Earnings per Share

6 Months Ended

Jun. 30, 2016

Note 6 – Earnings per Share

The computation of earnings per share, as presented in the Consolidated Statements of Income, is based on the weighted average number of shares outstanding during each period. There were 13,280,433 weighted average shares outstanding during the second quarter of 2016, and 13,560,091 during the second quarter of 2015. There were 13,272,903 weighted average shares outstanding during the first six months of 2016, and 13,619,050 during the first six months of 2015.

Diluted earnings per share include the effect of the potential issuance of common shares, which for the Company is limited to shares that would be issued on the exercise of “in-the-money” stock options. For the second quarter of 2016, calculations under the treasury stock method resulted in the equivalent of 113,015 shares being added to basic weighted average shares outstanding for purposes of determining diluted earnings per share, while a weighted average of 162,700 stock options were excluded from the calculation because they were underwater and thus anti-dilutive. For the second quarter of 2015 the equivalent of 126,115 shares were added in calculating diluted earnings per share while 169,300 anti-dilutive stock options were excluded. Likewise, for the first half of 2016 the equivalent of 115,761 shares were added to basic weighted average shares outstanding in calculating diluted earnings per share and a weighted average of 212,700 stock options that were anti-dilutive for the period were excluded, compared to the inclusion of the equivalent of 126,417 shares and exclusion of 171,700 anti-dilutive options in calculating diluted earnings per share for first half of 2015.