Annual report pursuant to Section 13 and 15(d)

Selected Quarterly Data (Unaudited)

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Selected Quarterly Data (Unaudited)
 12 Months Ended
Dec. 31, 2011
Selected Quarterly Data (Unaudited) [Abstract]  
Selected Quarterly Data (Unaudited)
(16)  Selected Quarterly Data (Unaudited)

The following table shows selected quarterly data for 2011 and 2010, in thousands, except earnings per share:

   
2011 Quarters
  
                         
   
1st
    
2nd
    
3rd
    
4th
  
                         
Revenues
   $ 151,244     $ 158,546     $ 159,923     $ 148,879  
Operating income
   $ 6,909     $ 7,273     $ 11,387     $ 11,111  
Net income
   $ 4,172     $ 4,211     $ 6,120     $ 6,049  
                                 
Basic and diluted earnings per share
   $ 0.80     $ 0.80     $ 1.17     $ 1.15  
Basic and diluted weighted average shares outstanding
     5,214       5,237       5,238       5,238  


   
2010 Quarters
  
                         
   
1st
    
2nd
    
3rd
    
4th
  
                         
Revenues
   $ 228,176     $ 212,473     $ 212,943     $ 212,444  
Operating income
   $ 8,651     $ 9,953     $ 11,845     $ 7,764  
Net income
   $ 5,398     $ 6,103     $ 7,218     $ 4,968  
                                 
Basic and diluted earnings per share
  $ 1.04     $ 1.18     $ 1.39     $ 0.96  
Basic and diluted weighted average shares outstanding
     5,180       5,192       5,192       5,192  

During the fourth quarter of 2011, we determined that four building leases that we executed in connection with the acquisition of WBI were capital leases. We incorrectly treated these leases as operating leases in our financial statements as of and for the periods ended June 30, 2011 and September 30, 2011. At inception of the leases, we should have recognized assets with offsetting capital lease obligations aggregating $6.7 million, representing the fair value of the buildings at that time per a third party appraisal.  At June 30, 2011 and September 30, 2011, total assets and liabilities were understated by $6.7 million and $6.6 million, respectively.  We have concluded that this error was not material to the affected financial statements. Additionally, accounting for these leases as operating leases resulted in us overstating rent expense and understating depreciation expense and interest expense in the interim periods.  The net impact of this misstatement was inconsequential to the consolidated statements of income and cash flows of the Company for any period in 2011. The error was corrected in the fourth quarter of 2011 (see Note 4).

Our profitability will fluctuate based on the mix of contract work performed and on the timing of fees earned and awarded on certain contracts. We recognized operating income on our Treasury Seized Asset Program in the third quarter of 2010 of approximately $3.5 million primarily due to this program’s annual incentive fee recognition.