Common Stock and Earnings Per Share

12 Months Ended

Dec. 31, 2023

Common Stock and Earnings Per Share [Abstract]

5. Common Stock and Earnings Per Share

Net income of $23,757 and $19,580 for the years ended December 31, 2023 and 2022, respectively, is used to calculate both basic and diluted earnings per share. Basic net income per share is based on the weighted average number of common shares outstanding. Diluted net income per share is based on the weighted average number of common shares outstanding plus potentially dilutive shares. The dilutive effect of employee stock-based compensation is included in the computation of diluted net income per share. The dilutive effect of stock-based compensation is calculated using the treasury stock method and expected proceeds upon exercise or issuance of the stock-based compensation.

The following table summarizes the shares used in computing basic and diluted net income per share:

	2023		2022
Weighted average common shares, basic		14,294,910		13,957,788
Effect of dilutive securities:
Employee stock-based compensation		803		1,127
Weighted average common shares, diluted		14,295,713		13,958,915

Under the employee stock purchase plan, all full-time employees who have been employed at least ninety consecutive days may purchase shares of the Company’s common stock limited to 10% of gross compensation. The purchase price is 95% of the fair market value (as defined). Shares issued during 2023 and 2022 were 4,227 and 4,378, respectively. As of December 31, 2023, 45,416 authorized shares remain unissued under the plan.

The Company has a Dividend Reinvestment and Direct Stock Purchase and Sale Plan (“the Plan”), which is available to both current shareholders and the general public. On November 7, 2022, the Company filed a Registration Statement on Form S-3 with the Securities and Exchange Commission (SEC) to rollover the unissued 365,975 shares authorized under the 2019 Form S-3, for issuance under the new Prospectus for the Plan. Under the optional dividend reinvestment portion of the Plan, holders of the Company’s common stock may purchase additional shares instead of receiving cash dividends. The purchase price is 95% of the fair market value (as defined). Under the direct stock purchase portion of the Plan, purchases are made monthly at 100% of the stock’s fair market value, as defined in the new Prospectus. The Registration Statement was declared effective by the SEC on November 17, 2022. Shares issued during 2023 and 2022 were 37,475 and 38,361, respectively. As of December 31, 2023, 320,708 authorized shares remain unissued under the Plan.

On April 5, 2022, the Company closed an underwritten public offering of 975,600 shares of its common stock, with an offering price of $41 per share. On April 7, 2022, the Company closed on the full exercise of the underwriter’s option to purchase an additional 146,340 shares of its common stock at the same price. Janney Montgomery Scott LLC was the underwriter in the offering. The Company received net proceeds in the offering, after deducting offering expenses and underwriters’ discounts and commissions, of $43,970. The net proceeds were used to repay the Company’s borrowings under its line of credit agreement incurred to fund capital expenditures and acquisitions, and for general corporate purposes.

On March 11, 2013, the Board of Directors, or the Board, authorized a share repurchase program granting the Company authority to repurchase up to 1,200,000 shares of the Company’s common stock from time to time. The stock repurchase program has no specific end date and the Company may repurchase shares in the open market or through privately negotiated transactions. The Company may suspend or discontinue the repurchase program at any time. During both 2023 and 2022, the Company did not repurchase or retire any shares. As of December 31, 2023, 618,004 shares remain available for repurchase.