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Earnings Per Share
 12 Months Ended
Sep. 30, 2017
Earnings Per Share [Abstract]  
Earnings Per Share

Note P. Earnings Per Share

The following tables summarize the components of the basic and diluted earnings per common share (“EPS”) computations:

 

 

 

Years Ended September 30

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In millions, except per share amounts)

 

Basic EPS:

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to Cabot Corporation

 

$

241

 

 

$

149

 

 

$

(334

)

Less: Dividends and dividend equivalents to participating

   securities

 

 

—

 

 

 

—

 

 

 

—

 

Less: Undistributed earnings allocated to participating

   securities(1)

 

 

2

 

 

 

1

 

 

 

—

 

Earnings (loss) allocated to common shareholders (numerator)

 

$

239

 

 

$

148

 

 

$

(334

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares and participating

   securities outstanding

 

 

62.8

 

 

 

62.9

 

 

 

63.9

 

Less: Participating securities(1)

 

 

0.5

 

 

 

0.5

 

 

 

0.5

 

Adjusted weighted average common shares

   (denominator)

 

 

62.3

 

 

 

62.4

 

 

 

63.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share amounts—basic:

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations attributable to

   Cabot Corporation

 

$

3.83

 

 

$

2.36

 

 

$

(5.29

)

Income (loss) from discontinued operations

 

 

—

 

 

 

0.02

 

 

 

0.02

 

Net income (loss) attributable to Cabot Corporation

 

$

3.83

 

 

$

2.38

 

 

$

(5.27

)

Diluted EPS:

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) allocated to common shareholders

 

$

239

 

 

$

148

 

 

$

(334

)

Plus: Earnings (loss) allocated to participating securities

 

 

2

 

 

 

1

 

 

 

—

 

Less: Adjusted earnings allocated to participating

   securities(2)

 

 

2

 

 

 

1

 

 

 

—

 

Earnings (loss) available to common shares (numerator)

 

$

239

 

 

$

148

 

 

$

(334

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted weighted average common shares outstanding

 

 

62.3

 

 

 

62.4

 

 

 

63.4

 

Effect of dilutive securities:

 

 

 

 

 

 

 

 

 

 

 

 

Common shares issuable(3)

 

 

0.4

 

 

 

0.5

 

 

 

—

 

Adjusted weighted average common shares

   (denominator)

 

 

62.7

 

 

 

62.9

 

 

 

63.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per share amounts—diluted:

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations attributable to

   Cabot Corporation

 

$

3.80

 

 

$

2.34

 

 

$

(5.29

)

Income (loss) from discontinued operations

 

 

—

 

 

 

0.02

 

 

 

0.02

 

Net income (loss) attributable to Cabot Corporation

 

$

3.80

 

 

$

2.36

 

 

$

(5.27

)

 

(1)

Participating securities consist of unvested time-based restricted stock units.

Undistributed earnings are the earnings which remain after dividends declared during the period are assumed to be distributed to the common and participating shareholders. Undistributed earnings are allocated to common and participating shareholders on the same basis as dividend distributions. The calculation of undistributed earnings is as follows:

 

 

 

Years Ended September 30

 

 

 

2017

 

 

2016

 

 

2015

 

 

 

(In millions)

 

Calculation of undistributed earnings:

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to Cabot Corporation

 

$

241

 

 

$

149

 

 

$

(334

)

Less: Dividends declared on common stock

 

 

77

 

 

 

65

 

 

 

56

 

Less: Dividends and dividend equivalents to participating

   securities

 

 

—

 

 

 

—

 

 

 

—

 

Undistributed earnings (loss)

 

$

164

 

 

$

84

 

 

$

(390

)

Allocation of undistributed earnings:

 

 

 

 

 

 

 

 

 

 

 

 

Undistributed earnings (loss) allocated to common

   shareholders

 

$

162

 

 

$

83

 

 

$

(390

)

Undistributed earnings allocated to participating

   securities

 

 

2

 

 

 

1

 

 

 

—

 

Undistributed earnings (loss)

 

$

164

 

 

$

84

 

 

$

(390

)

 

(2)

Undistributed earnings (loss) are adjusted for the assumed distribution of dividends to the dilutive securities, which are described in (3) below, and then reallocated to participating securities.

(3)

Represents incremental shares of common stock from the (i) assumed exercise of stock options issued under Cabot’s equity incentive plans; (ii) assumed issuance of shares to employees pursuant to the Company’s SERP 401(k) Plan; and (iii) assumed issuance of shares for outstanding and achieved performance-based stock unit awards issued under Cabot’s equity incentive plans using the treasury stock method. For fiscal 2017, 2016 and 2015, respectively, 179,052, 634,168 and 897,056 incremental shares of common stock were not included in the calculation of diluted earnings per share because the inclusion of these shares would have been antidilutive.