EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2013

EARNINGS PER SHARE

EARNINGS PER SHARE

3. EARNINGS PER SHARE

Basic and diluted earnings per share are computed by dividing net income by the weighted average number of shares outstanding during the respective periods.  The basic and diluted calculations differ as a result of the dilutive effect of stock options and time lapse restricted shares included in diluted earnings per share, but excluded from basic earnings per share. In addition, the Company has periodically issued share-based payment awards that contain non-forfeitable rights to dividends and are therefore considered participating securities.  A reconciliation of weighted average shares outstanding is as follows:

	Three months ended June 30,						Six months ended June 30,
(In thousands except per share data)	2013			2012			2013			2012
Net income available for stockholders:	$	1,935			2,173			3,384			3,805
Less:  Dividends paid
Common Stock		(1,142	)		(755	)		(2,283	)		(1,510	)
Undistributed income	$	793			1,418			1,101			2,295
Basic shares outstanding:
Common Stock		35,558			35,530			35,515			35,531
Restricted shares of common stock		1,271			1,138			1,259			1,118
		36,829			36,668			36,774			36,649
Diluted shares outstanding:
Common Stock		35,558			35,530			35,515			35,531
Dilutive effect of stock based awards		194			42			229			147
		35,752			35,572			35,744			35,678
Restricted shares of common stock		1,271			1,138			1,259			1,118
		37,023			36,710			37,003			36,796

Inclusion of all participating securities in the computation of Earnings Per Share (EPS) under the two-class method has no impact on the EPS amounts reported.

The effect of the Company’s stock options, as shown below, have been excluded from the computation of diluted earnings per share for the following periods, as their effect would have been anti-dilutive:

	Three months ended June 30,				Six months ended June 30,
(in thousands)	2013		2012		2013		2012
Stock options		42		42		42		42