Note 3 – Earnings Per Common Share

Basic earnings per common share amounts are computed by dividing income available to common shareholders, after deducting preferred stock dividends, by the average number of common shares outstanding. Diluted earnings per common share amounts assume the issuance of common stock for all potentially dilutive equivalent securities outstanding.

The following is a reconciliation of basic and diluted earnings per common share for the respective periods:



	Quarter Ended
	Fiscal June
	2017		2016
	(Dollars in thousands,
	except per share data)
Numerator for earnings per common share calculation:
Net income	$	17,585	$	16,755
Preferred stock dividends		(92)		(129)
Income available to common stockholders	$	17,493	$	16,626
Denominator for earnings per common share calculation:
Weighted average common shares, basic		32,704		32,258
Effect of dilutive securities:
Preferred stock		510		760
Stock options		78		309
Weighted average number of common shares, diluted		33,292		33,327
Basic earnings per common share:	$	.53	$	.52
Diluted earnings per common share:	$	.53	$	.50

The computation of diluted earnings per common share excludes the effect of the assumed exercise of approximately 655,000 and 229,000 stock options for the three months ended fiscal June 24, 2017 and June 25, 2016, respectively. Such amounts were excluded as the exercise prices of these stock options were greater than the average market value of our common stock for those periods, resulting in an anti-dilutive effect on diluted earnings per common share.