5. Earnings per Common Share
The schedule below summarizes the elements included in the calculation of basic and diluted earnings per common share for the fiscal years ended August 31, 2007, 2006 and 2005.
| Year Ended August 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2007 | 2006 | 2005 | |||||||||
| Net income | $ | 31,534,000 | $ | 28,112,000 | $ | 27,798,000 | |||||
| Weighted average common shares outstanding: Weighted average common shares outstanding, basic |
17,077,870 | 16,784,473 | 16,629,057 | ||||||||
| Weighted average dilutive securities | 193,372 | 127,882 | 178,342 | ||||||||
| Weighted average common shares outstanding, diluted | 17,271,242 | 16,912,355 | 16,807,399 | ||||||||
Weighted average options outstanding totaling 243,177, 359,507 and 270,455 for the fiscal years ended August 31, 2007, 2006 and 2005, respectively, were excluded from the calculation of diluted EPS, as the options have an exercise price greater than or equal to the average market value of the Company’s common stock during the respective periods. For the fiscal year ended August 31, 2007, there were no additional anti-dilutive weighted average options outstanding excluded from the calculation of diluted EPS under the treasury stock method. For the fiscal year ended August 31, 2006, weighted average options outstanding totaling 198,585 were also excluded from the calculation of diluted EPS under the treasury stock method as they were anti-dilutive. These options were anti-dilutive as a result of the assumed proceeds from (i) amounts option holders must pay for exercising stock options, (ii) the amount of compensation costs for future service that the Company has not yet recognized as expense, and (iii) the amount of tax benefits that would be recorded in additional paid-in capital upon exercise of the options.