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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 Nine Months Ended
September 30, September 30,
------------------------------------ ----------------------------------
1997 1996 1997 1996
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Primary Earnings Per Share:
(1) Weighted average shares of
common stock outstanding................... 263,373 245,889 243,769 247,664
(2) Effect of issuance of shares
from assumed exercise of
stock options (treasury stock method)...... 196 19 206 24
-------------- -------------- ------------ --------------
(3) Weighted average shares.................... 263,569 245,908 243,975 247,688
============== ============== ============ ==============
(4) Net income................................. $ 243,898 $ 240,024 $ 424,981 $ 368,618
(5) Primary earnings per share
(line 4/line 3)............................ $ 0.93 $ 0.98 $ 1.74 $ 1.49
Fully Diluted Earnings Per Share:
(6) Weighted average shares per
computation on line 3 above................ 263,569 245,908 243,975 247,688
(7) Shares applicable to options
included on line 2 above................... (196) (19) (206) (24)
(8) Dilutive effect of stock
options based on the average
price for the period or quarter-
end price, whichever is higher,
of $21.75 and $22.63 for the
third quarter of 1997 and 1996,
respectively, and $21.75 and
$22.88 for the first nine months
of 1997 and 1996, respectively
(treasury stock method).................... 215 19 215 24
(9) Effect of issuance of shares from
assumed conversion of debentures........... 946 946
(10) Fully diluted
weighted average shares.................... 264,534 245,908 244,930 247,688
============== ============== ============ ==============
(11) Net income................................. $ 243,898 $ 240,024 $ 424,981 $ 368,618
(12) Add: Interest on Bonds, net tax............ 310 930
(13) Fully diluted net income................... $ 244,208 $ 240,024 $ 425,911 $ 368,618
(14) Fully diluted earnings per
share (line 13/line 10).................... $ 0.92 $ 0.98 $ 1.74 $ 1.49
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.