Hibbett Sports 2007 Annual Report Download - page 52

- 40 -
Fiscal Year Ended
January 28,
2006
January 29,
2005
Net income, as reported $ 33,624 $ 25,147
Add: Stock-based employee compensation
expense, included in the determination of net
income, net of tax 61 -
Deduct: Stock-based employee compensation
expense, determined under the fair value
based method for all awards, net of tax (3,778) (1,759)
Net income, pro-forma $ 29,907 $ 23,388
Earnings per share:
Basic - as reported $ 1.00 $ 0.72
Basic - pro-forma $ 0.89 $ 0.67
Diluted - as reported $ 0.98 $ 0.70
Diluted - pro-forma $ 0.87 $ 0.66
Our plans allow for a variety of equity awards including stock options, restricted stock awards, stock
appreciation rights and performance awards. As of February 3, 2007, the Company had only granted awards in the
form of stock options and restricted stock. Restricted stock awards and options to purchase our common stock have
been granted to officers, directors and key employees. Beginning with the adoption of the Incentive Plan effective
July 1, 2005, a greater proportion of the awards granted to employees, including executive employees, were
restricted stock awards as opposed to stock options when compared to grants made in prior years. As of fiscal 2007,
we had only one performance-based restricted stock award to our Chief Executive Officer. Beginning with the annual
awards of fiscal 2008, all equity awarded to employees will be in the form of restricted stock units and all the five
named executive officers will be granted performance-based awards. We expect the Compensation Committee of
the Board will continue to grant more performance-based awards to key employees in the future. The terms and
vesting schedules for stock-based awards vary by type of grant and generally vest upon time-based conditions.
Upon exercise, stock-based compensation awards are settled with authorized but unissued company stock.
The compensation cost that has been charged against income for these plans was as follows for the fiscal
year ended February 3, 2007 (in thousands):
Stock-based compensation expense by type:
Stock options $ 2,104
Restricted stock awards 603
Employee stock purchase 99
Director deferred compensation 31
Total stock-based compensation expense 2,837
Tax benefit recognized 549
Stock-based compensation expense, net of tax $ 2,288
In accordance with SAB No. 107 issued in March 2005, share-based plan expense has been included in
general and administrative expense since it is incentive compensation. Certain other deferred stock compensation
plans are also reflected in general and administrative expense. There was no capitalized stock-based compensation
cost.
Prior to adoption of SFAS No. 123R, we presented the benefit of all tax deductions resulting from the
exercise of stock options as operating cash flows in the consolidated statements of cash flows. SFAS No. 123R
requires the benefits of tax deductions in excess of grant date fair value be reported as a financing cash flow, rather
than as an operating cash flow. Excess tax benefits of $1.2 million, which were classified as a financing cash inflow
in the 53-weeks ended February 3, 2007, would have been classified as an operating cash inflow if we had not
adopted SFAS No. 123R.