Shareholders' Equity

12 Months Ended

Dec. 31, 2016

Shareholders' Equity

Shareholders' Equity

Note 9. Shareholders’ Equity

Capital Stock

We have authorization for 15 million shares of preferred stock with a par value of $0.01 and 500 million shares of common stock with a par value of $0.125.  Outstanding common stock activity for the three years ended December 31, 2016 is presented below:

(In thousands)	2016	2015	2014
Balance at beginning of year	274,228	276,582	282,059
Stock repurchases	(6,898)	(5,197)	(8,921)
Share-based compensation activity	2,957	2,843	3,444
Balance at end of year	270,287	274,228	276,582

Earnings Per Share

We calculate basic and diluted earnings per share (EPS) based on net income, which approximates income available to common shareholders for each period.  Basic EPS is calculated using the two-class method, which includes the weighted-average number of common shares outstanding during the period and restricted stock units to be paid in stock that are deemed participating securities as they provide nonforfeitable rights to dividends.  Diluted EPS considers the dilutive effect of all potential future common stock, including stock options.

The weighted-average shares outstanding for basic and diluted EPS are as follows:

(In thousands)	2016	2015	2014
Basic weighted-average shares outstanding	270,774	276,682	279,409
Dilutive effect of:
Stock options	1,591	2,045	2,049
Accelerated Share Repurchase agreement	—	—	332
Diluted weighted-average shares outstanding	272,365	278,727	281,790

Stock options to purchase 2 million shares of common stock are excluded from the calculation of diluted weighted-average shares outstanding for each year presented as their effect would have been anti-dilutive.

Accumulated Other Comprehensive Loss

The components of Accumulated Other Comprehensive Loss are presented below:

(In millions)		Pension and Postretirement Benefits Adjustments		Foreign Currency Translation Adjustments		Deferred Gains (Losses) on Hedge Contracts		Accumulated Other Comprehensive Loss
Balance at January 3, 2015	$	(1,511)	$	18	$	(13)	$	(1,506)
Other comprehensive income (loss) before reclassifications		92		(65)		(26)		1
Reclassified from Accumulated other comprehensive loss		92		—		15		107
Other comprehensive income (loss)		184		(65)		(11)		108
Balance at January 2, 2016	$	(1,327)	$	(47)	$	(24)	$	(1,398)
Other comprehensive income (loss) before reclassifications		(240)		(49)		7		(282)
Reclassified from Accumulated other comprehensive loss		62		—		13		75
Other comprehensive income (loss)		(178)		(49)		20		(207)
Balance at December 31, 2016	$	(1,505)	$	(96)	$	(4)	$	(1,605)

Other Comprehensive Income (Loss)

The before and after-tax components of other comprehensive income (loss) are presented below:

		2016							2015							2014
(In millions)		Pre-Tax Amount		Tax (Expense) Benefit		After-Tax Amount			Pre-Tax Amount		Tax (Expense) Benefit		After-Tax Amount			Pre-Tax Amount		Tax (Expense) Benefit		After-Tax Amount
Pension and postretirement benefits adjustments:
Unrealized gains (losses)	$	(382)	$	135	$		(247)	$	136	$	(44)	$		92	$	(734)	$	252	$		(482)
Amortization of net actuarial loss*		104		(39)			65		150		(53)			97		114		(40)			74
Amortization of prior service credit*		(7)		4			(3)		(7)		2			(5)		(8)		4			(4)
Recognition of prior service credit		12		(5)			7		—		—			—		18		(7)			11
Pension and postretirement benefits adjustments, net		(273)		95			(178)		279		(95)			184		(610)		209			(401)
Deferred gains (losses) on hedge contracts:
Current deferrals		11		(4)			7		(33)		7			(26)		(16)		4			(12)
Reclassification adjustments		17		(4)			13		19		(4)			15		12		(3)			9
Deferred gains (losses) on hedge contracts, net		28		(8)			20		(14)		3			(11)		(4)		1			(3)
Foreign currency translation adjustments		(36)		(13)			(49)		(55)		(10)			(65)		(71)		(4)			(75)
Total	$	(281)	$	74	$		(207)	$	210	$	(102)	$		108	$	(685)	$	206	$		(479)

*These components of other comprehensive income (loss) are included in the computation of net periodic pension cost. See Note 11 for additional information.