28 Earnings per share

Basic earnings per share are determined by dividing net profit for the period by the weighted average number of Snam shares in issue during the period, excluding treasury shares.

Diluted earnings per share are determined by dividing net profit by the weighted average number of outstanding shares during the period, excluding treasury shares, increased by the number of shares which could potentially be issued following the allocation or disposal of treasury shares held for stock option plans.

The weighted average number of outstanding shares used to calculate diluted earnings per share was 3,379,132,663 and 3,380,325,175 respectively in the first halves of 2013 and 2014. In the first half of 2014, all existing stock options, all of which related to the 2008 allocation plan, had been exercised. At 30 June 2014, no stock options existed.

The reconciliation of the weighted average number of outstanding shares used to determine basic and diluted earnings per share is set out below: