CDW 2003 Annual Report Download - page 60

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47
Years Ended December 31,
2003 2002 2001
Basic earnings per share:
Income available to
common shareholders (numerator) $ 175,186 $ 185,249 $ 168,686
Weighted-average common
shares outstanding (denominator) 83,329 84,862 85,803
Basic earnings per share $ 2.10 $ 2.18 $ 1.97
Diluted earnings per share:
Income available to
common shareholders (numerator) $ 175,186 $ 185,249 $ 168,686
Weighted-average common
shares outstanding 83,329 84,862 85,803
Effect of dilutive securities:
Options on common stock 2,846 3,434 3,333
Total common shares and
dilutive securities (denominator)
86,175
88,296
89,136
Diluted earnings per share $ 2.03 $ 2.10 $ 1.89
Additional options to purchase common shares were outstanding during the years ended December 31, 2003
and 2002 but were not included in the computation of diluted earnings per share because the exercise prices of
these options were greater than the average market price of common shares during the respective periods. The
following table summarizes the weighted-average number, and the weighted-average exercise price, of those
options which were excluded from the calculation:
Years Ended December 31,
2003 2002
Weighted-average number of options (in 000’s) 987 920
Weighted-average exercise price $ 55.69 $ 55.69
13. Profit Sharing and 401(k) Plan
We have a profit sharing plan that includes a salary reduction feature established under the Internal Revenue
Code Section 401(k) covering substantially all employees. Company contributions to the profit sharing plan
are made in cash and determined at the discretion of the Board of Directors. For the years ended December 31,
2003, 2002 and 2001, amounts charged to expense for this plan totaled $3,066,000, $4,506,000 and
$3,060,000, respectively.
14. Leasing Joint Venture
In April 1999, CDWCC, a wholly-owned subsidiary of the Company, and First Portland Corporation
("FIRSTCORP"), an unrelated third party leasing company, formed CDW-L, a joint venture that is 50
percent owned by each of CDWCC and FIRSTCORP. During the first quarter of 2003, FIRSTCORP was
acquired by IFC Credit Corporation. CDW-L provides captive leasing services to our customers. Under the
terms of an operating agreement, FIRSTCORP provides leasing management services to CDW-L, with net
earnings of the venture allocated 50% to us and 50% to FIRSTCORP. CDWCC and FIRSTCORP each
contributed $600,000 to the capital of CDW-L, maintain equal operating control over CDW-L and have an
equal number of seats on the Board of Managers of the joint venture. Effective May 1, 2002, we decided to
stop originating new leases with this venture and began to refer customers to independent leasing sources,
including FIRSTCORP and several manufacturer captive entities. The existing leases in CDW-L’s portfolio
will be held until maturity, with the majority expiring prior to December 1, 2004.