Exhibit 11
Continental Medical Systems, Inc. and Subsidiaries
Computation of Earnings per Share
Three Months Ended Nine Months Ended
March 31, March 31,
1994 1993 (1) 1994 1993 (1)
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(In thousands, except per share data)
Primary:
Shares outstanding at beginning of
period 37,550 36,800 36,935 35,560
Weighted average shares issued
pursuant to:
Employee benefit plans 74 7 146 506
Acquisition agreements 22 307 125
Dilutive effect of outstanding stock
options 494 574 338 1,081
Contingent shares issuable pursuant
to acquisition agreements 401 612 455 641
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Weighted average number of shares
and equivalent shares outstanding 38,519 38,015 38,181 37,913
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Net income $ 4,170 $ 7,764 $15,531 $26,855
Additional goodwill amortization
from contingent shares issuable
pursuant to acquisition agreements (44) (44) (132) (138)
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Adjusted net income used in primary
calculation $ 4,126 $ 7,720 $15,399 $26,717
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Net income per share and equivalent
share $0.11 $0.20 $0.40 $0.70
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Fully Diluted:
Weighted average number of shares
and equivalent shares used in
primary calculation 38,519 38,015 38,181 37,913
Additional dilutive effect of stock
options 113
Additional dilutive effect of
contingent shares issuable
pursuant to acquisition agreements 82 82
Assumed conversion of dilutive
convertible debentures 234 234 234 234
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Fully diluted weighted average
number of shares and equivalent
shares outstanding 38,835 38,249 38,610 38,147
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Net income used in primary
calculation $ 4,126 $ 7,720 $15,399 $26,717
Adjustment for interest expense, net
of related income tax benefits 23 39 69 116
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Adjusted net income used in fully
diluted calculation $ 4,149 $ 7,759 $15,468 $26,833
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Fully diluted net income per share
and equivalent share $0.11 $0.20 $0.40 $0.70
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(1) On February 23, 1993, CMS acquired Kron in a business combination accounted
for as a pooling of interests. Accordingly, all share data at the beginning
of the period has been restated to include the shares issued in the
combination, and all financial results have been restated to include the
financial results of Kron prior to February 23, 1993.