Halma p.l.c. Half year report 2007/08

4 Earnings per ordinary share

Basic earnings per ordinary share are calculated using the weighted average of 372,554,066 (September 2006: 370,287,369; March 2007: 371,221,629) shares in issue during the period (net of shares purchased by the Company and held as treasury shares). Diluted earnings per ordinary share are calculated using 374,489,843 (September 2006: 372,168,717; March 2007: 374,036,077) shares which includes dilutive potential ordinary shares of 1,935,777 (September 2006: 1,881,348; March 2007: 2,814,448). Dilutive potential ordinary shares are calculated from those exercisable share options where the exercise price is less than the average price of the Company's ordinary shares during the period.

Adjusted earnings are calculated as earnings from continuing operations excluding the amortisation of acquired intangible assets after tax. The Directors consider that adjusted earnings represent a more consistent measure of underlying performance. A reconciliation of earnings and the effect on basic earnings per share figures is presented below:

Unaudited 26 weeks to 29 September 2007 £000		Unaudited 26 weeks to 30 September 2006 £000	Audited 52 weeks to 31 March 2007 £000
Earnings from continuing operations	22,250	20,228	44,011
Add back amortisation of acquired intangible assets after taxation	1,263	1,002	2,393
Adjusted earnings	23,513	21,230	46,404

Per ordinary share
Unaudited 26 weeks to 29 September 2007 £000		Unaudited 26 weeks to 30 September 2006 £000	Audited 52 weeks to 31 March 2007 £000
Earnings from continuing operations	5.97	5.46	11.86
Add back amortisation of acquired intangible assets after taxation	0.34	0.27	0.64
Adjusted earnings	6.31	5.73	12.50