FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For quarter ended February 28, 1994
Commission file number 001-10915
Healthtrust, Inc. - The Hospital Company
(Exact name of registrant as specified in its charter)
Delaware 62-1234332
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
4525 Harding Road
Nashville, Tennessee 37205
(Address of principal executive (Zip Code)
offices)
(615) 383-4444
Registrant's telephone number, including area code
Not Applicable
Former name, former address and former fiscal year, if changed since last
report.
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter periods that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practical date.
Common Stock, $.001 Par Value - 81,223,177 shares as of
March 25, 1994.
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INDEX
HEALTHTRUST, INC. - THE HOSPITAL COMPANY
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements (Unaudited)
Condensed consolidated balance sheets--
February 28, 1994 and August 31, 1993 3
Condensed consolidated statements of
operations--three months and six months
ended February 28, 1994 and 1993 4
Condensed consolidated statements of
cash flows--six months ended February 28,
1994 and 1993 5
Notes to condensed consolidated
financial statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 7-12
PART II. OTHER INFORMATION
Item 4. Submission of matters to a vote of security
holders 13
Item 6. Exhibits and reports on Form 8-K 13
SIGNATURES 14
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
HEALTHTRUST, INC. - THE HOSPITAL COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands)
<CAPTION>
February 28 August 31
1994 1993
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 159,750 $ 151,346
Accounts receivable, less allowances for
doubtful accounts of $128,281 and $107,758 392,122 346,491
Supplies 54,512 51,740
Other current assets 30,082 121,345
TOTAL CURRENT ASSETS 636,466 670,922
PROPERTY, PLANT AND EQUIPMENT 2,243,721 2,168,365
Less accumulated depreciation 660,167 600,853
1,583,554 1,567,512
EXCESS OF PURCHASE PRICE OVER NET ASSETS ACQUIRED 177,464 178,549
OTHER ASSETS 118,348 119,730
TOTAL ASSETS $ 2,515,832 $2,536,713
CURRENT LIABILITIES
Accounts payable $ 77,741 $ 109,545
Other current liabilities 267,143 342,274
TOTAL CURRENT LIABILITIES 344,884 451,819
LONG-TERM DEBT 931,422 948,604
DEFERRED INCOME TAXES 133,552 133,385
DEFERRED PROFESSIONAL LIABILITY RISKS 148,889 140,124
OTHER LIABILITIES 212,639 207,124
STOCKHOLDERS' EQUITY
Common Stock, $.001 par value; 400,000,000 shares
authorized 81,221,108 and 81,065,074 shares
issued and outstanding 81 81
Paid-in capital 828,330 826,350
Deferred compensation (581) (1,162)
Retained deficit (83,384) (169,612)
STOCKHOLDERS' EQUITY 744,446 655,657
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,515,832 $2,536,713
See accompanying notes.
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HEALTHTRUST, INC. - THE HOSPITAL COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Dollars in thousands, except per share data)
<CAPTION>
Three Months Ended February 28 Six Months Ended February 28
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Net operating revenue $ 652,521 $ 597,884 $ 1,274,616 $ 1,189,663
Costs and expenses:
Hospital service costs:
Salaries and benefits 236,182 218,271 468,445 437,846
Supplies 90,960 84,611 178,950 170,922
Fees 68,361 65,716 133,077 131,700
Other expenses 66,014 54,805 131,754 113,460
Bad debt expense 45,150 38,562 88,740 72,013
506,667 461,965 1,000,966 925,941
Depreciation and amortization 35,058 31,808 69,678 64,921
Interest 20,715 25,309 42,270 50,865
Pension expense 10,614 11,482 20,542 23,066
Deferred compensation expense 291 2,130 581 3,000
Other income (net) (3,229) (3,101) (8,679) (6,257)
570,116 529,593 1,125,358 1,061,536
INCOME BEFORE MINORITY
INTERESTS AND INCOME TAXES 82,405 68,291 149,258 128,127
Minority interests 2,647 4,026 4,089 7,390
INCOME BEFORE INCOME TAXES 79,758 64,265 145,169 120,737
Income tax provision 32,382 26,330 58,941 49,480
NET INCOME $ 47,376 $ 37,935 $ 86,228 $ 71,257
Net income per share $ 0.56 $ 0.45 $ 1.02 $ 0.85
Shares used in computation
of net income per share 84,878,164 83,676,464 84,639,121 83,413,692
See accompanying notes.
