05 Purchase accounting impact on revenue1 0

We believe that theexclusion of the amortization expense of acquisition-related intangible assetsprovides investors useful information facilitating comparison of our resultsperiod-over-period and with other companies in the software industry as theyeach have their own acquisition histories and related adjustments. Impairment of long-term investments - The liquidity and fair value of ourinvestments in marketable securities, including Auction Rate Securities (ARS),were negatively impacted in fiscal 2008 by the uncertainty in the credit marketsand exposure to the financial condition of bond insurance companies. As aresult, during the second, third and fourth quarters of fiscal 2008 we recordedimpairment charges to reduce the carrying value of our ARS investments. Theimpairment charges related to our ARS investments have been excluded from ournon-GAAP results of operations.

These impairment charges are excluded frommanagements assessment of our operating performance. We believe that theexclusion of these unique charges provide investors an enhanced view of ouroperations and facilitates comparisons with the results of other periods that donot reflect such charges LAWSON SOFTWARE, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in USD thousands, except per share data) (unaudited)Three Months Ended Increase (Decrease) Increase (Decrease)as reportedat constant currency Nov 30, 2008Nov 30, 2007Revenues: License fees $30,061$32,990(9) (4)Maintenance 90,083 84,7056 10 Consulting86,213 100,907 (15)(10) Total revenues206,357218,602 (6) (1)Cost of revenues: Cost of license fees6,6486,616 0 3Cost of maintenance 17,373 16,8303 8Cost of consulting73,710 84,155(12)(7)Total cost of revenues97,731 107,601 (9) (4)Gross profit108,626111,001 (2) 2Operating expenses: Research and development22,542 21,7324 10 Sales and marketing 42,986 48,214(11)(6)General and administrative22,165 25,839(14)(11) Restructuring 7,71780 Amortization of acquired intangibles2,3583,352 (30)(25) Total operating expenses97,768 99,217(1) 3Operating income10,858 11,784(8) (12) Other income (expense), net:Interest income 1,9875,882 (66)(66) Interest expense(2,019 ) (2,142 )(6) (5)Other income (expense), net 201(4,376 ) Total other income (expense), net 169(636 ) Income before income taxes11,027 11,148(1) (3)Provision for income taxes6,8197,425 (8) (7)Net income $4,208 $3,723 134Net income per share: Basic$0.03$0.02 Diluted$0.03$0.02 Weighted average common shares outstanding: Basic 162,456178,453 (9) Diluted 164,527181,941 (10)We provide the percent change in the results from one period to another using constant currency disclosure to adjust year-over-year measurements for impacts due to currency fluctuations. Constant currency changes should be considered in addition to, and not as a substitute for changes in revenues,expenses, income, or other measures of financial performance prepared in accordance with US GAAP. We calculate constant currency changes by convertingentities financial results for the prior year period that are reported in currencies other than the United States dollar at the exchange rate ineffect for the current period rather than the previous period. LAWSON SOFTWARE, INC.CONSOLIDATED STATEMENTS OF OPERATIONS(in USD thousands, except per share data)(unaudited) Six Months Ended Increase (Decrease) as reported Increase (Decrease) at constant currencyNov 30, 2008Nov 30, 2007Revenues:License fees $51,186$58,450(12)(11)Maintenance 179,192163,219 109 Consulting166,895184,341 (9) (9) Total revenues397,273406,010 (2) (2)Cost of revenues:Cost of license fees11,980 13,369(10)(13)Cost of maintenance 34,247 32,4905 5 Cost of consulting146,157155,381 (6) (6) Total cost of revenues192,384201,240 (4) (4)Gross profit204,889204,770 0 1Operating expenses:Research and development44,460 39,0181415Sales and marketing 89,477 90,505(1) (1) General and administrative41,454 51,562(20)(21)Restructuring 7,486(65)Amortization of acquired intangibles4,9856,568 (24)(25)Total operating expenses187,862187,588 0 0Operating income17,027 17,182(1) 4Other income (expense), net: Interest income 5,03512,745(60)(60)Interest expense(4,057 ) (4,746 )(15)(15)Other income (expense), net 273(4,054 )Total other income (expense), net 1,2513,945 (68)(65) Income before income taxes18,278 21,127(13)(9) Provision for income taxes16,593 11,8234041Net income $1,685 $9,304 (82)(80) Net income per share:Basic$0.01$0.05Diluted$0.01$0.05 Weighted average common shares outstanding:Basic 165,425179,974 (8)Diluted 168,114183,520 (8)We provide the percent change in the results from one period to another using constant currency disclosure to adjust year-over-year measurements for impacts due to currencyfluctuations. Constant currency changes should be considered in addition to, and not as a substitute for changes in revenues, expenses, income, or other measures of financialperformance prepared in accordance with US GAAP.

