Cash America 2009 Annual Report Download - page 114

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CASH AMERICA INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
86
directly related to corporate administrative functions.
Marketing Expenses
Costs of advertising and direct customer procurement are expensed at the time of first occurrence and
included in operating expenses. Advertising expense was $46.8 million, $34.1 million and $35.0 million for
the years ended December 31, 2009, 2008, and 2007, respectively.
Stock-Based Compensation
The Company accounts for its stock-based employee compensation plans in accordance with ASC
718-10-30, Compensation – Stock Compensation (“ASC 718-10-30”), using the modified prospective
method. Under the modified prospective method, the Company is required to recognize compensation
expense over the remaining vesting periods for stock-based awards.
Net Income Per Share
Basic net income per share is computed by dividing net income by the weighted average number of
common shares outstanding during the year. Diluted net income per share is calculated by giving effect to the
potential dilution that could occur if securities or other contracts to issue common shares were exercised and
converted into common shares during the year. Restricted stock units issued under the Company’s equity
plans are included in diluted shares upon the granting of the awards even though the vesting of shares will
occur over time.
The following table sets forth the reconciliation of numerators and denominators of basic and diluted
earnings per share computations for the years ended December 31, 2009, 2008 and 2007 (in thousands, except per
share amounts):
2009 2008 2007
Numerator:
Net income attributable to Cash America International, Inc. $ 96,678 $ 81,140 $ 79,346
Denominator:
Total weighted average basic shares (1) 29,639 29,327 29,643
Effect of shares applicable to stock option plans 184 334 351
Effect of restricted stock unit compensation plans 373 431 355
Effect of convertible debt(2) 307 - -
Total weighted average diluted shares 30,503 30,092 30,349
Basic earnings per share:
Net income $ 3.26 $ 2.77 $ 2.68
Diluted earnings per share:
Net income $ 3.17 $ 2.70 $ 2.61
(1)Included in “Total weighted average basic shares” are vested restricted stock units of 189, 206, and 160, as well as shares in
a non-qualified savings plan of 33, 59, and 57 for the years ended December 31, 2009, 2008, and 2007, respectively.
a
a
a
(2)The shares issuable related to the Company's 2009 Convertible Notes due 2029 have been calculated using the treasury
stock method. The Company intends to settle the principal portion of the convertible debt in cash; therefore, only the shares
related to the conversion spread have been included in weighted average diluted shares.
a
a
a