DigitalNet Reports Second Quarter and First Half 2004 Results; Second Quarter Revenue Up 18% to $97.6 Million.HERNDON Herndon, town (1990 pop. 16,139), Fairfax co., N Va., inc. 1874, rechartered 1938. A suburb of Washington, D.C., Herndon has a mix of light and high-tech industries. , Va. -- DigitalNet Holdings, Inc. (Nasdaq:DNET DNET Distributed.net DNET Dish Network DNET Dysembryoplastic Neuroepithelial Tumor DNET Dysembryoplastic Neuroectodermal Tumor DNET Distributed Network DNET Digital Network ), a leading provider of network computing Storing and/or running applications in servers in a network. See cloud computing and network computer. solutions to U.S. defense, intelligence and civilian CIVILIAN. A doctor, professor, or student of the civil law. federal government agencies, today announced its operating results for the three months and six months ended June June: see month. 30, 2004. The Company exceeded its previously issued guidance given in April 2004. In addition, the Company provided initial guidance for the third quarter 2004 and raised its previously issued guidance for the full year 2004. Reported Results --Revenues for the second quarter 2004 were $97.6 million, and were $178.3 million for the six months ended June 30, 2004. --Net income for the second quarter 2004 was $4.9 million, and was $9.6 million for the six months ended June 30, 2004. --EBITDA(2) for the second quarter 2004 was $13.6 million, and was $26.4 million for the six months ended June 30, 2004. --Diluted earnings per share for the second quarter 2004 was $0.30, and was $0.58 for the six months ended June 30, 2004. -------- --Revenues, as adjusted(1) for the second quarter 2004 were $97.1 million, an increase of 36.9% over our 2003 second quarter revenues, as adjusted(1) of $70.9 million. --EBITDA, as adjusted(3) for the second quarter 2004 was $13.2 million, an increase of 25.2% over our 2003 second quarter EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become , as adjusted(3) of $10.5 million. --Net income, as adjusted(4) for the second quarter 2004 was $5.8 million, an increase of 29.3% over our 2003 second quarter net income, as adjusted(4) of $4.5 million. --Diluted earnings per share, as adjusted(5,6) for the second quarter 2004 was $0.35. --Revenues, as adjusted(1) for the six months ended June 30, 2004 were $174.6 million, an increase of 26.1% over our 2003 first half revenues, as adjusted(1) of $138.4 million. --EBITDA, as adjusted(3) for the six months ended June 30, 2004 was $24.5 million, an increase of 19.5% over our 2003 first half EBITDA, as adjusted(3) of $20.5 million. --Net income, as adjusted(4) for the six months ended June 30, 2004 was $10.7 million, an increase of 23.7% over our 2003 first half net income, as adjusted(4) of $8.7 million. --Diluted earnings per share, as adjusted(5,6) for the six months ended June 30, 2004 was $0.65. A reconciliation of (i) net income to EBITDA, (ii) revenues, net income and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of on a U.S. GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). basis and on an as adjusted basis, and (iii) EBITDA to EBITDA, as adjusted, is provided in the footnotes to the financial tables at the end of this release. Ken Bajaj The word Bajaj can mean several things Names
Chief Financial Officer Jack Pearlstein added, "The second quarter was another consecutive quarter of significant operating and financial accomplishments. We completed the acquisition and integration of User Technology Associates, Inc. (UTA uta see leishmaniasis. ). We exceeded the top end of analysts' estimates, and we generated exceptional cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses allowing us to reduce the outstanding balance on our line of credit by $10 million. Our DSOs stood at an industry leading 65 days at June 30, 2004." New Business Wins The Company won a number of strategic contracts during the second quarter valued at up to $83 million, including the Air Force Secure Network (AFSN AFSN Air Force Service Number AFSN Air Force Spacetrack Network ) contract and the Defense Information Systems Agency (DISA 1. (body) DISA - Defense Information Systems Agency. 