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EXHIBIT 11
KMART CORPORATION
INFORMATION ON COMPUTATION OF PER SHARE EARNINGS
($ Millions) Fiscal Year Ended
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January 28, January 29, January 31, January 25, January 26,
1998 1997 1996* 1995* 1994*
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I. Basic earnings per common share:
Income (loss) from continuing operations before
extraordinary item and the effect of accounting changes $ 249 $ 231 $(230) $ 96 $(179)
Less: Series B and C convertible preferred shares dividend -- -- (6) (9) (9)
payment ------------------------------------------------------------------
(a) Income (loss) available to common shareholders from continuing
operations before extraordinary item 249 231 (236) 87 (188)
and the effect of accounting changes
(b) Discontinued operations including the effect of accounting
changes, net of income taxes -- (5) (260) 83 (234)
(c) Gain (loss) on disposal of discontinued operations,
net of income taxes -- (446) (30) 117 (520)
(d) Extraordinary item, net of income taxes -- -- (51) -- (10)
(e) Effect of accounting changes, net of income taxes -- -- -- -- (31)
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(f) Adjusted net income (loss) (1) $ 249 $ (220) $(577) $ 287 $(983)
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(g) Weighted average common shares outstanding 487.1 483.6 459.8 427.2 408.1
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Basic earnings per common share:
Income (loss) available to common shareholders from
continuing operations
before extraordinary item and the $ 0.51 $ 0.48 $(0.51) $0.20 $(0.46)
effect of accounting changes (a)/(g)
Discontinued operations including the effect of accounting
changes, net of income taxes (b)/(g) -- (0.01) (0.57) 0.20 (0.57)
Gain (loss) on disposal of discontinued operations,
net of income taxes (c)/(g) -- (0.92) (0.06) 0.27 (1.27)
Extraordinary item, net of income taxes (d)/(g) -- -- (0.11) -- (0.02)
Effect of accounting changes, net of income taxes (e)/(g) -- -- -- -- (0.08)
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Net income (loss) (f)/(g) $ 0.51 $ (0.45) $(1.25) $ 0.67 $(2.40)
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* Prior year amounts have been restated for the
effect of discontinued operations.
(1) Adjusted net income (loss) included an after-tax provision of $81
million or $0.17 per share for fiscal 1997 related to the non recurring
charge for the voluntary early retirement program, $150 million or $0.33
per share for fiscal 1995 related to the adoption of Financial Accounting
Standard No. 121 "Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to Be Disposed Of" and an after-tax provision of $579
million or $1.27 per share for fiscal 1993 for store restructuring and
other charges.
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KMART CORPORATION
INFORMATION ON COMPUTATION OF PER SHARE EARNINGS
($ Millions) Fiscal Year Ended
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January 28, January 29, January 31, January 25, January 26,
1998 1997 1996* 1995* 1994*
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II Earnings per common and common equivalent share assuming
dilution:
Income (loss) from continuing operations before
extraordinary item
and the effect of accounting changes $ 249 $ 231 $ (230) $ 96 $ (179)
Add: Dividends Preferred Stock, Net 49 31 -- -- --
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(h) Adjusted Income (loss) from continuing operations before
extraordinary item and the effect of accounting changes 298 262 (230) 96 (179)
(i) Discontinued operations including the effect of accounting
changes, net of income taxes -- (5) (260) 83 (234)
(j) Gain (loss) on disposal of discontinued operations,
net of income taxes -- (446) (30) 117 (520)
(k) Extraordinary item, net of income taxes -- -- (51) -- (10)
(l) Effect of accounting changes, net of income taxes -- -- -- -- (31)
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(m) Adjusted net income (loss)(1) $ 298 $ (189) $ (571) $ 296 $ (974)
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Weighted average common shares outstanding 487.1 483.6 459.8 427.2 408.1
Weighted average $3.41 Depository Shares outstanding
(each representing 1/4 share Series A conversion preferred) -- -- -- 29.2 46.0
Weighted average Series B and C convertible preferred
shares outstanding -- -- -- 9.7 8.0
Weighted Average Trust Convertible Preferred 66.7 41.4 -- -- --
Stock Options:
Common shares assumed issued 16.3 13.0 1.6 2.2 16.1
Less: common shares assumed repurchased (11.7) (10.5) (1.5) (2.0) (13.5)
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4.6 2.5 0.1 0.2 2.6
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(n) Applicable common shares, as adjusted 558.4 527.5 459.9 466.3 464.7
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Diluted earnings per common and common equivalent share:
Adjusted income (loss) from continuing operations before
extraordinary item and the effect of accounting
changes (h)/(n) $ 0.53 $ 0.50 $ (0.50) $ 0.21 $(0.39)
Discontinued operations including the effect of accounting
changes, net of income taxes (i)/(n) -- (0.01) (0.57) 0.17 (0.50)
Gain (loss) on disposal of discontinued operations,
net of income taxes (j)/(n) -- (0.85) (0.06) 0.25 (1.12)
Extraordinary item, net of income taxes (k)/(n) -- -- (0.11) -- (0.02)
Effect of accounting changes, net of income taxes (l)/(n) -- -- -- -- (0.07)
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Net income (loss) (m)/(n) $ 0.53 $ $ (0.36) $ (1.24) $ 0.63 $(2.10)
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(2) (2) (2) (2) (2)
*Prior year amounts have been restated for the effect of discontinued
operations.
(1) Adjusted net income (loss) included an after tax provision of $81
million or $0.15 per share for fiscal 1997 related to the charge for the
voluntary early retirement program, an after tax provision of $150 million
or $0.33 per share for fiscal 1995 related to the adoption of Financial
Accounting Standard No. 121 "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of" and an after tax
provision of $579 million or $1.25 per share for fiscal 1993 for store
restructing and other charges.
2) This calculation is submitted in accordance with Regulation S-K item
601(b)(11) although it is contrary to paragraph 13 of SFAS 128 because it
produces an anti-dilutive result.
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