on the operating margin perspective, what should we expect going into fiscal 09’? It is hard to back into the guidance. Just trying to figure out if you are expecting operating margin expansion in 09’?

We are. This will be a little easier I think once you see the 10K which we hope to file by Friday. We will be breaking out that and you will be able to see our operating income profile for that. And then, what we expect to do is at the Investor Conference on June 5th to break that down a little more for you in regard to fiscal 2009.

We will be giving you more visibility in the Investors Conference than we have historically given you.

I didn’t catch the difference in your definition, Don, for the 10% operating income goal. Can you give that to me again?

We have historically given an EBIT margin in our segment footnote, but we have talked in terms of the operating income margin, and what I described was the distinction there was in essence the corporate G&A. Which has historically been just under 1% point of revenue. I am not sure if that answers your question, but if not please follow up.

That helps. Finally, a last question on terms of how much acquisition revenue was in the fourth quarter?

Under $200 million. Maybe about $180 million or so.

Your next question will come from Julio Quinteros with Goldman Sachs. Please go ahead.

First question: could you update where we are in term of the CFO search process?

We are interviewing, and I am hopeful that we would bring that to a conclusion by the end of June.

Any big contract renewals that you are expecting in FY09’ that we should be aware of?

Not off the top of my head, none that I can think of.

Could you comment at all relative to the $4 billion of bookings that you recorded in this quarter, how much of this was renew- overs .

I think most if not all of the $1.6 billion in commercial is new. There is one re-signing; although it is an expansion of scope as well that we are expecting to sign within the first quarter. That would be part of the $4 billion. But as I said, I expect the commercial bookings to exceed 50% of that $4 billion. The commercial bookings will be north of $2 billion.

Finally, for the full year, should we expect the 50% commercial mix to stay true for the rest of the year? I am trying to get a sense of the weighting of the federal versus the commercial bookings.

That is really lumpy. One of the things that we haven’t done and that we are going to try and lay out at the Investors Conference is we only report what I call “large bookings” and significant bookings. There are a lot of our commercial bookings that we do not announce and we do not give visibility to. As we change that reporting scheme I think that will be helpful for you to get a better view of our commercial pipeline and our commercial backlog. If you could bear with us until the Investors Conference I think we will be able to help you a bit more then.

The next question is from Rod Bourgeois with Sanford Bernstein.

I am not completely clear on the free cash flow guidance, so let me inquire here. If you are guiding into 80-90% over two years in terms of free cash flow to net income, does this imply that fiscal 09’ free cash flow will actually need to be greater than 90% of net income in order to make up for the weak free cash flow of fiscal 09’? I am trying to understand how you are using this two year period that is involved in your free cash flow guidance.

The two year profile we talked about in looking at 2007and 2008 together because as we commented, at the end of 2007 there was a significant payment that we got from NHS that came in right at the very end that we hadn’t anticipated. That gave us a much stronger 2007 and we knew that it was going to give us a weaker 2008. I am not at all trying to imply that is a constant rolling two year profile. We are not trying to say that 2009 add it to 2008 and look at that as a two year profile. What I am trying to say for 2009 is that 2009 alone in isolation right now looks like it could be in the 80-90% range in isolation, looking at it as a single year. However, again, there is lumpiness associated with that, the program, like NHS has significant milestone payments throughout the year, some included in the fourth quarter that is a function of our ability to deliver things on schedule, on time, etc. And if that were to happen and flip the other way on us and at the end of 2009 something were to spill into fiscal 2010, that is where I would look for the 2009 and 2010 profile to be two year; but I am not trying to give a “it will always be” a rolling two year profile.

Our fiscal year 2009 free cash flow budget is in the 80-90% of this years net income.

When you say that cash flow could be lumpy for 09’, what you are signaling is that if NHS or some other contract has some lumpiness you may decide to change your fiscal 09’ guidance to look at fiscal 09’ and fiscal 10’?

It will be a function of progress we make on work efforts that have associated milestone payments with those work efforts. If those were to slip 30 days or 45 days, a payment could slip accordingly.

