EXHIBIT 11. STATEMENT RE: COMPUTATION OF BASIC EARNINGS PER SHARE AND DILUTED EARNINGS PER SHARE (Unaudited) Eli Lilly and Company and Subsidiaries Three Months Nine Months Ended September 30, Ended September 30, 1998 1997 1998 1997 ------------------------------------------------------- (In millions except per-share data) BASIC: Net income (loss)................ $ 518.2 $ 456.9 $1,530.6 $ (842.6) Preferred stock dividends........ (.2) (0.7) (1.5) (2.0) -------- -------- -------- -------- Adjusted net income (loss)....... $ 518.0 $ 456.2 $1,529.1 $ (844.6) ======== ======== ======== ======== Average number of common shares outstanding................... 1,091.6 1,101.8 1,096.9 1,101.1 Contingently issuable shares..... - - .4 - Adjusted average shares.......... 1,091.6 1,101.8 1,097.3 1,101.1 ======== ======== ======== ======== Basic earnings (loss) per share......................... $ 0.47 $ 0.41 $ 1.39 $ (0.77) ======== ======== ======== ======== DILUTED: Net income (loss)................ $ 518.2 $ 456.9 $1,530.6 $ (842.6) Preferred stock dividends........ (0.2) (0.7) (1.5) (2.0) -------- -------- -------- -------- Adjusted net income (loss)....... $ 518.0 $ 456.2 $1,529.1 $ (844.6) ======== ======== ======== ======== Average number of common shares outstanding................... 1,091.6 1,101.8 1,096.9 1,101.1 Incremental shares: Stock plans and contingently issuable shares............... 26.6 28.0 27.6 - -------- -------- -------- -------- Adjusted average shares.......... 1,118.2 1,129.9 1,124.5 1,101.1 ======== ======== ======== ======== Diluted earnings (loss) per share..................... $ 0.46 $ 0.40 $ 1.36 $ (0.77) ======== ======== ======== ======== For 1997, because the inclusion of stock options and other incremental shares would be antidilutive, earnings per share has been calculated assuming no incremental shares.