8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 23, 2009

ZIMMER HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-16407	13-4151777
(State or other	(Commission	(IRS Employer
jurisdiction of	File Number)	Identification No.)
incorporation)

345 East Main Street
Warsaw, Indiana 46580
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (574) 267-6131

Not applicable
(Former name or former address, if changed since last report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

     On July 23, 2009, Zimmer Holdings, Inc. (the “Registrant”) reported its results of operations for the quarter ended June 30, 2009. The Registrant’s earnings release is attached as Exhibit 99.1 and the information set forth therein is incorporated herein by reference and constitutes a part of this report.

     The earnings release attached as Exhibit 99.1 includes two types of non-GAAP financial measures that differ from financial measures calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These non-GAAP financial measures may not be comparable to similar measures reported by other companies and should be considered in addition to, and not as a substitute for, or superior to, other measures prepared in accordance with GAAP. The first type of non-GAAP financial measure included in the press release consists of sales information reported on a constant currency basis which has been calculated by translating actual current and prior-period sales at the same predetermined exchange rate. The translated results are then used to determine year-over-year percentage increases or decreases that exclude the effect of changes in foreign currency exchange rates.

     The second type of non-GAAP financial measure included in the press release consists of operating performance measures that have been adjusted to exclude certain items. The Registrant has presented adjusted net earnings, adjusted diluted EPS and projected adjusted diluted EPS to exclude the effects of inventory step-up, acquisition, integration, realignment and other expenses and net curtailment and settlement gain, net of tax.

     Management uses this non-GAAP information internally to evaluate the performance of the business and believes that it provides useful information to investors by offering the ability to make more meaningful period-to-period comparisons of the Registrant’s on-going operating results, the ability to better identify operating trends that may otherwise be masked or distorted by these types of items and to perform related trend analysis, and a higher degree of transparency of certain items.

     All of the non-GAAP financial measures are reconciled to the most directly comparable GAAP financial measure in the press release.

     The Registrant is furnishing the information contained in this report, including the Exhibit, pursuant to Item 2.02 of Form 8-K promulgated by the Securities and Exchange Commission (the “SEC”). This information shall not be deemed to be “filed” with the SEC or incorporated by reference into any other filing with the SEC. By filing this report on Form 8-K and furnishing this information, the Registrant makes no admission as to the materiality of any information in this report, including the Exhibit.

Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS

     (d) Exhibits

Exhibit No.	Description
99.1	Press Release, dated July 23, 2009, issued by the Registrant

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: July 23, 2009

ZIMMER HOLDINGS, INC.
By: Name:	/s/ Chad F. Phipps Chad F. Phipps
Title:	Senior Vice President, General Counsel and Secretary

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release, dated July 23, 2009, issued by the Registrant

EX-99.1

Exhibit 99.1

Contacts:

Media	Investors
Brad Bishop	Paul Blair	James T. Crines
574-372-4291	574-371-8042	574-372-4264
bradley.bishop@zimmer.com	paul.blair@zimmer.com	james.crines@zimmer.com

	Zimmer Holdings, Inc. Reports Second Quarter 2009 Financial Results
•	Net Sales of $1.02 billion represents a decrease of 5.5% reported (0.6% constant currency)
•	Diluted EPS for the second quarter were $0.98 reported, a decrease of 1.0% from the prior year period, and $1.00 adjusted, a decrease of 2.9% from the prior year period
•	Reaffirms full-year sales and adjusted EPS guidance

(WARSAW, IN) July 23, 2009—Zimmer Holdings, Inc. (NYSE and SWX: ZMH) today reported financial results for the quarter ended June 30, 2009. The Company reported second quarter net sales of $1.02 billion, a decrease of 5.5% reported and 0.6% constant currency from the second quarter of 2008. Diluted earnings per share for the quarter were $0.98 reported and $1.00 adjusted, a decrease of 2.9% adjusted from the prior year period.

“Our second quarter results provide further evidence that we are successfully stabilizing our business and making progress toward restoring positive momentum,” said David Dvorak, Zimmer President and CEO. “We achieved sequential improvement in revenue on a day-rate basis for the quarter in six of our seven product categories, including Knees and Hips. We are once again reaffirming our 2009 sales and earnings guidance.”

