Earnings per Share

3 Months Ended

Mar. 31, 2024

Note 5 – Earnings per Share

Earnings per share was calculated for the three months ended March 31, 2024 and 2023. Basic earnings per share is based upon the weighted average number of common shares outstanding, exclusive of unearned shares held by the Employee Stock Ownership Plan of Lake Shore Bancorp, Inc. (the “ESOP”) and by the Lake Shore Bancorp, Inc. 2012 Equity Incentive Plan (“EIP”). Diluted earnings per share is based upon the weighted average number of common shares outstanding and common share equivalents that would arise from the exercise of dilutive securities. Stock options are

regarded as potential common stock and are considered in the diluted earnings per share calculations to the extent they would be dilutive and computed using the treasury stock method.

The calculated basic and diluted earnings per share are as follows:


	Three Months Ended March 31,
	2024		2023
Numerator – net income	$	1,014,000	$	1,684,000
Denominator:
Basic weighted average shares outstanding		5,846,255		5,881,849
Increase in weighted average shares outstanding due to:
Stock options(1)		—		—
Diluted weighted average shares outstanding(1)		5,846,255		5,881,849

Earnings per share:
Basic	$	0.17	$	0.29
Diluted	$	0.17	$	0.29

(1)

Stock options to purchase 51,673 shares under the Company’s 2006 Stock Option Plan and 12,519 shares under the EIP at $14.38 were outstanding during the three months ended March 31, 2024 but were not included in the calculation of diluted earnings per share because to do so would have been anti-dilutive.