Note 2 – Acquisitions and Divestitures (continued) NOTE 3 – EArNINgs PEr sHArE The following results of operations for this business have been treated as discontinued operations for the years ending December 31,  2010 and 2009. This divestiture had no impact on the year ending December 31, 2011. In 2009, approximately $11.6 million of accumulated foreign currency translation adjustments were recognized as part of the loss on  divestiture of the NRB operations. The following table sets forth the reconciliation of the numerator and the denominator of basic earnings per share and diluted earnings  per share for the years ended December 31: THE TIMKEN COMPANY The exercise prices for certain stock options that the Company has awarded exceed the average market price of the Company’s common  stock. Such stock options are antidilutive and were not included in the computation of diluted earnings per share. The antidilutive stock  options outstanding were 436,850, 980,477 and 4,128,421 during 2011, 2010 and 2009, respectively. 2010 2009 Net sales $  – $ 406.7 Cost of goods sold –  376.3  Gross profit –  30.4  Selling, administrative and general expenses –  59.3  Impairment and restructuring charges –  52.6  Interest expense, net –  0.2  Other expense, net –  1.7  Earnings (loss) before income taxes on operations –  (83.4) Income tax benefit (expense) on operations –  23.5  Gain (loss) on divestiture  11.6   (19.9) Income tax (expense) benefit on disposal  (4.2)  7.2  Income (loss) from discontinued operations $ 7.4 $ (72.6) 2011 2010 2009 Numerator:  Income (loss) from continuing operations attributable to The Timken Company $ 454.3 $ 267.4 $ (61.4) Less: undistributed earnings allocated to nonvested stock  (1.6)  (1.2)  –  Income (loss) from continuing operations available to common shareholders  for basic earnings per share and diluted earnings per share $ 452.7 $ 266.2 $ (61.4) Denominator:  Weighted average number of shares outstanding – basic 97,451,064 96,535,273  96,135,783  Effect of dilutive options and awards  1,204,449   980,929   –  Weighted average number of shares outstanding, assuming dilution of stock  options and awards 98,655,513  97,516,202  96,135,783  Basic earnings (loss) per share from continuing operations $ 4.65 $ 2.76 $ (0.64) Diluted earnings (loss) per share from continuing operations $ 4.59 $ 2.73 $ (0.64) FINANCIAls ANd FOOTNOTEs 53