Net earnings for the second quarter were $210.1 million on a reported basis and $215.5 million on an adjusted basis, a decrease of 9.0% adjusted from the prior year period. Operating cash flow for the second quarter was $195.1 million. Net earnings for the first six months of 2009 were $412.3 million on a reported basis and $425.5 million on an adjusted basis, a decrease of 11.6% adjusted from the prior year period.

During the quarter, the Company utilized $36 million of cash to acquire 0.8 million shares under its $1.25 billion repurchase program. At the end of the quarter, $797 million of share repurchase authorization remained available under this program, which expires on December 31, 2009.

Guidance

The Company reaffirmed its full year 2009 sales and earnings guidance. Full year revenues for 2009 are expected to increase between 1% and 3% on a constant currency basis. Assuming foreign currency exchange rates remain consistent with current levels, the Company estimates that foreign currency translation will reduce revenue for 2009 by approximately 2.5%. Full year 2009 adjusted diluted earnings per share are projected to be in a range of $3.85 to $4.00.

Conference Call

The Company will conduct its second quarter 2009 investor conference call today, July 23, 2009, at 8:00 a.m. Eastern Time. The live audio webcast can be accessed via Zimmer’s Investor Relations website at http://investor.zimmer.com. It will be archived for replay following the conference.

Individuals who wish to dial into the conference call may do so at (888) 881-6248. International callers should dial (706) 634-6422. A digital recording will be available two hours after the completion of the conference call from July 23, 2009 to August 6, 2009. To access the recording, U.S./Canada callers should dial (800) 642-1687, and International callers should dial (706) 645-9291, and enter the Conference ID, 16739971. A copy of this press release and other financial and statistical information

about the periods to be presented in the conference call will be accessible through the Zimmer website at http://investor.zimmer.com.

Sales Tables

The following tables provide sales results by geographic segment and product category, as well as the percentage change compared to the prior year quarter and six months on both a reported and constant currency basis. Beginning in 2009, the Company’s Dental product category sales are no longer included within its Reconstructive products category. Prior year amounts related to Dental product category sales have been reclassified to conform to the 2009 presentation.

NET SALES — THREE MONTHS ENDED JUNE 30, 2009
(in millions, unaudited)

						Constant
	Net		Reported			Currency
	Sales		% Growth			% Growth
Geographic Segments
Americas	$	590		(1	)%		—	%
Europe		280		(14	)		(1	)
Asia Pacific		150		(6	)		(2	)
Total		1,020		(6	)		(1	)
Product Categories
Reconstructive
Americas		441		(2	)		(2	)
Europe		225		(16	)		(3	)
Asia Pacific		114		(5	)		(1	)
Total		780		(7	)		(2	)
Knees
Americas		272		(3	)		(2	)
Europe		108		(14	)		—
Asia Pacific		58		(6	)		—
Total		438		(6	)		(1	)
Hips
Americas		143		(4	)		(3	)
Europe		112		(19	)		(6	)
Asia Pacific		53		(4	)		(2	)
Total		308		(10	)		(4	)
Extremities		34		8			13
Dental		53		(17	)		(12	)
Trauma		57		3			7
Spine		64		18			23
OSP and other		66		1			3

NET SALES — SIX MONTHS ENDED JUNE 30, 2009
(in millions, unaudited)

						Constant
	Net		Reported			Currency
	Sales		% Growth			% Growth
Geographic Segments
Americas	$	1,184		(1	)%		(1	)%
Europe		546		(14	)		—
Asia Pacific		283		(8	)		(4	)
Total		2,013		(6	)		(1	)
Product Categories
Reconstructive
Americas		884		(2	)		(1	)
Europe		444		(15	)		(2	)
Asia Pacific		214		(7	)		(3	)
Total		1,542		(7	)		(2	)
Knees
Americas		548		(2	)		(2	)
Europe		213		(13	)		1
Asia Pacific		106		(8	)		(1	)
Total		867		(6	)		(1	)
Hips
Americas		285		(4	)		(3	)
Europe		219		(17	)		(5	)
Asia Pacific		104		(5	)		(5	)
Total		608		(10	)		(4	)
Extremities		67		6			10
Dental		100		(16	)		(11	)
Trauma		114		3			6
Spine		129		19			23
OSP and other		128		(11	)		(9	)

