Mercedes 2004 Annual Report Download - page 169

36. 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.
Because the Group reported a loss from continuing operations
for the year ended December 31, 2003 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 the weighted aver-
age number of shares outstanding would have potentially been
diluted by 0.5 million shares resulting from the conversion of
bonds and notes.
Stock options to acquire 67.1 million, 71.6 million and 53.1 million
DaimlerChrysler Ordinary Shares that were issued in connection
with the 2000 Stock Option Plan were not included in the compu-
tation of diluted earnings (loss) per share for 2004, 2003 and
2002, respectively, because the options’ underlying exercise
prices were higher than the average market prices of Daimler-
Chrysler Ordinary Shares in these periods.
37. Related Party Transactions
The Group purchases materials, supplies and services from
numerous suppliers throughout the world in the ordinary course
of its business. These suppliers include companies in which the
Group holds an ownership interest and companies that are affili-
ated with some members of DaimlerChrysler AG’s Supervisory
Board or Board of Management.
Mitsubishi Motor Manufacturing of America Inc., a subsidiary of
MMC, produces the Dodge Stratus and Chrysler Sebring coupes,
and NedCar B.V., another subsidiary of MMC, produces the smart
forfour for the Group. As discussed in Note 3, MMC was an equi-
ty method investee of DaimlerChrysler.
DaimlerChrysler has an agreement with McLaren Cars Ltd., a
wholly owned subsidiary of McLaren Group Ltd., for the produc-
tion of the Mercedes McLaren super sports car, which Daimler-
Chrysler launched into the markets in 2004. The Group owns a
40% equity interest in McLaren Group 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. At December 31, 2004, DaimlerChrysler hold an equity
stake of 85%. The company has been renamed Mercedes-Ilmor
Ldt. Mercedes-Ilmor Ltd. and DaimlerChrysler have been respon-
sible for the development, design and production of Mercedes-
Benz Formula 1 engines since 1993, which DaimlerChrysler sup-
plies to the West McLaren Mercedes team in support of motor
sport activities under the Mercedes-Benz brand. DaimlerChrysler
has consolidated Mercedes-Ilmor Ltd. since January 1, 2003.
In May 2002, DCC sold its Dayton Thermal Products Plant to Behr
Dayton, a joint venture company with Behr America Inc. As of May
1, 2004, DCC sold its remaining minority interest in the joint ven-
ture to Behr America Inc. DCC is required to purchase products
from the joint venture at competitively-based prices under a supply
agreement entered into in connection with the sale.
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.
165
(in millions of € or millions of shares,
except earnings (loss) per share)
4,795
12
4,807
1,008.3
5.6
1,013.9
4.76
4.74
200220032004
(418)
–
(418)
1,012.7
–
1,012.7
(0.41)
(0.41)
2,466
–
2,466
1,012.8
1.7
1,014.5
2.43
2.43
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 stock options in 2004 and
convertible bonds and notes in 2002
Weighted average number of shares
outstanding – diluted
Earnings (loss) per share from continuing
operations
Basic
Diluted
Year ended December 31,