EXHIBIT 11
REYNOLDS METALS COMPANY AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE
(In millions, except share data)
EARNINGS PER SHARE:
For 1996 and 1994, earnings per share equals net income, minus
dividends on the Company's convertible preferred stock (PRIDES),
divided by the weighted-average number of common shares
outstanding during the year. For 1995, earnings per share equals
net income divided by the weighted-average number of common
shares and common share equivalents outstanding during the year.
The number of common share equivalents outstanding for 1995 was
based on the assumed conversion of the PRIDES. For the purpose
of this computation, the conversion rate shown below, which
refers to the number of shares of common stock to be received for
each share of PRIDES, was based on the average market value of
common stock during 1995 (also shown below). Common share
equivalents relating to the PRIDES were not included in 1996 and
1994 since their effect would have been anti-dilutive.
YEARS ENDED DECEMBER 31
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1996 1995 1994
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Weighted-average shares outstanding:
Common shares 63,730,000 63,051,000 61,756,000
Common share equivalents - 9,704,000 -
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Total 63,730,000 72,755,000 61,756,000
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Income before cumulative effect of
accounting change $104 $389 $122
Less preferred stock dividends 36 - 34
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$68 $389 $88
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Cumulative effect of accounting change (15) - -
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Net income $53 $389 $88
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Earnings per share:
Income before cumulative effect of
accounting change $1.06 $5.35 $1.42
Cumulative effect of accounting change (0.24) - -
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Net income $0.82 $5.35 $1.42
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Conversion rate - 0.88 -
Average market value of common stock - $53.56 -
EARNINGS PER SHARE (FULLY DILUTED):
For 1996, earnings per share (fully diluted) equals net income
divided by the weighted-average number of common shares
outstanding during the year. For purposes of this calculation,
the PRIDES were assumed to be redeemed or converted into
9,019,990 shares of common stock on January 1, 1996 (see Note 7).
For 1995 and 1994, earnings per share (fully diluted) equals net
income divided by the weighted-average number of common shares
and common share equivalents outstanding during the year. For
the 1995 and 1994 calculation, the number of common share
equivalents outstanding was based on the maximum potential
issuance of common shares upon conversion of the PRIDES, which
was one share of common for each share of PRIDES. These
computations were made for presentation purposes only since the
effect was anti-dilutive in 1996 and 1994 and was not material in
1995. The difference between the number of common share
equivalents for the years ended December 31, 1995 and 1994 is due
to the PRIDES having been issued on January 25, 1994. The
calculation for 1996 is equivalent to supplemental earnings per
share disclosed in Note 1.
YEARS ENDED DECEMBER 31
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1996 1995 1994
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Weighted-average shares outstanding:
Common shares 72,680,000 63,051,000 61,756,000
Common share equivalents - 11,000,000 10,277,000
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Total 72,680,000 74,051,000 72,033,000
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Income before cumulative effect
of accounting change $104 $389 $122
Cumulative effect of accounting change (15) - -
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Net income $89 $389 $122
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Earnings per share (fully diluted):
Income before cumulative effect of
accounting change $1.43 $5.26 $1.69
Cumulative effect of accounting change (0.21) - -
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Net income $1.22 $5.26 $1.69
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