Express 2010 Annual Report Download - page 102

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The following table provides reconciliation between basic and diluted net income (loss) per share:
Year Ended
2010 2009 2008
(in thousands, except per share
amounts) Income
Weighted
Average
Share
Per Share
Amount Income
Weighted
Average
Shares
Per Share
Amount Loss
Weighted
Average
Shares
Per Share
Amount
Basic EPS
Net income (loss) ........ $127,388 85,369 $ 1.49 $75,307 74,566 $ 1.01 $(29,036) 72,516 $(0.40)
Effect of Dilutive
Securities
Stock options, restricted
stock units, and restricted
shares ............... — 681 (0.01) — 1,038 (0.01) — — —
Diluted EPS ............ $127,388 86,050 $ 1.48 $75,307 75,604 $ 1.00 $(29,036) 72,516 $(0.40)
Stock options to purchase 1.3 million shares of common stock were excluded from the computation of diluted
EPS for 2010 as the options would be anti-dilutive. No potentially dilutive shares were excluded from the
computation of diluted EPS in 2009.
Diluted net loss per common share is the same as basic net loss per share for 2008. Restricted shares of
5.5 million were excluded from the calculation as they were anti-dilutive due to the Company’s net loss position.
12. Pro forma Information (unaudited)
The pro forma net income applied in computing the pro forma EPS for 2010, 2009, and 2008 is based on the
Company’s historical net income as adjusted to reflect the Company’s conversion to a corporation as if it has
occurred as of the beginning of the respective periods. In connection with the conversion, effective May 2, 2010,
the Company became taxed as a corporation. The Company was previously treated as a partnership for tax
purposes, and therefore generally not subject to federal income tax. The pro forma net income includes
adjustments for income tax expense as if the Company had been a corporation at an assumed combined federal,
state, and local income tax rate of 40.9% for the first thirteen weeks of 2010 and 38.7% for 2009 and 2008.
The pro forma net income for 2010 eliminates the non-cash deferred tax benefit of $31.8 million as a
non-recurring item related to the Reorganization (see Note 7).
13. Retirement Benefits
The employees of the Company, if eligible, participate in a qualified defined contribution retirement plan (the
“Qualified Plan”) and a non-qualified supplemental retirement plan (the “Non-Qualified Plan”) sponsored by the
Company.
Participation in the Company’s Qualified Plan is available to employees who meet certain age and service
requirements. The Qualified Plan permits employees to elect contributions up to the maximum limits allowable
under the IRC. The Company matches employee contributions according to a pre-determined formula and
contributes additional amounts based on a percentage of the employees’ eligible annual compensation and years
of service. Employee contributions and Company matching contributions vest immediately.
Additional Company contributions and the related investment earnings are subject to vesting based on years of
service. Total expense recognized related to the Qualified Plan was $2.7 million, $0.4 million and $2.5 million in
2010, 2009, and 2008, respectively.
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