Third Quarter 2000 - Earnings Release October 23, 2000 CDW COMPUTER CENTERS, INC. REPORTS 72 PERCENT GROWTH IN NET INCOME, 51 PERCENT GROWTH IN SALES Third Quarter Highlights: 29th consecutive quarter of sequential sales growth as a public company Net income increases 72 percent 51 percent growth in net sales Direct Web sales increase 167 percent to $120 million Sales account managers grow 46 percent to 1,052 Financial & Operating Data Reflects 2-for-1 stock split paid June 21, 2000 Three Months Ended 9/30/00 9/30/99 % Change Nine Months Ended 9/30/00 9/30/99 % Change Net Sales (000’s) $1,028,051 $683,012 51% $2,835,381 $1,819,972 56% Income from Operations (000’s) $ 71,776 $ 42,091 71% $ 192,938 $ 109,844 76% Net Income (000’s) $ 44,930 $ 26,188 72% $ 120,270 $ 68,187 76% Basic Earnings Per Share $ 0.52 $ 0.30 73% $ 1.38 $ 0.79 75% Diluted Earnings Per Share $ 0.49 $ 0.30 63% $ 1.32 $ 0.78 69% Operating Data Number of Invoices Processed 981,491 770,356 27% 2,827,047 2,127,800 33% Average Invoice Size $ 1,091 $ 931 17% $ 1,049 $ 901 16% Number of Account Managers 1,052 720 46%       Customers Serviced-Commercial 141,850 126,353 12% 257,648 233,190 10% Customers Serviced-Commercial - Trailing Trailing 12 Months 304,095 277,916 9%       % of Sales to Commercial Customers 96.3% 93.5% 3% 95.9% 92.4% 3% Inventory Turnover 23 28   23 28   Days Sales Outstanding 31 33   34 36   "From frontline to back-end support, CDW's entire business revolves around our customers. It's this intense customer focus, combined with our diverse product mix and strength of our vendor relationships that has led to another quarter of record results. In September, we were selected from among the largest companies in America as the country's leading business in marketplace ethics by the National Better Business Bureau. We are determined to continue to make customer service our hallmark as we provide businesses with complete technology solutions, from work stations to networking" --- Michael P. Krasny, Chairman and Chief Executive Officer Vernon Hills, Illinois, October 23, 2000 --- CDW Computer Centers, Inc. (Nasdaq: CDWC) today announced record sales and earnings for the third quarter ended September 30, 2000. Net sales for the third quarter increased 51 percent to $1.028 billion from $683.0 million in the same period of 1999. Net income for the quarter rose 72 percent to $44.9 million from $26.2 million in the third quarter of 1999. Diluted earnings per share increased 63 percent to $0.49 in the third quarter of 2000 from $0.30 in the same period of 1999. Net sales for the nine months ended September 30, 2000 increased 56 percent to $2.835 billion from $1.820 billion in the same period of 1999. Year to date net income rose 76 percent to $120.3 million from $68.2 million in the same period of 1999. Diluted earnings per share increased 69 percent to $1.32 year to date from $0.78 in 1999. All earnings per share amounts reflect the 2-for-1 stock split effected in the form of a stock dividend, which was paid on June 21, 2000. "Our strong performance in the third quarter reflects the strength of both our business model and the small-to-medium business marketplace," said Michael P. Krasny, Chairman and Chief Executive Officer. "Our success reflects the breadth and depth of our customer base, our vendor relationships and our product offerings. Our diverse customer base includes more than 300,000 active commercial customers for the trailing twelve months ended September 30, 2000. We provide a broad range of technology products to our customers with CPU's representing 35 percent of our product mix and peripherals, components and software comprising 65 percent." Input devices, add-on boards/memory, data storage devices, video, printers, desktop computers and netcomm products were the fastest-growing product categories, all with sales growth rates exceeding 55 percent. Notebook computers, which remained the largest product category at 19 percent of net sales, increased 37 percent in net sales dollars compared to the third quarter of 1999. Desktop computers, which include servers, increased 56 percent. "The proliferation of networks and the Internet drives the demand for many of the peripheral product categories," said Gregory Zeman, CDW's president. Zeman added, "We maintained our high levels of account manager productivity while increasing our total account managers to 1,052, a 46 percent increase over the prior year quarter. We are on target to meet our goal of 1,100 account managers at the end of 2000 and plan to increase the total to more than 1,400 at the end of 2001." "Our e-business strategy is producing results. Third quarter direct Web sales were $120.5 million, a 167 percent increase over the third quarter of 1999 and 22 percent over the second quarter of 2000. Our CDW@work™ custom-tailored Web site program is an important element of our e-business strategy, as it not only drives incremental sales, but builds stronger customer relationships," said Zeman. Gross profit margin of 12.8 percent of net sales in the third quarter of 2000, was up 0.3 percent from the prior year quarter. The Company's gross profit as a percentage of net sales may vary on a quarterly basis based upon vendor support programs, including inventory price protection policies, product mix, pricing strategies, market conditions and other factors. As a result, there is no certainty that the Company will be able to sustain the gross profit margin levels achieved in the third quarter. Selling and administrative expenses, as a percentage of net sales, decreased to 5.8 percent in the third quarter of 2000 from 6.4 percent in the same period of 1999. The primary reasons for the change were an increase in advertising expense reimbursements from vendors and reduced payroll expense, both as a percentage of net sales. On a forward-looking basis, selling and administrative