Summary of ZIMMER HOLDINGS INC

Results of Operations and Financial Condition, Financial Statements and Exhib

Item 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On October 22, 2009, Zimmer Holdings, Inc. (the "Registrant") reported its results of operations for the quarter ended September 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. Adjusted operating profit for the third quarter of 2009 excludes the effects of inventory step-up, acquisition, integration, realignment and other expenses and a provision for known and anticipated claims relating to the 2008 temporary suspension of marketing and distribution of the Durom® Acetabular Component in the U.S. Adjusted diluted EPS and adjusted earnings for the quarter exclude the effects of those items, net of tax. Adjusted net earnings for the nine months ended September 30, 2009 and projected adjusted diluted EPS for the full year 2009 exclude the effects of those items and a net curtailment and settlement gain recognized during the second quarter of 2009, net of tax. Adjusted net earnings and adjusted diluted EPS for the 2008 periods presented in the press release exclude the effects of those items, other than the net curtailment and settlement gain recognized in 2009, as well as a tax benefit recorded in the third quarter of 2008 related to a civil settlement amount paid in 2007.
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. Management considers the provision related to the Durom Acetabular Component a non-recurring item that, as explained in the press release, is qualitatively different from the Registrant's routine product liability claims.
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

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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.