Mercedes 2003 Annual Report Download - page 172
Download and view the complete annual report
Please find page 172 of the 2003 Mercedes annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Financial Reporting | Overview | Analysis of the Financial Situation | Statement by the Board of Management | Independent Auditors’ Report | Financial Statements
35. Earnings (Loss) per Share
The computation of basic and diluted earnings (loss) per share for
“Income (loss) from continuing operations” is as follows:
See Note 23 for shares issued upon conversion of bonds and notes
in 2003.
Because the Group reported a loss from continuing operations for
the year ended December 31, 2003 and 2001, the diluted loss per
share does not include the antidilutive effects of convertible bonds
and notes. Had the Group reported income from continuing opera-
tions for the year ended December 31, 2003 and 2001, the weight-
ed average number of shares outstanding would have potentially
been diluted by 0.5 million and 10.7 million shares resulting from
the conversion of bonds and notes, respectively.
Stock options issued in 2003, 2002 and 2001 in connection with
the Stock Option Plan 2000 were not included in the computation
of diluted earnings per share for all years presented, because the
options’ underlying exercise prices were greater than the average
market prices for DaimlerChrysler Ordinary Shares for all periods
ended at December 31, 2003, 2002 and 2001.
36. Related Party Transactions
The Group purchases materials, supplies and services from numer-
ous suppliers throughout the world in the ordinary course of our
business. These suppliers include firms in which the Group holds
an ownership interest and firms that are affiliated with some mem-
bers of DaimlerChrysler’s Supervisory Board.
Mitsubishi Motor Manufacturing of America, a subsidiary of Mit-
subishi Motors Corporation, produces the Dodge Stratus and
Chrysler Sebring coupes for the Group. As discussed in Note 3,
DaimlerChrysler owns a 37% equity interest in Mitsubishi Motors
Corporation.
DaimlerChrysler has an agreement with McLaren Cars Ltd.,
a wholly owned subsidiary of TAG McLaren Holdings Ltd., for the
design and production of a new high-performance sports car, the
SLR, which DaimlerChrysler expects to launch in the first six
months of 2004. The Group owns a 40% equity interest in TAG
McLaren Holdings Ltd.
DaimlerChrysler increased its stake in the Formula 1 engine man-
ufacturer Ilmor Engineering Ltd. from 25% to 55% in the year 2002
and has agreed to gradually acquire the remaining shares by 2005.
In September 2003, DaimlerChrysler increased its equity stake to
70%. The company has been renamed Mercedes-Ilmor. Mercedes-
Ilmor and DaimlerChrysler have been responsible for the develop-
ment, design and production of Mercedes–Benz Formula 1 engines
since 1993, which DaimlerChrysler supplies to the West McLaren
team in support of motor sport activities under the Mercedes-Benz
brand. DaimlerChrysler has consolidated Mercedes-Ilmor since Jan-
uary 1, 2003.
In May 2002, DaimlerChrysler Corporation sold its Dayton Ther-
mal Products Plant to Behr Dayton Thermal Products LLC, a joint
venture company in which Behr America, Inc. owns a majority
interest and DaimlerChrysler Corporation owns a minority interest.
DaimlerChrysler Corporation is required to maintain its minority
interest in the joint venture company through May 2004 and to
purchase products from it at competitively-based prices under a
supply agreement entered into in connection with the sale. Provi-
sion for the loss on the sale was included in the Chrysler Group
Turnaround Plan (see Note 7).
The supply agreement is valid from April 2002 through April
2008. Product pricing was based on the existing cost structure of
the Dayton Thermal Products Plant and was comparable to pricing
in effect prior to the transaction. The supply agreement included
the potential for price reductions in future years based on produc-
tivity and other gains by Behr Dayton. There is no minimum pur-
chase volume commitment included in the agreement. DCC agreed
that Behr Dayton would be the exclusive provider of certain climate
control components for existing and specific future vehicles
through the end of the contract term. There was no value assigned
to the supply agreement.
The Group’s subsidiaries DaimlerChrysler Coordination Center
S.A. (DCCC) and DaimlerChrysler Aerospace AG (DASA)
granted a series of loans to debis Air Finance B.V. (dAF). Through
DaimlerChrysler’s subsidiaries DaimlerChrysler Services AG and
DaimlerChrysler Aerospace AG, the Group holds a 45% non-
controlling interest in debis Air Finance B.V. The total book value of
these loans as of December 31, 2003, was €524 million, the
highest aggregate amount outstanding during 2003 was €680
million. The interest rates are partially fixed, partially based on
Libor.
(in millions of € or millions of shares,
except earnings (loss) per share)
(763)
–
(763)
1,003.2
–
1,003.2
(0.76)
(0.76)
200120022003
4,795
12
4,807
1,008.3
5.6
1,013.9
4.76
4.74
(418)
–
(418)
1,012.7
–
1,012.7
(0.41)
(0.41)
Income (loss) from continuing operations –
basic
Interest expense on convertible
bonds and notes (net of tax)
Income (loss) from continuing operations
– diluted
Weighted average number of shares
outstanding – basic
Dilutive effect of convertible bonds and notes
Weighted average number of shares
outstanding – diluted
Earnings (loss) per share from continuing
operations
Basic
Diluted
Year ended December 31,