Computation of Earnings Per Common Share

6 Months Ended

Jan. 28, 2017

Computation of Earnings Per Common Share

Computation of Earnings per Common Share

The following table sets forth the computation of basic and diluted earnings per common share (dollars in thousands, except per share amounts):



	For the Three Months Ended				For the Six Months Ended
	January 28, 2017		January 23, 2016		January 28, 2017		January 23, 2016
Net income available to common stockholders (numerator)	$	23,663	$	15,473	$	74,713	$	46,297

Weighted-average number of common shares (denominator)	31,531,834		32,662,942		31,480,660		32,767,088

Basic earnings per common share	$	0.75	$	0.47	$	2.37	$	1.41

Weighted-average number of common shares	31,531,834		32,662,942		31,480,660		32,767,088
Potential shares of common stock arising from stock options, and unvested restricted share units	629,732		857,194		700,263		936,350
Total shares-diluted (denominator)	32,161,566		33,520,136		32,180,923		33,703,438

Diluted earnings per common share	$	0.74	$	0.46	$	2.32	$	1.37

The weighted-average number of common shares outstanding used in the computation of diluted earnings per common share does not include the effect of the following instruments because their inclusion would have been anti-dilutive:



	For the Three Months Ended		For the Six Months Ended
	January 28, 2017	January 23, 2016	January 28, 2017	January 23, 2016
Stock-based awards	58,750	63,357	50,355	61,481
0.75% convertible senior notes due 2021	5,005,734	5,005,734	5,005,734	5,005,734
Warrants	5,005,734	5,005,734	5,005,734	5,005,734
Total anti-dilutive weighted shares excluded from the calculation of earnings per common share	10,070,218	10,074,825	10,061,823	10,072,949

Under the treasury stock method, the convertible senior notes will have a dilutive impact on earnings per common share if the Company’s average stock price for the period exceeds the conversion price for the convertible senior notes of $96.89 per share. The warrants will have a dilutive impact on earnings per common share if the Company’s average stock price for the period exceeds the warrant strike price of $130.43 per share. As the Company’s average stock price for the three and six months ended January 28, 2017 was below the conversion price for the convertible senior notes and the strike price for the warrants, the underlying common shares were anti-dilutive as reflected above. See Note 10, Debt, for additional information related to the Company’s convertible senior notes and warrant transactions.

In connection with the offering of the convertible senior notes, the Company entered into convertible note hedge transactions with counterparties for the purpose of reducing the potential dilution to common stockholders from the conversion of the notes and offsetting any potential cash payments in excess of the principal amount of the notes. Prior to conversion, the convertible note hedge is not included for purposes of the calculation of earnings per common share as its effect would be anti-dilutive. Upon conversion, the convertible note hedge is expected to offset the dilutive effect of the convertible senior notes when the average stock price for the period is above $96.89 per share. See Note 10, Debt, for additional information related to the Company’s convertible note hedge.