We calculate constant currency changes by converting entities financial results for the prior year period that are reported incurrencies other than the United States dollar at the exchange rate in effect for the current period rather than the previous period. LAWSON SOFTWARE, INC.CONSOLIDATED BALANCE SHEETS(in USD thousands)Nov 30, 2008May 31, 2008(unaudited)ASSETSCurrent assets: Cash and cash equivalents$300,528 $435,121Restricted cash - current 9,501746Marketable securities -5,453Short term investments-45,236 Trade accounts receivable, net135,453184,047Income taxes receivable 1,43310,309 Deferred income taxes - current 14,146 16,839 Prepaid expenses and other current assets 40,804 44,470 Total current assets501,865742,221Restricted cash - non-current 2,6902,038Property and equipment, net 46,920 45,044 Goodwill448,553546,578Other intangibles assets, net 100,820120,194Deferred income taxes - non-current 43,396 35,907 Other assets13,464 18,614 Total assets $1,157,708 $1,510,596LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Long-term debt - current $3,021 $3,849Accounts payable10,239 23,481 Accrued compensation and benefits 66,301 89,733 Income taxes payable5,5468,860Deferred income taxes - current 6,0417,399Deferred revenue - current183,682298,509Other current liabilities 41,672 49,318 Total current liabilities 316,502481,149Long-term debt - non current243,163244,734Uncertain tax positions - non-current 6,7995,757Deferred income taxes - non-current 13,011 12,529 Deferred revenue - non-current13,815 14,097 Other long-term liabilities 7,4788,771Total liabilities 600,768767,037Stockholders equity: Common stock2,0142,010Additional paid-in capital840,766838,141Treasury stock, at cost (314,184 ) (225,598 ) Retained earnings 33,147 31,462 Accumulated other comprehensive income (loss) (4,803 ) 97,544 Total stockholders equity556,940743,559Total liabilities and stockholders equity $1,157,708 $1,510,596LAWSON SOFTWARE, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(in USD thousands) (unaudited) Three Months EndedSix Months EndedNov 30, 2008Nov 30, 2007Nov 30, 2008 Nov 30, 2007Cash flows from operating activities:Net income $4,208$3,723 $1,685$9,304 Adjustments to reconcile net income to net cash used in operating activities:Depreciation and amortization 9,510 10,966 19,77021,166Amortization of debt issuance costs 321329642 644 Deferred income taxes 2,764 4293,669 1,429 Provision for doubtful accounts 318(1,292 ) 68(845) Warranty provision1,923 1,7443,180 2,800 Impairment on long-term investments -4,229- 4,229 Net gain on disposal of assets-(3 ) - (311) Excess tax benefits from stock transactions (19) (700 ) (367) (1,721) Stock-based compensation expense2,917 2,2274,734 4,255 Amortization of discounts and premiums on marketable securities 9(63) 15(90 ) Changes in operating assets and liabilities: Trade accounts receivable 4,000 (12,900) 38,90715,472Prepaid expenses and other assets 8,455 2,9483,093 (9,215) Accounts payable(3,33 ) 546(11,455 ) (5,495) 8 Accrued and other liabilities 10,92 3,202(8,080) (21,979 )

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4 Income taxes payable/receivable (10,3 ) 3,885(5,163) 8,632 48Deferred revenue and customer deposits(74,9 ) (69,142) (108,579) (98,750 ) 48Net cash used in operating activities (43,3 ) (49,872) (57,881 ) (70,475 ) 04 Cash flows from investing activities:Change in restricted cash (9,80 ) (510 ) (9,407) (59 ) 8 Purchases of marketable securities and investments-(25,543) - (205,098) Proceeds from maturities and sales of marketable securities and investments 983112,76550,677194,120 Purchases of property and equipment (9,12 ) (7,921 ) (16,069 ) (10,822 ) 3 Net cash provided by (used in) investing activities (17,9 ) 78,791 25,201(21,859 ) 48 Cash flows from financing activities:Principal payments on long-term debt(328 ) (475 ) (910) (881) Payments on capital lease obligations (487 ) (341 ) (617) (676) Cash proceeds from exercise of stock options1141,8821,547 5,486 Excess tax benefit from stock transactions19 700367 1,721 Cash proceeds from employee stock purchase plan 7497431,528 1,445 Repurchase of common stock from related parties - (36,800 ) Repurchase of common stock-other9,075 (3,082 ) (90,966 ) (19,945 ) Net cash provided by (used in) financing activities 9,142 (573 ) (89,051 ) (49,650 )Effect of exchange rate changes on cash and cash equivalents(7,73 ) 4,820(12,862 ) 5,824 0Net increase (decrease) in cash and cash equivalents(59,8 ) 33,166 (134,593) (136,160) 40Cash and cash equivalents at beginning of period360,3 304,637435,121 473,963 68Cash and cash equivalents at end of period $300,5$337,803 $300,528$337,803 28LAWSON SOFTWARE, INC. RECONCILIATION