Notes to the Financial Statements

For the short period 1 April 2006 to 3 March 2007

14. BASIC AND DILUTED EARNINGS PER SHARE (EPS)

Basic and diluted EPS for comparative periods have been calculated on the basis of the number of Home Retail Group plc ordinary shares in issue at the date of demerger, excluding ordinary shares held in Home Retail Group’s ESOT.

Basic and diluted EPS for 2007 have been calculated on the number of shares in issue at the date of demerger for the pre-demerger period together with the weighted average number of shares post demerger, excluding ordinary shares held in Home Retail Group’s ESOT.

Earnings	2007 £m	2006 £m
Profit after tax for the financial period	187.4	176.4
Effect of exceptional items	15.8	24.7
Effect of financing fair value remeasurements	0.1	2.0
Financing impact on retirement benefit balances	(12.1)	(2.6)
Demerger incentive schemes	5.8	–
Attributable taxation	9.2	(7.2)
Benchmark profit after tax for the financial period	206.2	193.3
Weighted average number of shares	millions	millions
Number of ordinary shares for the purpose of basic EPS	869.6	869.0
Dilutive effect of share incentive awards	7.6	7.6
Number of ordinary shares for the purpose of diluted EPS	877.2	876.6

EPS	pence	pence
Basic EPS	21.6	20.3
Diluted EPS	21.4	20.1

Basic benchmark EPS	23.7	22.2
Diluted benchmark EPS	23.5	22.1