Chipotle 2005 Annual Report Download - page 65

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Chipotle Mexican Grill, Inc.
Notes to Financial Statements (Continued)
(in thousands, except per share data)
landlord financing liability was $3,533 as of December 31, 2005. The future minimum lease payments
for each of the next five years and thereafter for deemed landlord financing obligations are as follows
2006 .................................................... $ 310
2007 .................................................... 310
2008 .................................................... 310
2009 .................................................... 310
2010 .................................................... 316
Thereafter ................................................ 5,273
Total minimum lease payments ................................. 6,829
Less: Interest implicit in lease ................................. (3,296)
Total deemed landlord financing ................................ $3,533
10. Earnings Per Share
In connection with the Company’s initial public offering, the Reclassification (as discussed in
Note 1) converted each share of Series B convertible preferred stock, Series C and Series D junior
convertible preferred stock and common stock, issued and outstanding as of the effective date of the
initial public offering, into one-third share of class B common stock. The share and per share data
presented reflect the retroactive application of the Reclassification.
Basic earnings per common share is calculated by dividing income (loss) available to common
shareholders by the weighted-average number of shares of common stock outstanding during each
period. Diluted earnings per common share (‘‘Diluted EPS’’) is calculated using income (loss) available
to common shareholders divided by diluted weighted-average shares of common stock outstanding
during each period. Potentially dilutive securities include potential common shares related to stock
options and non-vested stock. Diluted EPS considers the impact of potentially dilutive securities except
in periods in which there is a loss because the inclusion of the potential common shares would have an
anti-dilutive effect. Options to purchase 241 shares of common stock in 2003 at a weighted-average
exercise price of $16.00, which were outstanding during the period, were excluded from the calculation
of diluted earnings per share because they were anti-dilutive.
The following table sets forth the computations of basic and dilutive earnings per common share:
Year ended December 31,
2005 2004 2003
Net income (loss) ......................................... $37,696 $ 6,126 $ (7,714)
Shares:
Weighted average number of common shares outstanding ............ 26,281 25,454 22,384
Dilutive stock options ...................................... 67 66 —
Dilutive non-vested stock ................................... 26 — —
Diluted weighted average number of common shares outstanding ...... 26,374 25,520 22,384
Basic earnings (loss) per share ............................... $ 1.43 $ 0.24 $ (0.34)
Diluted earnings (loss) per share .............................. $ 1.43 $ 0.24 $ (0.34)
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