EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share:



	Fiscal Year Ended March 31,
(in thousands, except share and per share data)	2017			2016			2015
Basic Earnings Per Share
Numerator for basic earnings per share
Net income attributable to Universal Corporation	$	106,304		$	109,016		$	114,608
Less: Dividends on convertible perpetual preferred stock	(11,061		)	(14,748		)	(14,824		)
Less: Cost in excess of carrying value on conversion or repurchase of convertible perpetual preferred stock	(74,353		)	—			(36		)
Earnings available to Universal Corporation common shareholders for calculation of basic earnings per share	20,890			94,268			99,748

Denominator for basic earnings per share
Weighted average shares outstanding	23,433,860			22,683,290			23,035,920

Basic earnings per share	$	0.89		$	4.16		$	4.33

Diluted Earnings Per Share
Numerator for diluted earnings per share
Earnings available to Universal Corporation common shareholders	$	20,890		$	94,268		$	99,748
Add: Dividends on convertible perpetual preferred stock (if conversion assumed)	—			14,748			14,824
Add: Cost in excess of carrying value on conversion or repurchase of convertible perpetual preferred stock (if dilutive)	—			—			36
Earnings available to Universal Corporation common shareholders for calculation of diluted earnings per share	20,890			109,016			114,608

Denominator for diluted earnings per share
Weighted average shares outstanding	23,433,860			22,683,290			23,035,920
Effect of dilutive securities (if conversion or exercise assumed)
Convertible perpetual preferred stock	—			4,853,268			4,843,309
Employee share-based awards	336,228			288,933			342,035
Denominator for diluted earnings per share	23,770,088			27,825,491			28,221,264

Diluted earnings per share	$	0.88		$	3.92		$	4.06

In December 2016, 111,072 shares of the Company’s Series B 6.75% Convertible Perpetual Preferred Stock were converted into approximately 2.5 million shares of the Company's common stock. In January 2017, the Company announced a mandatory conversion of all 107,418 remaining outstanding shares of the preferred stock after meeting the requirements to initiate the mandatory conversion under the original terms of the preferred shares. The Company chose to satisfy the conversion obligation for the mandatory conversion in cash. Although the conversions of the preferred stock into common stock or for cash did not impact the Company’s net income, the shares converted for cash under the mandatory conversion in January 2017 resulted in a one-time reduction of retained earnings of approximately $74.4 million during the fourth quarter ending March 31, 2017, representing the excess of the conversion cost over the carrying value of those shares. The reduction in retained earnings resulted in a corresponding one-time reduction of earnings available to common shareholders for the fiscal year ending March 31, 2017 for purposes of determining the amounts reported for basic and diluted earnings per share. The effects of the conversions on the computation of basic and diluted earnings per share for the fiscal year ended March 31, 2017, are included in the table above. See Note 11 for additional information.

For the fiscal years ended March 31, 2017, 2016, and 2015, the Company had the following potentially dilutive securities (stock appreciation rights) outstanding that were not included in the computation of diluted earnings per share because their effect would have been antidilutive:



	Fiscal Year Ended March 31,
	2017		2016		2015
Potentially dilutive securities	—		133,600		156,200
Weighted-average exercise price	$	—	$	62.66	$	61.83