2. (standard) DISA - Data Interchange Standards Association. ) Information Assurance Vulnerability Management (IAVM IAVM Information Assurance Vulnerability Management IAVM Institute of Advanced Volunteer Management (UK) ) solution. --AFSN contract - DigitalNet will support the AFSN Program Office modernizing portions of the Air Force's worldwide network communication infrastructure and managing classified and unclassified un·clas·si·fied adj. 1. Not placed or included in a class or category: unclassified mail. 2. data networks from all Air Force, Guard and Reserve activities worldwide. The contract is valued at up to $16 million. --DISA IAVM solution - DigitalNet was awarded a Task Order under the DISA I-ASSURE Contract sponsored by the United States Strategic Command United States Strategic Command (USSTRATCOM) is one of the ten Unified Combatant Commands of the United States Department of Defense. USSTRATCOM controls the nuclear weapons assets of the United States military. (USSTRATCOM USSTRATCOM United States Strategic Command ) on behalf of the Department of Defense. Under the Task Order, DigitalNet will integrate and deploy an automated au·to·mate v. au·to·mat·ed, au·to·mat·ing, au·to·mates v.tr. 1. To convert to automatic operation: automate a factory. 2. IAVM tool that will provide network administrators and security personnel a mechanism for verifying ver·i·fy tr.v. ver·i·fied, ver·i·fy·ing, ver·i·fies 1. To prove the truth of by presentation of evidence or testimony; substantiate. 2. application or non-application of Department of Defense (DoD) Computer Emergency Response Team (CERT) Information Assurance Vulnerability Management Notices. The IAVM tool will provide System Administrators with the ability to conduct self-assessments of known vulnerabilities A bug in software that has been identified. It typically refers to bugs that have been used for malicious purposes. For example, bugs in Web server, Web browser and e-mail client software are widely exploited by attackers. on all system assets and track the status through closure. The task order is worth up to $6 million. The Company's backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. stood at approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $1.1 billion as of June 30, 2004, an increase of over 50% from June 30, 2003. Company Outlook The Company has provided below its initial guidance for the third quarter 2004 and its raised guidance for the full year 2004. The Company's guidance includes the results from the UTA acquisition, but excludes the results from any subsequent acquisitions. The Company will update its full year guidance upon the successful completion of any subsequent acquisition. The table below summarizes the guidance ranges for the third quarter 2004 and full year 2004.
(Dollars and shares in millions, except per share data)
Previous Current
Q3 2004 FY2004 FY2004
-------------- ---------------- ----------------
Revenues $98.0 - $99.0 $372.2 - $377.2 $376.7 - $379.7
Revenues, as adjusted $98.0 - $99.0 $369.0 - $374.0 $373.0 - $376.0
Net income $4.5 - $4.6 $16.7 - $17.3 $18.7 - $19.0
Net income, as
adjusted $5.6 - $5.8 $20.7 - $21.4 $22.2 - $22.5
Diluted earnings per
share $0.27 - $0.28 $1.01 - $1.04 $1.13 - $1.15
Diluted earnings per
share, as adjusted $0.34 - $0.35 $1.25 - $1.29 $1.34 - $1.36
Diluted weighted
average shares
outstanding 16.55 - 16.55
Due to the forward looking nature of the projections of revenue, net income and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. earnings on an as adjusted basis, information to reconcile such non-GAAP financial measures to the GAAP measures is not available without unreasonable effort. Management does not believe such information is material. Conference Call Information The Company has scheduled a conference call for 10 AM E.T. Thursday Thursday: see week. , July July: see month. 15, 2004, during which management will be making a brief presentation focusing on second quarter and first half results, operating trends and its expectations. A question-and-answer session will follow to allow further discussion of the results and the company's future expectations. Interested parties may listen to the conference call by dialing (800) 901-5213 (U.S./Canada) and (617) 786-2962 (International) and entering the passcode 61913786. The call will be webcast simultaneously si·mul·ta·ne·ous adj. 1. Happening, existing, or done at the same time. See Synonyms at contemporary. 