About the Company

Founded in 1927 and headquartered in Warsaw, Indiana, Zimmer designs, develops, manufactures and markets orthopaedic reconstructive, spinal and trauma devices, dental implants, and related surgical products. Zimmer has operations in more than 25 countries around the world and sells products in more than 100 countries. Zimmer’s 2008 sales were approximately $4.1 billion. The Company is supported by the efforts of more than 8,000 employees worldwide.

###

For more information about Zimmer, visit www.zimmer.com

Note on Non-GAAP Financial Measures

As used in this press release, the term “adjusted” refers to operating performance measures that exclude inventory step-up, acquisition, integration, realignment and other expenses and net curtailment and settlement gain. The term “constant currency” refers to any financial measure that excludes the effect of changes in foreign currency exchange rates. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measure are included in this press release.

Zimmer Safe Harbor Statement

This press release contains forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 based on current expectations, estimates, forecasts and projections about the orthopaedics industry, management’s beliefs and assumptions made by management. Forward-looking statements may be identified by the use of forward-looking terms such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “projects,” “assumes,” “guides,” “targets,” “forecasts,” and “seeks” or the negative of such terms or other variations on such terms or comparable terminology. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that could cause actual outcomes and results to differ materially. These risks and uncertainties include, but are not limited to, our compliance with the Corporate Integrity Agreement through 2012; the impact of our enhanced healthcare compliance global initiatives and business practices on our relationships with customers and consultants, our market share and our overall financial performance; the success of our quality initiatives; the outcome of the informal investigation by the U.S. Securities and Exchange Commission into Foreign Corrupt Practices Act matters announced in October 2007; price and product competition;

changes in customer demand for our products and services caused by demographic changes or other factors; dependence on new product development, technological advances and innovation; shifts in the product category or regional sales mix of our products and services; supply and prices of raw materials and products; control of costs and expenses; our ability to obtain and maintain adequate intellectual property protection; our ability to successfully integrate acquired businesses; our ability to form and implement alliances; challenges relating to changes in and compliance with governmental laws and regulations affecting our U.S. and international businesses, including regulations of the U.S. Food and Drug Administration and foreign government regulators and tax obligations and risks; the impact of temporarily suspending U.S. distribution of one of our key hip replacement products; product liability and intellectual property litigation losses; reductions in reimbursement levels from third-party payors and cost-containment efforts of healthcare purchasing organizations; our ability to retain the independent agents and distributors who market our products; changes in general industry and market conditions, including domestic and international growth rates and general domestic and international economic conditions, including interest rate and currency exchange rate fluctuations; and the costs of defending or resolving putative class action securities litigation and lawsuits, investigations or other proceedings resulting from our September 2007 settlement with the U.S. government and other matters. For a further list and description of such risks and uncertainties, see our periodic reports filed with the U.S. Securities and Exchange Commission. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be set forth in our periodic reports. Readers of this document are cautioned not to place undue reliance on these forward-looking statements, since, while we believe the assumptions on which the forward-looking statements are based are reasonable, there can be no assurance that these forward-looking statements will prove to be accurate. This cautionary statement is applicable to all forward-looking statements contained in this document.

ZIMMER HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE THREE MONTHS ENDED JUNE 30, 2009 and 2008
(in millions, except per share amounts, unaudited)

