Zimmer Biomet (ZBH) 8-K Zimmer Reports Second Quarter 2006 Financial Results

Exhibit 99.1

Contacts:

Media	Investors
Brad Bishop		Sean O’Hara	Sam Leno
574-372-4291		574-371-8032	574-372-4790
bradley.bishop@zimmer.com		sean.f.ohara@zimmer.com	sam.leno@zimmer.com

Zimmer Reports Second Quarter 2006 Financial Results

Highlights

• Net Sales of $882 million represent an increase of 4% reported (5% constant currency) and a sequential quarter increase of $22 million

• Americas Reconstructive sales increased 6% reported (6% constant currency)

• Americas recorded positive price increase of 1.3%

• Double-digit Worldwide sales growth in Dental, Spine and Trauma

• Continued margin strength—77% gross, 32% operating and 23% net reported; 77% gross, 33% operating and 23% net adjusted; and 78% gross, 35% operating and 25% net adjusted excluding the effect of share-based payment

• Diluted EPS were $0.81 reported, $0.83 adjusted, and $0.89 adjusted excluding the effect of share-based payment, an increase of 11%

• Record operating cash flow of $305 million, a 25% increase over prior year

• Repurchased almost 5,000,000 common shares

(WARSAW, IN) July 26, 2006 — Zimmer Holdings, Inc. (NYSE and SWX: ZMH) today reported financial results for the quarter ended June 30, 2006. For the quarter, the Company announced net sales of $882 million, an increase of 4% reported and 5% constant currency. Diluted earnings per share for the quarter were $0.81 reported and $0.83 adjusted, exceeding First Call earnings estimates of $0.82 adjusted.

Reported and adjusted diluted earnings per share for the second quarter of 2006 include a $0.06 per diluted share impact related toSFAS 123(R), Share-Based Payment. Effective January 1, 2006, the Company adopted this new accounting standard using the modified-prospective method. In accordance with this adoption method, the Company is not adjusting its historical financial statements to reflect the impact of share-based payment. Excluding the impact of SFAS 123(R), adjusted diluted earnings per share for the second quarter were $0.89, representing an 11% increase over adjusted diluted earnings per share for the second quarter of 2005.

“Our sales results were consistent with what the overall orthopaedic market has seen, and as expected, for us, similar to the first quarter,” said Ray Elliott, Zimmer Chairman, President and CEO. “We have made substantial progress in key strategic areas, including important additions to our joint reconstruction offering with two new alternate bearing options and the world’s first knee replacement designed for the unique characteristics of a woman’s anatomy—theZimmer^® Gender Solutions™ Knee Implant. We also achieved a significant biologics milestone with the approval of the U.S. IND application for Neocartilage and launched our entry into hospital profitability consulting with the acquisition of theHuman Motion Institute^SMbrand.”

The Company introduced itsGender Solutionsknee implant in May. Initial implantations were limited to the system’s surgeon developers, but the product will be released to a wider surgeon audience in the fall. Media efforts have already resulted in approximately 500 articles and stories, which have generated more than 80 million exposures. “As we roll out theGender Solutions product more broadly to additional surgeons, we will be launching targeted nationwide publicity campaigns to increase women’s awareness of this therapeutic option,” said Elliott.

In June, the Company launched theDurom^®Acetabular Cup withMetasul^® LDH™Large Diameter Heads, filling an important offering in the metal-on-metal hip replacement category. The Company also gained regulatory approval to market theTrilogy AB^®Ceramic-on-Ceramic Acetabular System, which was launched last week.

During the quarter, the Company finalized its acquisition of Musculoskeletal Management Systems, LLC (MMS). MMS, which is better known as theHuman Motion Institute(HMI), has

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established several long term service agreements with various hospitals throughout the United States. HMI provides focused consulting services which help its member institutions not only design but implement and manage successful orthopaedic programs of distinction. “Our overall goal, which HMI will support in the field, is to identify opportunities to create long-term, permanent cost savings that extend beyond the historic cost-shifting that goes with year-to-year implant pricing negotiations,” said Elliott. “Savings solutions are available and we intend to be the leader in making them a reality.”

In the second quarter, Zimmer Holdings invested $309 million to repurchase almost five million common shares as part of an authorized $1 billion program. “Our primary use of excess cash will continue to be strategic acquisitions in the areas of Biologics, Dental and Spine,” said Elliott. “However, until we finalize such acquisitions, we expect to use the share buyback program to deploy cash opportunistically to build shareholder value.”