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<TABLE>
HEALTHTRUST, INC. - THE HOSPITAL COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Dollars in thousands)
<CAPTION>
Six Months Ended February 28
1994 1993
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 86,228 $ 71,257
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 65,372 61,271
Amortization 4,306 3,650
Non-cash insurance expense 8,765 4,882
Pension expense accrual 20,542 23,066
Increase in accounts and agency receivables (39,989) (24,982)
Decrease in accounts payable and accrued liabilities (62,476) (10,683)
Other (5,456) (9,950)
NET CASH PROVIDED BY OPERATING ACTIVITIES 77,292 118,511
INVESTING ACTIVITIES
Purchases of property, plant and equipment (83,709) (87,465)
Proceeds from sales of property, plant and equipment 97,948 29,760
Other (3,407) (4,647)
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 10,832 (62,352)
FINANCING ACTIVITIES
Principal payments on long-term debt (81,700) (351,250)
Proceeds from long-term borrowings 300,000
Payment of debt issuance costs (4,618)
Other 1,980 (2,921)
NET CASH USED IN FINANCING ACTIVITIES (79,720) (58,789)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 8,404 (2,630)
Cash and cash equivalents at beginning of period 151,346 172,600
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 159,750 $ 169,970
Cash paid during the year for:
Interest $ 44,551 $ 48,325
Income taxes 92,272 53,126
See accompanying notes.
</TABLE>
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HEALTHTRUST, INC. - THE HOSPITAL COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Basis of Presentation
The accompanying unaudited condensed consolidated financial
statements have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly,
they do not include all of the information and footnotes required by
generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. All significant intercompany transactions have been eliminated
in consolidation. Operating results for the three months and six months
ended February 28, 1994 are not necessarily indicative of the results that
may be expected for the fiscal year ending August 31, 1994. For further
information, refer to the consolidated financial statements and footnotes
thereto for the year ended August 31, 1993 (included in the Company's
Annual Report on Form 10-K).
Income Per Share
Income per share has been computed by dividing net income for each
period by the weighted average number of shares and share equivalents
outstanding during the applicable period, adjusted for stock splits.
Fully diluted per share data is not presented since the effect would
dilute earnings per share by less than three percent (3%).
Acquisition of EPIC Holdings
Healthtrust entered into an agreement on January 9, 1994 to acquire
EPIC Holdings, Inc. The agreement provides for the EPIC shareholders to
receive $7.00 for each share of EPIC common stock (approximately $278
million in the aggregate) and Healthtrust will assume or refinance
approximately $733 million of EPIC indebtedness. Healthtrust filed
registration statements with the SEC to offer $200 million of Subordinated
Notes and 5.2 million shares of common stock on February 25, 1994. The
proceeds from these offerings will be utilized in financing the EPIC
acquisition.
