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Net Income Per Share
9 Months Ended
Sep. 30, 2013
Earnings Per Share [Abstract]  
Net Income Per Share

NOTE 3· Net Income Per Share

Accounting Standards Codification (“ASC”) Topic 260 — Earnings Per Share is the authoritative guidance that states that unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and, therefore, are included in computing earnings per share (“EPS”) pursuant to the two-class method. The two-class method determines EPS for each class of common stock and participating securities according to dividends or dividend equivalents and their respective participation rights in undistributed earnings. Performance stock shares granted to employees under the Company’s Performance Stock Plan and Stock Incentive Plan are considered participating securities as they receive non-forfeitable dividend equivalents at the same rate as common stock.

 

Basic EPS is computed based on the weighted average number of common shares (including participating securities) issued and outstanding during the period. Diluted EPS is computed based on the weighted average number of common shares issued and outstanding plus equivalent shares assuming the exercise of stock options. The dilutive effect of stock options is computed by application of the treasury stock method. The following is a reconciliation between basic and diluted weighted average shares outstanding:

 

    For the three months
ended September 30,
    For the nine months
ended September 30,
 
(in thousands, except per share data)   2013     2012     2013     2012  

Net income

  $ 57,749      $ 49,504      $ 169,887      $ 141,408   

Net income attributable to unvested awarded performance stock

    (1,626     (1,428     (4,092     (4,174
 

 

 

   

 

 

   

 

 

   

 

 

 

Net income attributable to common shares

  $ 56,123      $ 48,076      $ 165,795      $ 137,234   
 

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of common shares outstanding – basic

    145,228        143,607        144,403        143,418   

Less unvested awarded performance stock included in weighted average number of common shares outstanding – basic

    (4,089     (4,142     (3,478     (4,233
 

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of common shares outstanding for basic earnings per common share

    141,139        139,465        140,925        139,185   

Dilutive effect of stock options

    1,650        2,632        1,551        2,584   
 

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of shares outstanding – diluted

    142,789        142,097        142,476        141,769   
 

 

 

   

 

 

   

 

 

   

 

 

 

Net income per share:

       

Basic

  $ 0.40      $ 0.34      $ 1.18      $ 0.99   
 

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

  $ 0.39      $ 0.34      $ 1.16      $ 0.97