13. Earnings per share (EPS)

Basic earnings per share

Basic earnings per share are calculated by dividing the net income attributable to shareholders by the weighted average number of shares outstanding during the year. The number of outstanding shares is calculated by deducting the average number of shares purchased and held as treasury shares from the total of all issued shares.

In CHF’000 2007 2006
Net income attributable to bearer shareholders 60 221 123 902
Net income attributable to registered shareholders 5 875 12 142
Total net income 66 096 136 044
Weighted average number of bearer shares outstanding 47 457 434 47 244 699
Weighted average number of registered shares outstanding 46 300 000 46 300 000
Basic earnings per share (in CHF)
Bearer shares 1.2689 2.6226
Registered shares 0.1269 0.2623

Diluted earnings per share

The diluted earnings per share calculation takes into account all potential dilutions to the earnings per share arising from the convertible bonds and options on Kudelski SA shares.

In CHF’000 2007 2006
Net income attributed to equity holders of the company 66 096 136 044
Elimination of interest expense on convertible debt * - 10 950
Tax impact on above adjustments - -
Net income used to determine earnings per share 66 096 146 994
Of which:
-attributable to bearer shareholders 60 229 135 088
-attributable to registered shareholders 5 867 11 906
66 096 146 994
Weighted average number of bearer shares outstanding 47 457 434 47 244 699
Effect of dilutive potential bearer share:
-employee stock option plan (ESOP) 71 911 120 877
-convertible bond* - 5 165 290
Weighted average number of bearer shares for the purpose of diluted earnings per share 47 529 345 52 530 866
Weighted average number of registered shares for the purpose
of diluted earnings per share		 46 300 000 46 300 000
Diluted earnings per share (in CHF)
Bearer shares 1.2672 2.5716
Registered shares 0.1267 0.2572

* Shares equivalent of 5 225 440 (2006: 0) relating to the convertible bonds were excluded from the calculation of diluted earnings per share as they were anti-dilutive.