Earnings Per Common Share

3 Months Ended

Oct. 31, 2011

Earnings Per Common Share

Earnings Per Common Share

Note 11.                 Earnings Per Common Share

Basic EPS is computed based upon the weighted average number of common shares outstanding during the period. Diluted EPS is computed based upon the weighted average number of common shares outstanding during the period plus the dilutive effect of Common Stock equivalents using the treasury stock method and the average market price of our Common Stock for the period.

We include participating securities (unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents) in the computation of EPS pursuant to the two-class method. Our participating securities consist solely of unvested restricted stock awards, which have contractual participation rights equivalent to those of stockholders of unrestricted common stock. The two-class method of computing earnings per share is an allocation method that calculates earnings per share for common stock and participating securities.

The following table sets forth the computation of basic and diluted EPS available to stockholders of common stock (excluding participating securities):

	Three Months Ended
	October 31,
	2011			2010
Numerator for basic and diluted earnings per share:
Net income	$	6,220,000		$	4,975,000
Less income allocated to participating securities	(112,000		)	(57,000		)
Net income available to common stockholders	$	6,108,000		$	4,918,000
Denominator for basic and diluted earnings per share, as adjusted for participating securities:
Denominator for basic earnings per share - weighted average number of shares outstanding attributable to common stock	17,442,389			16,712,353
Dilutive effect of stock options using the treasury stock method and the average market price for the period	185,820			107,553
Denominator for diluted earnings per share - weighted average number of shares and common stock equivalents attributable to common stock	17,628,209			16,819,906
Earnings per share attributable to common stock:
Basic earnings per share	$	0.35		$	0.29
Diluted earnings per share	$	0.35		$	0.29
Stock options excluded from weighted average dilutive common shares outstanding because their inclusion would have been antidilutive	—			906,251

A reconciliation of weighted average number of shares and common stock equivalents attributable to common stock, as determined above, to the Company’s total weighted average number of shares and common stock equivalents, including participating securities, are set forth in the following table:

	Three Months Ended
	October 31,
	2011	2010
Denominator for diluted earnings per share - weighted average number of shares and common stock equivalents attributable to common stock	17,628,209	16,819,906
Participating securities	304,391	173,218
Total weighted average number of shares and common stock equivalents attributable to both common stock and participating securities	17,932,600	16,993,124