Earnings per Share

9 Months Ended

Jan. 23, 2016

Note 13: Earnings per Share

Certain share-based compensation awards that entitle their holders to receive non-forfeitable dividends prior to vesting are considered participating securities. We grant restricted stock awards that contain non-forfeitable rights to dividends on unvested shares, and we are required to include these participating securities in calculating our basic earnings per common share, using the two-class method.

The following is a reconciliation of the numerators and denominators we used in our computations of basic and diluted earnings per share:

	Quarter Ended						Nine Months Ended
(Unaudited, amounts in thousands)	1/23/16			1/24/15			1/23/16			1/24/15
Numerator (basic and diluted):
Net income attributable to La-Z-Boy Incorporated	$	21,906		$	17,948		$	56,534		$	50,558
Income allocated to participating securities	(107		)	(97		)	(292		)	(283		)

Net income available to common shareholders	$	21,799		$	17,851		$	56,242		$	50,275


Denominator:
Basic weighted average common shares outstanding	50,038			51,576			50,371			52,015
Add:
Contingent common shares	171			210			172			223
Stock option dilution	330			353			337			302

Diluted weighted average common shares outstanding	50,539			52,139			50,880			52,540

The above values for contingent common shares reflect the dilutive effect of common shares that we would have issued to employees under the terms of performance-based share awards if the relevant performance period for the award had been the reporting period.

We had outstanding options to purchase 0.4 million shares for the quarter and nine months ended January 23, 2016, and January 24, 2015, with a weighted average exercise price of $26.69 and $23.63, respectively. We excluded the effect of these options from our diluted share calculation since, for each period presented, the weighted average exercise price of the options was higher than the average market price, and including the options’ effect would have been anti-dilutive.