Fitch affirms Computer Sciences

Fitch Ratings said it affirmed Computer Sciences Corp.'s long-term issuer default rating, senior unsecured debt and bank credit facility at BBB+ and its short-term issuer default rating and commercial paper at F2.

The outlook is stable.

The agency said the ratings reflect continued solid growth in the company's North American public sector segment, significant recurring revenues from long-term contracts, strengthening new contract signings in the North American public sector segment and for global outsourcing services, solid contract pricing and execution and expanding operating profit margin in global outsourcing services due to restructuring efforts.

Fitch's rating concerns center on pressured new contract signings in Computer Sciences'

most profitable operating segment, business solutions and services; long-term risk of additional debt-financed acquisitions and share repurchases; its material weakness in internal controls over financial reporting with respect to income taxes; and the risk of tax or procurement reforms instituted by the U.S. federal government that materially reduce federal and/or commercial demand for information technology services.

Fitch estimates that the total debt-to-operating EBITDA ratio increased to 1.7 times in fiscal 2009 from 1.4 times in fiscal 2008.

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