2. Mathematics through a link on the DigitalNet website (www.digitalnet.com). A replay of the conference call will be available approximately two hours after the conclusion of the conference call through August 5, 2004 by dialing (888) 286-8010 (U.S./Canada) and (617) 801-6888 (International) and entering the passcode 98926176. About DigitalNet DigitalNet builds, integrates and manages enterprise network computing solutions that provide government organizations with sustainable strategic business advantages. With more than 30 years of experience, the Company provides Managed Network Services, Information Security Solutions and Application Development Services and Solutions for the U.S. Department of Defense, U.S. Government civilian agencies and the intelligence community. We are focused on adding value to our clients by increasing network reliability, reducing overall network costs, and rapidly migrating mission critical network computing environments to new technologies. www.digitalnet.com. The statements contained in this release which are not historical facts are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , within the meaning of The Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These forward-looking statements are based on current expectations, forecasts and assumptions that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in, or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by, the forward-looking statements. The Company has attempted, whenever possible, to identify these forward-looking statements using words such as "may," "will," "should," "projects," "estimates," "expects," "plans," "intends," "anticipates," "believes," and variations of these words and similar expressions. Similarly, statements herein that describe the Company's business strategy, prospects, opportunities, outlook, objectives, plans, intentions or goals are also forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: funding decisions of U.S. Government projects; government contract procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. , option exercise and termination The point where a line, channel or circuit ends. See SCSI termination and hybrid. risks; competitive factors such as pricing pressures and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. competition to hire and retain qualified employees; the Company's ability to identify, execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution or effectively integrate future acquisitions, including UTA; the Company's ability to successfully raise additional capital; changes to the tax laws relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the treatment and deductibility of goodwill or any change in tax rates; additional costs related to compliance with the Sarbanes-Oxley Act See SOX. of 2002, revised NASDAQ listing standards, SEC rule changes or other corporate governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. issues; material changes in laws or regulations applicable to the Company's business and other risk factors described in the Company's 10-K for the year ended December December: see month. 31, 2003. In addition, the statements in this press release are made as of July 15, 2004. We expect that subsequent events or developments will cause our views to change. The Company undertakes no obligation to update any of the forward-looking statements made herein, whether as a result of new information, future events, changes in expectations or otherwise. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to July 15, 2004.
DigitalNet Holdings, Inc.
Consolidated Balance Sheets
(Dollars in Thousands)
December 31,
2003 June 30, 2004
------------- -------------
Assets
Current assets:
Cash and cash equivalents $ 23,635 $ 8,739
Accounts receivable, net 66,197 70,459
Inventory 7,692 5,509
Prepaid expenses and other current
assets 9,162 3,967
------------- -------------
Total current assets 106,686 88,674
------------- -------------
Other assets 8,438 6,994
Property and equipment, net 12,008 10,260
Intangible assets, net 173,128 216,094
------------- -------------
Total assets $ 300,260 $ 322,022
============= =============
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 7,621 $ 7,051
Accrued expenses 35,029 33,040
Deferred revenues 5,630 2,149
Current portion of long-term debt - 4,000
------------- -------------
Total current liabilities 48,280 46,240
------------- -------------
Long-term debt 81,250 96,250
Other liabilities 11,277 10,242
Stockholders' equity 159,453 169,290
------------- -------------
Total liabilities and stockholders' equity $ 300,260 $ 322,022
============= =============
DigitalNet Holdings, Inc.
Consolidated Statements of Operations
(Dollars in Thousands, except per share data)
Three months ended Six months ended
June 30, June 30,
---------------------- ----------------------
2003 2004 2003 2004
---------------------- ----------------------
Revenues $ 82,410 $ 97,572 $ 160,312 $ 178,296
Costs of revenues $ 64,936 $ 74,899 $ 126,820 $ 136,842
---------------------- ----------------------
Gross profit 17,474 22,673 $ 33,492 $ 41,454
---------------------- ----------------------
Operating expenses:
Selling, general, and
administrative 8,916 10,151 $ 17,371 $ 17,855
Acquisition and related
expenses - - $ - $ (366)
Amortization of
intangibles 2,649 2,282 $ 5,298 $ 4,163
---------------------- ----------------------
Total operating expenses 11,565 12,433 $ 22,669 $ 21,652
---------------------- ----------------------
Income from operations 5,909 10,240 $ 10,823 $ 19,802
Other income (expense):
Interest income 33 63 $ 80 $ 176
Interest expense (4,037) (2,295) $ (8,141) $ (4,385)
Other income (expense) (39) (3) $ (33) $ 12
---------------------- ----------------------
Total other income
(expense) (4,043) (2,235) $ (8,094) $ (4,197)
---------------------- ----------------------
Income before provision
for income taxes 1,866 8,005 $ 2,729 $ 15,605
Provision for income
taxes 765 3,076 $ 1,274 $ 6,050
---------------------- ----------------------
Net income $ 1,101 $ 4,929 $ 1,455 $ 9,555
====================== ======================
Dividends on preferred
stock (1,449) - $ (2,861) $ -
---------------------- ----------------------
Net (loss) income
attributable to common
stockholders $ (348) $ 4,929 $ (1,406) $ 9,555
====================== ======================
Net (loss) income per
common share:
Basic net (loss) income
attributable to common
stockholders per share $ (0.06) $ 0.30 $ (0.25) $ 0.59
====================== ======================
Basic weighted average
common shares
outstanding 5,581,628 16,303,454 5,541,831 16,296,806
====================== ======================
Diluted net (loss)
income attributable to
common stockholders per
share $ (0.06) $ 0.30 $ (0.25) $ 0.58
====================== ======================
Diluted weighted average
common shares
outstanding 5,581,628 16,488,706 5,541,831 16,481,409
====================== ======================
DigitalNet Holdings, Inc.
Consolidated Statements of Cash Flows
(Dollars in Thousands)
Six months ended
June 30,
--------------------
2003 2004
--------------------
Cash flows from operating activities:
Net income $ 1,455 $ 9,555
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 3,964 2,437
Loss (gain) on sale of equipment 41 (12)
Amortization of intangible assets 5,298 4,162
Amortization of deferred financing fees 2,021 375
Amortization of discount on debt 360 -
Amortization of deferred compensation 485 144
Deferred income taxes 1,274 6,050
Changes in assets and liabilities, net of effect
of acquisitions:
Accounts receivable 5,187 3,622
Inventory (6,043) 2,183
Prepaid expenses and other assets (3,060) 1,665
Accounts payable, accrued expenses and other
liabilities (6,159) (10,395)
Deferred revenues 7,909 (3,481)
--------------------
Net cash provided by operating activities 12,732 16,305
--------------------
Cash flows from investing activities:
Purchases of property and equipment (3,554) (2,047)
Proceeds from sale of equipment 10 1,813
Acquisitions, net of cash acquired (9,477) (50,105)
Net cash collected on behalf of and due to
Getronics Parent 4,800 -
--------------------
Net cash used in investing activities (8,221) (50,339)
--------------------
Cash flows from financing activities:
Net borrowings (repayments) under revolving
credit facility (3,900) 19,000
Repayments on term loan facility (1,250) -
Proceeds from stock option exercises - 138
Payments on management notes receivable 119 -
--------------------
Net cash (used in) provided by financing
activities (5,031) 19,138
--------------------
Net decrease in cash and cash equivalents (520) (14,896)
Cash and cash equivalents, beginning of period 3,894 23,635
--------------------
Cash and cash equivalents, end of period $ 3,374 $ 8,739
====================
(1) Revenues, as adjusted, represent revenues, as reported, less
revenues derived from our NASA CSOC contract. Because our
performance under the NASA CSOC contract ended on March 31, 2004,
management believes that revenues, as adjusted, presents investors
with a more meaningful depiction of our ongoing business. A
reconciliation of revenues, as reported, to revenues, as adjusted,
is as follows (dollars in thousands):
Three months ended Six months ended
June 30, June 30,
----------------------- -----------------------
2003 2004 2003 2004
----------------------- -----------------------
Revenues, as reported $ 82,410 $ 97,572 $ 160,312 $ 178,296
