EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2017

Basic earnings per share ("EPS") is computed by dividing net income attributable to Heska by the weighted-average number of common shares outstanding during the period. The computation of diluted EPS is similar to the computation of basic EPS except that the numerator is increased to exclude charges that would not have been incurred, and the denominator is increased to include the number of additional common shares that would have been outstanding (using the if-converted and treasury stock methods), if securities containing potentially dilutive common shares (stock options and restricted stock units but excluding options to purchase fractional shares resulting from the Company's December 2010 1-for-10 reverse stock split) had been converted to common shares, and if such assumed conversion is dilutive.

The following is a reconciliation of the weighted-average shares outstanding used in the calculation of basic and diluted earnings per share for the three and nine months ended September 30, 2017 and 2016 (in thousands, except per share data):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016
Net income attributable to Heska	$	3,083	$	3,347	$	11,023	$	7,055

Basic weighted-average common shares outstanding	7,139		6,871		6,985		6,727
Assumed exercise of dilutive stock options and restricted shares	529		583		595		572
Diluted weighted-average common shares outstanding	7,668		7,454		7,580		7,299

Basic earnings per share attributable to Heska	$	0.43	$	0.49	$	1.58	$	1.05
Diluted earnings per share attributable to Heska	$	0.40	$	0.45	$	1.45	$	0.97

The following stock options and restricted shares were excluded from the computation of diluted earnings per share because they would have been anti-dilutive (in thousands):



	Three Months Ended September 30,		Nine Months Ended September 30,
	2017	2016	2017	2016
Stock options	27	100	132	135