	2009			2008			% Inc/(Dec)
Net Sales	$	1,019.9		$	1,079.5			(6	)%
Cost of products sold		236.8			262.3			(11	)
Gross Profit		783.1			817.2			(4	)
Research and development		49.9			48.3			3
Selling, general and administrative		432.3			448.0			(4	)
Acquisition, integration, realignment and other		36.5			12.5			192
Net curtailment and settlement		(32.1	)		—			100
Operating expenses		486.6			508.8			(5	)
Operating Profit		296.5			308.4			(4	)
Interest and other, net		(4.0	)		6.8			(158	)
Earnings before income taxes		292.5			315.2			(7	)
Provision for income taxes		82.4			87.8			(6	)
Net Earnings		210.1			227.4			(7	)
Less: Net earnings attributable to noncontrolling interest		—			(0.3	)		(100	)
Net Earnings of Zimmer Holdings, Inc.	$	210.1		$	227.1			(7	)
Earnings Per Common Share
Basic	$	0.98		$	0.99			(1	)
Diluted	$	0.98		$	0.99			(1	)
Weighted Average Common Shares Outstanding
Basic		214.7			228.4
Diluted		215.5			229.5

Certain amounts in the 2008 consolidated statement of earnings have been reclassified to conform to the 2009 presentation.

ZIMMER HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE SIX MONTHS ENDED JUNE 30, 2009 and 2008
(in millions, except per share amounts, unaudited)

	2009			2008			% Inc/(Dec)
Net Sales	$	2,012.5		$	2,138.7			(6	)%
Cost of products sold		467.1			517.0			(11	)
Gross Profit		1,545.4			1,621.7			(5	)
Research and development		101.7			96.1			6
Selling, general and administrative		856.0			865.8			(1	)
Acquisition, integration, realignment and other		43.5			19.8			120
Net curtailment and settlement		(32.1	)		—			100
Operating expenses		969.1			981.7			(1	)
Operating Profit		576.3			640.0			(10	)
Interest and other, net		(7.7	)		7.8			(198	)
Earnings before income taxes		568.6			647.8			(12	)
Provision for income taxes		156.3			180.9			(14	)
Net Earnings		412.3			466.9			(12	)
Less: Net earnings attributable to noncontrolling interest		—			(0.5	)		(100	)
Net Earnings of Zimmer Holdings, Inc.	$	412.3		$	466.4			(12	)
Earnings Per Common Share
Basic	$	1.89		$	2.02			(6	)
Diluted	$	1.88		$	2.01			(6	)
Weighted Average Common Shares Outstanding
Basic		218.1			230.5
Diluted		218.8			231.7

Certain amounts in the 2008 consolidated statement of earnings have been reclassified to conform to the 2009 presentation.

ZIMMER HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, unaudited)

	June 30,		December 31,
	2009		2008
Assets
Current Assets:
Cash and cash equivalents	$	277.5	$	212.6
Restricted cash		2.7		2.7
Receivables, net		768.7		732.8
Inventories, net		980.9		928.3
Other current assets		298.9		302.2
Total current assets		2,328.7		2,178.6
Property, plant and equipment, net		1,254.4		1,264.1
Goodwill		2,814.6		2,774.8
Intangible assets, net		874.6		872.1
Other assets		189.8		149.4
Total Assets	$	7,462.1	$	7,239.0
Liabilities and Shareholders’ Equity
Current liabilities	$	669.2	$	771.1
Other long-term liabilities		333.8		353.9
Long-term debt		653.5		460.1
Shareholders’ equity		5,805.6		5,653.9
Total Liabilities and Shareholders’ Equity	$	7,462.1	$	7,239.0

ZIMMER HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 2009 and 2008
(in millions, unaudited)

	2009			2008
Cash flows provided by (used in) operating activities
Net earnings of Zimmer Holdings, Inc.	$	412.3		$	466.4
Depreciation and amortization		161.4			129.2
Gain on sale of investments		—			(8.7	)
Net curtailment and settlement		(32.1	)		—
Share-based compensation		40.1			39.4
Inventory step-up		7.0			1.8
Income tax benefits from employee stock compensation plans		0.2			10.0
Excess income tax benefits from employee stock compensation plans		—			(6.0	)
Changes in operating assets and liabilities
Income taxes		4.8			(35.7	)
Receivables		(29.8	)		(81.9	)
Inventories		(51.8	)		(55.6	)
Accounts payable and accrued expenses		(119.4	)		87.6
Other assets and liabilities		(13.0	)		(23.2	)
Net cash provided by operating activities		379.7			523.3
Cash flows provided by (used in) investing activities
Additions to instruments		(75.9	)		(119.5	)
Additions to other property, plant and equipment		(54.7	)		(121.5	)
Acquisition of intellectual property rights		(25.9	)		—
Proceeds from sale of investments		—			12.0
Investments in other assets		(17.8	)		(7.5	)
Net cash used in investing activities		(174.3	)		(236.5	)
Cash flows provided by (used in) financing activities
Net borrowings under credit facilities		200.0			220.0
Proceeds from employee stock compensation plans		3.6			45.2
Excess income tax benefits from employee stock compensation plans		—			6.0
Repurchase of common stock		(337.8	)		(640.2	)
Acquisition of noncontrolling interest		(7.8	)		—
Net cash used in financing activities		(142.0	)		(369.0	)
Effect of exchange rates on cash and cash equivalents		1.5			6.4
Increase in cash and cash equivalents		64.9			(75.8	)
Cash and cash equivalents, beginning of period		212.6			463.9
Cash and cash equivalents, end of period	$	277.5		$	388.1

