Earnings Per Share

Our basic earnings per share ("EPS") is computed based on the weighted average number of common shares (including vested but unissued stock units, share units, performance shares and restricted stock units ("RSUs")), outstanding during each respective period. Our diluted EPS reflects the dilution from potential common stock issuable pursuant to the exercise of equity-classified stock-based awards, if dilutive, outstanding during each respective period. Pursuant to FASB ASC 260 "Earnings Per Share," equity-classified stock-based awards that are subject to performance conditions are not considered in our diluted EPS calculations until the respective performance conditions have been satisfied. When calculating our diluted earnings per share, we consider the amount an employee must pay upon assumed exercise of stock-based awards and the amount of stock-based compensation cost attributed to future services and not yet recognized. On August 1, 2017, we adopted ASU 2016-09, which amends several aspects of the accounting for and reporting of share-based payment transactions. As a result of our adoption of ASU 2016-09, the amount of excess tax benefits assuming exercise of in-the-money stock-based awards is no longer included in the calculation of diluted earnings per share on a prospective basis and the denominator for our diluted calculations could increase in the future as compared to prior calculations. See Note (12) - "Stock-Based Compensation" for more information on the impact of adopting ASU 2016-09.

There were no purchases of our common stock during the six months ended January 31, 2018 or 2017. See Note (17) - "Stockholders’ Equity" for more information.

Weighted average stock options, RSUs and restricted stock outstanding of 1,812,000 and 2,173,000 for the three months ended January 31, 2018 and 2017, respectively, and 1,821,000 and 2,305,000 for the six months ended January 31, 2018 and 2017, respectively, were not included in our diluted EPS calculation because their effect would have been anti-dilutive.

Our EPS calculations exclude 259,000 and 237,000 weighted average performance shares outstanding for the three months ended January 31, 2018 and 2017, respectively, and 211,000 and 229,000 weighted average performance shares outstanding for the six months ended January 31, 2018 and 2017, respectively, as the performance conditions have not yet been satisfied. However, the compensation expense related to these awards is included in net income (the numerator) for EPS calculations for each respective period.

The following table reconciles the numerators and denominators used in the basic and diluted EPS calculations:



	Three months ended January 31,			Six months ended January 31,
	2018		2017	2018	2017
Numerator:
Net income for basic calculation	$	15,761,000	6,585,000	14,101,000	4,096,000
Numerator for diluted calculation	$	15,761,000	6,585,000	14,101,000	4,096,000

Denominator:
Denominator for basic calculation	23,816,000		23,428,000	23,805,000	23,406,000
Effect of dilutive securities:
Stock-based awards	137,000		17,000	137,000	21,000
Denominator for diluted calculation	23,953,000		23,445,000	23,942,000	23,427,000