Antitrust Investigation Update

On June 23, 2006, the Company received a subpoena from the Antitrust Division of the U.S. Department of Justice. Four of Zimmer’s competitors also have announced that they received subpoenas pertaining to the same antitrust investigation.

It is the Company’s belief that the following events gave rise to the Antitrust Division’s investigation. In the fall of 2005, a single hospital conducted a bid process for orthopaedic implant pricing. As part of that process, a representative of the hospital sent an e-mail containing the hospital’s proposal to the local representatives of various orthopaedic companies, including Zimmer’s local independent distributor.

Upon receipt of that e-mail, a representative of one of Zimmer’s competitors sent an unsolicited message to the same group of competitors that received the hospital’s original message. The competitor’s e-mail proposed that the orthopaedic companies adopt a uniform pricing strategy in responding to this hospital.

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When Zimmer learned of the competitor’s proposal, the Company advised its local independent distributor to reject it on behalf of both the distributor and Zimmer, which the distributor did. The written rejection stated emphatically that neither Zimmer nor its distributors will participate in pricing discussions with competitors and that Zimmer’s policies insist on full compliance with the antitrust laws.

Throughout the fall and winter, Zimmer continued to engage in its own one-on-one pricing negotiations with the hospital, and successfully concluded a new Zimmer-specific pricing arrangement in early 2006.

Zimmer is cooperating fully with the Antitrust Division’s investigation and will continue to do so. Zimmer noted that the information it is providing today about the investigation is limited to the specific incident described and that it can offer no assurances as to the final outcome of this investigation. In light of the ongoing nature of the investigation, Zimmer says that providing this information should not be construed as an intention on the Company’s part to provide further updates except as legally required.

Sales Tables

The following tables provide sales results by geographic segment and product category, as well as the percent change compared to the prior year quarter and six months on both a reported and constant currency basis.

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NET SALES — THREE MONTHS ENDED JUNE 30, 2006
(in millions, unaudited)

						Constant
	Net		Reported			Currency
	Sales		% Growth			% Growth
Geographic Segments
Americas	$	521		5	%		5	%
Europe		239		5			6
Asia Pacific		122		(1	)		3
Total		882		4			5
Product Categories
Reconstructive
Americas		423		6			6
Europe		213		3			5
Asia Pacific		98		(2	)		2
Total		734		4			5
Knees
Americas		236		4			4
Europe		90		7			8
Asia Pacific		42		(2	)		2
Total		368		4			5
Hips
Americas		146		6			6
Europe		106		(1	)		0
Asia Pacific		47		(6	)		(1	)
Total		299		2			3
Extremities		20		15			15
Dental		47		16			15
Trauma		49		11			12
Spine		46		12			12
Orthopaedic Surgical Products and other		53		(6	)		(5	)

Net earnings for the quarter were $201 million on a reported basis, and were $206 million adjusted. Included in adjusted earnings for the second quarter of 2006 is $14 million of after tax

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expense due to the January 1, 2006 adoption of SFAS 123(R), Share-Based Payment. Second quarter adjusted net earnings, excluding the effect of share-based payment, were $220 million, a 10% increase over the second quarter of 2005.

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NET SALES — SIX MONTHS ENDED JUNE 30, 2006
(in millions, unaudited)

						Constant
	Net		Reported			Currency
	Sales		% Growth			% Growth
Geographic Segments
Americas	$	1,037		6	%		6	%
Europe		467		1			6
Asia Pacific		238		0			7
Total		1,742		4			6
Product Categories
Reconstructive
Americas		841		7			7
Europe		420		0			5
Asia Pacific		190		0			6
Total		1,451		4			6
Knees
Americas		475		6			6
Europe		179		3			9
Asia Pacific		80		0			6
Total		734		5			7
Hips
Americas		288		7			6
Europe		209		(4	)		1
Asia Pacific		95		(4	)		4
Total		592		1			4
Extremities		38		13			14
Dental		87		18			19
Trauma		96		7			9
Spine		89		12			13
Orthopaedic Surgical Products and other		106		(5	)		(3	)

Net earnings for the six months were $407 million on a reported basis, and were $411 million adjusted, an increase of 6% adjusted over the prior year period. Included in adjusted earnings for

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the first six months of 2006 is $27 million of after tax expense due to the January 1, 2006 adoption of SFAS 123(R), Share-Based Payment. First six months 2006 adjusted net earnings, excluding the effect of share-based payment, were $438 million, a 13% increase over the first six months of 2005.

