MAC-GRAY CORP

CIK:0001038280|SEC Filings

Earnings Per Share

9 Months Ended

Sep. 30, 2013

7. Earnings Per Share

	Three months ended				Nine months ended
	September 30,				September 30,
	2012		2013		2012		2013

Net income	$	1,471	$	1,457	$	1,756	$	5,587

Weighted average number of common shares outstanding - basic	14,447		14,715		14,396		14,634
Effect of dilutive securities:
Stock options and restricted stock units	687		690		682		572
Weighted average number of common shares outstanding - diluted	15,134		15,405		15,078		15,206

Earnings per share - basic	$	0.10	$	0.10	$	0.12	$	0.38
Earnings per share - diluted	$	0.10	$	0.09	$	0.12	$	0.37

There were 921,000 and 587,000 shares under option plans that were excluded from the computation of diluted earnings per share for the three months ended September 30, 2013 and 2012, and 882,000 and 548,000 shares under option plans that were excluded from the computation of diluted earnings per share for the nine months ended September 30, 2013 and 2012, respectively due to their anti-dilutive effects.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities:
Net income	$ 5,587	$ 1,756
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation and amortization	32,784	32,162
Amortization of deferred financing costs	262	356
Loss on early extinguishment of debt	54	1,220
Decrease in allowance for doubtful accounts and lease reserves	(15)	(41)
Gain on disposition of assets	(269)	(97)
Stock grants	321	392
Gain on change in fair value of interest rate derivatives	(196)	(360)
Gain loss on change in fair value of fuel commodity derivatives	(20)	(43)
Decrease in deferred income taxes	(1,424)	(1,298)
Non-cash stock compensation	1,945	2,024
Increase in accounts receivable	(854)	(405)
Increase in inventory	(860)	(685)
Increase in prepaid facilities management rent and other assets	(7,204)	(3,232)
Increase (decrease) in accounts payable, accrued facilities management rent, accrued expenses and other liabilities	5,330	(1,682)
Net cash flows provided by operating activities	35,441	30,067
Cash flows from investing activities:
Capital expenditures	(30,799)	(25,269)
Payments for acquisitions	(5,128)
Proceeds from sale of assets	335	177
Net cash flows used in investing activities	(35,592)	(25,092)
Cash flows from financing activities:
Payments on capital lease obligations	(1,217)	(1,010)
Payment on senior notes		(100,000)
Payments on secured revolving credit facility	(75,976)	(169,592)
Borrowings on secured revolving credit facility	79,911	289,978
Payments on secured term credit facility		(18,750)
Proceeds from exercise of stock options	598	588
Proceeds from issuance of common stock	274	300
Debt acquisition and amendment costs	(379)	(1,497)
Cash dividend paid	(3,851)	(2,629)
Repurchase of common stock		(2,000)
Net cash flows used in financing activities	(640)	(4,612)
Increase (decrease) in cash and cash equivalents	(791)	363
Cash and cash equivalents, beginning of period	14,328	13,881
Cash and cash equivalents, end of period	13,537	14,244
Supplemental cash flow activities:
Capital lease agreements	2,840	770
Fair value of net assets acquired	5,847
Consideration paid in cash	5,128
Future cash payment	$ 719

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Sep. 30, 2013	Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 13,537	$ 14,328
Trade receivables, net of allowance for doubtful accounts	6,704	5,835
Inventory of finished goods, net	2,144	1,284
Deferred income taxes	1,148	1,148
Prepaid facilities management rent and other current assets	11,633	9,476
Total current assets	35,166	32,071
Property, plant and equipment, net	143,699	129,947
Goodwill	58,185	57,737
Intangible assets, net	164,395	169,640
Prepaid facilities management rent and other assets	14,307	12,014
Total assets	415,752	401,409
Current liabilities:
Current portion of long-term debt and capital lease obligations	1,587	1,201
Trade accounts payable	10,369	9,189
Accrued facilities management rent	20,390	20,930
Accrued expenses and other current liabilities	18,663	13,677
Total current liabilities	51,009	44,997
Long-term debt and capital lease obligations	196,141	190,969
Deferred income taxes	45,133	46,770
Other liabilities	1,178	1,386
Total liabilities	293,461	284,122
Commitments and contingencies (Note 6)
Stockholders' equity:
Preferred stock ($.01 par value, 5 million shares authorized, no shares issued or outstanding)
Common stock ($.01 par value, 30 million shares authorized, 14,516,074 issued and outstanding at December 31, 2012, and 14,734,072 issued and outstanding at September 30, 2013)	147	145
Additional paid in capital	92,918	89,706
Accumulated other comprehensive loss		(130)
Retained earnings	29,226	27,566
Total stockholders' equity	122,291	117,287
Total liabilities and stockholders' equity	$ 415,752	$ 401,409