National Oilwell Varco 2003 Annual Report Download - page 37

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36
option’s vesting period, our net income and net income per share would have been (in thousands,
except per share data):
2003 2002 2001
Net income:
As reported 76,821$ 73,069$ 104,063$
Pro forma 68,269$ 63,926$ 94,227$
Basic net income per share:
As reported 0.91$ 0.90$ 1.29$
Pro forma 0.81 0.79 1.17
Diluted net income per share:
As reported 0.90$ 0.89$ 1.27$
Pro forma 0.80 0.78 1.15
These pro forma results may not be indicative of future effects.
Environmental Liabilities
When environmental assessments or remediations are probable and the costs can be reasonably
estimated, remediation liabilities are recorded on an undiscounted basis and are adjusted as
further information develops or circumstances change.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and assumptions that affect
reported and contingent amounts of assets and liabilities as of the date of the financial statements
and reported amounts of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
Net Income Per Share
The following table sets forth the computation of weighted average basic and diluted shares
outstanding (in thousands):
2003 2002 2001
Denominator for basic earnings per
share - weighted average 84,549 80,974 80,813
Effect of dilutive securities:
Employee stock options 436 735 920
Denominator for diluted earnings per
share - adjusted weighted average
shares and assumed conversions 84,985 81,709 81,733
Year Ended December 31,