WeightWatchers 2006 Annual Report Download - page 83

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WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—Continued
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
On December 18, 2006, the Company commenced a tender offer in which it sought to acquire up to 8,300
shares of its common stock at a price between $47.00 and $54.00 per share (the “Tender Offer”). Prior to the
Tender Offer, the Company entered into an agreement with Artal whereby Artal agreed to sell to the Company at
the same price as is determined in the Tender Offer the number of its shares necessary to keep its percentage
ownership in the Company at substantially the same level after the Tender Offer. Artal also agreed not to
participate in the Tender Offer so that it would not affect the determination of the price in the Tender Offer.
The Tender Offer expired at midnight on January 18, 2007, and on January 26, 2007 approximately 8,548
shares were repurchased at a price of $54.00 per share. The 8,548 shares repurchased are comprised of the 8,300
shares the Company offered to purchase and 248 shares purchased pursuant to the Company’s right to purchase
up to an additional 2% of the outstanding shares as of November 30, 2006. On February 2, 2007, the Company
repurchased 10,511 of its shares from Artal at a purchase price of $54.00 per share pursuant to its prior
agreement with Artal. In January 2007, the Company amended the WWI Credit Facility to finance these
repurchases. See Note 19.
8. Earnings Per Share
Basic earnings per share (“EPS”) computations are calculated utilizing the weighed average number of
common shares outstanding during the periods presented. Diluted EPS is calculated utilizing the weighted
average number of common shares outstanding adjusted for the effect of dilutive common stock equivalents.
The following table sets forth the computation of basic and diluted EPS for the fiscal years ended:
December 30,
2006
December 31,
2005
January 1,
2005
Numerator:
Income available to common shareholders before cumulative effect
of accounting change ................................... $209,825 $174,402 $195,025
Cumulative effect of accounting change, net of tax .............. — — (11,941)
Net income available to common shareholders ................. $209,825 $174,402 $183,084
Denominator:
Weighted average common shares outstanding ................. 98,719 102,747 104,704
Effect of dilutive common stock equivalents ................... 707 1,456 2,281
Weighted average diluted common shares outstanding ........... 99,426 104,203 106,985
Basic EPS:
Income available to common shareholders before cumulative effect
of accounting change ................................... $ 2.13 $ 1.70 $ 1.86
Cumulative effect of accounting change, net of tax .............. — — (0.11)
Net income available to common shareholders ................. $ 2.13 $ 1.70 $ 1.75
Diluted EPS:
Income available to common shareholders before cumulative effect
of accounting change ................................... $ 2.11 $ 1.67 $ 1.82
Cumulative effect of accounting change, net of tax .............. — — (0.11)
Net income available to common shareholders ................. $ 2.11 $ 1.67 $ 1.71
F-20