Net Income Per Share

9 Months Ended

May 30, 2020

Net Income Per Share [Abstract]

Net Income Per Share

Note 3: Net Income per Share

The Company’s non-vested restricted share awards (RSAs) contain non-forfeitable rights to dividends and meet the criteria of a participating security as defined by ASC Topic 260, “Earnings Per Share”. Under the two-class method, net income per share is computed by dividing net income allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, net income is allocated to both common shares and participating securities based on their respective weighted average shares outstanding for the period. Effective in fiscal 2016, the Company discontinued its granting of RSAs and as of May 30, 2020 does not have any non-vested RSAs outstanding.

 The following table sets forth the computation of basic and diluted net income per common share under the two-class method for the thirteen and thirty-nine weeks ended May 30, 2020 and June 1, 2019, respectively:

	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	May 30,		June 1,		May 30,		June 1,
	2020		2019		2020		2019
Net income attributable to MSC Industrial as reported	$	77,703	$	79,601	$	198,621	$	222,257
Less: Distributed net income available to participating securities		—		(10)		(10)		(34)
Less: Undistributed net income available to participating securities		—		(19)		—		(66)
Numerator for basic net income per share:
Undistributed and distributed net income available to common shareholders	$	77,703	$	79,572	$	198,611	$	222,157
Add: Undistributed net income allocated to participating securities		—		19		—		66
Less: Undistributed net income reallocated to participating securities		—		(19)		—		(66)
Numerator for diluted net income per share:
Undistributed and distributed net income available to common shareholders	$	77,703	$	79,572	$	198,611	$	222,157
Denominator:
Weighted average shares outstanding for basic net income per share		55,563		55,158		55,435		55,266
Effect of dilutive securities		36		229		146		290
Weighted average shares outstanding for diluted net income per share		55,599		55,387		55,581		55,556
Net income per share Two-class method:
Basic	$	1.40	$	1.44	$	3.58	$	4.02
Diluted	$	1.40	$	1.44	$	3.57	$	4.00
Potentially dilutive securities		1,933		1,093		1,417		939

Potentially dilutive securities attributable to outstanding stock options, restricted stock units, and performance share units are excluded from the calculation of diluted earnings per share where the combined exercise price and average unamortized fair value are greater than the average market price of MSC common stock, and therefore their inclusion would be anti-dilutive.