Notes to the consolidated financial statements - analysis of items in the primary statements
9. Earnings per share
Earnings per ordinary share have been calculated by dividing the profit for the year attributable to equity shareholders of the parent company by the weighted average number of ordinary shares in issue during the year.
Adjusted earnings per share, excluding exceptional items, remeasurements and stranded cost recoveries, are provided to reflect the business performance subtotals used by the Company as described in accounting policy T. For further details of exceptional items, remeasurements and stranded cost recoveries, refer to note 3.
Diluted earnings per share have been calculated by dividing the net profit attributable to ordinary equity shareholders by the diluted weighted average number of ordinary shares outstanding during the year, adjusted to reflect the dilutive effect of the employee share plan.
(a) Basic earnings per share
| Earnings 2010 £m | Earnings per share 2010 pence | Earnings 2009 £m | Earnings per share 2009* pence | Earnings 2008 £m | Earnings per share 2008* pence |
|
|---|---|---|---|---|---|---|
| Adjusted earnings – continuing operations | 1,418 | 57.4 | 1,250 | 50.2 | 1,247 | 47.2 |
| Exceptional items after taxation | (270) | (10.9) | (247) | (9.9) | (2) | (0.1) |
| Commodity contract remeasurements after taxation | 42 | 1.7 | (266) | (10.7) | 133 | 5.0 |
| Derivative financial instrument remeasurements after taxation | (25) | (1.0) | (74) | (3.0) | (35) | (1.3) |
| Stranded cost recoveries after taxation | 221 | 8.9 | 256 | 10.3 | 229 | 8.7 |
| Earnings – continuing operations | 1,386 | 56.1 | 919 | 36.9 | 1,572 | 59.5 |
| Adjusted earnings – discontinued operations | – | – | 9 | 0.4 | 28 | 1.1 |
| Gain on disposal of operations after taxation | – | – | 16 | 0.6 | 1,582 | 59.8 |
| Other exceptional items and remeasurements | – | – | – | – | 8 | 0.3 |
| Earnings – discontinued operations | – | – | 25 | 1.0 | 1,618 | 61.2 |
| Earnings | 1,386 | 56.1 | 944 | 37.9 | 3,190 | 120.7 |
| 2010 millions | 2009* millions | 2008* millions |
|
|---|---|---|---|
| Weighted average number of shares – basic* | 2,470 | 2,490 | 2,644 |
- *
- Comparative EPS data have been restated to reflect the impact of the additional shares issued as scrip dividends
(b) Diluted earnings per share
| Earnings 2010 £m | Earnings per share 2010 pence | Earnings 2009 £m | Earnings per share 2009* pence | Earnings 2008 £m | Earnings per share 2008* pence |
|
|---|---|---|---|---|---|---|
| Adjusted diluted earnings – continuing operations | 1,418 | 57.1 | 1,250 | 49.9 | 1,247 | 46.9 |
| Exceptional items after taxation | (270) | (10.9) | (247) | (9.9) | (2) | (0.1) |
| Commodity contract remeasurements after taxation | 42 | 1.7 | (266) | (10.6) | 133 | 5.0 |
| Derivative financial instrument remeasurements after taxation | (25) | (1.0) | (74) | (3.0) | (35) | (1.3) |
| Stranded cost recoveries after taxation | 221 | 8.9 | 256 | 10.2 | 229 | 8.6 |
| Diluted earnings – continuing operations | 1,386 | 55.8 | 919 | 36.6 | 1,572 | 59.1 |
| Adjusted diluted earnings – discontinued operations | – | – | 9 | 0.4 | 28 | 1.1 |
| Gain on disposal of operations after taxation | – | – | 16 | 0.6 | 1,582 | 59.5 |
| Other exceptional items and remeasurements | – | – | – | – | 8 | 0.3 |
| Diluted earnings – discontinued operations | – | – | 25 | 1.0 | 1,618 | 60.9 |
| Diluted earnings | 1,386 | 55.8 | 944 | 37.6 | 3,190 | 120.0 |
| 2010 millions | 2009* millions | 2008* millions |
|
|---|---|---|---|
| Weighted average number of shares – diluted* | 2,483 | 2,507 | 2,659 |
- *
- Comparative EPS data have been restated to reflect the impact of the additional shares issued as scrip dividends
(c) Reconciliation of basic to diluted average number of shares
| 2010 millions | 2009 millions | 2008 millions |
|
|---|---|---|---|
| Weighted average number of ordinary shares – basic | 2,470 | 2,490 | 2,644 |
| Effect of dilutive potential ordinary shares – employee share plans | 13 | 17 | 15 |
| Weighted average number of ordinary shares – diluted | 2,483 | 2,507 | 2,659 |