Less:
NASA CSOC contract 11,486 512 21,913 3,733
----------------------- -----------------------
Revenues, as adjusted $ 70,924 $ 97,060 $ 138,399 $ 174,563
----------------------- -----------------------
(2) EBITDA is defined as net income, as reported, plus interest,
income taxes, depreciation and amortization. Our method of
computation may or may not be comparable to other similarly titled
measures used by other companies. EBITDA is presented because we
believe EBITDA is a meaningful indicator that can be used by
investors to analyze and compare our operating performance to the
operating performance of other companies. However, EBITDA should
not be construed as an alternative to net income as determined in
accordance with accounting principles generally accepted in the
United States as an indicator of operating performance or as an
alternative to cash flows as a measure of liquidity. A
reconciliation of net income, as reported, to EBITDA is as follows
(dollars in thousands):
Three months ended Six months ended
June 30, June 30,
----------------------- -----------------------
2003 2004 2003 2004
----------------------- -----------------------
Net income, as reported $ 1,101 $ 4,929 $ 1,455 $ 9,555
Plus:
Interest, net 4,004 2,232 8,061 4,209
Income taxes 765 3,076 1,274 6,050
Depreciation 1,931 1,084 3,964 2,437
Amortization 2,649 2,282 5,298 4,163
----------------------- -----------------------
EBITDA $ 10,450 $ 13,603 $ 20,052 $ 26,414
----------------------- -----------------------
(3) EBITDA, as adjusted, represents EBITDA as set forth above,
less gross profit associated our NASA CSOC contract and
acquisition and related expenses, plus certain stock-based
compensation. Our method of computation may or may not be
comparable to other similarly titled measures used by other
companies. EBITDA, as adjusted, should not be construed as either
an alternative to net income, as determined in accordance with
accounting principles generally accepted in the United States as
an indicator of operating performance or as an alternative to cash
flows as a measure of liquidity. Gross profit associated with our
NASA CSOC contract represents the amount by which revenues
associated with this contract exceed the costs of revenues
associated with this contract. Because our performance under the
NASA CSOC contract ended on March 31, 2004, management believes
that EBITDA, as adjusted, presents investors with a more
meaningful depiction of our ongoing business. In addition, we have
excluded acquisition and related expenses from EBITDA, as
adjusted, because management believes that the benefit for lease
costs included in acquisition and related expenses is
non-recurring as it relates to transactions concurrent with the
commencement of substantive operations and the acquisition of our
predecessor. We have also excluded certain stock-based
compensation from EBITDA, as adjusted, because these charges are
non-recurring and related to common stock issued in conjunction
with the formation of the Company and the acquisition of our
predecessor. Management believes that such presentation provides a
more meaningful depiction of our ongoing business. A
reconciliation of EBITDA to EBITDA, as adjusted, is as follows
(dollars in thousands):
Three months ended Six months ended
June 30, June 30,
----------------------- -----------------------
2003 2004 2003 2004
----------- ----------- ----------- -----------
EBITDA $ 10,450 $ 13,603 $ 20,052 $ 26,414
Less:
NASA CSOC contract
gross margin - (398) - (1,511)
Acquisition and related
expenses - - - (366)
Plus:
Stock-based
compensation 96 - 485 -
----------------------- -----------------------
EBITDA, as adjusted $ 10,546 $ 13,205 $ 20,537 $ 24,537
----------------------- -----------------------
(4) Net income, as adjusted, represents net income, as reported,
less gross profit, associated with our NASA CSOC contract and
acquisition and related expenses, plus certain stock-based
compensation, amortization of certain intangibles and interest
related to debt retired with the proceeds of the IPO. Our method
of computation may or may not be comparable to other similarly
titled measures used by other companies. Net income, as adjusted,
should not be construed as an alternative to net income, as
determined in accordance with accounting principles generally
accepted in the United States. Gross profit associated with our
NASA CSOC contract represents the amount by which revenues
associated with this contract exceed the costs of revenues
associated with this contract. Because our performance under the
NASA CSOC contract ended on March 31, 2004, management believes
that net income, as adjusted, presents investors with a more
meaningful depiction of our ongoing business. In addition, we have