Guidance

The Company is reaffirming its previous sales guidance ranges for the third and fourth quarter of 2006. Consistent with previous guidance, both quarters are expected to increase 10% to 11% over prior year.

Previous guidance for adjusted diluted earnings per share was $0.76 in the third quarter and approximately $1.00 in the fourth quarter. As a result of increased activities related to legal matters, the Company is reducing adjusted diluted earnings per share guidance by $0.01 in each remaining quarter of 2006. Therefore, adjusted diluted earnings per share are expected to be approximately $0.75 and $0.99 in the third and fourth quarters respectively.

Conference Call

The Company will conduct its second quarter 2006 investor conference call on Thursday, July 27, 2006, at 8:00 a.m. Eastern Time. The live audio webcast can be accessed via Zimmer’s Investor Relations website athttp://investor.zimmer.com. It will be archived for replay following the conference.

Individuals who wish to dial into the conference call may do so at (800) 406-1106. International callers should dial (706) 634-7075. A digital recording will be available two hours after the completion of the conference call from July 27, 2006 to July 31, 2006. To access the recording, US/Canada callers should dial (800) 642-1687, or for International callers, dial (706) 645-9291, and enter the Conference ID, 2012778. A copy of this press release and other financial and statistical information about the periods to be presented in the conference call will be accessible through the Zimmer website athttp://investor.zimmer.com.

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About the Company

Founded in 1927 and headquartered in Warsaw, Indiana, Zimmer is the worldwide #1 pure-play orthopaedic leader in designing, developing, manufacturing and marketing reconstructive and spinal implants, trauma and related orthopaedic surgical products. Zimmer has operations in more than 24 countries around the world and sells products in more than 100 countries. Zimmer’s 2005 sales were approximately $3.3 billion. The Company is supported by the efforts of more than 6,700 employees worldwide.

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For more information about Zimmer and the Gender Solutions™ Knee Implant,

visitwww.zimmer.com

Note on Non-GAAP Financial Measures

As used in this press release, the term“adjusted”refers to operating performance measures that exclude acquisition, integration and other expenses and inventory step-up. This press release also includes adjusted performance measures that exclude the effect of share-based payment, which is also a non-GAAP financial measure. The term “constant currency” refers to any financial measure that excludes the effect of changes in foreign currency exchange rates. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measure are included in this press release.

Zimmer Safe Harbor Statement

This press release contains forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 based on current expectations, estimates, forecasts and projections about the orthopaedics industry, management’s beliefs and assumptions made by management. Forward-looking statements may be identified by the use of forward-looking terms such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “projects,” “assumes,” “guides,” “targets,” “forecasts,” and “seeks” or the negative of such terms or other variations on such terms or comparable terminology. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that could cause actual outcomes and results to differ materially. These risks and uncertainties include, but are not limited to, our ability to successfully integrate acquired businesses, the outcome of the Department of Justice investigations announced in March 2005

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and June 2006, price and product competition, rapid technological development, demographic changes, dependence on new product development, the mix of our products and services, supply and prices of raw materials and products, customer demand for our products and services, control of costs and expenses, our ability to form and implement alliances, international growth, governmental laws and regulations affecting our U.S. and international businesses, including tax obligations and risks, product liability and intellectual property litigation losses, reimbursement levels from third-party payors, general industry and market conditions and growth rates and general domestic and international economic conditions including interest rate and currency exchange rate fluctuations. For a further list and description of such risks and uncertainties, see our periodic reports filed with the U.S. Securities and Exchange Commission. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be set forth in our periodic reports. Readers of this document are cautioned not to place undue reliance on these forward-looking statements, since, while we believe the assumptions on which the forward-looking statements are based are reasonable, there can be no assurance that these forward-looking statements will prove to be accurate. This cautionary statement is applicable to all forward-looking statements contained in this document .