EPIC owns and operates 34 hospitals in 10 states and reported net
operating revenue of $272.5 and $1,019.1 million and net losses of $8.3 and
$47.1 million for the three months ended December 31, 1993 and fiscal year
ended September 30, 1993, respectively. The transaction is expected to be
completed by May 1994 and will be recorded using the purchase method of
accounting.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
SELECTED OPERATING STATISTICS
(DOLLARS IN MILLIONS)
Same Hospitals Operating Data (1):
<CAPTION>
Three Months Ended February 28, Six Months Ended February 28,
% Increase %Increase
1994 1993 (Decrease) 1994 1993 (Decrease)
<S> <C> <C> <C> <C> <C> <C>
Number of Hospitals 77 77 77 77
Gross Revenue:
Inpatient $691.9 $622.7 11.1% $1,318.3 $1,213.9 8.6%
Outpatient $310.9 $271.1 14.7% $623.9 $539.7 15.6%
Net Operating Revenue $617.1 $572.4 7.8% $1,205.0 $1,124.4 7.2%
Hospital Service Costs $470.6 $440.0 7.0% $931.4 $867.2 7.4%
Admissions 73,240 68,733 6.6% 140,417 135,066 4.0%
Adjusted Admissions 106,123 98,641 7.6% 206,872 195,116 6.0%
Patient Days 384,056 376,892 1.9% 729,162 737,771 -1.2%
Adjusted Patient Days 556,673 540,921 2.9% 1,074,249 1,065,784 0.8%
Average Length of Stay (days) 5.24 5.48 5.19 5.46
Occupancy Rate 44.1% 42.8% 41.4% 41.6%
Operating Margin 23.7% 23.1% 22.7% 22.9%
(1)The results of operations applicable to hospital acquisitions and dispositions have been excluded.
</TABLE>
General
The Company continues to experience gross and net operating revenue
increases and the Company's results of operations continue to be affected
by the trend toward certain services being performed more frequently on an
outpatient basis. While admissions for the six months ended February 28,
1994 increased 4.0%, patient days declined 1.2% due to a reduction in the
average length of stay from 5.46 days to 5.19 days. The Company has been
able to achieve increases in net operating revenue due to the higher
utilization of outpatient and non-acute specialty services, general price
increases and an increased severity of illness for the patients admitted.
Although the Company's net operating revenue has grown in each period, the
impact of price increases and increases in patient acuity have been
partially offset by the increasing proportion of revenue derived from fixed
payment sources, including Medicare and Medicaid (approximately 44% and
41%, for the six months ended February 28, 1994 and 1993, respectively, of
the Company's net operating revenue was related to Medicare and Medicaid
patients).
The growth in outpatient services is expected to continue as
procedures currently being performed on an inpatient basis become available
on an outpatient basis through continuing advances in pharmaceutical and
medical technologies. The redirection of certain procedures to an
outpatient basis has also been influenced by pressures from payors to
direct certain procedures from inpatient care to outpatient care. While
the Company expects the growth in outpatient services to continue, the rate
of increase is expected to decline.
The Company expects Medicare and Medicaid revenue to continue to
increase due to the general aging of the population and the expansion of
state Medicaid programs. The Medicare program reimburses the Company's
hospitals primarily based on established rates that are dependant on each
patient's diagnosis, regardless of the provider's cost to treat the patient
or the length of time the patient stays in the hospital. The Medicare
program's established rates are indexed for inflation annually, but these
increases have historically been less than both the actual inflation rate
and the Company's increases to its standard charges.
Insurance companies, government programs (other than Medicare) and
employers purchasing health care services for their employees are
negotiating the amounts they will pay health care providers, rather than
paying the providers standard prices. This leads to these purchasers of
health care services becoming managed care payors, similar to HMO's and
PPO's, in virtually all markets and making it increasingly difficult for
providers to maintain their historical net revenue growth trends.
The Congress is currently reviewing various proposals for
comprehensive health care reform. The reform proposals contain coverage
guarantees, benefits standards and cost control mechanisms. The Company
cannot predict what reforms the Congress will adopt, when such reforms will
be implemented or the resulting implications for providers, at this time.
However, the Company believes that the delivery of primary care, emergency
care, obstetrical services and rehabilitative services, on a local basis,
to rural and suburban markets will be an integral component of any strategy
for controlling health care costs and the Company believes it is well
positioned to provide these services.
