Notes to the consolidated financial statements
28 Earnings per share
8,677
55,212
-
-
-
29 Financial risk management and financial instruments
Financial risk management
31 www.ahold.com/reports2008
Financial statements
AHOLD ANNUAL REPORT 2008 86
The calculation of basic and diluted net income per share attributable to common shareholders is based on the following data:
2008
2007
Earnings million)
Net income attributable to common shareholders for the purposes of basic earnings per share
Effect of dilutive potential common shares, reversal of preferred dividends from earnings
1,074
31
2,931
Net income attributable to common shareholders for the purposes of diluted earnings per share
1,105
2,931
Number of shares (x 1,000)
Weighted average number of common shares for the purposes of basic earnings per share
Effect of dilutive potential common shares:
Share options and conditional shares
Cumulative preferred financing shares
1,173,924
1,447,378
9,106
Weighted average number of common shares for the purposes of diluted earnings per share
1,237,813
1,456,484
The August 2007 capital repayment and reverse stock split, as disclosed in Note 19, reduced the number of common shares
outstanding by 20 percent with a corresponding reduction in cash resources. Consequently, the overall effect of the capital
repayment and reverse stock split was a share buyback at fair value. Therefore, the weighted average number of shares outstanding
in the table above for 2007 is adjusted for the reduction in the number of shares as of the date of the reverse stock split and prior
periods are not restated.
The cumulative preferred financing shares were antidilutive in 2007 (i.e., assuming their conversion to common shares would
increase earnings per share) and were therefore not included in the calculation of the diluted earnings per share. For the conversion
features of the cumulative preferred financing shares and the maximum number of common shares issuable upon their conversion,
see Note 21.
The calculation of the basic and diluted income per share from continuing operations attributable to common shareholders is based
on the same number of shares as detailed above and the following earnings data:
million
2008
2007
Income from continuing operations
868
753
Non-controlling interests
Income from continuing operations, attributable to common shareholders
for the purposes of basic earnings per share
868
753
Effect of dilutive potential common shares, reversal of preferred dividends from earnings
31
Income from continuing operations, attributable to common shareholders
for the purposes of diluted earnings per share
899
753
Basic and diluted income per share from discontinued operations attributable to common shareholders amounted to EUR 0.17 and
EUR 0.16, respectively (2007: EUR 1.51 basic and EUR 1.49 diluted) and are based on the income from discontinued operations
attributable to common shareholders of EUR 206 million (2007: EUR 2,178 million) and the denominators detailed above.
The treasury function provides a centralized service to the Company for funding, foreign exchange, interest rate, liquidity and
counterparty risk management. Treasury operates in a centralized function within a framework of policies and procedures which is
reviewed regularly. The treasury function is not operated as a profit center but to manage the financial risks that arise in relation to
underlying business needs. Ahold's Corporate Executive Board has overall responsibility for the establishment and oversight of the
treasury risk management framework. Ahold's Finance Committee reviews material changes to treasury policy and receives
management information related to treasury activities.
