Management Report
7. Core Earnings Per Share
Earnings per share according to IFRS are affected by the purchase price allocation for acquisitions and other special factors. To enhance comparability, we also determine core net income after elimination of the amortization of intangible assets, asset write-downs (including any impairment losses), and special items in EBITDA including the related tax effects.
From this core net income we calculate core earnings per share in the same way as earnings per share. Core earnings per share form the basis for our dividend policy. For the first quarter of 2010, core earnings per share amounted to €1.20 (Q1 2009: €0.91).
The calculation of earnings per share in accordance with IFRS is explained in the Notes to the Condensed Consolidated Interim Financial Statements on page 37. The (adjusted) core net income, core earnings per share and core EBIT are not defined in the IFRS.
| Calculation of Core EBIT and Core Earnings Per Share | [Table 14] |
|---|
| | 1st
Quarter
2009 | 1st
Quarter
2010 |
| | € million | € million |
| EBIT as per income statements | 973 | 1,197 |
| Amortization and write-downs of intangible assets | 378 | 352 |
| Write-downs of property, plant and equipment | 13 | 1 |
| Special items (other than write-downs) | 34 | 77 |
| Core EBIT | 1,398 | 1,627 |
| Non-operating result (as per income statements) | (334) | (244) |
| Income taxes (as per income statements) | (215) | (259) |
| Tax adjustment | (127) | (129) |
Income after taxes attributable to non-controlling interest
(as per income statements) |
1 |
(1) |
| Core net income | 723 | 994 |
| Financing expenses for the mandatory convertible bond, net of tax effects | 28 | 0 |
| Adjusted core net income | 751 | 994 |
|
Shares |
Shares |
| Weighted average number of issued ordinary shares | 764,343,660 | 826,947,808 |
(Potential) shares (to be) issued upon conversion
of the mandatory convertible bond |
60,039,083 |
0 |
| Adjusted weighted average total number of issued and potential ordinary shares | 824,382,743 | 826,947,808 |
| Core earnings per share (€) | 0.91 | 1.20 |