| Income or Loss Per Share |
| The Company computes basic and diluted earnings or loss per share in accordance with SFAS No. 128, "Earnings Per Share." Basic income or loss per share excludes dilution and is computed by dividing income or loss available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted income or loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The dilutive effect of stock options outstanding during 2000 and 1999 added 9,000 and 121,000, respectively, to the weighted average shares outstanding for purposes of calculating diluted income per share. There was no dilutive effect of stock options outstanding during 2001. |
| Comprehensive Income |
| Total comprehensive loss or income, consisting of net loss or income plus other nonowner changes in equity for the years ended December 31, 2001, 2000 and 1999, was a loss of $14,659,000 and income of $7,956,000 and $43,738,000, respectively. Accumulated other comprehensive loss at December 31, 2001 and 2000 consisted of foreign currency translation adjustments of $810,000 and $753,000, respectively. |
| New Accounting Pronouncements |
| In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging Activities." SFAS No. 133 established accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts (collectively referred to as derivatives), and for hedging activities. It also requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. In June 1999, the FASB issued SFAS No. 137, "Accounting for Derivative Instruments and Hedging Activities – Deferral of the Effective Date of FASB Statement 133." This pronouncement deferred the effective date of SFAS No. 133 until the fiscal year ending December 31, 2001. In June 2000, the FASB issued SFAS No. 138, "Accounting for Certain Derivative Instruments and Certain Hedging Activities (an Amendment of FASB No. 133)." This pronouncement amends the accounting and reporting standards of SFAS No. 133 for certain derivative instruments and hedging activities. The Company adopted SFAS No. 133, as amended, on January 1, 2001. This pronouncement did not have a material impact on the Company's consolidated financial statements upon adoption.
In June 2001, the FASB issued SFAS No. 141, "Business Combinations" ("SFAS No. 141") and SFAS No. 142, "Goodwill and Other Intangible Assets" ("SFAS No. 142"). SFAS No. 141 supercedes Accounting Principles Board ("APB") Opinion No. 16 "Business Combinations" and SFAS No. 38, "Accounting for Preacquisition Contingencies for Purchased Enterprises." SFAS No. 141 prescribes the accounting principles for business combinations and requires that all business combinations be accounted for using the purchase method of accounting. This pronouncement is effective for all business combinations after June 30, 2001.
SFAS No. 142 supercedes APB Opinion No. 17, "Intangible Assets". This pronouncement prescribes the accounting practices for goodwill and other intangible assets. Under this pronouncement, goodwill will no longer be amortized to earnings, but instead will be reviewed periodically (at least annually) for impairment. As of December 31, 2001, the Company had $146,465,000 of recorded net goodwill, which will be subject to this new pronouncement. During fiscal year 2001, the Company recorded $2,996,000 of goodwill amortization expense, net of taxes. The Company adopted this pronouncement effective January 1, 2002. The Company is currently evaluating this pronouncement using an external advisor and will determine the impact on its consolidated financial statements in accordance with the timing provisions under this pronouncement.
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| In July 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement Obligations" ("SFAS no. 143"). This pronouncement requires entities to record the fair value of a liability for an asset retirement obligation in the period in which it is incurred. When the liability is initially recorded, the entity capitalizes the cost by increasing the carrying amount of the related long-lived asset. Over time, the liability is accreted to its present value each period and the capitalized cost is depreciated over the useful life of the related asset. Upon settlement of the liability, the entity either settles the obligation for the amount recorded or incurs a gain or loss. SFAS No. 143 is effective for fiscal years beginning after June 15, 2002. The Company does not expect the adoption of this pronouncement to have a material impact on its consolidated financial statements.
In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS No. 144"). This pronouncement addresses financial accounting and reporting for the impairment or disposal of long-lived assets and supercedes SFAS No. 121. SFAS No. 144 is effective for fiscal years beginning after December 15, 2001. The Company adopted SFAS No. 144 as of January 1, 2002. The Company does not expect the adoption of this pronouncement to have a material impact on its consolidated financial statements.
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2. Shareholders' Equity
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| Preferred Stock |
| The Company has authorized 5,000,000 shares of $0.10 par value preferred stock. The preferred stock is issuable from time to time in one or more series and with such designations and preferences for each series as shall be stated in the resolutions providing for the designation and issue of each such series adopted by the board of directors of the Company. The board of directors is authorized by the Company's articles of incorporation to determine the voting, dividend, redemption, and liquidation preferences pertaining to each such series. No shares of preferred stock have been issued by the Company. |
| Common Stock Purchase Plan |
| The Company has cumulatively purchased 3,169,000 shares of its common stock since January 1996 pursuant to a plan authorized and approved by its board of directors allowing purchases of up to 4,000,000 common shares. The Company's board of directors has authorized purchases of up to 831,000 additional shares. There were no stock purchases in 2001, 2000 or 1999. The Company's 9 7/8% senior subordinated notes and its senior credit facility limit its ability to repurchase its common stock. |
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