EXHIBIT 11
XEROX CORPORATION
COMPUTATION OF EARNINGS (LOSS) PER COMMON SHARE
(Dollars in millions, except per-share data; shares in thousands)
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2002 | 2001 | 2002 | 2001 | ||||||||||||
I. Basic Earnings (Loss) Per Common Share | |||||||||||||||
Income (Loss) before cumulative effect of change in accounting principle | $ | 87 | $ | (107 | ) | $ | 36 |
| $ | 115 |
| ||||
Accrued dividends on ESOP Preferred Stock |
| — |
| — |
|
| — |
|
| (12 | ) | ||||
Adjusted Income (Loss) before cumulative effect of change in accounting principle | $ | 87 | $ | (107 | ) | $ | 36 |
| $ | 103 |
| ||||
Net Income (Loss) | $ | 87 | $ | (107 | ) | $ | (27 | ) | $ | 115 |
| ||||
Accrued dividends on ESOP Preferred Stock |
| — |
| — |
|
| — |
|
| (12 | ) | ||||
Adjusted Net Income (Loss) | $ | 87 | $ | (107 | ) | $ | (27 | ) | $ | 103 |
| ||||
Average common shares outstanding during the period |
| 726,499 |
| 699,657 |
|
| 725,320 |
|
| 688,478 |
| ||||
Common shares issuable with respect to exchangeable shares |
| 1,498 |
| 1,668 |
|
| 1,501 |
|
| 1,718 |
| ||||
Adjusted average shares outstanding for the period |
| 727,997 |
| 701,325 |
|
| 726,821 |
|
| 690,196 |
| ||||
Basic Earnings (Loss) per share before cumulative effect of change in accounting principle | $ | 0.12 | $ | (0.15 | ) | $ | 0.05 |
| $ | 0.15 |
| ||||
Basic Earnings (Loss) per share | $ | 0.12 | $ | (0.15 | ) | $ | (0.04 | ) | $ | 0.15 |
| ||||
II. Diluted Earnings (Loss) Per Common Share | |||||||||||||||
Income (Loss) before cumulative effect of change in accounting principle | $ | 87 | $ | (107 | ) | $ | 36 |
| $ | 115 |
| ||||
ESOP expense adjustment, net of tax |
| — |
| — |
|
| — |
|
| (8 | ) | ||||
Interest on convertible debt, net |
| 13 |
| — |
|
| — |
|
| 1 |
| ||||
Adjusted Net Income (Loss) | $ | 100 | $ | (107 | ) | $ | 36 |
| $ | 108 |
| ||||
Average common shares outstanding during the period |
| 726,499 |
| 699,657 |
|
| 725,320 |
|
| 688,478 |
| ||||
Common shares issuable with respect to: | |||||||||||||||
Stock options, incentive and exchangeable shares |
| 7,250 |
| 1,668 |
|
| 7,730 |
|
| 6,051 |
| ||||
Convertible debt |
| 113,426 |
| — |
|
| — |
|
| 1,992 |
| ||||
ESOP preferred stock |
| 65,935 |
| — |
|
| 61,949 |
|
| 82,776 |
| ||||
Adjusted average shares outstanding for the period |
| 913,110 |
| 701,325 |
|
| 794,999 |
|
| 779,297 |
| ||||
Diluted Earnings (Loss) per share before cumulative effect of change in accounting principle | $ | 0.11 | $ | (0.15 | ) | $ | 0.05 |
| $ | 0.14 |
| ||||
Net Income (Loss) | $ | 87 | $ | (107 | ) | $ | (27 | ) | $ | 115 |
| ||||
ESOP expense adjustment, net of tax |
| — |
| — |
|
| — |
|
| (8 | ) | ||||
Interest on convertible debt, net |
| 13 |
| — |
|
| — |
|
| 1 |
| ||||
Adjusted Net Income (Loss) | $ | 100 | $ | (107 | ) | $ | (27 | ) | $ | 108 |
| ||||
Average common shares outstanding during the period |
| 726,499 |
| 699,657 |
|
| 725,320 |
|
| 688,478 |
| ||||
Common shares issuable with respect to: | |||||||||||||||
Stock options, incentive and exchangeable shares |
| 7,250 |
| 1,668 |
|
| 1,501 |
|
| 6,051 |
| ||||
Convertible debt |
| 113,426 |
| — |
|
| — |
|
| 1,992 |
| ||||
ESOP preferred stock |
| 65,935 |
| — |
|
| — |
|
| 82,776 |
| ||||
Adjusted average shares outstanding for the period |
| 913,110 |
| 701,325 |
|
| 726,821 |
|
| 779,297 |
| ||||
Diluted Earnings (Loss) per share | $ | 0.11 | $ | (0.15 | ) | $ | (0.04 | ) | $ | 0.14 |
| ||||
1
