page 114 Bombardier Inc. Annual Report 2003-04 16 EARNINGS (LOSS) PER SHARE Basic and diluted earnings (loss) per share were as shown below for the years ended January 31. The number of shares and options in the table are expressed in thousands. For the year ended January 31, 2004, a total of 42,799,520 stock options (22,980,375 options for the year ended January 31, 2003) were excluded from the calculation of diluted earnings per share from discontinued operations, since the average market value of the underlying shares was less than the exercise price or the predetermined target market price thresholds of the Corporation’s Class B Shares (Subordinate Voting) for the year. For fiscal years ended January 31, 2004 and 2003, the effect of stock options potentially exercisable on loss per common share from continuing operations was anti-dilutive; therefore, basic and diluted loss per share from continuing operations are the same. Interest expense, net was as follows for the years ended January 31: 17 INTEREST EXPENSE, NET BC’s interest expense is classified as cost of sales. 2004 2003 Loss from continuing operations $(195) $(709) Preferred share dividends, net of tax (30) (29) Loss from continuing operations attributed to common shareholders (225) (738) Income from discontinued operations, net of tax 106 94 Loss attributed to common shareholders $(119) $(644) Weighted average number of common shares outstanding 1,670,690 1,372,747 Net effect of stock options 299 7,263 Weighted average diluted number of common shares outstanding 1,670,989 1,380,010 Basic and diluted earnings (loss) per share: From continuing operations $(0.13) $(0.54) From discontinued operations 0.06 0.07 $(0.07) $(0.47) 2004 2003 Bombardier Interest expense on: Short-term borrowings $ 66 $ 61 Long-term debt 140 129 Sales incentives 49 47 Interest income (19) (21) 236 216 BC Interest expense on: Short-term borrowings 18 42 Long-term debt 168 230 186 272 $ 422 $ 488