But is it NHS that is the biggest wildcard as you see that guidance on fiscal 09’ on the cash flow front?

That is a significant piece of the wildcard.

Can you talk about what the milestone is specifically that would create that? Is it related to the software deployment, or can you talk about the specific milestone that we should be watching in that regard?

There are the rollouts and the take-ups of all the trusts, etc. so I think it is a combination.

It is a combination of the deployments that go on as well as the milestones of the software development as well as the advance payments that we negotiate with the customer. It is a combination of those things, and historically we have managed them to the level that we have spoken to, and would expect to continue to do that. But I think is trying to put out here that there is some potential for some variability. We don’t expect it, but it could happen.

On the DSO front, you made some progress in low-ranked DSOs and that was necessary to hit your fiscal 08’ cash flow target. Are you assuming further DSO decline in your fiscal 09’ free cash flow guidance? Can you give us an idea of what magnitude?

Yes. Single digits.

Finally, on your revenue growth guidance, does it assume any foreign exchange benefit?

We look at the currency rate at the time of the fiscal year end lock-in for that and then just proceed on from there.

So it assumes the current rates stay intact for the next year?

Right.

One final question. How are you responding to the HP- EDS proposed merger? Are you expecting that this might help your sales pipeline given disruption that might occur, or are you looking at this as a neutral event at this point in time?

I guess I would say we have been contacted by several EDSs industry partners who have voiced various levels of concern, I might say up to alarm, regarding the expected combination, and of course we are dialoguing with those companies to see what the opportunities might be. You can also suspect that some of EDSs clients will investigate their options in the exchange of control provisions and we certainly consider CSC to one of those available options.

It is both partners of EDS hardware and software companies and also customers that you are going to be looking out for?

We are doing more than looking out for.

The next question comes from George Price of Stifel Nicolaus.

I wanted to clarify one thing from the last question. The particular guidance that you are giving for free cash flow, and I don’t want to beat a dead horse, but I want to make sure that I understood this clearly because we are going between one year and two years, you are suggesting best visibility now 80-90% of net income for 09’, is that correct?

Correct.

When you talk about lumpiness and potential timing issues and so forth, my perception that the tone was more suggestive of downside to fiscal 09’ if things flip, is that accurate in the sense more likelihood of downside slippage into fiscal 10’, than upside potential for some reason?

I don’t think I am trying to signal one way or the other, just trying to say that there are things that can happen where something could flip from one year to the next the same way it happened in fiscal 2008-08.

If you recall, in fiscal 07’ we had a very positive surprise on the last day, and that could happen as well.

I know you are saying no more special items in the P & L. Do we have any lingering restructuring cash outflows that you expect? Can you give the timing and amounts?

We expect that it is about $30 million more cash in the next fiscal year, but that is baked into the projections we have already given.

So that 80-90% …

It includes the restructuring related cash out-flows.

It includes the negative impact of them?

It includes the negative impact.

Do we know the timing of these out-flows?

There is a lot of it that is related to lease payments, etc. etc. so some of it will just be over the course of the period.

Last question, in terms of everything that is going on in the global demand macroenvironment, can you talk a little more about your pipeline, particularly on the commercial side? Maybe looking at U.S. versus International; conversion rates; how fast are things moving, or sales cycles being impacted? Is it one vertical versus another, a little color along those lines would be great. Thank you.

I would say that non-U.S. is hotter than U.S. We are seeing good activity in Europe, we are seeing good activity in Asia. U.S. is growing but not as aggressively as the other areas. As I pointed out in my opening remarks, we have a very diversified portfolio between government business, which is insulated from the general macro-economic issues, and then we have the outsourcing business that is more or less long-term annuities, and then we have the project business. And the project business, or what we call business solutions and services, would be where we would expect to see an impact in a softening of the economy. So far we are doing ok, knock onwood. We haven’t seen the extent of a negative outcome that to some extent I had anticipated. I don’t think this is over yet, either.