ZIMMER HOLDINGS, INC.
NET SALES BY GEOGRAPHIC SEGMENT
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2009 and 2008
(in millions, unaudited)

	Three Months Ended June 30,							Six Months Ended June 30,
	2009		2008		% (Dec)			2009		2008		% (Dec)
Americas	$	589.6	$	594.5		(1	)%	$	1,184.2	$	1,201.6		(1	)%
Europe		280.4		325.8		(14	)		545.5		631.3		(14	)
Asia Pacific		149.9		159.2		(6	)		282.8		305.8		(8	)
Total	$	1,019.9	$	1,079.5		(6	)	$	2,012.5	$	2,138.7		(6	)

ZIMMER HOLDINGS, INC.
NET SALES BY PRODUCT CATEGORY
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2009 and 2008
(in millions, unaudited)

	Three Months Ended June 30,							Six Months Ended June 30,
	2009		2008		% Inc/(Dec)			2009		2008		% Inc/(Dec)
Reconstructive	$	780.0	$	841.1		(7	)%	$	1,541.6	$	1,656.6		(7	)%
Dental		52.7		63.3		(17	)		100.1		119.1		(16	)
Trauma		56.7		54.9		3			113.6		110.6		3
Spine		64.2		54.3		18			128.8		108.3		19
OSP and other		66.3		65.9		1			128.4		144.1		(11	)
Total	$	1,019.9	$	1,079.5		(6	)	$	2,012.5	$	2,138.7		(6	)

ZIMMER HOLDINGS, INC.
RECONCILIATION OF REPORTED % GROWTH TO
CONSTANT CURRENCY % GROWTH
(unaudited)

	For the Three Months Ended
	June 30, 2009
				Foreign			Constant
	Reported			Exchange			Currency
	% Growth			Impact			% Growth
Geographic Segments
Americas		(1	)%		(1	)%		—	%
Europe		(14	)		(13	)		(1	)
Asia Pacific		(6	)		(4	)		(2	)
Total		(6	)		(5	)		(1	)
Product Categories
Reconstructive
Americas		(2	)		—			(2	)
Europe		(16	)		(13	)		(3	)
Asia Pacific		(5	)		(4	)		(1	)
Total		(7	)		(5	)		(2	)
Knees
Americas		(3	)		(1	)		(2	)
Europe		(14	)		(14	)		—
Asia Pacific		(6	)		(6	)		—
Total		(6	)		(5	)		(1	)
Hips
Americas		(4	)		(1	)		(3	)
Europe		(19	)		(13	)		(6	)
Asia Pacific		(4	)		(2	)		(2	)
Total		(10	)		(6	)		(4	)
Extremities		8			(5	)		13
Dental		(17	)		(5	)		(12	)
Trauma		3			(4	)		7
Spine		18			(5	)		23
OSP and other		1			(2	)		3

ZIMMER HOLDINGS, INC.
RECONCILIATION OF REPORTED % GROWTH TO
CONSTANT CURRENCY % GROWTH
(unaudited)

