SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) October 29, 1996
COMPUTER SCIENCES CORPORATION
(Exact name of Registrant as specified in its charter)
NEVADA 1-4850 95-2043126
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
2100 East Grand Avenue
El Segundo, California 90245
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (310) 615-0311
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Item 5. Other Events.
In a press release dated October 29, 1996, the Registrant reported
its results of operations for the fiscal quarter ended September 27, 1996. A
copy of the press release is included as Exhibit 99.1 hereto.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
The exhibit listed below is filed as a part of this report:
99.1 Press Release of the Registrant dated October 29, 1996
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.
COMPUTER SCIENCES CORPORATION
Dated: October 29, 1996 By /s/ Denis M. Crane
--------------------------
Denis M. Crane
Vice President and Controller
Chief Accounting Officer
EXHIBIT 99.1
Contact: Bruce Plowman, FOR IMMEDIATE RELEASE
Spencer Davis Moved On Business Wire
310.615.0311 October 29, 1996
CSC's 2ND QUARTER EARNINGS PER SHARE UP 23.5%,
EXCLUDING NON-RECURRING MERGER CHARGE
EL SEGUNDO, Calif., October 29 -- Computer Sciences Corporation
(NYSE:CSC) reported earnings per share of 63 cents for its second quarter
(ended September 27, 1996) before a merger-related, non-recurring charge. The
63 cents is a 23.5% increase over the restated 51 cents earned for the same
period last year.
All results reported for previous periods have been restated to reflect
CSC's August 1 acquisition of The Continuum Company, Inc., accounted for on a
pooling of interests basis. In connection with the acquisition, a previously
announced one-time charge equivalent to 45 cents per share was provided during
the second quarter of this year. After this charge, CSC earned 18 cents per
share for the quarter.
Excluding the non-recurring charge, CSC's net income for the second
quarter was $49.3 million, compared with $39.6 million a year ago. Including
the charge of $48.9 million ($35.3 million after related income tax effects),
net income was $14.0 million. Revenue for the quarter rose to $1.36 billion,
up 20.1% from the $1.13 billion for the second quarter of last year.
Before the charge, net income for the first six months of this year was
$94.6 million, versus the last year's $75.5 million. Revenue for the first
half was $2.66 billion, up 20.2% from the $2.21 billion for the prior year's
first half. After the charge, net income was $59.3 million.
"The second quarter is the first since completing our merger with
Continuum. Operationally, CSC had an excellent quarter, continuing its strong
growth in both revenue and income," said Van B. Honeycutt, CSC's president and
chief executive officer.
"Earlier today we announced a 10-year $250 million technology outsourcing
contract with ING Financial Services International in Atlanta, together with a
7-year $35 million contract between a unit of that company and CSC Continuum
for systems application development. This clearly demonstrates the strength
of the CSC and Continuum combination in the global financial services
industry."
Global commercial revenue for the quarter, including both domestic and
international activities, totaled $963.1 million, up 27.4% compared with the
$755.7 million for the second quarter of fiscal 1996.
For the quarter just ended, U.S. commercial revenue rose to $524.1
million, an increase of 20.6% from $434.4 million last year. Slightly more
than half the growth was provided by information technology outsourcing, with
the remainder coming principally from consulting and systems integration
activities.
International revenue for the quarter rose to $439.0 million, up 36.6%
from $321.3 million. The increase came principally from new outsourcing
business signed last year, growth in revenue from CSC's German SAP consulting
operations, and from the acquisition earlier this year of 75% of
Datacentralen, a major provider of information technology services in Denmark.
U.S. federal revenue for the second quarter was $392.2 million, up 5.2%
versus last year's $372.9 million. The improvement was mainly due to new
contract awards. During the quarter, CSC announced nearly $1 billion in new
federal contracts, one of the largest quarterly totals in CSC's history.
After restatement for the pooling of interests, CSC had $5.2 billion of
revenue for the 12 months ended September 27, 1996. Computer Sciences
Corporation is headquartered in El Segundo, Calif., and has 40,000 employees
in nearly 600 offices worldwide. CSC provides clients with a wide range of
professional services including management consulting, business reengineering,
information systems consulting and integration and outsourcing.
Note to Analysts and Editors: Please see attached tables.
- ----------------------------------------------------------
Revenue by Market Sector
Second Quarter
---------------------------------------------
% of Total
Sept. 27, Sept. 29, ----------------
In millions 1996 1995 FY97 FY96
- ---------- --------- --------- ------ ------
U.S. commercial $ 524.1 $ 434.4 39% 38%
International 439.0 321.3 32 28
--------- --------- ------ ------
Global commercial 963.1 755.7 71 66
Department of Defense 253.4 223.9 19 20
NASA 75.1 77.5 5 7
Civil agencies 63.7 71.5 5 7
--------- --------- ------ ------
U.S. federal government 392.2 372.9 29 34
--------- --------- ------ ------
$1,355.3 $1,128.6 100% 100%
========= ========= ====== ======
Six Months Ended
---------------------------------------------
% of Total
Fiscal Fiscal ----------------
In millions 1997 1996 1997 1996
- ---------- --------- --------- ------ ------
U.S. commercial $ 999.5 $ 843.0 37% 38%
International 821.8 613.0 31 28
--------- --------- ------ ------
Global commercial 1,821.3 1,456.0 68 66
Department of Defense 550.4 448.5 21 20
NASA 150.6 156.5 6 7
Civil agencies 136.8 150.6 5 7
--------- --------- ------ ------
U.S. federal government 837.8 755.6 32 34
--------- --------- ------ ------
$2,659.1 $2,211.6 100% 100%
========= ========= ====== ======
<FN>
(Figures shown herein are unaudited)
Consolidated Statements of Income
Second Quarter 6 Months Ended
------------------------ ------------------------
In thousands except Sept. 27, Sept. 29, Sept. 27, Sept. 29,
per-share amounts 1996 1995 1996 1995
- ------------------- ----------- ----------- ----------- -----------
Revenues $1,355,255 $1,128,648 $2,659,147 $2,211,611
----------- ----------- ----------- -----------
Costs of services 1,073,502 881,692 2,110,710 1,731,417
Selling, general and
administrative 116,306 112,157 232,759 221,190
Depreciation and
amortization 80,902 63,547 152,509 123,735
Interest expense 10,708 9,284 19,022 18,635
Interest income (2,102) (932) (3,565) (2,888)
Non-recurring charge* 48,929 48,929
----------- ----------- ----------- -----------
Total costs and
expenses 1,328,245 1,065,748 2,560,364 2,092,089
----------- ----------- ----------- -----------
Income before taxes 27,010 62,900 98,783 119,522
Taxes on income 13,004 23,331 39,500 44,012
----------- ----------- ----------- -----------
Net income $ 14,006 $ 39,569 $ 59,283 $ 75,510
=========== =========== =========== ===========
Earnings per common
share $ 0.18 $ 0.51 $ 0.76 $ 0.99
=========== =========== =========== ===========
Average shares and
equivalents 78,022 76,858 77,924 76,600
<FN>
* The non-recurring charge represents costs and expenses related to the
August 1 acquisition of The Continuum Company, Inc. The amount of the
charge, net of income tax benefits on the tax deductible portion, is $35.3
million or 45 cents per share, and falls within the previously announced
range of estimates for transaction expenses, costs associated with
elimination of redundant functions, and the write-off of assets impaired due
to merger-related business realignment.
(Figures shown herein are unaudited)