excluded acquisition and related expenses from net income, as
adjusted, because management believes that the benefit for lease
costs included in acquisition and related expenses is
non-recurring as it relates to transactions concurrent with the
commencement of substantive operations and the acquisition of our
predecessor. We have also excluded certain stock-based
compensation from net income, as adjusted, because these charges
are non-recurring and related to common stock issued in
conjunction with the formation of the Company and the acquisition
of our predecessor. We have also excluded amortization of
intangibles related to the acquisition of our predecessor from net
income, as adjusted, because these expenses relate to the
acquisition that was the formative transaction that commenced the
substantive operations of our company, and management believes
that such presentation provides a more meaningful comparison of
our operating performance with the operating performance of other
companies. We have also excluded interest expense related to debt
retired with the proceeds of the IPO or the sale of 9% senior
notes because such elimination reflects the effect of our current
capital structure after consummation of the 2003 refinancing
transactions. A reconciliation of net income to net income, as
adjusted, is as follows (dollars in thousands):
Three months ended Six months ended
June 30, June 30,
----------------------- -----------------------
2003 2004 2003 2004
----------------------- -----------------------
Net income, as reported $ 1,101 $ 4,929 $ 1,455 $ 9,555
Less:
NASA CSOC contract
gross profit - (398) - (1,511)
Acquisition and related
expenses - - - (366)
Plus:
Stock-based
compensation 96 - 485 -
Amortization 2,649 1,881 5,298 3,762
Interest on retired
debt 2,785 - 5,680 -
Income tax effect, net (2,119) (578) (4,261) (735)
----------------------- -----------------------
Net income, as adjusted $ 4,512 $ 5,834 $ 8,657 $ 10,705
----------------------- -----------------------
(5) The diluted weighted average common shares outstanding, as
adjusted, reflects the following: a) shares of common stock issued
in connection with the IPO, as if the offering was consummated on
January 1, 2003, b) shares of common stock issued in connection
with the conversion of the Class A Preferred Stock, including
accrued dividends, upon the consummation of the IPO, as if the
shares were issued on January 1, 2003, c) shares of carried stock,
reserved stock, and restricted stock that vested upon the IPO with
assumed vesting on January 1, 2003, and d) the treasury stock
effect of warrants to purchase 94,868 shares of common stock. We
have presented diluted weighted average common shares outstanding,
as adjusted, to show the effect on earnings per share of the
Company's current capital structure after consummation of the
refinancing transactions related to the IPO and the sale of 9%
senior notes due 2010. A reconciliation of the historical diluted
weighted average common shares outstanding to the diluted weighted
average common shares outstanding, as adjusted, is as follows:
Three months ended Six months ended
June 30, June 30,
----------------------- -----------------------
2003 2004 2003 2004
----------------------- -----------------------
Historical diluted
weighted average
common shares
outstanding 5,581,628 16,488,706 5,541,831 16,481,409
Common stock issued in
IPO 5,750,000 - 5,750,000 -
Conversion of the Class
A Preferred Stock at
IPO 3,807,132 - 3,807,132 -
Common stock vested
upon IPO 1,151,398 - 1,191,195 -
Treasury stock effect
of warrants 94,795 - 94,785 -
----------------------- -----------------------
Diluted weighted
average common shares
outstanding, as
adjusted 16,384,953 16,488,706 16,384,943 16,481,409
----------------------- -----------------------
(6) The diluted earnings per share, as adjusted, is computed by
dividing net income, as adjusted, by the diluted weighted average
common shares outstanding, as adjusted, during the period. The
following details the computation of the diluted earnings per
share, as adjusted, (dollars in thousands, except per share data):
Three months ended Six months ended
June 30, June 30,
----------------------- -----------------------
2003 2004 2003 2004
----------------------- -----------------------
Net income, as adjusted $ 4,512 $ 5,834 $ 8,657 $ 10,705
======================= =======================
Diluted weighted
average common shares
outstanding, as
adjusted 16,384,953 16,488,706 16,384,943 16,481,409
======================= =======================
Diluted earnings per
share, as adjusted $ 0.28 $ 0.35 $ 0.53 $ 0.65
======================= =======================
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