Have you had any signs of deterioration, even if demand is still reasonably good, just given what happened at the end of last quarter in the financial side particularly?

There has been cautious advancement on the project side, but we are continuing, people are making awards, so I wouldn’t send a signal that anything there is looking abnormally slow.

The next question is from Eric Boyer with Wachovia.

The last couple of quarters you cited higher bill rates in your U.S. SI consulting business. Could you go into more detail about what areas of that business you are seeing

Certainly in the SAP area. Globally there is a shortage of SAP resources and we are certainly seeing a pickup there. We have put a real emphasis on industry-specific consulting, and what we are seeing is that we can get a better value, and better return with our industry-specific consulting staff as opposed to what I will call a generic staff. I think our focus at an industry level as well as some of the general market conditions in our areas like SAP I probably highlighted the ones with the most activity and the biggest boost to the ratings.

You also mentioned some slip to the right. Can you give us some more details into which areas the Warfighter Focus, is it mostly budget-related, or another issues there?

No, as I said, the one program was Warfighter Focus a big training program. The award was protested, it took a number of months to work through that protest process. We were one of the awardees on that, and we continue to be one of the awardees. It is just that the work didn’t start on the time that we or the government customer anticipated. It has now started.

And just a clarification question on the equitable adjustment timing: did you say that it could take two years for the discover and the litigation process to be ove?

It could. It is a function of how the judge moves things along and how the parties are pushed or whether it goes to full litigation and full discovery etc.

It is still in the early days, and we don’t control this process, so we will keep you apprised of any significant changes along that path, but again it is not incorporated in any of our numbers or any of our forecast. From a cash-flow standpoint it is an upside number.

Finally, just how many points of revenue growth does NHS provide to the Europe segment in the quarter?

I don’t think we have that data. I am not sure we are allowed to disclose that either; I have to check on the contractual constraints. We are very constrained in regard to NHS in what we can and can’t say.

Our final question will come from Tien-Tsin Huang with JP Morgan.

I was curious on the Covansys side, how that has fared in terms of retention both with employees and clients, and maybe if you could describe how the business is performing overall relative to the plan?

The retention has been excellent. I am not aware of any senior level executive that has left us. The retention in India has improved, both at the Legacy CSC and at the Covansys so we are very pleased with that. And the integration with overall CSC is proceeding very well. We are very pleased with it, we are leveraging it in a significant way with our existing legacy CSC clients, so we are effectively to their base and our base. In a very effective manner.

It sounds like the consulting in the NSI side of the house is faring pretty well. I am just curious, any change in terms of the pricing utilization that you can share with us?

As you said, the rates have up-ticked, and that is a bit of mix and a bit of supply, I don’t know if I have the utilization numbers.

If not I can follow up off line.

We moved some of the organizational structure around, so to get apples to apples on utilization we have to do a little bit of work, but we will get that for you.

If I could sneak in one more. I know that you struck a nice software deal with Mastercard on the payment side with NBPO. Any other deals like that that are out there? I know there is a lot going on in the payment side related to step-up in Europe. How does the pipeline look there?

We are really optimistic about the whole industry specific BPO play. Financial services for sure, but also on the healthcare side. That is one of our specific focuses of project or strategic plan. We think there is real opportunity there, as I have said for a number of years We are not really interested in what I call the horizontal BPO play. I think that is commoditized and we think that there is good growth and good profitability in the industry-specific BPO.

We will look for more detail on the analysts day.

That will conclude our question-and-answer session. I would like to turn the call back over to our speakers for any additional or closing comments.

Thank you so much for joining us today, and for bearing with us the past year. I know it has been difficult to sort through our reporting when we got our reporting out. We are working diligently to insure that you have better insight and better visibility, and as you heard on the call today we have made the decision in a number of cases to where we could have gone the other way to keep the P&L quite clean relative to special charges and that is our goal forward. We look forward to seeing you in a couple of weeks in the Investors Conference. Thanks for joining us.

Thank you everyone for your participation. You may disconnect at this time.