Three Months Ended February 28, 1994 and 1993
Net operating revenue for the Company's hospitals for the quarter
ended February 28, 1994, increased 9.1% to $652.5 million, while same
hospitals net operating revenue increased 7.8%. Gross revenue during the
quarter ended February 28, 1994, increased 10.5% due to a 15.9% increase
in gross outpatient revenue and an 8.2% increase in gross inpatient
revenue. On a same hospitals basis, gross revenue increased 10.8% compared
to the prior year, due to a 14.7% increase in gross outpatient revenue and
an 11.1% increase in gross inpatient revenue. In each case, gross revenue
grew faster than net operating revenue, primarily because the patient mix
continues to become more heavily weighted to Medicare, Medicaid and
specialty unit patients (for which reimbursement rate increases have been
less than implemented price increases) and increased utilization by managed
care programs.
Costs of hospital services (salaries and benefits, fees, supplies,
bad debt expense and other expenses) for the quarter ended February 28,
1994 increased 9.7%. The 9.1% increase in net operating revenue and 9.7%
increase in the costs of hospital services resulted in the operating margin
declining from 22.7% for the quarter ended February 28, 1993 to 22.4% for
the quarter ended February 28, 1994. Salaries and benefits, the largest
component of hospital services, declined from 36.5% to 36.2% of net
operating revenue for the quarters ended February 28, 1993 and 1994,
respectively. Supplies expense declined from 14.2% to 13.9% of net
operating revenue, primarily resulting from the Company's efforts to
standardize supplies and negotiate contracts with vendors on a consolidated
basis. Bad debt expense increased from 6.4% to 6.9% of net operating
revenue. The increase in bad debt expense relates primarily to higher than
average bad debt expense for the hospitals the Company acquired during
fiscal 1993.
Interest expense declined $4.6 million for the quarter ended February
28, 1994. This decrease was due to both lower interest rates on the
Company's variable rate debt and reductions in the total amount of debt
outstanding.
Income before income taxes increased $15.5 million due primarily to
(i) an increase of $9.9 million in net operating revenue less hospital
service costs and (ii) reductions in interest expense ($4.6 million),
deferred compensation expense ($1.8 million ) and minority interests ($1.4
million).
Six Months Ended February 28, 1994 and 1993
Net operating revenue for the Company's hospitals for the six months
ended February 28, 1994, increased 7.1% to $1,274.6 million, while same
hospitals net operating revenue increased 7.2%. Gross revenue during the
six months ended February 28, 1994, increased 7.4% due to a 15.9% increase
in gross outpatient revenue and an 8.2% increase in gross inpatient
revenue. On a same hospitals basis, gross revenue increased 10.8% compared
to the prior year, due to a 15.6% increase in gross outpatient revenue and
an 8.6% increase in gross inpatient revenue.
Costs of hospital services (salaries and benefits, fees, supplies,
bad debt expense and other expenses) for the six months ended February 28,
1994 increased 8.1%. The 7.1% increase in net operating revenue and 8.1%
increase in the costs of hospital services resulted in the operating margin
decreasing from 22.2% for the six months ended February 28, 1993 to 21.5%
for the six months ended February 28, 1994. Salaries and benefits, the
largest component of hospital services, were 36.8% of net operating revenue
for both six-month periods. Supplies expense was reduced from 14.4% to
14.0% of net operating revenue for the six months ended February 28, 1994,
reflecting the benefits of the Company's efforts to standardize supplies
and consolidate vendors. Fees declined from 11.1% to 10.4% of net
operating revenue due to decreased usage of contractual labor for both
nursing services and departmental administration. Other expenses increased
from 9.5% to 10.3% of net operating revenue, due primarily to higher
expenditures for physician recruiting and employee travel. Bad debt
expense has increased from 6.0% to 7.0% of net operating revenues,
resulting primarily from higher than average expense at the facilities
acquired during fiscal 1993.
Income before income taxes increased $24.4 million due primarily to
a $9.9 million increase in net operating revenue less hospital service
costs, an $8.6 million reduction in interest expense and a $3.3 million
decline in minority interests.
