Net Income Per Share

6 Months Ended

Jul. 01, 2014

Net Income Per Share

Net Income Per Share

7.  Net Income Per Share

At July 1, 2014 and July 2, 2013, 1.8 million and 1.5 million shares, respectively, of restricted stock issued to employees were unvested, and therefore excluded from the calculation of basic earnings per share for the fiscal quarters ended on those dates.  Diluted net income per share includes the dilutive effect of outstanding equity awards, calculated using the treasury stock method.  Assumed proceeds from the in-the-money options include the windfall tax benefits, net of shortfalls, calculated under the “as-if” method as prescribed by FASB Accounting Standards Codification (“ASC”) 718, “Compensation — Stock Option Compensation.”

	Thirteen Weeks Ended July 1, 2014		Thirteen Weeks Ended July 2, 2013		Twenty-Six Weeks Ended July 1, 2014		Twenty-Six Weeks Ended July 2, 2013
	(In thousands, except per share data)
Net income	$	30,049	$	28,583	$	52,567	$	53,875
Basic weighted average shares outstanding	49,349		52,892		50,044		52,574
Dilutive effect of equity awards	2,009		2,181		2,054		2,118
Diluted weighted average shares outstanding	51,358		55,073		52,098		54,692
Basic net income per share	$	0.61	$	0.54	$	1.05	$	1.02
Diluted net income per share	$	0.59	$	0.52	$	1.01	$	0.99

Shares of common stock equivalents of 0.4 million and 0.8 million for the thirteen and twenty-six weeks ended July 1, 2014, respectively, and 0.5 million and 1.1 million for the thirteen and twenty-six weeks ended July 2, 2013, respectively, were excluded from the diluted calculation due to their anti-dilutive effect.

Certain of our restricted stock awards are considered participating securities as these awards include non-forfeitable rights to dividends with respect to unvested shares.  As such, they must be included in the computation of earnings per share pursuant to the two-class method.  Under the two-class method, a portion of net income is allocated to participating securities, and therefore is excluded from the calculation of earnings per share allocated to common shares.  The calculation of basic and diluted earnings per share pursuant to the two-class method resulted in an immaterial difference from the amounts displayed in the consolidated statements of comprehensive income.