Mondi Limited

Notes to the financial statements and
consolidated financial statements
continued
for the year ended 31 December 2010
1 Accounting policies (continued)
Treasury shares
The purchase by any Group entity of Mondi Limited’s equity instruments results in the recognition of treasury shares. The
consideration paid is deducted from equity. Where treasury shares are subsequently sold, reissued or otherwise disposed of, any
consideration received is included in equity attributable to the equity holders of Mondi Limited, net of any directly attributable
incremental transaction costs and the related tax effects.
Dividend payments
Dividend distributions to Mondi Limited’s ordinary equity holders are recognised as a liability in the period in which the dividends
are declared and approved. Final dividends are accrued when approved by Mondi Limited’s ordinary equity holders at its annual
general meeting and interim dividends are recognised when approved by the board.
Special items
Special items are those items of financial performance that the Group and Company believe should be separately disclosed to
assist in the understanding of the underlying financial performance achieved by the Group and its businesses. Such items are
material by nature or amount in relation to the financial year’s results.
Earnings per share (EPS)
Basic EPS
Basic EPS is calculated by dividing net profit attributable to ordinary equity holders of the parent company by the weighted average
number of ordinary Mondi Limited shares in issue during the year, net of treasury shares. For this purpose, net profit is defined as
the profit after tax and special items attributable to equity holders of the parent company.
Diluted EPS
For diluted EPS, the weighted average number of Mondi Limited ordinary shares in issue, net of treasury shares, is adjusted to
assume conversion of all dilutive potential ordinary shares, such as share awards granted to employees. Potential or contingent
share issuances are treated as dilutive when their conversion to shares would decrease net EPS. The effect of anti-dilutive potential
shares is excluded from the calculation of diluted EPS.
Underlying and headline EPS
Underlying EPS excludes the impact of special items and is a non-IFRS measure. It is included to provide an additional basis on
which to measure the Group’s earnings performance. The presentation of headline EPS is mandated under the JSE Listings
Requirements and is calculated in accordance with Circular 3/2009, ‘Headline Earnings’, as issued by the South African Institute of
Chartered Accountants.
Segmental reporting
The Group’s operating segments are reported in a manner consistent with the internal reporting provided to the DLC executive
committee, being the chief operating decision-making body.
28 Annual report and accounts 2010