costs may increase as a percentage of net sales due to investments in new sales account managers, marketing initiatives, new facilities and lower advertising expense reimbursements from vendors. Working capital as of September 30, 2000 was $521.2 million, including approximately $147.1 million in cash, cash equivalents and marketable securities. The Company estimates spending approximately $17 million for construction and equipment related to the 250,000 square foot expansion of its warehouse and distribution facility which is currently under construction and scheduled to open in the first quarter of 2001. The Company also announced that it recently agreed to lease a 156,000 square foot office building in Mettawa, Illinois, approximately five miles from its Vernon Hills corporate headquarters. The new building, which is scheduled for occupancy in the second quarter of 2001, has capacity for approximately 900 people. It will initially house sales, customer service and sales recruiting and training departments. "This new building eliminates our space constraints and allows for future expansion in the vicinity of our headquarters," said Krasny. The statements in this release concerning the Company's gross margin percentage and selling and administrative costs and other statements of a non-historical basis (including statements regarding implementing strategies for future growth, the ability of the Company to sustain its model of profitable growth and the expected benefits of the Company's e-Business strategy) are forward-looking statements that involve certain risks and uncertainties. Such risks and uncertainties include the continued acceptance of the Company's distribution channel by vendors and customers, the timely availability and acceptance of new products, continuation of key vendor relationships and support programs and the ability of the Company to hire and retain qualified account managers. About CDW Computer Centers, Inc. CDW® (Nasdaq: CDWC), ranked No. 560 on the FORTUNE 1000, is the country's direct solutions provider, offering complete, customized computing solutions for businesses and government and educational institutions nationwide. CDW is a leading source of technology products and services from companies such as Cisco, Compaq, Computer Associates, Hewlett-Packard, IBM, Microsoft, Sony, Toshiba and other top name brands. CDW was founded in 1984 as a home-based business and today employs more than 2,600 coworkers whose efforts generated net sales of $3.6 billion for the trailing twelve months ended September 30, 2000. CDW's direct model offers one-on-one relationships with highly-trained account managers; telephone and online purchasing; custom configured solutions and same day shipping; flexible financing solutions; and lifetime 24x7 phone and online technical support, with more than 80 factory-trained and A+ certified technicians on staff. As a result of CDW's full integration of its e-business strategy with its existing business model and internal systems, CDW.com enjoys more than 72,000 unique users daily, with more than 54,000 businesses accessing customized CDW@work extranets. For more information about CDW's products and services, call 800-797-4239 or visit the award-winning e-commerce Web site at www.cdw.com A live Web cast of CDW Management's discussion of the third quarter will be available on www.vcall.com and on www.streetevents.com. The Web cast will begin today, October 23, 2000 at 5:00 pm EDT. An audio replay of the call will be available on www.vcall.com until January 23, 2001. For more information about CDW: Visit CDW on the Internet at http://www.cdw.com Contact CDW Investor Relations via the Internet at shserv@cdw.com Or by telephone at 847-419-8234. CDW COMPUTER CENTERS, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (unaudited)   September 30, 2000 December 31, 1999 ASSETS Current Assets Cash, cash equivalents and marketable securities $ 147,133 $ 82,975 Accounts receivable, net of allowance for doubtful accounts of $6,000 and $4,300, respectively 348,956 230,190 Merchandise inventory 165,944 126,217 Miscellaneous receivables 16,458 7,589 Deferred income taxes 6,702 6,702 Prepaid expenses 2,186 1,375 Total current assets 687,379 455,048 Property and equipment, net 51,844 39,429 Investment in and advances to subsidiary 5,294 6,499 Deferred income taxes and other assets 3,922 4,939 Total assets $748,439 $505,915   LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable $107,972 $ 65,657 Accrued expenses and other current liabilities 56,207 47,055 Accrued exit costs 2,000 2,219 Total current liabilities 166,179 114,931 Shareholders' equity 582,260 390,984 Total liabilities and shareholders' equity $748,439 $505,915 CDW COMPUTER CENTERS, INC. AND SUBSIDIARY CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share data) (unaudited)   Three Months Ended September 30, Nine Months Ended September 30,   2000 1999 2000 1999 Net Sales $1,028,051 $683,012 $2,835,381 $1,819,972 Cost of Sales 896,917 597,398 2,472,813 1,591,705 Gross profit 131,134 85,614 362,568 228,267 Selling and administrative expenses 59,358 43,523 169,630 118,423 Income from operations 71,776 42,091 192,938 109,844 Interest income 2,734 1,363 6,654 3,366 Other expense (123) (96) (470) (317) Income before income taxes 74,387 43,358 199,122 112,893 Income tax provision 29,457 17,170 78,852 44,706 Net income $ 44,930 $ 26,188 $ 120,270 $ 68,187 Earnings per share    Basic $0.52 $0.30 $1.38 $0.79    Diluted $0.49 $0.30 $1.32 $0.78 Weighted average number of common shares outstanding    Basic 87,236 86,300 86,858 86,208    Diluted 91,872 88,216 90,832 87,944 Traded: Nasdaq: CDWC CDW Computer Centers, Inc. CDW Computer Centers, Inc. Investor Inquiries Media Inquiries Harry J. Harczak, Jr. Chief Financial Officer (847) 419-6226 Melissa Sullivan Corporate Communications Manager (847) 371-5067