The Company generated $77.3 million of cash flows from operations
during the six months ended February 28, 1994. This represented a $41.2
million decrease in cash flows provided by operations compared to the prior
year. The decline in cash flows was due to changes in current assets and
liabilities (a $51.8 million decrease in accounts payable and accrued
liabilities and a $15.0 million increase in receivables), which offset the
$15.0 million improvement in net income.
Liquidity and Capital Resources
The Company began fiscal 1994 with a strong balance sheet; cash
totaled $151.3 million; total assets were $2.537 billion; stockholders'
equity had climbed to $655.7 million; and debt as a percentage of total
capital was reduced to 59% from 66% the previous year. At February 28,
1994, stockholders equity had increased to $744.4 million and debt as a
percentage of capital had been reduced to 56%. These improvements were
achieved primarily through strong earnings and cash flows provided by
operations.
Cash provided from operations continued to satisfy all of the
Company's working capital, capital expenditure and debt principal
payment requirements.
The Company receives payment for services rendered from federal and
state agencies (under the Medicare, Medicaid and Champus programs), private
insurance carriers, employers, managed care programs and patients. During
the six months ended February 28, 1994, approximately 44% of the Company's
net operating revenue related to patients participating in the Medicare and
Medicaid programs. The Company recognizes that revenue and receivables
from government agencies are significant to the Company's operations, but
the Company does not believe that there are any significant credit risks
associated with these government agencies. The Company does not believe
that there are any other significant concentrations of revenue from any
particular payor that would subject the Company to any significant credit
risks in the collection of its accounts receivable.
The Company is primarily self-insured for professional and general
liability risks. The unfunded reserve for professional and general
liability risks was $164.9 million at February 28, 1994. Payments of
professional and general liability claims aggregated $7.1 million for the
six months ended February 28, 1994. The Company does not believe that the
payment of these self-insured risks will have any significant impact on the
Company's liquidity or working capital.
At March 31, 1994, the Company had $150.3 million of outstanding term
loans and approximately $192 million of credit available under the 1992
Credit Agreement.
During fiscal 1993, the Company acquired five hospital facilities in
Tennessee and Texas for an aggregate purchase price of $90.1 million.
During October 1993, the Company signed a letter of intent to acquire three
hospitals in Utah from the Holy Cross Health System Corporation and a
letter of intent to acquire Nashville Memorial Hospital in Nashville,
Tennessee. These transactions were originally expected to be completed
during the second quarter of fiscal 1994, but the FTC's review of the Holy
Cross transaction and certain litigation related to the Nashville Memorial
transaction have delayed the expected consummation dates and the Company
now expects the Nashville Memorial acquisition to be completed during the
third quarter of fiscal 1994. On March 22, 1994, the Federal Trade
Commission voted to challenge the sale of the Holy Cross Health Services
facilities to the Company and the Company is currently considering its
available options regarding the Utah facilities.
On January 9, 1994 the Company entered into an agreement to acquire
EPIC Holdings, Inc. EPIC owns and operates 34 general acute care hospitals
and owns and manages certain specialty medical programs and services. The
Company expects the acquisition of EPIC will require approximately $278
million to acquire the outstanding EPIC common stock and approximately $790
million (including related fees and expenses) to purchase and/or redeem
certain EPIC outstanding debt securities.
The Company plans to finance the acquisition and redemption of the
EPIC stock and debt by using cash on hand (approximately $200 million,
combined), the proceeds from an offering of 5.2 million shares of
Healthtrust common stock (approximately $150 million), the proceeds from
an offering of subordinated debt (approximately $200 million) and
borrowings under a proposed new bank credit agreement. On a pro forma
basis, the acquisition and related financing will increase stockholders'
equity by approximately $145 million and the ratio of debt to total
capitalization will increase to approximately 67%.
