1. FINAL TRANSCRIPT CTX - Q2 2009 Centex Corporation Earnings Conference Call Event Date/Time: Oct. 29. 2008 / 10:00AM ET www.streetevents.com Contact Us 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

2. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call CORPORATE PARTICIPANTS Tim Eller Centex Corporation - Chairman, CEO Cathy Smith Centex Corporation - EVP and CFO Matt Moyer Centex Corporation - VP, IR Mark Kemp Centex Corporation - SVP, Controller CONFERENCE CALL PARTICIPANTS Nishu Sood Deutsche Bank - Analyst Kenneth Zener Macquarie Research - Analyst Daniel Oppenheim Credit Suisse - Analyst James McCanless FTN Midwest Research - Analyst Ivy Zelman Zelman & Associates - Analyst Stephen Kim Alpine - Analyst David Goldberg UBS Securities - Analyst Rob Stevenson Fox-Pitt Kelton - Analyst Carl Reichardt Wachovia Securities - Analyst Stephen East Pali Capital - Analyst Joshua Levin Citi Investment Research - Analyst Chris Hussey Goldman Sachs - Analyst Michael Mike Rehaut JP Morgan - Analyst Alex Barron Agency Trading Group - Analyst Eric Landry Morningstar - Analyst Joel Locker FBN Securities - Analyst www.streetevents.com Contact Us 1 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

3. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Jim Wilson Jolson Merchant Partners LLC - Analyst Susan Berliner JP Morgan - Analyst Buck Horne Raymond James & Associates - Analyst PRESENTATION Operator Good morning and welcome to the Centex Corporation fiscal year 2009 second quarter earnings conference call with senior management. Today's call will be recorded and transcribed. Today's call also will be simultaneously webcast at ir.centex.com. A copy of today's presentation was filed last night with the SEC on Form 8-K. A link to that document is now available on the website. As usual, participants must download and advance their own slides during today's conference. Continuing on slide 2, Centex wishes to emphasize to everyone listening on the call and via the Internet, that certain statements made during the course of this call are forward-looking. These statements are not guarantees of future performance and are subject to significant risks and uncertainties, that could cause actual results to differ materially from those discussed during the call. For further information regarding these risks and uncertainties and Centex's forward-looking statements, please refer to the forward-looking statements disclosure in the presentation, and to Centex's reports on forms 10-K and 10-Q, filed with the SEC. (OPERATOR INSTRUCTIONS) If you have additional questions following today's call, please contact Matt Moyer, Vice President of Investor Relations at 214-981-5000. I now turn the call over to Tim Eller, Chairman and CEO. Please go ahead, sir. Tim Eller - Centex Corporation - Chairman, CEO Thank you, Christy, and good morning, everyone. Thanks for joining us for our fiscal year 2009 second quarter conference call. With me today, is Cathy Smith, our Chief Financial Officer, Mark Kemp, our Chief Accounting Officer, and Matt Moyer, head of Investor Relations. I will start our call today with some introductory comments on the quarter, as well as a few thoughts about the months ahead. Next, Cathy will provide details about our financial performance for the quarter and the year to date. Then I will offer some closing comments and we'll take your questions. Turning to Slide 3, it's an understatement to say that unprecedented economic conditions have had an increasingly negative impact on the housing industry. Last quarter our sales per neighborhood dropped to an average 1.7 per month from 2.5 in the previous quarter. And sales may well weaken further in the December quarter. I will suggest, however, that I think virtually all elements of a bottom for the housing cycle are in place. But it's not at all possible to predict when we will reach bottom, nor how long we'll likely bounce along there. And frankly, conditions will probably get worse before they get better, especially in light of the continuing financial and credit turmoil and increasing job losses. The depth and duration of this housing and financial correction make this a game changer for home builders, like no cycle that has come before. And I believe that it will dramatically alter the competitive landscape. It's now clear that this cycle will test the best and eliminate the rest. At Centex we have been consistent with our actions, based on current market realities at the time, to effectively navigate this unprecedented cycle. www.streetevents.com Contact Us 2 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

4. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call We're continuing to increase our cash position, ending the quarter with $1.3 billion cash on hand. That's up more than $700 million since the beginning of the fiscal year, and $64 million over our last quarter after having paid off $150 million of maturing senior notes in the quarter. We have combined and consolidated operations around the country for efficiency. In California, for example, we now operate two divisions with a couple of satellite offices, where we once operated nine separate divisions. We have made similar changes in Florida and the Carolinas. We shortened our land position. Only one other national builder has a lower total lot position than Centex, based on the last 12 months sales. We accomplished through this not through distressed sales nor forcing specs, but through an effective and practical business approach of preselling homes to a backlog, then building homes on a predictable schedule based on that backlog. While sales have declined, we're carefully managing that process to optimize volumes and maintain resource efficiencies. And as we do, we're retaining the capability to take advantage of the inevitable, and perhaps historic opportunities that will arise. We intend to excel on the other side of this housing cycle. Based upon our multiple cycle experiences, I believe we're making the right strategic choices for the current environment. We've established a steady monthly pattern of improving gross margins this fiscal year despite commodity price pressures and declining sales. Gross margins have increased every month for the past six months. Direct construction costs have declined 0.5% each month. Gross margins reached 15% in the second quarter and our backlog indicates that we'll see additional improvements. Discounts and incentives have dropped as have financing costs and sales concessions. Further confirmation that our build to order transparent pricing approach is the right one. Home building G&A combined with corporate G&A is down 39% from a year ago. However, we're still taking actions to further reduce G&A spending in light of current sales conditions. Our land development requirements are low. About half our lots in land under development are finished. Looking ahead, this cycle will virtually assure land and finished lots can be acquired on soft terms in a fairly asset-light basis. We expect to continue growing our cash position. We'll continue to reduce debt and increase cash on hand to the fiscal year. We're confident in our abilities to generate the cash necessary to manage debt levels over the next several years, even at current levels of production. While we continue to structure our business to weather this cycle we're also preparing to emerge from it with strength. So turn to slide 5. Today's land position is sufficient for our near term needs. With the abundance of finished lots that will be coming on the market, we can supplement our existing inventory as needed. We have the opportunity to gain market share. And we've been steadily doing so in our key markets. Across the nation, in major markets like Washington, DC, Dallas-Fort Worth, San Antonio, and Phoenix, we're gaining market share on an absolute and relative basis. This is in large part because of the severity of this cycle is driving smaller and less well capitalized players from the field. Scale in the most attractive markets will further margin improvement and higher returns. With that, I'll turn it over to Cathy to take us through some of the specifics for the quarter. Cathy Smith - Centex Corporation - EVP and CFO I would characterize the quarter by good cash performance and improved gross margins. Although on a macro basis, the home building market continues to deteriorate. I'm on slide 6. Our home building operations were cash flow positive for the fifth straight quarter. This reflects our keen focus on cash and the progressive changes in our business processes. We continue to strengthen our balance sheet and now have a home building net debt-to-cap ratio below 48%. This is an improvement of almost 700 basis points in the last six months. We continue to generate cash through asset reductions and utilizing our developed lot supply. What's more exciting, because of the longer term implications, we are becoming more asset efficient and more profitable, as we have almost fully completed our transition to a build to order production model. As Tim said, even at these depressed levels of sales and closings we can produce positive cash flow. Another positive of the second quarter is the improvement in our gross www.streetevents.com Contact Us 3 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

5. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call margins. Gross margins improved 320 basis points sequentially to 15%. Our discounts and incentives came down again this quarter and in each month of the quarter as well. Specifically, our sales discounts and incentives were 7.9% of the average selling price, down from 10.5% last quarter, making the third consecutive sequential decrease. We also made good strides toward achieving operational profitability through overhead cost reductions. We reduced our home building overhead per closing by 13% year-over-year, and lower SG&A as a percent of revenue by 30 basis points sequentially. Although our home building SG&A was lower, our corporate G&A increased year-over-year. We recognize even in these unprecedented times, it's important to continue to frugally invest in the future. We've been doing much to centralize, standardize, and simplify our business, and some of the associated costs show up in corporate G&A. I'm confident these investments will enable Centex to have a sustainable, scalable and efficient cost structure. We also furthered our strategy to focus on our core home building business in the quarter. We essentially completed the wind-down of our retail mortgage operations, and we successfully completed the sale of two of our smaller non-core businesses. We closed on the sale of our insurance agency business and just after the end of the quarter, we sold our CTX builder supply business. In both cases, we were approached by the buyer an sold the businesses for a gain. The gain on the sale of the insurance business appears in the discontinued operations on the income statement. The cash received is in investing activities on the cash flow statement. Slide 7 provides the details around the home building operations for the second quarter. We closed 3,797 homes in the quarter, 48% fewer than last year. The average price of homes closed in the quarter declined 12% to $247,534. Total home building revenues were down 55%, to about $1 billion. Sales in units were down 54% year-over-year. On a per-neighborhood basis, sales were down 42% as average neighborhoods declined 21% to 523. As Tim said earlier, this level of activity was within our planning ranges and will continue to adjust overhead as we have for the past several quarters. Our cancellation rate jumped up this quarter to 40.3% versus 35.4% a year ago and 30% last quarter. The increase in cancellations was due to the elimination of the down payment assistance program, rising job losses, and tightening credit standards. We continue to believe that a return to more normal qualification standards is necessary long-term, even if it causes a little bit of short-term pain. Following the weaker sales pace, and higher cancellations, our backlog fell by 28% year-over-year to 6,953 units, valued at $1.83 billion. This is one of the strongest backlog positions in the industry, and a direct result of our build to order model. The right level of backlog will be increasingly important to us. Creating a presold backlog allows us to build to a cadence. Building to a cadence using standardized business processes, yields operating efficiencies, higher margins and more predictable results, and developing a backlog through preselling is essential to our asset-light business model. We're moving rapidly in this direction. Consistent with our strategy and early actions, we've done a great job reducing our total lot position. We now own 63,311 lots and control just 11,866 lots. Based on trailing 12-month sales, this is less than a four-year supply of total lots. One of the best positions in the industry. On a pretax basis, this quarter we recorded $103 million in land-related charges, including $77 million in land impairments, $14 million in option walk-away costs, and $12 million of JV impairments. We impaired 28 neighborhoods this quarter, which brings the total number of neighborhoods impaired at least once to about 280. As I said each quarter, we take a consistent, methodical approach to land valuation. We recognize this is a dynamic environment. We will continue to take the same disciplined approach to valuing our assets each quarter. Along with the impairment analysis, it's essential to assess each neighborhood for positive incremental cash flow. We evaluate every asset, every quarter, to make sure we have the right strategy for that particular asset. We assess whether the highest return is to sell, build through, or hold. We're still finding that the best answer most of the time, is to continue to build through our assets. You will see that our land held category decreased slightly sequentially. Continuing to build through our assets will leave us with a leaner balance sheet, and an opportunity to add faster turning, higher yielding assets in the future. www.streetevents.com Contact Us 4 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

6. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call We also increased our valuation allowance related to our deferred tax asset by $66 million. In total, the balance of our DTA is $1 billion, with a valuation allowance against it of $945 million. Or just over $7.50 per share. This represents over 45% of our current book value. We will realize this asset when we see stability and improving environment and a return to profitability. Let me take a few minutes to review the regional results. Slide 8 details sales and closings by region. As you will you quickly notice, we have a -- we have realigned our reporting regions to better reflect the ongoing changes in our business and the industry. In the quarter we sold 2,728 homes, down 54% year-over-year. Our average active neighborhoods were down 21% in the quarter. A rate that will likely continue to accelerate through the second half of the year. In our east region, sales were down 39%. The coastal Carolinas and DC metro, were relatively stronger than the rest of the region. In the central region, Texas and Nashville were relatively stronger than other divisions in the region. And in the west region, the northern pacific area and New Mexico were the stronger areas. That said, only one division had a year-over-year increase in sales. Year-over-year closings were down across the board consistently, reflecting the soft market environment and the reductions in active neighborhoods. Moving to slide 9, the current conditions in the housing market highlight even more the strength of our strategic choices, as they are yielding the expected positive results. Our business model emphasizes selling to a backlog and then building to a cadence. This increases our profitability and predictability. Our gross margins have now improved 730 basis points in the last six months to 15%, and should continue to get better in the December quarter. Incentives and discounts were down to 7.9% this quarter, less than half of our peak levels last year. Our sell to a backlog, build to a cadence model helps us to better know exactly where and when we need finished lots. As a result, we have been able to further reduce our land acquisition and development spend for the entire fiscal year to $300 million, of which $100 million of the spending remains, and given the recent volumes, we expect our land spending next year to be similar to or less than this year's $300 million. Our operators and trade partners are working hard to take advantage of the efficiencies gained in our production cadence model, and this is helping offset the price increases we are seeing due to higher commodity and energy costs. These efficiencies will be far more meaningful at higher volumes. Furthermore, we expect to take advantage of the fully and partially developed lots in most markets using a cash-light model for the foreseeable future. In all our markets, we're actively assessing and cataloging future potential land. For this acquisition model to be effective, we're establishing important relationships now, both with developers and capital sources. Turning to slide 10, starting early in this cycle, we recognized our value proposition to shareholders will be to consistently produce a solid home building margin and a high asset efficiency. We'll execute a finished lot strategy, and we'll be generally averse to trying to -- tieing up lots amounts of capital in slower turning undeveloped land. The result is that we can have lower closing volumes in a quarter and still be cash flow positive. In the quarter, we paid off $150 million of senior notes and still increased our cash balance by $64 million. We ended the quarter with a cash balance of $1.3 billion, and we're expecting our cash balance to increase by the end of the fiscal year. With the lack of stability and price and volume, it's prudent to conserve and accumulate cash. This is a Company priority. Consistent with these priorities we'll continue to scrutinize all uses of cash. Another Company priority is to return to operational profitability as quickly as possible. We remain highly focused on our overhead cost reductions, our home building G&A was down 13% per closing in the quarter. On a combined basis with home building and corporate, G&A was down 39% year-over-year. We expect this trend to continue throughout the rest of this year, and our headcount today is lower than any time in the past seven years. Turning to slide 11, Centex financial services is now much more streamlined and straightforward. In the quarter, we essentially completed the wind-down of our retail operations. The associated costs were $26 million, in line with the $25 to $35 million we previously guided. The wind-down costs are primarily for severance and lease obligations. www.streetevents.com Contact Us 5 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

7. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Also, given all the pressures in the market, we felt it was prudent to increase our loan related reserves again by $16 million, net of some loan sales we made at higher prices than expected. The additional reserve is not for loans repurchased, but rather our cautious stance in light of the mortgage market environment. CTX mortgage is now solely focused on Centex homebuyers and is only originating FHA and GSE loans almost exclusively. This structure is one of keys to our industry leadership position in customer satisfaction. Finally CTX mortgage also has adequate committed warehouse lines. I will turn the call back over to Tim for concluding remarks. Tim Eller - Centex Corporation - Chairman, CEO Thanks, Cathy. The housing industry is grappling with unprecedented economic conditions, but Centex is navigating the cycle effectively. We have a strong and growing cash position of $1.3 billion on hand, and have shortened total land position to be among the shortest in the industry. We have steadily improved our gross margins and reduced our use of incentives and discounts, despite substantial head winds. We'll continue our G&A reductions and our need to spend on land development will remain low. We're facing what metaphorically and literally could be a cold, dark winter for home builders. But winter won't last forever, nor will this downturn. A spring for the housing market will come eventually, and we're preparing to emerge with strength. Looking ahead we have a sufficient supply of lots for immediate needs, and we foresee access to thousands of finished lots to build scale when demand improves. We're increasing market share in the nation's most attractive markets, which will yield benefits today and higher returns over the long term. Restoring the organization to profitability and continuing to improve our liquidity are our highest priorities. And now Christy let's address questions. QUESTIONS AND ANSWERS Operator (OPERATOR INSTRUCTIONS) Our first question is from Nishu Sood from Deutsche Bank. Your line is open. Nishu Sood - Deutsche Bank - Analyst Thanks and good morning everyone. Tim Eller - Centex Corporation - Chairman, CEO Good morning Nishu. Nishu Sood - Deutsche Bank - Analyst First question I wanted to ask was on your reduced forecast for land spend. If I am doing my math correctly of taking it down by $100 to $200 million for the year. So I -- and -- just wanted to understand the dynamics of that. Mostly I imagine you are cutting your forecast for development expenditures, So is it the situation that you are just finding that the timing has been stretched out for when you are going to need these lots, because of lower absorptions? Or is it more along the lines of the constant calculations you are doing to determine whether or not you are going to be able to get cash recovery on the development costs that you are putting into the ground? www.streetevents.com Contact Us 6 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

8. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Cathy Smith - Centex Corporation - EVP and CFO Good morning, Nishu, it's Cathy. It's really more of the former. As we continue to evaluate our needs by market, in our sell to a backlog and build to a cadence model, we can really clearly pinpoint where the development needs to go, and we're just trying to do just-in-time development wherever we can. 50% of our land in production is fully developed. So it's really more of a reflection of that. Nishu Sood - Deutsche Bank - Analyst Got it. Second question, Tim, I think you described it well but this is going to test the best or eliminate the rest, and that there's going to be opportunities, of course, in terms of picking up finished lots as we come out of this. Now, when the capital markets might open up again to providing capital to the industry, it might differ from when might be the best time to buy a lot of these lots. So how are you going to look to fund these opportunities once you decide to go after them? Is got you are going to try to fund internally, or would you pursue the more conservative route and wait for the capital market to open up again? Tim Eller - Centex Corporation - Chairman, CEO We're not going to wait for capital markets because we're not sure when they will open up again. We know that we can acquire lots on fairly soft terms, even now and do. We expect that next fiscal -- the next calendar year 2009 we will see many, many more additional opportunities as banks sort out their capital structure now before the end of the year, given everything that the treasury is doing and the fed is doing to support the bank's capital. So I think we'll see a lot of activity from the banks next year. We're also talking to developers and other sources of private capital to align with them in terms of taking advantage of these opportunities should there be bulk sales as well and we'll buy those through -- work through third parties with those. When you think about this, we're the logical end user for these lots anyway. Even if private capital acquires these lots, they are going to need to be -- there's going to need to be an exit strategy for them, and we are the exit strategy. There will be so few of us left that we will have, I think, a great shot at a lot of great properties. Operator Our next question comes from the line of Kenneth Zener from Macquarie Capital. Kenneth Zener - Macquarie Research - Analyst Good morning. If you could talk, obvious well the gross margins up going up sequentially could you break that out between your spec and non-spec sales, because it certainly looks like the discounts are related to -- covers lot of the improvement in gross margins. Cathy Smith - Centex Corporation - EVP and CFO Gross margins continue to improve for a really a couple of reasons. The biggest being our focus with our trade partners on our production efficiencies, so that's coming through in brick and mortar as direct construction costs have continued to come down, as well as our discounts and incentives. They are about half of what they have been at their peak levels, so that's really what's driving the improvement in gross margins. On specs, versus presold, it's about two-thirds of our sales were presold versus a third on specs. www.streetevents.com Contact Us 7 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

9. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Kenneth Zener - Macquarie Research - Analyst How would that compare to last quarter, I guess? Cathy Smith - Centex Corporation - EVP and CFO A little bit more towards presold. Kenneth Zener - Macquarie Research - Analyst Okay. Then I guess, Tim or Cathy, with another private homebuilder in Phoenix going bankrupt last week, do you think the banks are going too far in their tightening relative to builders that could have actually survived? How do you kind of see that in the markets, the banks' behavior? Tim Eller - Centex Corporation - Chairman, CEO I think everybody is trying to sort out the cycle, and they're trying to do the best they can, but the reality is that a lot of the land that private builders are working on just doesn't have much value any more. So there's no incentive for even the builder to continue. So that's the way the cycle is working out, and the banks will have to reconcile that in their capital structure, which is why I say I think next year, 2009, will have lots of opportunities. Operator Our next question comes from the line of Dan Oppenheim with Credit Suisse. Your line is open. Daniel Oppenheim - Credit Suisse - Analyst Thanks very much. I was wondering about your priorities. You spent a lot of time talking the about improving gross margins sequentially, but also about the production cadence, which certainly sounds a lot like even flow production rather than benefit higher volumes. Given the order decline which then limits future cash flow, what are you going to focus on as we look ahead to the coming quarters, generating more orders and cash flow in the future or trying to continue to improve the gross margin? Cathy Smith - Centex Corporation - EVP and CFO Our priorities are to accumulate and preserve the cash we have, and to structure for profitability, and we know that selling to a backlog and building to a cadence helps us with that. So you are not going to see us necessarily deviating from that model. Tim Eller - Centex Corporation - Chairman, CEO A couple other things we know is, we generate cash on virtually every closing. We look at this every quarter. We also know that we can generate cash at even lower levels of closings. In fact, half of our current level of production we will be cash flow positive. Operator Our next question comes from the line of Jay McCanless from FTN Midwest. Your line is open. www.streetevents.com Contact Us 8 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

10. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call James McCanless - FTN Midwest Research - Analyst Good morning. First question is on the gross margin. How much of the 15% that you earned this quarter would you say came from impairments on land? Cathy Smith - Centex Corporation - EVP and CFO The homesite costs have been essentially flat over the last couple of quarters Tim Eller - Centex Corporation - Chairman, CEO As a percentage of revenue. Cathy Smith - Centex Corporation - EVP and CFO Thanks, as a percentage of revenue. Matt Moyer - Centex Corporation - VP, IR Jay, the way we have answered that in the past, this is Matt Moyer, about a third of our closings were in previously impaired neighborhoods. So you can make your own assumptions around that. James McCanless - FTN Midwest Research - Analyst Okay. And then my second question, I wanted to dig a little deeper into how much impact the build-to-order strategy that you have gone to now has on the closing levels. Is at function of trying to hold price in certain areas, or can you just dig into that a little bit more and explain what impact you have seen so far in your order rates based on this new strategy? Tim Eller - Centex Corporation - Chairman, CEO Well, first of all, look at our backlog. Our backlog is among the strongest in the industry, so that gives us predictable level of construction out over the next several months, couple quarters, perhaps. So I think that's the strength of the model, is the predictability of the construction which allows us to create efficiencies with our trade partners and lower our costs the way we have. And expect to continue to. So in terms of pricing, we've moved to a transparent pricing model about a year ago, and that, again, we focused on the affordability of our product with our customer, and while credit standards have tightened and affordability has become a little bit more challenging, our pricing largely has stayed where it was, and while we have reduced a bit, only a bit, and looking ahead, that's probably going to continue. We don't see a need to lower prices at this point, although we expect that our volumes will decline, our prices may not. Operator Our next question comes from the line of Ivy Zelman from Zelman & Associates. Your line is open. www.streetevents.com Contact Us 9 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

11. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Ivy Zelman - Zelman & Associates - Analyst Good morning, guys, good quarter. Cathy Smith - Centex Corporation - EVP and CFO Good morning Ivy. Ivy Zelman - Zelman & Associates - Analyst Just in terms of understanding -- one of the challenges we're are all trying to figure out is two things, one you've got obviously a strategy that seems to be successfully turning margins around, and yet at some price obviously, as you indicated, you are getting a volume. And one of the things I know, Cathy, you talked about sensitivities. Is there a number of units where obviously the cash flow is no longer going to be positive, and the flexibility on that land spend, how that sensitivity works? Is any help on helping us figure out the sensitivity would be very incremental, I think. Secondly, Tim, you and I spoke about finished lots. I think all of us realize that having half of your owned inventory is finished is great news, because it gives you a lot of specs with flexibility on the development, what you have to bring forward. But where are those finished lots? Hopefully not all in the tertiary markets of Inland Empire and in the Central Valley. I think if builders provided us more transparency on where those lots actually are, I think that would be very incremental in giving us more confident that you guys have staying power and longevity. Lastly, Tim, we know you're very involved politically or active in trying to move forward this housing stimulus plan that the coalition has been formed by the larger builders. Can you give us any thoughts on the success of that stimulus bill and hopefully some insights into what impediments might be, if any? Tim Eller - Centex Corporation - Chairman, CEO Sure, let's start with your first. Cathy Smith - Centex Corporation - EVP and CFO I'll take the first, Tim can take the other two. So to help you with some sensitivities around cash generating, high level of set of assumptions that you guys could model as well, would suggest that at about half of our current volumes we would still be cash flow positive on an incremental basis. As Tim has iterated and you know from your knowledge of us that we evaluate every single house we sell and close around its cash generating ability. So we have fairly good confidence there that even at fairly significantly reduced volumes we can continue to generate cash. Now, obviously it's not without -- we still to have continue to reduce our overhead costs and stuff like that but we've been doing that. The sensitivity around land spend, which is the acquisition and development costs, there is a low, low level of kind of obligatory spend that you have to do for property taxes and stuff like. That but beyond that with 50% of our lots fully finished, and pretty much spread across most of the markets where it will matter, we feel pretty good about the low levels of spend that we can achieve and as we said, we have reduced it down to 300 this year, 200 is already spent, 100 in front of us. Next year, given the volumes we are seeing, we could be that low or lower as well. So again, sensitivity-wise, we understand where all of our finished lots are and where our volumes are because of our selling to a backlog and building to a cadence we know right where we're going to need them. www.streetevents.com Contact Us 10 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

12. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Tim Eller - Centex Corporation - Chairman, CEO And that partially answers your second question, Ivy, in the sense that because we -- because our lots are in places where we're selling houses, our finished lots are in places where we're selling houses we're not having to develop as much. Certainly there's finished lots, lots -- I wouldn't call them tertiary markets -- but I would call them the more impacted markets in terms of sale rates We certainly have finished lots there. But frankly we aren't spending much in the way of development anywhere outside of Texas right now, and maybe Raleigh Durham in the Carolinas, and maybe the coastal Carolinas just a bit as well because our sales rates are still holding up relatively well. I'd say it's a balanced -- we have pretty much of a balanced footprint of finished lots. As to your third question, the talk about stimulus for the economy is everywhere now. I don't think that talk can be -- can exclude anything around home building. I think home building has to be a part of that stimulus. Home building led us into this, or you could argue mortgages led us into this, but home building has the capability of leading us out. We have the capability of creating jobs very quickly, creating -- improving buyer confidence very quickly. We have as an industry, we have capability of creating some urgency and if not excitement around some economic activity. I think there's three things that we have to think about from a housing stimulus, and this is where we'll focus, where the industry will focus. We have to think about the remaining ARM resets that are -- roughly two million more ARM resets that are out there that will reset over the course of the next two and a half to three years. We have to try to think about preventing those from going into foreclosure. Most of them are going to reset at higher rates, and the houses for most -- house values, for most of them are much lower than their note rates. So that's number one. Number two, we have to think about a stronger tax incentive to buy a new home. This was successful back in the mid-70s when it was done, the tax incentive that was passed earlier this year is proving not to be sufficient because it is not high enough, and it requires repayment. We need a true tax credit for homebuyers who buy a house. Not just first-time buyers, but any buyer for any house. And thirdly, we need to have a below-market mortgage rate. Again this was successful back in the mid '70s, and we think it would be successful again. And that package of things, we think, would after strong impact on housing demand and supply. Operator Our next question comes from the line of Steven Kim with Alpine. Your line is open. Stephen Kim - Alpine - Analyst Thanks very much, guys. How are you, Tim and Cathy? Cathy Smith - Centex Corporation - EVP and CFO Good mornings Steven. Stephen Kim - Alpine - Analyst Just to follow up on Ivy's question, I wanted to push the question in the direction of what the response you have encountered on the hill to these -- this set of proposals, because obviously, you know, it sounds good, and I think it makes a heck of a lot of sense, but one could also look at that with a somewhat jaundiced eye and say, it's just the builders looking out for number one. So could you talk about how you've seen that progress, maybe how the resistance has changed from maybe three months ago to a proposal such as this? www.streetevents.com Contact Us 11 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

13. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Tim Eller - Centex Corporation - Chairman, CEO Well, I think it's really a coalition. I think you are right, that we don't want this to be seen self-serving on the part of builders. We think this is actually very good for the economy, very good for lots of other industries to get this kind of economic activity working. It's good for banks, good for our trade partners, good for -- frankly, it's good for auto dealers who can see some economic activity improving. So if there's a lot of -- and it's good for the resale market. So there's a lot of constituencies and stakeholders in this -- its not just the builders. That is our message, and that is the coalition that we are building. And clearly there -- the little bit that we have been on the hill in terms of talking to legislators and members of Congress and Senators, there's a desire to do something that's just what that something is, is what needs to be worked out. As you might imagine there's a lot of constituencies kind of thinking about because the impact now economically is so broad, that there's a lot of constituencies asking for a lot of things. But we're working on our message, and we're working on an outcome. Stephen Kim - Alpine - Analyst Great. All my other questions have been answered. Thanks very much guys. Good quarter. Cathy Smith - Centex Corporation - EVP and CFO Thanks Stephen. Operator Next question comes from the line of David Goldberg with UBS. Your line is open. David Goldberg - UBS Securities - Analyst Thanks. Good afternoon. Tim Eller - Centex Corporation - Chairman, CEO Hey, David. David Goldberg - UBS Securities - Analyst I wonder if we could get a little bit more clarity on a couple questions, a line of questions that's already been asked. But in terms of the sales pace, I know you guys said at even half the current closing rate is what you meant you still be free cash flow positive, but I look at orders per community versus closings per community. The order rate obvious per community is lower at this point so it seems like you're already kind of on the way there in terms of doing half the volume of closings looking forward. I guess if you combine that with Tim's comments about how the December quarter could get worse. I guess the question I have is, am I looking at it the right way in terms of free cash flow i.e., if things deteriorated in December, is the potential free cash flow, neutral free cash flow negative there? And with that, and I guess as part of the question, with the gross margins improving how are you thinking about -- and maybe we need to put some more incentives in to pick up volumes a little bit because of the free cash flow issue, with a lot of finished lots right now. www.streetevents.com Contact Us 12 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

14. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Cathy Smith - Centex Corporation - EVP and CFO David, we have a really strong backlog with almost 7,000 units sitting there. So we have pretty good insight into the next quarter and even though recent volumes could suggest that it's going to be a little lower as Tim says, going to be a cold winter, so that gives us confidence there, and then as we've guided, we expect -- fully expect to end our fiscal year with more cash than we have today. So feel pretty good about where we're at there. Operator Our next question comes from the line of Rob Stevenson with Fox-Pitt Kelton. Your line is open. Rob Stevenson - Fox-Pitt Kelton - Analyst Good morning, guys. In terms of the cancellation uptick this quarter, did you see any noticeable uptick in cancellations at the closing table, or very late in the process, or did the vast majority of the uptick come sort of more early and towards the middle, as you would expect? Cathy Smith - Centex Corporation - EVP and CFO Really kind of throughout. The difference in the cancellations this quarter were -- we really scrubbed our backlog with DPAs going away. We wanted to make sure that we would have high confidence that everyone in our backlog could close. And then the continued concerns around job losses or people with concerns around their jobs in the economy, as well as tightening up credit standards, those three things caused the cans to go up but when they canned throughout their process was really kind of throughout the process, not early, later, or in between. Rob Stevenson - Fox-Pitt Kelton - Analyst Okay. Then Cathy, what is your most restrictive covenant and where are you against that? Cathy Smith - Centex Corporation - EVP and CFO We have two covenants for our revolver. One is a tangible net worth covenant, the other is a leverage covenant that ratchets down. The most restrictive of those two would be tangible net worth and we still have fairly good room on that. Operator Our next question comes from the line of Carl Reichardt. with Wachovia. Your line is open. Carl Reichardt - Wachovia Securities - Analyst I wanted to get back to Nishu question, the first one -- have you have talked before about emergence of financial partners who you could work with long term, to develop owned developed lots for you, as you run the asset-light model? But obviously given what's happening in the marketplace a lot of that capital that we thought was there, isn't going to be there. It was either levered or its moved to commercial. So can you give me any more color or any more sense, as to whether or not that capital availability, those partners are still here or still ready to go, and if they are not, what can we expect your business to look like, say over the next year if things begin to improve, but that capital is not there? www.streetevents.com Contact Us 13 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

15. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Cathy Smith - Centex Corporation - EVP and CFO I will answer it and Tim may pipe in as well. There was reportedly a ton of capital out there as you suggest. However, there are a number of real-estate focused capital sources that are very real and are still very much well funded. Many have actually formed their funds. So for the real ones and the ones that we would have been talking to you, because we like the ones that know real-estate, we think that's a better partnership, those are still there. They are very viable and have every intention to continue with their mission. So I don't see a wholesale change in landscape around the partners that we would have been talking to. Tim Eller - Centex Corporation - Chairman, CEO And what we are finding, Carl, is that a lot of these potential partners kind of withdrew from the market at the peak and they -- so they didn't tie up their capital, in fact, they kind of preserved and reserved their capital for just this kind of time. So we're finding sufficient amount of capital and sufficient amount of interest that we think it will be fine. Carl Reichardt - Wachovia Securities - Analyst Okay. Appreciate that. Then I've asked other CEOs, last question, and Tim you are one of the few that this quarter hasn't talked about foreclosures impacting your order pace I'm curious, given we've seen some improvement in existing home sales turnover data in a few markets that have been bad, where a lot of it seems to be foreclosure activity, how is that impacting you and do you have any data support that would say who is purchasing the foreclosed properties that are turning over at a faster rate? Is it investors or your customers? Tim Eller - Centex Corporation - Chairman, CEO Anecdotally -- well, first of all, certainly foreclosures impact our volumes. The fact that they are 50%, 60%, 70% of some of the resale markets in the country certainly have an impact on our volumes. We are not trying to chase foreclosures in price at all. We have said that before. And that will remain the case. Anecdotally, what we -- what we see happening, is that the foreclosure buyers tend to be different than new homebuyers anyway. So we are not sharing customers with foreclosures very much at all. And while we -- who we're also anecdotally hearing is foreclosure buyers now are owner occupants, they are not investors, they're just people who are going to intend to occupy that home. So it is a clearing process. The clearing process has to happen. And it is happening. Operator Our next question comes from the line of Steven East with Pali Capital. Your line is open. Stephen East - Pali Capital - Analyst Good morning everyone. Tim, if I could ask you about the markets, when you talk about downsizing SG&A etc., are there still some markets out there, that as you continue to shrink your business, that probably make sense exiting now, that maybe didn't make sense a year ago, something like that? Tim Eller - Centex Corporation - Chairman, CEO Good question. We view these -- we review these every quarter, and we most recently exited, or in the process of exiting Denver. We sold all of our assets in Detroit last quarter. And there's a number of other markets that we have exited over the course of this cycle. For the most part, the markets that we're in right now are the markets we believe are good for us for the longer term. www.streetevents.com Contact Us 14 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

16. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call They are attractive for a number of reasons for the longer term. We are consolidating operations in Florida and other markets just for efficiencies. And to be able to take advantage of the opportunities that are going to come in those markets. There may be one or two others, but I don't think it would be any more than that, Steven. Stephen East - Pali Capital - Analyst Okay. And then sort of along those lines, while it's outstanding to hear that you all could cut volumes by half and still be cash flow positive, is there a level, looking at the income statement side, where you really would say, hey, we need to stimulate some orders that's above that drop of 50%? Tim Eller - Centex Corporation - Chairman, CEO I don't think so at this point. It looks like we can execute our model at fairly low volumes. We'd certainly like it to be higher, but we can execute at fairly low volumes, stick to our strategy, or stick to our transparent pricing, price to our customers' affordability. We may introduce some smaller houses at lower prices to adjust in that way. But I think that would be the extent of that. Operator Our next question comes from the line of Josh Levin from Citi. Your line is open. Joshua Levin - Citi Investment Research - Analyst Good morning. If the winter does, in fact, turn out to be as hard and cold as you mentioned, or if 2009 turns out to be a dismal year for the industry, do you think there could be a meaningful reacceleration in impairment charges? Tim Eller - Centex Corporation - Chairman, CEO Well, impairments are more price related than volume related, so I'll let Cathy talk about how we look at impairments. Cathy Smith - Centex Corporation - EVP and CFO I don't know that I would say meaningful. Tim said the biggest determinant is price, and if we -- and we believe that our strategy is an appropriate one, which is price to our customer's affordability, and we know that we've largely done that, so that shouldn't cause impairments to accelerate. The absorptions do have an impact, but we look at over the life of an asset, so most of these assets are multiple-year lives and so shouldn't have -- I wouldn't say meaningful. So I think the answer is no. Joshua Levin - Citi Investment Research - Analyst Okay. As you think about how you plan to manage the business over the next six to 12 months, how has your thinking changed over the past two months with the credit crisis? What are you planning on doing differently compared with your plan two months ago? www.streetevents.com Contact Us 15 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

17. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Cathy Smith - Centex Corporation - EVP and CFO We continue to be focused on two priorities, which is to preserve and accumulate cash. We think that's one of the most prudent things we can be doing right now, then continue to structure for profitability. There is not a day that goes by that we don't focus on both those priorities. Operator Our next question comes from the line of Chris Hussey from Goldman Sachs. Your line is open. Chris Hussey - Goldman Sachs - Analyst Thank you. Good morning. Just trying to delve in a little more on the cash flow dynamics. I wasn't sure if you provided this information yet. On the inventory, number of finished specs that you might have in inventory at this point, maybe you could give us a little bit of characterization around how much cash flow per closing you guys are getting currently. Then the last question would be around October. What have you seen specifically in October? Could you characterize the sales per neighborhood and per month in October, seeing as we're only a couple days away from the end? Cathy Smith - Centex Corporation - EVP and CFO We don't have finished specs for you right now. Tim Eller - Centex Corporation - Chairman, CEO I think it's 1390, something like that, I believe. Matt Moyer - Centex Corporation - VP, IR Total specs, Chris, were 1396, of which 600 were characterized as finished. Tim Eller - Centex Corporation - Chairman, CEO And -- Cathy Smith - Centex Corporation - EVP and CFO Your middle question was, I'm sorry? Chris Hussey - Goldman Sachs - Analyst I was asking about cash flow per closing. Cathy Smith - Centex Corporation - EVP and CFO Thank you. www.streetevents.com Contact Us 16 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

18. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Chris Hussey - Goldman Sachs - Analyst If you guys wanted to characterize that at this point. Cathy Smith - Centex Corporation - EVP and CFO You know, that is highly variable, depending on which market you are in, and essentially, it's about the investment in land, so that would be about your cash flow per closing. And that's going vary depending on which market. Texas still obviously, and a couple of the other markets would have beyond that you still have some -- some greater than replacement cost type cash as well. So you decide what an average lot is. I don't know, Matt, usually an average of, what, 70 or 80 average finished lots? Matt Moyer - Centex Corporation - VP, IR Per lot. Cathy Smith - Centex Corporation - EVP and CFO Yes. Matt Moyer - Centex Corporation - VP, IR Yes, it's a little lower than that. You can take our land held, or land under development, divided by lots, and -- Cathy Smith - Centex Corporation - EVP and CFO That will give you about -- Matt Moyer - Centex Corporation - VP, IR Right. Tim Eller - Centex Corporation - Chairman, CEO As far as October, we don't comment on the current month in these calls, but I will say that generally in the second quarter, sales deteriorated throughout the quarter, given the increasing financial and credit turmoils that were going on. So, just a lot depends right now on external factors, and we -- and job losses, and we continue to hear about job losses. The announcements are coming out almost daily on those, so -- just causing consumers and reflected itself in consumer confidence recently. You see how the consumers are thinking. So that can turn around with some positive news, so hopefully we'll at some point begin to hear some positive news. Operator Our next question comes from the line of Susan Berliner from JP Morgan. Your line is open. www.streetevents.com Contact Us 17 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

19. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Susan Berliner - JP Morgan - Analyst Thank you, good morning. Cathy Smith - Centex Corporation - EVP and CFO Hi, Susan. Susan Berliner - JP Morgan - Analyst How are you? Just a couple questions. One is Cathy, can you tell us what your availability is on your bank line now? Cathy Smith - Centex Corporation - EVP and CFO Yes, the borrowing base capacity would have it almost fully available, and then because of our cash horde feature, we have about half of that we could actually take down. And then -- that's what you wanted to know? Susan Berliner - JP Morgan - Analyst Exactly. Cathy Smith - Centex Corporation - EVP and CFO Okay. Susan Berliner - JP Morgan - Analyst And then I guess, you guys were talking about cash flow. Obviously it sounds like you are going to be generating cash throughout this fiscal year. Can you comment at all about the -- I know your land spend going forward is also going to be pretty small, so can we expect that will you continue to generate cash flow in the next fiscal year? Cathy Smith - Centex Corporation - EVP and CFO We haven't really given that guidance, Susan, so we do know that we're going to say the end of this fiscal year will be higher than what we have on our balance sheet today. And we know that at lower volumes we continue to generate cash. Matt Moyer - Centex Corporation - VP, IR We have very low compulsory levels of land spend moving forward so -- and at lower volumes we can be cash flow positive, although we can't give guidance at this point for something that's 18 months away. Operator Our next question comes from the line of Michael Rehaut. Your line is open. JP Morgan. www.streetevents.com Contact Us 18 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

20. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Michael Mike Rehaut - JP Morgan - Analyst Yes. Good morning. Thanks for taking my question. First question is just, I guess, I know it's -- I don't want to beat a dead horse, but in terms of the absorption pace, hats off in terms of the ability to generate cash flow with half of the production. I don't think I've heard that from other home builders. But with the absorption pace now at your lowest level in the last few years, down dramatically, and this quarter you took in 1,000 fewer orders in closings, so you are talking about working your backlog off by 1,000 a quarter. As -- if that continues, and you do get to that production level, 50% from current, at that point would you be considering -- what would you do in order to improve your order intake, and how would you go about the market at that point? Tim Eller - Centex Corporation - Chairman, CEO Michael, we'd continue to adjust, just like we've adjusted since the beginning of this cycle and this downturn. So it's -- we have a strategy, we have a model, we've been consistent about that, and there's nothing that would cause me to think we shouldn't continue to be consistent about that. So we would continue to adjust. Michael Mike Rehaut - JP Morgan - Analyst Okay. The second question, just on the pre build or presold model, and certainly it appears that that's had great success on the gross margin, but I was surprised to hear you say you still had about a third of your closings in spec. So I wanted to know if that's just -- as that model continues to get implemented, if that number would go down, and do you have a target for spec as a percent of homes closed, and, or is that just kind of a function of being in certain markets that just -- that's how those market are predicated, like a Texas market? Cathy Smith - Centex Corporation - EVP and CFO Our model is absolutely to sell to a backlog and build to a cadence. So that balance of closings and sales to a backlog are going to -- is going to continue to go up and specs will come -- will continue to come down. We do still have some specs that we need to sell through, and, you know, often times in a multifamily unit, you sell six, but will you start two specs, get the building started, and hopefully have them sold before it completes. So will you always after few natural specs because of that. Then just by definition, you are always going to have a couple of natural specs because of cancellation so but other than that we're not intentionally generating specs. Operator Our next question comes from the line of Alex Barron with Agency Trading Group. Your line is open. Alex Barron - Agency Trading Group - Analyst Good morning, guys. I wanted to ask you if you could help me understand, as I'm looking at the balance sheet, and it's -- I'm looking at the relationship between inventory, revenues, and payables, and it seems like your inventory and revenues are down 50% or so, but your accounts payable year-over-year is down 18%. And I'm just trying to understand, is this just a seasonal or temporary thing, or is there something more structural there. www.streetevents.com Contact Us 19 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

21. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Cathy Smith - Centex Corporation - EVP and CFO I don't think there's anything more structural. We watch our DPO, days payable outstanding, and it's actually slightly improved, which is not necessarily consistent with all of our cash but it has. So it's not -- we know it's not in the DPO metric, and I would have to assume it's really timing of the inventory spent, when we built it. There's nothing structural. Tim Eller - Centex Corporation - Chairman, CEO I should say we're very consistent on our DPOs, as part of our model we've standardized our payable terms, payments terms across the entire country, so it's very -- we're looking for very predictable cash flows in and cash flows out. Alex Barron - Agency Trading Group - Analyst Okay, thanks. My other question had to do with, again, related to the current sales pace, if this current sales pace remains going forward, what further efforts can you do on the SG&A front to prevent that from going up meaningfully? Tim Eller - Centex Corporation - Chairman, CEO We think quite a bit, and we continue to work on that. We still have a strong backlog. We have to close the backlog so we have G&A in place to do that. But we have continued to reduce G&A, really every month, and almost every week in response to the current conditions. So we believe there's still quite a bit to go, if volumes continue to decline. Operator Our next question comes from the line of Buck Horne with Raymond James. Your line is open. Buck Horne - Raymond James & Associates - Analyst Hey thanks guys. Just some housekeeping things. Do you have the number of homes under constructional quarter end? And secondly, can you give us the capitalized interest balance both at the end of the quarter and the start of the quarter. And I guess related to that are you comfortable that you are allocating enough interest expense per closing such that we might not see another big write-off of capitalized interest later? Tim Eller - Centex Corporation - Chairman, CEO We'll ask Matt. Cathy Smith - Centex Corporation - EVP and CFO Matt and Mark are going to give you those numbers. Matt Moyer - Centex Corporation - VP, IR The homes under construction are 6,967. www.streetevents.com Contact Us 20 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

22. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Buck Horne - Raymond James & Associates - Analyst Great. Cathy Smith - Centex Corporation - EVP and CFO Just a second. They are getting cap I. We may have to get back to you on cap I. Matt Moyer - Centex Corporation - VP, IR Let me call you back on the cap I balance. Buck Horne - Raymond James & Associates - Analyst Thanks, guys. Matt Moyer - Centex Corporation - VP, IR Thanks. Operator Our next question comes from the line of Eric Landry with Morningstar. Your line is open. Eric Landry - Morningstar - Analyst Thanks. Outstanding quarter. Tim Eller - Centex Corporation - Chairman, CEO Thank you. Eric Landry - Morningstar - Analyst Really good work. Congratulations. The strategies look like they're starting to show through. Tim Eller - Centex Corporation - Chairman, CEO Thank you. Eric Landry - Morningstar - Analyst Your conversion was lower -- www.streetevents.com Contact Us 21 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

23. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Tim Eller - Centex Corporation - Chairman, CEO And you're right, they are. Eric Landry - Morningstar - Analyst I agree. Your backlog conversion was the lowest it's been in years, if I calculate the numbers right here. Is this a function of the building to the cadence, and if, so are we going to see a less volatile conversion rate going forward, or what should we look for? Cathy Smith - Centex Corporation - EVP and CFO Yes, that's really it. Matt Moyer - Centex Corporation - VP, IR Yes, you should see lower backlog conversion, and it's really a function of no spec, not closing a lot of spec, probably March of last year, of last fiscal year, earlier this March was probably our high point for backlog conversion. And from then on it's going to really kind of come down, and you should actually see it become, when volumes start to steady, you should see it become much more consistent at a pretty low level. You may see -- if it is higher in any one quarter, it would probably be the March quarter, but you should see a pretty consistent low level in every quarter other than that. Eric Landry - Morningstar - Analyst So it should stabilize somewhere between 40% and 60%? Matt Moyer - Centex Corporation - VP, IR Probably on the lower end of that range. Operator Our next question comes from the line of Joel Locker from FBN Securities. Your line is open. Joel Locker - FBN Securities - Analyst Yes, I just wanted to follow up on the accounts payable and accrued liabilities. I guess the accounts payable there is roughly around $130 million, if it's similar to last quarter, and just wanted to see if you had a breakdown of the accrued liabilities, the $1.7 billion or so. Cathy Smith - Centex Corporation - EVP and CFO I think I would tell to you wait for the Q to come out. That will help with you that. www.streetevents.com Contact Us 22 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

24. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Joel Locker - FBN Securities - Analyst Even the accrued liabilities will be broken down? Mark Kemp - Centex Corporation - SVP, Controller Certain aspects. Some of the bigger accrued liabilities are disclosed in the footnotes. Joel Locker - FBN Securities - Analyst In the footnotes. Tim Eller - Centex Corporation - Chairman, CEO Yes. Joel Locker - FBN Securities - Analyst Is there -- I guess just going, as a percentage of inventories, on the accrued liability/account payables, around say close to 40% versus some of the other builders, most of them are in the 20% to 30% range. Is there anything you guys do different, at least that you know about that's different than the other home builders? Cathy Smith - Centex Corporation - EVP and CFO Nothing sticks out in my mind. It seems pretty typical when we go through our balance sheet. I will go take a look at that but nothing sticks out in my mind. Operator And our last question comes from the line of Jim Wilson with JMP Securities. Your line is open. Jim Wilson - Jolson Merchant Partners LLC - Analyst Let's see. Tim, Cathy, could we go back to the land spend. I know you're looking at probably a number, $300 million or less, kind of in line with this year. Can you give a little color? I can guess on the answers, but where you are targeting that spend, and is it mostly out of options already in place? I assume not too much new deals. Are you concentrating on Texas and Carolinas where things are a little better? Cathy Smith - Centex Corporation - EVP and CFO No,actually it is a little bit of -- I would characterize it as probably two-thirds development type spending, and a third in acquisition-type spending, and I would have said that was really more concentrated on a little bit of what's sitting in options, but more new acquisition. www.streetevents.com Contact Us 23 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.

25. FINAL TRANSCRIPT Oct. 29. 2008 / 10:00AM, CTX - Q2 2009 Centex Corporation Earnings Conference Call Jim Wilson - Jolson Merchant Partners LLC - Analyst More into new? Cathy Smith - Centex Corporation - EVP and CFO Yes. Jim Wilson - Jolson Merchant Partners LLC - Analyst Okay. And again, geographically, where -- can you give any color where that might be on the margin? Cathy Smith - Centex Corporation - EVP and CFO It's going to be on the markets that have continued to perform well, as the land is priced appropriately. Tim Eller - Centex Corporation - Chairman, CEO We would look at every market for A locations at this point. Again, these are our key markets, the markets that we are going to focus on for the future, and we would be -- we are buyers of A locations. Operator We have now reached the end of our allotted time for questions. I now turn the call back over to Tim Eller for his closing remarks. Tim Eller - Centex Corporation - Chairman, CEO Thanks, Christy. I want to thank all of you for joining us today. We look forward to discussing our results with you again during our third quarter conference call in January, 2009. Operator This concludes our -- Centex's fiscal year 2009 second quarter earnings conference call. Thank you for your participation today. DISCLAIMER Thomson Financial reserves the right to make changes to documents, content, or other information on this web site without obligation to notify any person of such changes. In the conference calls upon which Event Transcripts are based, companies may make projections or other forward-looking statements regarding a variety of items. Such forward-looking statements are based upon current expectations and involve risks and uncertainties. Actual results may differ materially from those stated in any forward-looking statement based on a number of important factors and risks, which are more specifically identified in the companies' most recent SEC filings. Although the companies may indicate and believe that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate or incorrect and, therefore, there can be no assurance that the results contemplated in the forward-looking statements will be realized. THE INFORMATION CONTAINED IN EVENT TRANSCRIPTS IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE CONFERENCE CALLS. IN NO WAY DOES THOMSON FINANCIAL OR THE APPLICABLE COMPANY ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY EVENT TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S CONFERENCE CALL ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS. 2008, Thomson Financial. All Rights Reserved. 1997997-2008-10-30T12:40:32.157 www.streetevents.com Contact Us 24 2008 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.