SkyWest Airlines 2011 Annual Report Download - page 80

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SKYWEST, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
DECEMBER 31, 2011
(1) Nature of Operations and Summary of Significant Accounting Policies (Continued)
Income Taxes
The Company recognizes a liability or asset for the deferred tax consequences of all temporary
differences between the tax basis of assets and liabilities and their reported amounts in the consolidated
financial statements that will result in taxable or deductible amounts in future years when the reported
amounts of the assets and liabilities are recovered or settled.
Net Income (Loss) Per Common Share
Basic net income (loss) per common share (‘‘Basic EPS’’) excludes dilution and is computed by
dividing net income (loss) by the weighted average number of common shares outstanding during the
period. Diluted net income (loss) per common share (‘‘Diluted EPS’’) reflects the potential dilution
that could occur if stock options or other contracts to issue common stock were exercised or converted
into common stock. The computation of Diluted EPS does not assume exercise or conversion of
securities that would have an anti-dilutive effect on net income (loss) per common share. During the
years ended December 31, 2011, 2010 and 2009, 4,323,000, 4,183,000 and 4,356,000 shares reserved for
issuance upon the exercise of outstanding options were excluded from the computation of Diluted EPS
respectively, as their inclusion would be anti-dilutive.
The calculation of the weighted average number of common shares outstanding for Basic EPS and
Diluted EPS are as follows for the years ended December 31, 2011, 2010 and 2009 (in thousands):
Year Ended December 31,
2011 2010 2009
Numerator:
Net Income (Loss) .......................... $(27,335) $96,350 $83,658
Denominator:
Denominator for basic earnings per-share weighted
average shares ........................... 52,201 55,610 55,854
Dilution due to stock options and restricted stock . . . — 916 960
Denominator for diluted earnings per-share weighted
average shares ........................... 52,201 56,526 56,814
Basic earnings (loss) per-share ................. $ (0.52) $ 1.73 $ 1.50
Diluted earnings (loss) per-share ................ $ (0.52) $ 1.70 $ 1.47
Comprehensive Income (Loss)
Comprehensive income (loss) includes charges and credits to stockholders’ equity that are not the
result of transactions with the Company’s shareholders. Also, comprehensive income (loss) consisted of
net income (loss) plus changes in unrealized appreciation (depreciation) on marketable securities and
unrealized gain (loss) on foreign currency translation adjustment related to the Company’s equity
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