Unisource Energy Earnings Per Share

9 Months Ended

Sep. 30, 2011

Unisource Energy Earnings Per Share [Abstract]

UNISOURCE ENERGY EARNINGS PER SHARE

NOTE 10. UNISOURCE ENERGY EARNINGS PER SHARE

We compute basic EPS by dividing Net Income by the weighted average number of common shares outstanding during the period. Except when the effect would be anti-dilutive, the diluted EPS calculation includes the impact of shares that could be issued upon exercise of outstanding stock options; contingently issuable shares under equity-based awards and common shares that would result from the conversion of convertible notes. The numerator in calculating diluted EPS is Net Income adjusted for the interest on Convertible Senior Notes (net of tax) that would not be paid if the notes were converted to common shares.

The following table shows the effects of potentially dilutive common stock on the weighted average number of shares:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
	-Thousands of Dollars-
Numerator:
Net Income	$	59,712	$	55,665	$	101,787	$	101,732
Income from Assumed Conversion of Convertible Senior Notes		1,097		1,097		3,292		3,292
Adjusted Numerator	$	60,809	$	56,762	$	105,079	$	105,024
	-Thousands of Shares-
Denominator:
Weighted Average Shares of Common Stock Outstanding:
Common Shares Issued		36,867		36,308		36,739		36,107
Fully Vested Deferred Stock Units		136		132		127		120
Participating Securities		50		93		64		94
Total Weighted Average Shares of Common Stock Outstanding and Participating Securities — Basic		37,053		36,533		36,930		36,321
Effect of Dilutive Securities:
Convertible Senior Notes		4,295		4,192		4,268		4,166
Options and Stock Issuable under Share Based Compensation Plans		429		416		379		436
Total Shares — Diluted		41,777		41,141		41,577		40,923

The following table shows the number of stock options excluded from the diluted EPS computation because the stock option’s exercise price was greater than the average market price of the Common Stock:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2011		2010		2011		2010
	-Thousands of Shares-
Stock Options Excluded from the Diluted EPS Computation		147		218		158		227