OF CONSOLIDATED GAAP NET INCOME TO CONSOLIDATED NON-GAAP NET INCOME(in USD thousands)Three Months EndedSix Months Ended Nov 30, 2008Nov 30, 2007Nov 30, 2008Nov 30, 2007 Net income, as reported $4,208 $3,723 $1,685 $9,304Purchase accounting impact on revenue(1) 1584224161,042Purchase accounting impact on consulting cost32 16365 256Amortization of purchased maintenance contracts6741,0001,3831,822Stock-based compensation 2,9172,2264,7344,254Pre-merger claims reserve adjustment (2,001 ) -(3,808 ) -Restructuring7,71780 7,486(65) Amortization 5,0336,47210,309 13,143 Impairment on long term investments-4,229-4,229Tax provision(4) (2,126 ) (2,696 ) 2,991(5,723 ) Non-GAAP net income $16,612$15,619$25,261$28,262RECONCILIATION OF CONSOLIDATED GAAP TO CONSOLIDATED NON-GAAP PER SHARE EFFECTThree Months EndedSix Months Ended Nov 30, 2008Nov 30, 2007Nov 30, 2008Nov 30, 2007 Net income, as reported(2)$0.03$0.02$0.01$0.05 Purchase accounting impact on revenue(1) 0.00 0.00 0.00 0.01 Purchase accounting impact on consulting cost0.00 0.00 0.00 0.00 Amortization of purchased maintenance contracts0.00 0.01 0.01 0.01 Stock-based compensation 0.02 0.01 0.03 0.02 Pre-merger claims reserve adjustment (0.01) -(0.02) -Restructuring0.05 0.00 0.04 0.00 Amortization 0.03 0.04 0.06 0.07 Impairment on long term investments-0.02 -0.02 Tax provision(4) (0.01) (0.01) 0.02 (0.03) Non-GAAP net income per share(2) (3)$0.10$0.09$0.15$0.15Weighted average shares - basic162,456178,453165,425179,974Weighted average shares - diluted164,527181,941168,114183,520 SUMMARY OF NON-GAAP ITEMS(in USD thousands) Three Months EndedSix Months Ended Nov 30, 2008Nov 30, 2007Nov 30, 2008Nov 30, 2007 Purchase accounting impact on revenue(1)$158 $422 $416 $1,042Purchase accounting impact on consulting cost32 16365 256Amortization of purchased maintenance contracts6741,0001,3831,822Stock-based compensation 2,9172,2264,7344,254Pre-merger claims reserve adjustment (2,001 ) -(3,808 ) -Restructuring7,71780 7,486(65) Amortization 5,0336,47210,309 13,143 Impairment on long term investments-4,229-4,229subtotal pre-tax adjustments 14,530 14,592 20,585 24,681 Tax provision(4) (2,126 ) (2,696 ) 2,991(5,723 ) Impact on net income$12,404$11,896$23,576$18,958(1) For the purchase accounting impact on deferred revenues for three months and six months ended November 30, 2008, $158,000 and $416,000, respectively, relates to maintenance revenues and $0 and $0, respectively, relates to consulting revenues.(2) For calculation of EPS, basic weighted average shares are used with a net loss and diluted weighted average shares are used with net income.(3) Net income per share columns may not total due to rounding. (4) The non-GAAP tax provision is calculated excluding the non-GAAP adjustments on a jurisdictional basis.LAWSON SOFTWARE, INC.SUPPLEMENTAL NON-GAAP MEASURES INCREASE (DECREASE) IN GAAP AMOUNTS REPORTED (in USD thousands) (unaudited)Three Months EndedSix Months EndedNov 30, 2008Nov 30, 2007Nov 30, 2008Nov 30, 2007 Revenue items Purchase accounting impact on maintenance$158$350$416$852 Purchase accounting impact on consulting- 72- 190 Total revenue items 158 422 416 1,042 Cost of license items Amortization of acquired software (2,675) (3,120) (5,325) (6,575) Non-cash stock-based compensation - (6) - (13 ) Total cost of license items (2,675) (3,126) (5,325) (6,588) Cost of maintenance items Amortization of purchased maintenance contracts (674) (1,000) (1,383) (1,822) Non-cash stock-based compensation (65 ) (26 ) (117) (67 ) Total cost of maintenance items (739) (1,026) (1,500) (1,889) Cost of consulting itemsPurchased accounting impact on consulting cost(32 ) (163) (65 ) (256) Amortization- - 1 - Non-cash stock-based compensation (164) (215) (175) (433) Total cost of consulting items(196) (378) (239) (689) Research and development itemsNon-cash stock-based compensation (164) (127) (298) (291) Total research and development items(164) (127) (298) (291) Sales and marketing items Non-cash stock-based compensation (544) (370) (1,000) (736) Total sales and marketing items (544) (370) (1,000) (736) General and administrative itemsPre-merger claims reserve adjustment2,001 - 3,808 - Non-cash stock-based compensation (1,980) (1,482) (3,144) (2,714) Total general and administrative items21(1,482) 664 (2,714) Restructuring (7,717) (80 ) (7,486) 65Amortization of acquired intangibles(2,358) (3,352) (4,985) (6,568) Other income (expense), impairment on long-term investments - 4,229 - 4,229 Tax provision (1) (2,126) (2,696) 2,991 (5,723) Total adjustments$12,404 $11,896 $23,576 $18,958(1) At the beginning of the fiscal year, the company computed an estimated annual global effective non-GAAP tax rate of 35.