XML 27 R15.htm IDEA: XBRL DOCUMENT
v3.20.2

Net Income per Share | 6 Months Ended
--- | ---
Jun. 27, 2020
Net Income per Share |
I. | Net Income per Share
The Company calculates net income per share using the two-class method, which requires the Company to allocate net income to its Class A Common Shares, Class B Common Shares and unvested share-based payment awards that participate in dividends with common stock, in the calculation of net income per share. The Class A Common Stock has no voting rights, except (1) as required by law, (2) for the election of Class A Directors, and (3) that the approval of the holders of the Class A Common Stock is required for (a) certain future authorizations or issuances of additional securities which have rights senior to Class A Common Stock, (b) certain alterations of rights or terms of the Class A or Class B Common Stock as set forth in the Articles of Organization of the Company, (c) other amendments of the Articles of Organization of the Company, (d) certain mergers or consolidations with, or acquisitions of, other entities, and (e) sales or dispositions of any significant portion of the Company’s assets. The Class B Common Stock has full voting rights, including the right to (1) elect a majority of the members of the Company’s Board of Directors and (2) approve all (a) amendments to the Company’s Articles of Organization, (b) mergers or consolidations with, or acquisitions of, other entities, (c) sales or dispositions of any significant portion of the Company’s assets, and (d) equity-based and other executive compensation and other significant corporate matters. The Company’s Class B Common Stock is not listed for trading. Each share of the Class B Common Stock is freely convertible into one share of Class A Common Stock, upon request of the respective Class B holder, and participates equally in dividends. The Company’s unvested share-based payment awards include unvested shares (1) issued under the Company’s investment share program, which permits employees who have been with the Company for at least one year to purchase shares of Class A Common Stock and to purchase those shares at a discount ranging from 20% to 40% below market value based on years of employment starting after two years of employment, and (2) awarded as restricted stock awards at the discretion of the Company’s Board of Directors. The investment shares and restricted stock awards generally vest over five years in equal number of shares. The unvested shares participate equally in dividends. See Note O for a discussion of the current year unvested stock awards and issuances. Included in the computation of net income per diluted common share are dilutive outstanding stock options and restricted stock that are vested or expected to vest. At its discretion, the Board of Directors grants stock options and restricted stock to senior management and certain key employees. The terms of the employee stock options are determined by the Board of Directors at the time of grant. To date, stock options granted to employees vest over various service periods and/or based on the attainment of certain performance criteria and generally expire after ten years. In December 2018, the Employee Equity Incentive Plan was amended to permit the grant of restricted stock units. The restricted stock units generally vest over four years in equal number of shares. Each restricted stock unit represents an unfunded and unsecured right to receive one share of Class A Stock upon satisfaction of the vesting criteria. The unvested shares participate equally in dividends and are forfeitable. Prior to March 1, 2019, the Company granted restricted stock awards, generally vesting over five years in equal number of shares. The Company also grants stock options to its non-employee directors upon election or re-election to the Board of Directors. The number of option shares granted to non-employee directors is calculated based on a defined formula and these stock options vest immediately upon grant and expire after ten years. Net Income per Common Share - Basic The following table sets forth the computation of basic net income per share using the two-class method:
|  | Thirteen weeks ended |  |  | Twenty-six weeks ended |
|  | June 27, 2020 |  |  | June 29, 2019 |  |  | June 27, 2020 |  |  | June 29, 2019 |
|  | (in thousands, except per share data) |  |  | (in thousands, except per share data) |
Net income |  | $ | 60,141 |  |  | $ | 27,856 |  |  | $ | 78,375 |  |  | $ | 51,550 |
Allocation of net income for basic: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Class A Common Stock |  | $ | 47,930 |  |  | $ | 20,639 |  |  | $ | 61,612 |  |  | $ | 38,161 |
Class B Common Stock |  |  | 11,836 |  |  |  | 6,964 |  |  |  | 16,237 |  |  |  | 12,908 |
Unvested participating shares |  |  | 375 |  |  |  | 253 |  |  |  | 526 |  |  |  | 481 |
|  | $ | 60,141 |  |  | $ | 27,856 |  |  | $ | 78,375 |  |  | $ | 51,550 |
Weighted average number of shares for basic: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Class A Common Stock |  |  | 9,720 |  |  |  | 8,648 |  |  |  | 9,572 |  |  |  | 8,627 |
Class B Common Stock* |  |  | 2,400 |  |  |  | 2,918 |  |  |  | 2,523 |  |  |  | 2,918 |
Unvested participating shares |  |  | 76 |  |  |  | 106 |  |  |  | 82 |  |  |  | 109 |
|  |  | 12,196 |  |  |  | 11,672 |  |  |  | 12,177 |  |  |  | 11,654 |
Net income per share for basic: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Class A Common Stock |  | $ | 4.93 |  |  | $ | 2.39 |  |  | $ | 6.44 |  |  | $ | 4.42 |
Class B Common Stock |  | $ | 4.93 |  |  | $ | 2.39 |  |  | $ | 6.44 |  |  | $ | 4.42 |
* | Change in Class B Common Stock resulted from the conversion of 100,000 shares to Class A Common Stock on August 8, 2019, 145,000 shares to Class A Common Stock on December 13, 2019, 150,000 shares to Class A Common Stock on March 11, 2020 and 215,000 shares to Class A Common Stock on May 6, 2020 with the ending number of shares reflecting the weighted average for the period.
