1
EXHIBIT 11
HOUSTON INDUSTRIES INCORPORATED AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
AND COMMON EQUIVALENT SHARE
(THOUSANDS OF DOLLARS, EXCEPT PER SHARE AMOUNTS)
Three Months Ended Six Months Ended
June 30, June 30,
------------------------------ ------------------------------
1997 1996 1997 1996
------------ ------------ ------------ ------------
Primary Earnings Per Share:
(1) Weighted average shares of
common stock outstanding . . . . . . 233,918,869 248,656,061 233,804,728 248,561,076
(2) Effect of issuance of shares
from assumed exercise of
stock options
(treasury stock method) . . . . . . . (29,987) 18,885 (7,033) (15,577)
------------ ------------ ------------ ------------
(3) Weighted average shares . . . . . . . 233,888,882 248,674,946 233,797,695 248,545,499
============ ============ ============ ============
(4) Net income . . . . . . . . . . . . . $ 121,463 $ 145,334 $ 181,083 $ 128,594
(5) Primary earnings per share
(line 4/line 3) . . . . . . . . . . . $ 0.52 $ 0.58 $ 0.77 $ 0.52
Fully Diluted Earnings Per Share:
(6) Weighted average shares per
computation on line 3 above . . . . . 233,888,882 248,674,946 233,797,695 248,545,499
(7) Shares applicable to options
included on line 2 above . . . . . . 29,987 (18,885) 7,033 15,577
(8) Dilutive effect of stock
options based on the average
price for the period or period-
end price, whichever is higher
($21.44 and $24.63 for the
second quarter of 1997 and 1996,
respectively, and $21.63 and
$24.63 for the first six months
Of 1997 and 1996,respectively)
(treasury stock method) . . . . . . . (12,605) 58,282 (7,033) 58,283
------------ ------------ ------------ ------------
(9) Weighted average shares . . . . . . . 233,906,264 248,714,343 233,797,695 248,619,359
============ ============ ============ ============
(10) Net income . . . . . . . . . . . . . $ 121,463 $ 145,334 $ 181,083 $ 128,594
(11) Fully diluted earnings per
share (line 10/line 9) . . . . . . . $ 0.52 $ 0.58 $ 0.77 $ 0.52
Notes:
These calculations are submitted in accordance with Regulation S-K item
601(b)(11), although it is not required for financial presentation disclosure
per footnote 2 to paragraph 14 of Accounting Principles Board (APB) Opinion No.
15 because it does not meet the 3% dilutive test.
The calculations for the quarters and six months ended June 30, 1997 and 1996
are submitted in accordance with Regulation S-K item 601(b)(11), although they
are contrary to paragraphs 30 and 40 of APB No. 15 because they produce
anti-dilutive results.