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ZIMMER HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF EARNINGS

FOR THE THREE MONTHS ENDED JUNE 30, 2006 and 2005

(in millions, except per share amounts, unaudited)

	2006			2005			% Inc/(Dec)
Net Sales	$	881.6		$	846.8			4	%
Cost of products sold		200.0			188.8			6
Gross Profit		681.6			658.0			4
Research and development		48.6			43.6			12
Selling, general and administrative		344.8			328.5			5
Acquisition, integration and other		6.3			10.1			(39	)
Operating expenses		399.7			382.2			5
Operating Profit		281.9			275.8			2
Interest income (expense)		1.2			(4.2	)		N/A
Earnings before income taxes and minority interest		283.1			271.6			4
Provision for income taxes		82.0			80.7			2
Minority interest		(0.2	)		(0.2	)		—
Net Earnings	$	200.9		$	190.7			5
Earnings Per Common Share
Basic	$	0.82		$	0.77			7
Diluted	$	0.81		$	0.76			7
Weighted Average Common Shares Outstanding
Basic		245.5			247.0
Diluted		247.7			249.9

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ZIMMER HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE SIX MONTHS ENDED JUNE 30, 2006 and 2005
(in millions, except per share amounts, unaudited)

	2006			2005%			Inc/(Dec)
Net Sales	$	1,742.0		$	1,675.3			4	%
Cost of products sold		389.4			379.1			3
Gross Profit		1,352.6			1,296.2			4
Research and development		96.0			85.7			12
Selling, general and administrative		679.7			650.1			5
Acquisition, integration and other		4.5			27.0			(83	)
Operating expenses		780.2			762.8			2
Operating Profit		572.4			533.4			7
Interest income (expense)		1.7			(11.4	)		N/A
Earnings before income taxes and minority interest		574.1			522.0			10
Provision for income taxes		167.1			157.3			6
Minority interest		(0.5	)		(0.4	)		N/A
Net Earnings	$	406.5		$	364.3			12
Earnings Per Common Share
Basic	$	1.65		$	1.48			11
Diluted	$	1.63		$	1.46			12
Weighted Average Common Shares Outstanding
Basic		246.6			246.5
Diluted		248.9			249.5

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ZIMMER HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 2006 and DECEMBER 31, 2005
(in millions)

	June 30,		December 31,
	2006		2005
	(unaudited)
Assets
Current Assets:
Cash and equivalents	$	335.8	$	233.2
Restricted cash		2.4		12.1
Receivables, net		639.2		524.2
Inventories, net		606.1		583.7
Other current assets		208.9		222.4
Total current assets		1,792.4		1,575.6
Property, plant and equipment, net		725.0		708.8
Goodwill		2,523.1		2,428.8
Intangible assets, net		739.3		756.6
Other assets		183.8		252.1
Total Assets	$	5,963.6	$	5,721.9
Liabilities and Shareholders’ Equity
Current liabilities	$	631.5	$	606.9
Other long-term liabilities		351.0		348.3
Long-term debt		82.6		81.6
Minority interest		2.7		2.3
Shareholders’ equity		4,895.8		4,682.8
Total Liabilities and Shareholders’ Equity	$	5,963.6	$	5,721.9

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ZIMMER HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2006 and 2005
(in millions, unaudited)

	2006			2005
Cash flows provided by (used in) operating activities
Net earnings	$	406.5		$	364.3
Depreciation and amortization		93.5			90.4
Share-based compensation		39.0			—
Inventory step-up		—			4.1
Income tax benefits from stock option exercises		3.3			28.1
Excess income tax benefits from stock option exercises		(2.5	)		—
Changes in operating assets and liabilities
Income taxes		72.3			51.8
Receivables		(100.5	)		(66.6	)
Inventories		(11.0	)		(58.6	)
Accounts payable and accrued expenses		(16.0	)		(1.1	)
Other assets and liabilities		23.3			(16.3	)
Net cash provided by operating activities		507.9			396.1
Cash flows provided by (used in) investing activities
Additions to instruments		(62.5	)		(90.6	)
Additions to other property, plant and equipment		(52.3	)		(42.2	)
Implex acquisition, net of acquired cash		(8.5	)		—
Proceeds from sale of property, plant and equipment		16.2			—
Other		(5.0	)		(9.7	)
Net cash used in investing activities		(112.1	)		(142.5	)
Cash flows provided by (used in) financing activities
Proceeds from employee stock compensation plans		16.2			52.1
Excess income tax benefits from stock option exercises		2.5			—
Repurchase of common stock		(316.4	)		—
Net proceeds on lines of credit		—			174.7
Payments on term loan		—			(550.0	)
Debt issuance costs		—			(1.9	)
Net cash used in financing activities		(297.7	)		(325.1	)
Effect of exchange rates on cash and equivalents		4.5			(4.3	)
Increase (decrease) in cash and equivalents		102.6			(75.8	)
Cash and equivalents, beginning of period		233.2			154.6
Cash and equivalents, end of period	$	335.8		$	78.8

