EXHIBIT 11.1
WASTE INDUSTRIES, INC.
COMPUTATION RE: EARNINGS PER SHARE
YEAR ENDED DECEMBER 31,
Pro forma (1) Pro forma (1)
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Six Months Ended June 30,
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1995 1996 1997 1997 1998
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Net income .......................................... $ 5,119,900 $ 4,977,410 $ 6,589,760 $ 2,839,162 $ 4,756,769
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Weighted average number of common shares issued
and outstanding - Basic .......................... 10,236,252 10,272,056 11,320,521 10,423,658 12,263,390
Common stock equivalents -
Options for common stock .......................... 39,721 352,667 526,000 526,000 570,082
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Weighted average common stock equivalents ........... 10,275,973 10,624,723 11,846,521 10,949,658 12,833,472
Less treasury shares to be repurchased ..............) (4,150) (132,883) (166,988) (170,302) (223,969
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Weighted average shares outstanding - Diluted ....... 10,271,823 10,491,890 11,679,533 10,779,357 12,609,503
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Basic earnings per share ............................ $ 0.50 $ 0.48 $ 0.58 $ 0.27 $ 0.39
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Diluted earnings per share .......................... $ 0.50 $ 0.47 $ 0.56 $ 0.26 $ 0.38
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(1) Pro forma basic and diluted earnings per share computations are based on the
weighted-average common stock outstanding and include the dilutive effect of
stock options using the treasury stock method (using the initial offering
price of $13.50 per share for periods prior to the initial public offering.
Common stock outstanding used to compute the weighted-average shares was
retroactively adjusted for the (i) 1996 exchange of shares resulting from
the merger of affiliated companies; (ii) 1997 conversion of nonvoting to
voting stock; (iii) 1997 1-for-2.5 reverse stock split; (iv) acquisition of
entities under common control during the quarter ending March 31, 1998; and
(v) Dumpsters and RTS mergers accounted for as poolings-of-interests during
the quarter ending June 30,1998.
The Company's S Corporation status was terminated on May 8, 1997 and,
accordingly, the Company became fully subject to federal and state income taxes
on May 9, 1997. Pro forma net income and earnings per share amounts have been
computed as if the Company was subject to federal and all applicable state
corporate income taxes for the three months and six months ended June 30, 1998.
Prior to the mergers, Dumpsters and RTS had elected S-Corporation status for
income tax purposes. The recognition of the cumulative deferred tax provision
associated with Dumpsters' and RTS's conversions from S Corporations to a C
Corporations was immaterial to the Company's consolidated financial statements.
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