| Year ended 31 December 2004 pence |
Year ended 31 December 2003 (restated) pence |
|
|---|---|---|
| a) Earnings per share – basic | ||
| Before exceptional items | 8.3 | 9.1 |
| After exceptional items | 7.2 | (17.6) |
| b) Earnings per share – diluted | ||
| Before exceptional items | 8.2 | 9.0 |
| After exceptional items | 7.1 | (17.6) |
| c) Basis of calculation – earnings | £m | £m |
| Profit attributable to shareholders before exceptional items | 108 | 113 |
| Exceptional items | (14) | (332) |
| Profit/(loss) attributable to shareholders after exceptional items | 94 | (219) |
| d) Basis of calculation – number of Ordinary Shares | Million | Million |
| Weighted average number of issued Ordinary Shares | 1,308.3 | 1,247.8 |
| Weighted average number of shares held by | ||
| Employee Share Ownership Plans (ESOPs) | (2.8) | (3.6) |
| 1,305.5 | 1,244.2 | |
| Dilutive potential Ordinary Shares: | ||
| Employee share schemes | 10.9 | 10.3 |
| Convertible bond | 3.0 | – |
| Weighted average number of Ordinary Shares taking account of applicable dilutive instruments | 1,319.4 | 1,254.5 |
The actual cum rights price on 20 August 2004, the last day of quotation cum rights, was 147p per share and the theoretical ex rights per price for an Ordinary Share was therefore 131p per share. The comparative earnings per share are shown after applying the factor 131/147 to the published figures for 2003.
FRS 14 requires presentation of diluted earnings per share when a company could be called upon to issue shares that would decrease net profit or increase net loss per share. A net loss per share would only be increased by the exercise of out–of–the–money share options. Since it seems inappropriate to assume that option holders would act irrationally, no adjustment has been made for out–of–the–money options and hence in 2003 diluted EPS (after exceptional items) equals basic EPS (after exceptional items).