[15] Earnings per share Audited by KPMG

Basic earnings per share are calculated by dividing the net profit after minority interest by the weighted average number of theoretical shares outstanding. The use of a theoretical number of shares takes into account the fact that the general partner’s capital is not represented by shares. In accordance with the division of the share capital in the amount of €168.0 million into 64,613,126 shares, the general partner’s capital amounts to 152,767,813 theoretical shares. The Executive Board of Merck KGaA resolved and announced on January 21, 2007 with the consent of the Supervisory Board and of E. Merck OHG as the general partner holding an equity interest, to utilize the authorized capital to increase the share capital. Within the scope of this capital increase, 13,278,927 new shares were issued. In addition, an increase in the equity interest of the general partner E. Merck OHG by a nominal amount of approximately €34 million, corresponding to 13,067,816 new shares, took place. It should be noted that in accordance with IAS 33, the 13,299,237 shares issued through the capital increase and the Merck stock option program in 2007 may only be included in basic earnings per share on a time proportionate basis from the date of their conversion.

Basic earnings per share from discontinued operations were €16.71 (2006: €1.01). Diluted earnings per share are calculated by dividing the net profit after minority interest by the weighted average number of theoretical shares outstanding, plus all potentially dilutive shares. Potentially dilutive shares in the Merck Group are stock options under the Merck stock option program, provided that their exercise requirements are met at the balance sheet date. In this case, this relates to the stock options from tranche 2002 of Merck’s stock option program. The weighted average number of shares to calculate diluted earnings per share was 215,917,465 shares (2006: 194,011,560 shares). The resulting dilutive effect is not material. The diluted earnings per share thus correspond to the basic earnings per share.