	For the Six Months Ended
	June 30, 2009
				Foreign			Constant
	Reported			Exchange			Currency
	% Growth			Impact			% Growth
Geographic Segments
Americas		(1	)%		—	%		(1	)%
Europe		(14	)		(14	)		—
Asia Pacific		(8	)		(4	)		(4	)
Total		(6	)		(5	)		(1	)
Product Categories
Reconstructive
Americas		(2	)		(1	)		(1	)
Europe		(15	)		(13	)		(2	)
Asia Pacific		(7	)		(4	)		(3	)
Total		(7	)		(5	)		(2	)
Knees
Americas		(2	)		—			(2	)
Europe		(13	)		(14	)		1
Asia Pacific		(8	)		(7	)		(1	)
Total		(6	)		(5	)		(1	)
Hips
Americas		(4	)		(1	)		(3	)
Europe		(17	)		(12	)		(5	)
Asia Pacific		(5	)		—			(5	)
Total		(10	)		(6	)		(4	)
Extremities		6			(4	)		10
Dental		(16	)		(5	)		(11	)
Trauma		3			(3	)		6
Spine		19			(4	)		23
OSP and other		(11	)		(2	)		(9	)

ZIMMER HOLDINGS, INC.
Reconciliation of Net Earnings and Adjusted Net Earnings
For the Three Months Ended June 30, 2009 and 2008
(in millions, unaudited)

	Three Months
	Ended June 30,
	2009			2008
Net Earnings	$	210.1		$	227.1
Inventory step-up		2.8			1.5
Acquisition, integration, realignment and other		36.5			12.5
Net curtailment and settlement		(32.1	)		—
Taxes on inventory step-up, acquisition, integration, realignment and other and net curtailment and settlement		(1.8	)		(4.2	)
Adjusted Net Earnings	$	215.5		$	236.9

ZIMMER HOLDINGS, INC.
Reconciliation of Net Earnings and Adjusted Net Earnings
For the Six Months Ended June 30, 2009 and 2008
(in millions, unaudited)

	Six Months
	Ended June 30,
	2009			2008
Net Earnings	$	412.3		$	466.4
Inventory step-up		7.0			1.8
Acquisition, integration, realignment and other		43.5			19.8
Net curtailment and settlement		(32.1	)		—
Taxes on inventory step-up, acquisition, integration, realignment and other and net curtailment and settlement		(5.2	)		(6.8	)
Adjusted Net Earnings	$	425.5		$	481.2

ZIMMER HOLDINGS, INC.
Reconciliation of Diluted EPS and Adjusted Diluted EPS
For the Three Months Ended June 30, 2009 and 2008
(unaudited)

	Three Months
	Ended June 30,
	2009			2008
Diluted EPS	$	0.98		$	0.99
Inventory step-up		0.01			0.01
Acquisition, integration, realignment and other		0.17			0.05
Net curtailment and settlement		(0.15	)		—
Taxes on inventory step-up, acquisition, integration, realignment and other and net curtailment and settlement		(0.01	)		(0.02	)
Adjusted Diluted EPS	$	1.00		$	1.03

ZIMMER HOLDINGS, INC.
Reconciliation of Diluted EPS and Adjusted Diluted EPS
For the Six Months Ended June 30, 2009 and 2008
(unaudited)

	Six Months
	Ended June 30,
	2009			2008
Diluted EPS	$	1.88		$	2.01
Inventory step-up		0.03			0.01
Acquisition, integration, realignment and other		0.20			0.09
Net curtailment and settlement		(0.15	)		—
Taxes on inventory step-up, acquisition, integration, realignment and other and net curtailment and settlement		(0.02	)		(0.03	)
Adjusted Diluted EPS	$	1.94		$	2.08

ZIMMER HOLDINGS, INC.
Reconciliation of 2009 Projected Diluted EPS
and Projected Adjusted Diluted EPS
(unaudited)

Projected Twelve Months Ended December 31, 2009:	Low			High
Diluted EPS	$	3.68		$	3.83
Inventory step-up		0.05			0.05
Acquisition, integration, realignment and other		0.35			0.35
Net curtailment and settlement		(0.15	)		(0.15	)
Taxes on inventory step-up, acquisition, integration, realignment and other and net curtailment and settlement		(0.08	)		(0.08	)
Adjusted Diluted EPS	$	3.85		$	4.00