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EARNINGS PER SHARE (EPS)
 3 Months Ended
Dec. 31, 2011
Earnings Per Share [Abstract]  
Earnings Per Share [Text Block]

8. EARNINGS PER SHARE (EPS)

 

The Company computes earnings per share in accordance with Accounting Standards Codification (“ASC”) 260, Earnings Per Share. ASC 260 provides for the calculation of basic and diluted earnings per share. Basic earnings per share includes no dilution and is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of the Company.

 

Potential common stock shares consist of shares that may arise from outstanding dilutive common stock warrants and options (the number of which is computed using the “treasury stock method”) and from outstanding convertible debentures (the number of which is computed using the “if converted method”).

  

Diluted EPS considers the potential dilution that could occur if the Company’s outstanding common stock options, warrants and convertible debentures were converted into common stock that then shared in the Company’s earnings (as adjusted for interest expense that would no longer occur if the debentures were converted).

 

(in thousands, except per share data)   FOR THE QUARTER ENDED  
    DECEMBER 31,  
    2011     2010  
Basic earnings per share:                
Income from continuing operations attributable to Rick's shareholders   $ 2,233     $ 2,326  
Loss from discontinued operations, net of income taxes     (48 )     (250 )
Net income attributable to Rick's shareholders   $ 2,185     $ 2,076  
Average number of common shares outstanding     9,685       10,043  
Basic earnings (loss) per share:                
Income (loss) from continuing operations attributable to Rick's shareholders   $ 0.23     $ 0.23  
Discontinued operations   $ (0.00 )   $ (0.02 )
Net income (loss) attributable to Rick's shareholders   $ 0.23     $ 0.21  
Diluted earnings per share:                
Income (loss) from continuing operations attributable to Rick's shareholders   $ 2,233     $ 2,326  
Adjustment. to net earnings from assumed conversion of debentures (2)     -       -  
Adjusted income (loss) from continuing operations     2,233       2,326  
Discontinued operations     (48 )     (250 )
Adjusted net income (loss) attributable to Rick's shareholders   $ 2,185     $ 2,076  
Average number of common shares outstanding:                
Common shares outstanding     9,685       10,043  
Potential dilutive shares resulting from exercise of warrants and options (1)     2       2  
Potential dilutive shares resulting from conversion of debentures (2)     -       -  
Total average number of common shares outstanding used for dilution     9,687       10,045  
Diluted earnings (loss) per share:                
Income (loss) from continuing operations attributable to Rick's shareholders   $ 0.23     $ 0.23  
Discontinued operations   $ (0.00 )   $ (0.02 )
Net income (loss) attributable to Rick's shareholders   $ 0.23     $ 0.21  

 

(1)  All outstanding warrants and options were considered for the EPS computation. Potential dilutive options and warrants of 864,081 and 889,081 for the three months ended December 31, 2011 and 2010, respectively, have been excluded from earnings per share due to being anti-dilutive.

(2)  Convertible debentures (principal and accrued interest) outstanding at December 31, 2011 and 2010 totaling $6,283,919 and $9,212,778, respectively, were convertible into common stock at a price of $10.25 and $10.00 per share in 2011 and $10.25 per share in 2010. Potential dilutive shares of 614,910 and 889,057 for the three months ended December 31, 2011 and 2010, respectively, have been excluded from earnings per share due to being anti-dilutive.

 

*EPS may not foot due to rounding.