Goldman Sachs 2004 Annual Report Download - page 94

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notes฀to฀consolidated฀financial฀statements
92฀฀฀G O L D M A N ฀ S A C H S ฀ 2004฀ ANNUAL฀REPO RT
92฀฀฀G O L D M A N ฀ S A C H S ฀ 2 004฀ A N N U A L ฀ R E P O RT
NOTE฀7฀
Shareholders’ Equity
Dividends declared per common share were $1.00 in 2004,
$0.74 in 2003 and $0.48 in 2002. On December 15, 2004, the
Board of Directors of Group Inc. (the Board) declared a divi-
dend of $0.25 per share to be paid on February 24, 2005 to
common shareholders of record on January 25, 2005.
During 2004 and 2003, the firm repurchased 18.7 million shares
and 12.2 million shares of the firm’s common stock, respectively.
The average price paid per share for repurchased shares was
$96.29 and $76.83 for the years ended November 2004
and November 2003, respectively. In addition, to satisfy mini-
mum statutory employee tax withholding requirements related
to the delivery of shares underlying restricted stock units, the
firm cancelled 9.1 million restricted stock units at an average
price of $95.20 per unit in 2004. On January 30, 2004, the
Board authorized the repurchase of an additional 15.0 million
shares of common stock pursuant to the firm’s existing
repurchase program. As of November 2004, the firm was
authorized to repurchase up to 6.4 million additional shares of
common stock pursuant to the firm’s repurchase program.
The firm provides representations and warranties to counter-
parties in connection with a variety of commercial transactions
and occasionally indemnifies them against potential losses
caused by the breach of those representations and warranties.
The firm may also provide indemnifications protecting against
changes in or adverse application of certain U.S. tax laws in
connection with ordinary-course transactions such as securities
issuances, borrowings or derivatives. In addition, the firm may
provide indemnifications to some counterparties to protect
them in the event additional taxes are owed or payments are
withheld, due either to a change in or an adverse application of
certain non-U.S. tax laws. These indemnifications generally are
standard contractual terms and are entered into in the normal
course of business. Generally, there are no stated or notional
amounts included in these indemnifications, and the contingen-
cies triggering the obligation to indemnify are not expected to
occur. The firm is unable to develop an estimate of the maxi-
mum payout under these guarantees. However, management
believes that it is unlikely the firm will have to make material
payments under these arrangements, and no liabilities related to
these arrangements have been recognized in the consolidated
statements of financial condition as of November 2004 and
November 2003.
NOTE฀8
Earnings Per Share
The computations of basic and diluted EPS are set forth below:
฀ ฀ YEAR฀ENDED฀NOVEMBER
(IN฀MILLIONS,฀EXCEPT฀PER฀SHARE฀AMOUNTS)฀ 2004฀ 2003฀ 2002
Numerator for basic and diluted EPS — earnings available to
common shareholders $4,553 $3,005฀ $2,114
Denominator for basic EPS — weighted average number of
common shares 489.5 488.4฀ 495.6
Effect of dilutive securities
Restricted stock units 9.6 16.0฀ 22.1
Stock options 11.4 7.5฀ 7.4
Dilutive potential common shares 21.0฀ 23.5฀ 29.5
Denominator for diluted EPS — weighted average number of
common shares and dilutive potential common shares(1)฀ 510.5 511.9฀ 525.1
Basic EPS $฀฀9.30 $฀฀6.15฀ $฀฀4.27
Diluted EPS฀฀ 8.92฀ 5.87฀ 4.03
(1)฀The฀diluted฀EPS฀computations฀do฀not฀include฀the฀antidilutive฀effect฀of฀the฀following฀options:
฀ ฀ YEAR฀ENDED฀NOVEMBER
฀ (IN฀MILLIONS)฀ 2004฀ 2003฀ 2002
฀ Number฀of฀antidilutive฀options,฀end฀of฀period฀฀ 1฀ 27฀ 28
BES฀•฀Phone฀(201)฀635-5240฀฀•฀FAX฀(201)฀635-5199
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