Net Income per Common Share - Diluted The Company calculates diluted net income per share for common stock using the more dilutive of (1) the treasury stock method, or (2) the two-class method, which assumes the participating securities are not exercised. The following table sets forth the computation of diluted net income per share, assuming the conversion of all Class B Common Stock into Class A Common Stock and using the two-class method for unvested participating shares:
|  | Thirteen weeks ended |
|  | June 27, 2020 |  |  | June 29, 20 19 |
|  | Earnings to Common Shareholders |  |  | Common Shares |  |  | EPS |  |  | Earnings to Common Shareholders |  |  | Common Shares |  |  | EPS |
|  | (in thousands, except per share data) |
As reported - basic |  | $ | 47,930 |  |  |  | 9,720 |  |  | $ | 4.93 |  |  | $ | 20,639 |  |  |  | 8,648 |  |  | $ | 2.39 |
Add: effect of dilutive potential common shares |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Share-based awards |  |  | — |  |  |  | 138 |  |  |  |  |  |  |  | — |  |  |  | 118 |  |  |  |  |
Class B Common Stock |  |  | 11,836 |  |  |  | 2,400 |  |  |  |  |  |  |  | 6,964 |  |  |  | 2,918 |  |  |  |  |
Net effect of unvested participating shares |  |  | 4 |  |  |  | — |  |  |  |  |  |  |  | 2 |  |  |  | — |  |  |  |  |
Net income per common share - diluted |  | $ | 59,770 |  |  |  | 12,258 |  |  | $ | 4.88 |  |  | $ | 27,605 |  |  |  | 11,684 |  |  | $ | 2.36 |
|  | Twenty-six weeks ended |
|  | June 27, 2020 |  |  | June 29, 20 19 |
|  | Earnings to Common Shareholders |  |  | Common Shares |  |  | EPS |  |  | Earnings to Common Shareholders |  |  | Common Shares |  |  | EPS |
|  | (in thousands, except per share data) |
As reported - basic |  | $ | 61,612 |  |  |  | 9,572 |  |  | $ | 6.44 |  |  | $ | 38,161 |  |  |  | 8,627 |  |  | $ | 4.42 |
Add: effect of dilutive potential common shares |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Share-based awards |  |  | — |  |  |  | 126 |  |  |  |  |  |  |  | — |  |  |  | 115 |  |  |  |  |
Class B Common Stock |  |  | 16,237 |  |  |  | 2,523 |  |  |  |  |  |  |  | 12,908 |  |  |  | 2,918 |  |  |  |  |
Net effect of unvested participating shares |  |  | 5 |  |  |  | — |  |  |  |  |  |  |  | 5 |  |  |  | — |  |  |  |  |
Net income per common share - diluted |  | $ | 77,854 |  |  |  | 12,221 |  |  | $ | 6.37 |  |  | $ | 51,074 |  |  |  | 11,660 |  |  | $ | 4.38 |
During the thirteen and twenty-six weeks ended June 27, 2020, weighted-average stock options to purchase approximately 23,000 and 16,000 shares of Class A Common Stock were outstanding but not included in computing dilutive income per common share because their effects were anti-dilutive. During the thirteen and twenty-six weeks ended June 29, 2019, weighted-average stock options to purchase approximately 10,000 and 6,000 shares of Class A Common Stock were outstanding but not included in computing dilutive income per common share because their effects were anti-dilutive. Additionally, performance-based stock options to purchase approximately 18,000 shares of Class A Common Stock were outstanding as of June 29, 2019, respectively, but not included in computing diluted income per common share because the performance criteria of these stock options were not met as of the end of the reporting period.

X
- Definition The entire disclosure for earnings per share. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 260 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=109243012&loc=SL65017193-207537 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 260 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 260 -URI http://asc.fasb.org/topic&trid=2144383 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 260 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3630-109257 + Details
Name: | us-gaap_EarningsPerShareTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration