|
| Interest income |
2 |
2 |
| Interest expense |
-38 |
-34 |
|
-36 |
-32 |
8.6 Income tax
| Recognised in the income statement |
| Current tax* |
137 |
72 |
| Deferred tax |
-12 |
3 |
| Income tax expense for the year |
125 |
75 |
* The current tax expense in 2007 is subject to tax charges for non recurring items of €23 million. Please refer to note 8.8 .
Vedior’s operations are subject to income taxes in various foreign jurisdictions with a weighted average statutory income tax rate of 32.0% (2006: 30.8%).
Reconciliation of effective tax rate
The reconciliation between the effective tax rate and the weighted average statutory income tax rate is as follows:
|
| Profit before tax |
361 |
|
261 |
|
| Share of profit of associates (after tax) |
1 |
|
1 |
|
|
362 |
|
262 |
|
| Weighted average income tax rate |
116 |
32.0% |
81 |
30.8% |
| Non deductible expenses |
11 |
3.0% |
4 |
1.6% |
| Benefit from tax facilities |
-4 |
-1.1% |
-5 |
-1.9% |
| Loss carry forwards |
4 |
1.1% |
-5 |
-1.9% |
| Revaluation deferred tax |
|
|
1 |
0.3% |
| Other |
-2 |
-0.5% |
-1 |
-0.2% |
| Effective tax rate |
125 |
34.5% |
75 |
28.7% |
Deferred tax recognised directly in equity
|
| Relating to share based payments |
- |
2 |
8.7 Profit for the period and earnings per share The calculation of the basic and diluted earnings per share attributable to ordinary shares is based on the following data:
|
| Profit attributable to holders of ordinary shares |
236 |
186 |
| Non recurring items (net of tax)* |
-6 |
-5 |
| Profit excluding non recurring items, attributable to holders of ordinary shares |
230 |
181 |
* Please refer to note 8.8 for further details on the non recurring items.
Number of shares
Weighted average number of ordinary shares in thousands |
| Weighted average number of ordinary shares for the purposes of basic earnings per share |
173,138 |
170,694 |
| Effect of dilutive potential ordinary shares from share based payment plans |
931 |
2,283 |
| Weighted average number of ordinary shares for the purposes of diluted earnings per share |
174,069 |
172,977 |
In the table below the earnings per share are specified as stated on the face of the income statement and adjusted using the profit after non recurring items as specified in the notes.
| Earnings per share |
| Including non recurring items |
|
|
| Basic earnings per share € |
1.36 |
1.09 |
| Diluted earnings per share € |
1.36 |
1.08 |
|
|
|
| Excluding non recurring items |
|
|
| Basic earnings per share € |
1.33 |
1.06 |
| Diluted earnings per share € |
1.32 |
1.05 |
8.8 Non recurring items 2007 Vedior’s profit and loss account is subject to non recurring items which can be specified as shown in the following table:
|
| Sales |
8,432 |
|
8,432 |
| Cost of sales |
-6,699 |
-100 |
-6,799 |
| Gross profit |
1,733 |
-100 |
1,633 |
|
|
|
|
| Operating expenses |
-1,335 |
71 |
-1,264 |
| Operating income |
398 |
-29 |
369 |
|
|
|
|
| Finance costs |
-36 |
|
-36 |
| Share of profit of associates (after tax) |
-1 |
|
-1 |
| Profit before tax |
361 |
|
332 |
|
|
|
|
| Income tax expense |
-125 |
23 |
-102 |
| Profit for the period |
236 |
-6 |
230 |
|
|
|
|
| Earnings per share |
|
|
|
| Basic earnings per share € |
1.36 |
|
1.33 |
| Diluted earnings per share € |
1.36 |
|
1.32 |
The cost of sales includes the favourable benefits from the revised calculation method for social security charges in France that became effective in April 2007 with retroactive effect from 1 January 2006. The amount attributable to 2007 is €43 million and €57 million is attributable to 2006. These benefits ceased to exist at 30 September 2007.
The non recurring operating costs of €71 million comprise of employee costs for €36 million, of which €30 million is related to the favourable benefits from the revised calculation method for social security charges in France, and €6 million to the CEO transition in September 2007. Of the 36 million €18 million is attributable to 2006. The remainder of the non recurring costs of €35 million relate to other operating costs for the settlement with the VEB (please refer to our media release on 31 January 2008), a provision for the competition investigation in France (see note 8.18) as well as the cost of the strategic review and intended merger with Randstad.