Earnings Per Share

12 Months Ended

Sep. 30, 2016

Basic income per share is calculated by dividing net income by the weighted average number of shares outstanding during the period. Diluted income per share adjusts the basic income per share for the effects of any potentially dilutive instruments, only in periods in which the Company has net income and such effects are dilutive under the treasury stock method. Basic and diluted income per share is calculated using unrounded numbers.

For the years ended September 30, 2016, 2015 and 2014, 1.5 million, 1.1 million and 0.6 million shares related to nonvested stock-based compensation awards, respectively, were excluded from our calculation of diluted income per share as a result of their anti-dilutive effect.

The weighted-average number of common shares outstanding used to calculate basic income per share is reconciled to shares used to calculate diluted income per share as follows for the periods presented:



	Fiscal Year Ended September 30,
(in thousands)	2016		2015	2014
Basic shares	31,798		27,628	25,795
Shares issued upon conversion of TEUs ^(a)	N/A	^(b)	4,069	5,784
Shares issuable upon vesting/exercise of stock awards/options	5		75	216
Diluted shares	31,803		31,772	31,795

^(a) In July 2015, the remaining prepaid stock purchase contracts related to our previously outstanding Tangible Equity Units were settled in Beazer Homes' common stock. This conversion required us to issue approximately 5.2 million shares of common stock to the instrument holders. These instruments were dilutive from October 1, 2014 through July 15, 2015; once the shares were converted, they were included in the number of the weighted-average basic shares outstanding.

^(b)N/A - Not applicable