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ZIMMER HOLDINGS, INC.
NET SALES BY GEOGRAPHIC SEGMENT
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2006 and 2005
(in millions, unaudited)

	Three Months Ended June 30,							Six Months Ended June 30,
	2006		2005		% Inc/(Dec)			2006		2005		% Inc/(Dec)
Americas	$	520.9	$	494.7		5	%	$	1,036.9	$	975.1		6	%
Europe		238.4		228.1		5			467.1		462.7		1
Asia Pacific		122.3		124.0		(1	)		238.0		237.5		0
Total	$	881.6	$	846.8		4		$	1,742.0	$	1,675.3		4

ZIMMER HOLDINGS, INC.
NET SALES BY PRODUCT CATEGORY
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2006 and 2005
(in millions, unaudited)

	Three Months Ended June 30,							Six Months Ended June 30,
	2006		2005		% Inc/(Dec)			2006		2005		% Inc/(Dec)
Reconstructive	$	733.4	$	704.9		4	%	$	1,451.3	$	1,394.3		4	%
Trauma		49.1		44.4		11			95.8		89.8		7
Spine		46.0		41.1		12			89.1		79.4		12
OSP and other		53.1		56.4		(6	)		105.8		111.8		(5	)
Total	$	881.6	$	846.8		4		$	1,742.0	$	1,675.3		4

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ZIMMER HOLDINGS, INC.
RECONCILIATION OF REPORTED % GROWTH TO
CONSTANT CURRENCY % GROWTH
(unaudited)

	For the Three Months Ended
	June 30, 2006
							Constant
	Reported			FX			Currency
	% Growth			Impact			% Growth
Geographic Segments
Americas		5	%		0	%		5	%
Europe		5			(1	)		6
Asia Pacific		(1	)		(4	)		3
Total		4			(1	)		5
Product Categories
Reconstructive
Americas		6			0			6
Europe		3			(2	)		5
Asia Pacific		(2	)		(4	)		2
Total		4			(1	)		5
Knees
Americas		4			0			4
Europe		7			(1	)		8
Asia Pacific		(2	)		(4	)		2
Total		4			(1	)		5
Hips
Americas		6			0			6
Europe		(1	)		(1	)		0
Asia Pacific		(6	)		(5	)		(1	)
Total		2			(1	)		3
Extremities		15			0			15
Dental		16			1			15
Trauma		11			(1	)		12
Spine		12			0			12
OSP and other		(6	)		(1	)		(5	)

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ZIMMER HOLDINGS, INC.
RECONCILIATION OF REPORTED % GROWTH TO
CONSTANT CURRENCY % GROWTH
(unaudited)

	For the Six Months Ended
	June 30, 2006
							Constant
	Reported			FX			Currency
	% Growth			Impact			% Growth
Geographic Segments
Americas		6	%		0	%		6	%
Europe		1			(5	)		6
Asia Pacific		0			(7	)		7
Total		4			(2	)		6
Product Categories
Reconstructive
Americas		7			0			7
Europe		0			(5	)		5
Asia Pacific		0			(6	)		6
Total		4			(2	)		6
Knees
Americas		6			0			6
Europe		3			(6	)		9
Asia Pacific		0			(6	)		6
Total		5			(2	)		7
Hips
Americas		7			1			6
Europe		(4	)		(5	)		1
Asia Pacific		(4	)		(8	)		4
Total		1			(3	)		4
Extremities		13			(1	)		14
Dental		18			(1	)		19
Trauma		7			(2	)		9
Spine		12			(1	)		13
OSP and other		(5	)		(2	)		(3	)

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ZIMMER HOLDINGS, INC.
Reconciliation of Net Earnings, Adjusted Net Earnings and
Adjusted Net Earnings, excluding the effects of share-based payment
For the Three Months Ended June 30, 2006 and 2005
(in millions, unaudited)

	Three Months
	Ended June 30,
	2006			2005
Net Earnings	$	200.9		$	190.7
Acquisition, integration and other		6.3			10.1
Inventory step-up		—			2.1
Tax benefit of acquisition, integration and other and inventory step-up		(1.1	)		(3.7	)
Adjusted Net Earnings		206.1			199.2
Share-based payment, net of tax		13.9			—
Adjusted Net Earnings, excluding the effects of share-based payment	$	220.0		$	199.2

