Earnings Per Share

12 Months Ended

Jan. 01, 2017

The reconciliation of basic earnings per share on common stock for the year-end 2016, 2015 and 2014 follows (in millions of dollars except per share data).



	2016			2015			2014
Net earnings	$	120.8		$	53.8		$	23.7
Less: Earnings allocated to participating securities	(2.6		)	(1.4		)	(0.7		)
Net earnings available to common shareholders	$	118.2		$	52.4		$	23.0

Average common shares outstanding (millions):
Basic	38.1			37.8			37.5
Dilutive share awards	0.3			0.1			—
Diluted	38.4			37.9			37.5

Basic earnings per share	$	3.10		$	1.39		$	0.61
Diluted earnings per share	$	3.08		$	1.39		$	0.61

Potentially dilutive shares outstanding are primarily related to performance shares for 2016 and 2015. Stock options excluded from the computation of diluted earnings per share due to their anti-dilutive effect for 2016 and 2015 were not significant. Stock options representing 0.1 million shares for 2014 were excluded from the computation of diluted earnings per share due to their anti-dilutive effect.

We have presented earnings per share for our two classes of common stock on a combined basis. This presentation is consistent with the earnings per share computations that result for each class of common stock utilizing the two-class method as described in ASC Topic 260, “Earnings Per Share”. The two-class method is an earnings allocation formula which determines earnings per share for each class of common stock according to the dividends declared (or accumulated) and participation rights in the undistributed earnings.

In applying the two class method, we have determined that the undistributed earnings should be allocated to each class on a pro rata basis after consideration of all of the participation rights of the Class B shares (including voting and conversion rights) and our history of paying dividends equally to each class of common stock on a per share basis.

The Company’s Restated Certificate of Incorporation allows the Board of Directors to declare a cash dividend to Class A shares without declaring equal dividends to the Class B shares. Class B shares’ voting and conversion rights, however, effectively allow the Class B shares to participate in dividends equally with Class A shares on a per share basis.

The Class B shares are the only shares with voting rights. The Class B shareholders are therefore able to exercise voting control with respect to all matters requiring stockholder approval, including the election of or removal of directors. The Board of Directors has historically declared and the Company historically has paid equal per share dividends on both the Class A and Class B shares. Each class has participated equally in all dividends declared since 1987.

In addition, Class B shares are convertible, at the option of the holder, into Class A shares on a one-for-one basis. As a result, Class B shares can participate equally in any dividends declared on the Class A shares by exercising their conversion rights.