KeyBank 2006 Annual Report Download - page 74

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74
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS KEYCORP AND SUBSIDIARIES
Key’s basic and diluted earnings per common share are calculated as follows:
Year ended December 31,
dollars in millions, except per share amounts 2006 2005 2004
EARNINGS
Income from continuing operations before cumulative effect
of accounting change $1,193 $1,090 $907
Income (loss) from discontinued operations, net of taxes (143) 39 47
Income before cumulative effect of accounting change 1,050 1,129 954
Net income 1,055 1,129 954
WEIGHTED-AVERAGE COMMON SHARES
Weighted-average common shares outstanding (000) 404,490 408,981 410,585
Effect of dilutive common stock options and other stock awards (000) 5,732 5,033 4,845
Weighted-average common shares and potential
common shares outstanding (000) 410,222 414,014 415,430
EARNINGS PER COMMON SHARE
Income per common share from continuing operations before cumulative
effect of accounting change $2.95 $2.67 $2.21
Income (loss) per common share from discontinued operations (.35) .10 .11
Income per common sharebeforecumulative effect of accounting change 2.60 2.76 2.32
Net income per common share 2.61 2.76 2.32
Income per common share from continuing operations before cumulative
effect of accounting change — assuming dilution 2.91 2.63 2.18
Income (loss) per common share from discontinued operations —
assuming dilution (.35) .09 .11
Income per common share before cumulative effect of accounting
change — assuming dilution 2.56 2.73 2.30
Net income per common share — assuming dilution 2.57 2.73 2.30
2. EARNINGS PER COMMON SHARE
During the years ended December 31, 2006, 2005 and 2004, certain
weighted-average options to purchase common shares were outstanding
but not included in the calculation of “net income per common share —
assuming dilution” during any quarter in which the exercise prices of the
options were greater than the average market price of the common shares
because including the options in the calculations would have been
antidilutive. The calculations for the full years shown in the following
table were made by averaging the results of the four quarterly
calculations for each year.
Year ended December 31, 2006 2005 2004
Weighted-average options excluded from the calculation
of net income per common share — assuming dilution 384,907 4,548,100 4,451,498
Exercise prices for weighted-average options excluded $36.22 to $50.00 $32.84 to $50.00 $30.33 to $50.00
In addition, during the years ended December 31, 2006, 2005 and
2004, weighted-average contingently issuable performance-based awards
for 1,700,305, 966,287 and 430,647 common shares, respectively,
were outstanding, but not included in the calculation of “net income per
common share — assuming dilution.” These awards vest contingently
upon Key’s achievement of certain cumulative three-year financial
performance targets and were not included in the calculation because the
measuring time period had not yet expired.
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