During 1993, the Company spent $219.5 million for capital
expenditures (excluding the five facilities acquired), primarily to
renovate and add new equipment and technology to existing facilities. The
Company intends to continue to invest in its existing facilities and in new
facilities within its existing health care business, and capital
expenditures (excluding hospital acquisitions) for fiscal 1994 are
expected to be approximately $230 million (capital expenditures for the
quarter and six months ended February 28, 1994 were $49.4 million and $83.7
million, respectively). The Company may seek to sell certain of its
hospitals from time to time. Management does not consider the sale of any
assets to be necessary to repay the Company's indebtedness or to provide
working capital. The Company's cash, cash expected to be generated from
operations and available sources of capital are believed by management to
be adequate to finance its planned future growth.
Management believes that, based upon its analysis of the Company's
financial condition, the cash flow generated from operations in the future
should provide sufficient liquidity to meet all cash requirements for at
least the next year without substantial additional borrowings (other than
the borrowings to finance the EPIC acquisition). In addition, the Company
believes, based on current internal long-term projections of future results
of operations, that it will be able to satisfy its current and expected
obligations as they become due without incurring substantial additional
indebtedness, and that satisfaction of such obligations will not prevent
the Company from meeting liquidity requirements for operations and capital
expenditures. However, there can be no assurance that future developments
in the health care industry or general economic trends will not adversely
affect the Company's operations or its ability to meet such obligations.
<PAGE>
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company's Annual Meeting of Shareholders was held on
January 13, 1994. the following members were elected to the
Company's Board of Directors to serve as Class III Directors
until the annual meeting following the Company's fiscal year
ending August 31, 1996 and until their successors are elected
and qualified.
VOTES VOTES
NOMINEE IN FAVOR WITHHELD
R. Clayton McWhorter 50,458,084 280,642
W. Hudson Connery, Jr. 50,464,062 274,664
Harry N. Beaty, MD 50,472,937 265,789
The results of the voting on the motion to ratify the selection
of Ernst & Young as the Company's independent auditors for the
fiscal year ending August 31, 1994 were; 50,348,643 common
shares were voted for ratification, 149,797 shares were voted
against ratification and 240,286 shares abstained from voting.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibit is included herein:
(11) Statement re: Computation of Earnings Per Share
(b) The Company filed a current report on Form 8-K dated January
10, 1994 to disclose the signing of an agreement under which
Healthtrust will acquire EPIC Holdings, Inc. No financial
statements were filed with the Form 8-K.
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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 thereunto duly authorized.
Healthtrust, Inc. - The Hospital Company
(Registrant)
April 5, 1994 /S/ R. Clayton McWhorter
Date R. Clayton McWhorter
Chairman of the Board,
Chief Executive Officer and President
April 5, 1994 /S/ Kenneth C. Donahey
Date Kenneth C. Donahey
Senior Vice President and Controller
Chief Accounting Officer
<TABLE>
HEALTHTRUST, INC. - THE HOSPITAL COMPANY
Exhibit 11 - STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
(Dollars in thousands, except per share data)
<CAPTION>
Three Months Ended February 28 Six Months Ended February 28
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Primary:
Average shares outstanding 81,175,622 81,241,645 81,138,773 81,274,611
Net effect of dilutive warrants 2,731,645 2,171,052 2,675,458 2,004,328
Net effect of dilutive stock options 970,897 263,767 824,890 134,753
Total weighted average common shares 84,878,164 83,676,464 84,639,121 83,413,692
Net income $ 47,376 $ 37,935 $ 86,228 $ 71,257
Net income per share $ 0.56 $ 0.45 $ 1.02 $ 0.85
Fully Diluted:
Average shares outstanding 81,175,622 81,241,645 81,138,773 81,274,611
Net effect of dilutive warrants 2,772,431 2,171,052 2,772,431 2,004,328
Net effect of dilutive stock options 1,061,482 263,767 1,020,829 134,753
Total weighted average common shares 85,009,535 83,676,464 84,932,033 83,413,692
Net income $ 47,376 $ 37,935 $ 86,228 $ 71,257
Net income per share $ 0.56 $ 0.45 $ 1.02 $ 0.85
</TABLE>