ZIMMER HOLDINGS, INC.
Reconciliation of Net Earnings, Adjusted Net Earnings and
Adjusted Net Earnings, excluding the effects of share-based payment
For the Six Months Ended June 30, 2006 and 2005
(in millions, unaudited)

	Six Months
	Ended June 30,
	2006		2005
Net Earnings	$	406.5	$	364.3
Acquisition, integration and other		4.5		27.0
Inventory step-up		—		4.1
Tax expense (benefit) of acquisition, integration and other and inventory step-up		0.1		(9.3	)
Adjusted Net Earnings		411.1		386.1
Share-based payment, net of tax		26.8		—
Adjusted Net Earnings, excluding the effects of share-based payment	$	437.9	$	386.1

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ZIMMER HOLDINGS, INC.
Reconciliation of Diluted EPS, Adjusted Diluted EPS and
Adjusted Diluted EPS, excluding the effects of share-based payment
For the Three Months Ended June 30, 2006 and 2005
(unaudited)

	Three Months
	Ended June 30,
	2006			2005
Diluted EPS	$	0.81		$	0.76
Acquisition, integration and other		0.03			0.04
Inventory step-up		—			0.01
Tax benefit of acquisition, integration and other and inventory step-up		(0.01	)		(0.01	)
Adjusted Diluted EPS		0.83			0.80
Share-based payment, net of tax		0.06			—
Adjusted Diluted EPS, excluding the effects of share-based payment	$	0.89		$	0.80

ZIMMER HOLDINGS, INC.
Reconciliation of Diluted EPS, Adjusted Diluted EPS and
Adjusted Diluted EPS, excluding the effects of share-based payment
For the Six Months Ended June 30, 2006 and 2005
(unaudited)

	Six Months
	Ended June 30,
	2006		2005
Diluted EPS	$	1.63	$	1.46
Acquisition, integration and other		0.02		0.11
Inventory step-up		—		0.02
Tax benefit of acquisition, integration and other and inventory step-up		—		(0.04	)
Adjusted Diluted EPS		1.65		1.55
Share-based payment, net of tax		0.11		—
Adjusted Diluted EPS, excluding the effects of share-based payment	$	1.76	$	1.55

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ZIMMER HOLDINGS, INC.
Reconciliation of Net Margin, Adjusted Net Margin and
Adjusted Net Margin excluding the effects of share-based payment
For the Three and Six Months Ended June 30, 2006
(unaudited)

	Three Months Ended			Six Months Ended
	June 30,			June 30,
	2006			2006
Net Margin		22.8	%		23.3	%
Acquisition, integration and other, net of tax		0.6			0.3
Adjusted Net Margin		23.4			23.6
Share-based payment, net of tax		1.6			1.5
Adjusted Net Margin excluding the effects of share-based payment		25.0	%		25.1	%

ZIMMER HOLDINGS, INC.
Reconciliation of Operating Margin, Adjusted Operating Margin and
Adjusted Operating Margin excluding the effects of share-based payment
For the Three and Six Months Ended June 30, 2006
(unaudited)

	Three Months Ended			Six Months Ended
	June 30,			June 30,
	2006			2006
Operating Margin		32.0	%		32.9	%
Acquisition, integration and other		0.7			0.2
Adjusted Operating Margin		32.7			33.1
Share-based payment		2.2			2.2
Adjusted Operating Margin excluding the effects of share-based payment		34.9	%		35.3	%

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ZIMMER HOLDINGS, INC.
Reconciliation of Gross Margin, Adjusted Gross Margin and
Adjusted Gross Margin excluding the effects of share-based payment
For the Three and Six Months Ended June 30, 2006
(unaudited)

	Three Months Ended			Six Months Ended
	June 30,			June 30,
	2006			2006
Gross Margin and Adjusted Gross Margin		77.3	%		77.6	%
Share-based payment		0.2			0.3
Adjusted Gross Margin excluding the effects of share-based payment		77.5	%		77.9	%

ZIMMER HOLDINGS, INC.
RECONCILIATION OF 2006 PROJECTED DILUTED EPS
AND PROJECTED ADJUSTED DILUTED EPS
(unaudited)

Projected Three Months Ended September 30, 2006:
Diluted EPS	$	0.74
Acquisition, integration and other, net of tax		0.01
Adjusted Diluted EPS	$	0.75
Projected Three Months Ended December 31, 2006:
Diluted EPS	$	0.98
Acquisition, integration and other, net of tax		0.01
Adjusted Diluted EPS	$	0.99

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