Plantronics 2000 Annual Report Download - page 28

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N OTES TO consolidated financial statements
EARNI NGS PER SHARE
Basic Earnings Per Share (“EPS”) is computed by dividing net income available to common stockholders
(numerator – computed as net income before and after extraordinary item) by the weighted average
number of common shares outstanding (denominator) during the period. Basic EPS excludes the dilutive
effect of stock options. Diluted EPS gives effect to all dilutive potential common shares outstanding
during a period. In computing diluted EPS, the average stock price for the period is used in determining
the number of shares assumed to be purchased from exercise of stock options.
Following is a reconciliation of the numerators and denominators of the basic and diluted EPS:
FISCAL YEAR ENDED M ARCH 3 1 ,
(IN TH OUSANDS, EXCEPT EARNINGS PER SHARE) 1 9 9 8 1 9 9 9 2 0 0 0
Net income before extraordinary item $39,189 $55,253 $64,517
Net income after extraordinary item $39,189 $54,204 $64,517
Weighted average shares –– basic 16,481 16,574 16,505
Effect of dilutive securities –– employee stock options 1,742 1,708 1,168
Weighted average shares –– diluted 18,223 18,282 17,673
Net earnings per common share –– basic
Before extraordinary item $ 2.38 $ 3.33 $ 3.91
After extraordinary item $ 2.38 $ 3.27 $ 3.91
Net earnings per common share –– diluted
Before extraordinary item $ 2.15 $ 3.02 $ 3.65
After extraordinary item $ 2.15 $ 2.96 $ 3.65
COMPREHENSIVE INCOME
Comprehensive income includes charges or credits to equity that are not the result of transactions with
owners.Total comprehensive income was the same as net income for all periods presented.
SEGMENT REPORTI NG
Statement of Financial Accounting Standards No. 131,“Disclosures About Segments of an Enterprise and
Related Information” (“SFAS 131”), requires that we report certain information about operating segments
in our annual financial statements. It also establishes standards for related disclosures about products and
services, geographic areas and major customers (see note 9).
STOCK BASED COMPENSATION
Statement of Financial Accounting Standards No. 123,“Accounting for Stock-Based Compensation”
(“SFAS 123”), encourages, but does not require, companies to record compensation cost for stock-based
employee compensation plans based on the fair value of options granted.We have elected to continue to
account for stock-based compensation using the intrinsic value method prescribed in Accounting Principles
Board Opinion No. 25,“Accounting for Stock Issued to Employees”and related interpretations, and to
provide additional disclosures with respect to the pro forma effects of adoption had we recorded compensation
expense as provided in SFAS 123 (see note 10).
page 26 PLANTRONI CS ANN UAL REPORT 200 0