Earnings per Share

3 Months Ended

Jul. 25, 2020

Certain share-based compensation awards that entitle their holders to receive non-forfeitable dividends prior to vesting are considered participating securities. Prior to fiscal 2019, we granted restricted stock awards that contained non-forfeitable rights to dividends on unvested shares, and we are required to include these participating securities in calculating our basic earnings per common share, using the two-class method.

The following is a reconciliation of the numerators and denominators we used in our computations of basic and diluted earnings per share:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Numerator (basic and diluted):
Net income attributable to La-Z-Boy Incorporated	$	4,798		$	18,069
Income allocated to participating securities	(4		)	(39		)
Net income available to common Shareholders	$	4,794		$	18,030

Denominator:
Basic weighted average common shares outstanding	45,909			46,820
Add:
Contingent common shares	47			130
Stock option dilution	9			175
Diluted weighted average common shares outstanding	45,965			47,125

Earnings per Share:
Basic	$	0.10		$	0.39
Diluted	$	0.10		$	0.38

The values for contingent common shares set forth above reflect the dilutive effect of common shares that we would have issued to employees under the terms of performance-based share awards if the relevant performance period for the award had been the reporting period.

We had outstanding options to purchase 1.5 million shares for the quarter ended July 25, 2020, with a weighted average exercise price of $29.08. We excluded the effect of these options from our diluted share calculation since the weighted average exercise price of the options was higher than the average market price and including the options’ effect would have been anti-dilutive. Similarly, we excluded options to purchase 0.4 million shares from the diluted share calculation for the quarter ended July 27, 2019.