Net Income (Loss) Per Share

3 Months Ended

Oct. 01, 2011

Net Income (Loss) Per Share [Abstract]

Net Income (Loss) Per Share

2. Net Income (Loss) Per Share

The computation of net income (loss) per share only includes results attributable to Sara Lee and does not include earnings related to noncontrolling interests. Net income per share – basic is computed by dividing net income (loss) attributable to Sara Lee by the weighted average number of shares of common stock outstanding for the period. Net income per share – diluted reflects the potential dilution that could occur if options or fixed awards to be issued under stock-based compensation awards were converted into common stock. For the quarter ended October 1, 2011, options to purchase 1.7 million shares of the corporation's common stock had exercise prices that were greater than the average market price of those shares during the respective reporting periods. For the quarter ended October 2, 2010, options to purchase 13.7 million shares of the corporation's common stock had exercise prices that were greater than the average market price of those shares during the respective reporting periods. In 2012, the dilutive effect of stock option and award plans was excluded from the earnings per share calculation as they would be anti-dilutive given the loss in the period.

The average shares outstanding declined in the first quarter of 2012 as compared to the first quarter of 2011 as a result of shares repurchased under the corporation's ongoing share repurchase program. During 2011, the corporation repurchased 80.2 million shares of common stock for $1.3 billion, the majority of which were repurchased after the end of the first quarter of 2011. As of October 1, 2011, the corporation was authorized to repurchase approximately $1.2 billion of common stock under its existing share repurchase program, plus 13.5 million shares of common stock that remain authorized for repurchase under the corporation's prior share repurchase program. The corporation repurchases common stock at times management deems appropriate. However, the corporation does not expect to continue with any further share repurchases.

The following is a reconciliation of net income to net income per share – basic and diluted – for the first quarter of 2012 and 2011 (per share amounts are rounded and may not add to total):

Computation of Net Income per Common Share

(In millions, except per share data)

	Oct. 1, 2011			Oct. 2, 2010
Amounts attributable to Sara Lee:
Income (loss) from continuing operations	$	(34	)	$	61
Income (loss) from discontinued operations		(183	)		131
Net income (loss)	$	(217	)	$	192
Average shares outstanding – basic		591			653
Dilutive effect of stock option and award plans		—			2
Diluted shares outstanding		591			655
Earnings per common share – Basic
Income (loss) from continuing operations	$	(0.06	)	$	0.09
Income (loss) from discontinued operations	$	(0.31	)	$	0.20
Net income (loss)	$	(0.37	)	$	0.29
Earnings per common share – Diluted
Income (loss) from continuing operations	$	(0.06	)	$	0.09
Income (loss) from discontinued operations	$	(0.31	)	$	0.20
Net income (loss)	$	(0.37	)	$	0.29