Blackberry 2010 Annual Report Download - page 32

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As noted above, on March 12, 2009, subsequent to the Company’s fiscal year end, the Government of Canada
enacted legislation to allow the Company the option to determine its Canadian tax results based on its
functional currency (the U.S. dollar) rather than the Canadian dollar. While the Company elected for Canadian
tax purposes to adopt these rules in the third quarter of fiscal 2009, the Company could not recognize the
related tax benefit of electing to adopt these rules for U.S. GAAP financial reporting purposes until the quarter
in which they were enacted resulting in a $99.7 million higher provision for income taxes in fiscal 2009. As
noted above, in the first quarter of fiscal 2010, the Company recorded an incremental, one time net benefit of
approximately $145.0 million to net income relating to the adoption of the amending legislation.
Net Income
Net income was $1.89 billion in fiscal 2009, compared to net income of $1.29 billion in fiscal 2008. Basic EPS
was $3.35 and diluted EPS was $3.30 in fiscal 2009 compared to $2.31 basic EPS and $2.26 diluted EPS, in fiscal
2008.
The $598.7 million increase in net income in fiscal 2009 reflects primarily an increase in gross margin in the
amount of $2.02 billion, resulting primarily from the increased number of device shipments, which was partially
offset by the decrease of consolidated gross margin percentage and an increase of $1.33 billion in the
Company’s research and development, selling, marketing and administration expenses and the Company’s
provision for income taxes, which included the negative impact of $99.7 million due to the significant
depreciation of the Canadian dollar relative to the U.S. dollar in the fiscal year. See “Income Taxes”.
The weighted average number of shares outstanding was 565.1 million common shares for basic EPS and
574.2 million common shares for diluted EPS for the fiscal year ended February 28, 2009 compared to
559.8 million common shares for basic EPS and 572.8 million common shares for diluted EPS for the fiscal year
ended March 1, 2008.
Stock Split
The Company declared a 3-for-1 stock split of the Company’s outstanding common shares on June 28, 2007.
The stock split was implemented by way of a stock dividend. Shareholders received two common shares of
the Company for each common share held. The stock dividend was paid in the second quarter of fiscal 2008.
All share, earnings per share and stock option data for the current fiscal year and prior comparative periods
reflects this stock dividend.
MD&A
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