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FORM 10-K FOR FISCAL YEAR ENDED DECEMBER 31, 2006NOTES TO CONSOLIDATED FINANCIAL STATEMENTS2. Earnings Per Share
Basic earnings per share (“Basic EPS”) have been computed
using the weighted average number of common shares outstanding during the
respective periods. Diluted earnings per share (“Diluted EPS”) for all periods
also assumes, as of the beginning of the period, exercise of stock options and
restricted stock grants using the treasury stock method. Certain of our stock
options and restricted stock that would potentially dilute Basic EPS in the
future were also antidilutive for the 2006, 2005, and 2004 periods and are
discussed below. The following is a reconciliation of the numerators and
denominators used in the calculation of Basic and Diluted EPS for the years
ended December 31, 2006, 2005, and 2004: |
2006
2005
2004
Net Per Share Net Per Share Net Per Share Income Shares Amount Income Shares Amount Income Shares Amount Basic EPS: Net Income and Share Amounts $
161,565,34029,265,366 $
5.52$
115,778,45628,496,275 $
4.06$68,450,917
27,822,413
$2.46
Dilutive Securities: Restricted Stock --
168,759
--
61,516
--
--
Stock Options --
581,891 --
736,937
--
524,860
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Diluted EPS: Net Income and Assumed Share Conversions $
161,565,34030,016,016
$
5.38$
115,778,45629,294,728
$
3.95$68,450,917
28,347,273
$2.41
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Options to purchase approximately 1.5 million shares at an average exercise price of $24.59 were outstanding at December 31, 2006, while options to purchase 2.1 million shares at an average exercise price of $21.28 were outstanding at December 31, 2005, and options to purchase 3.0 million shares at an average exercise price of $18.51 were outstanding at December 31, 2004. Approximately 1.0 million, 0.1 million, and 1.1 million options to purchase shares were not included in the computation of Diluted EPS for the years ended December 31, 2006, 2005, and 2004, respectively, because these options were antidilutive, in that the sum of the option price, unrecognized compensation expense and excess tax benefits recognized as proceeds in the treasury stock method was greater than the average closing market price for the common shares during those periods. Employee restricted stock grants of 334,425 shares, 6,990 shares and 70,900 shares, were not included in the computation of Diluted EPS for the year ended December 31, 2006, 2005, and 2004, respectively, because these restricted stock grants were antidilutive in that the sum of the unrecognized compensation expense and excess tax benefits recognized as proceeds under the treasury stock method was greater than the average closing market price for the common shares during that period. Other restricted stock grants of 15,000 shares, which were issued in 2004, were not included in the computation of Diluted EPS for the year ended December 31, 2005, as performance conditions surrounding the vesting of these shares had not occurred.
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