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103
ANNUAL REPORT AND FINANCIAL STATEMENTS 2015
NOTES TO THE FINANCIAL STATEMENTS
CONTINUED
OUR BUSINESSOUR PERFORMANCE
GOVERNANCEFINANCIAL STATEMENTS
8 EARNINGS PER SHARE
The calculation of earnings per ordinary share is based on earnings after tax and the weighted average number of ordinary shares in issue
during the year.
The underlying earnings per share fi gures have also been calcul ated based on earnings before items that are one-o in nature, signifi cant
and are not considered normal operating costs of the underlying business (see note 5). These have been calculated to allow the
shareholders to gain an understanding of the underlying trading performance of the Group.
For diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive
potential ordinary shares. The Group has four classes of dilutive potential ordinary shares being those share options granted to employees
where the exercise price is less than the average market price of the Company’s ordinary shares during the year, unvested shares
granted under the Deferred Share Bonus Plan, unvested shares granted under the Restricted Share Plan and unvested shares within
the Performance Share Plan that have met the relevant performance conditions at the end of the reporting period.
Details of the underlying earnings per share are set out below:
2015
£m
2014
£m
Profi t attributable to equity shareholders of the Company 486.5 524.8
Add/(less) (net of tax):
– Net M&S Bank charges incurred in relation to the insurance mis-selling provision 10.9 39.1
– Restructuring costs 3.9 62.5
– IAS 39 fair value movement of embedded derivative (1.0) 2.8
– Loss/(profi t) on disposal and impairment once commitment to closure 4.3 (76.3)
– International store review 36.6 17.3
– UK and Ireland one-o pension credits – (23.3)
– Fees incurred on tax repayment – (2.5)
– Strategic programme costs – 1.6
– Non-underlying adjustment to tax charge in respect of prior periods – (26.0)
Underlying profi t attributable to equity shareholders of the Company 541.2 520.0
2015
Million
2014
Million
Weighted average number of ordinary shares in issue 1,635.6 1,615.0
Potentially dilutive share options under Group’s share option schemes 11. 3 14.1
Weighted average number of diluted ordinary shares 1,646.9 1,629.1
2015
Pence
2014
Pence
Basic earnings per share 29.7 32.5
Diluted earnings per share 29.5 32.2
Underlying basic earnings per share 33.1 32.2
Underlying diluted earnings per share 32.9 31.9
9 DIVIDENDS
2015
per share
2014
per share
2015
£m
2014
£m
Dividends on equity ordinary shares
Paid fi nal dividend 10.8p 10.8p 176.2 173.6
Paid interim dividend 6.4p 6.2p 104.5 100.0
17.2p 17. 0 p 280.7 273.6
The directors have proposed a fi nal dividend in respect of the year ended 28 March 2015 of 11.6p per share amounting to a dividend of
£191.1m. It will be paid on 10 July 2015 to shareholders on the Register of Members as at close of business on 29 May 2015, subject to approval
of shareholders at the Annual General Meeting, to be held on 7 July 2015. In line with the requirements of IAS 10 ‘Events after the reporting
period’, this dividend has not been recognised within these results.
A dividend reinvestment plan (DRIP) is available to shareholders who would prefer to invest their dividends in the shares of the Company.
The shares will go ex-dividend on 28 May 2015. For those shareholders electing to receive the DRIP the last date for receipt of a new election
is 19 June 2015.
The Group has a progressive dividend policy with dividends covered broadly twice by earnings, as explained in the Financial review on
page 16.