Earnings per share

12 Months Ended

Dec. 31, 2013

Earnings per share

NOTE 15

Earnings per share. The Company’s basic earnings per share attributable to Stewart was calculated by dividing net earnings attributable to Stewart by the weighted-average number of shares of Common Stock and Class B Common Stock outstanding during the reporting periods.

To calculate diluted earnings per share, net earnings and number of shares are adjusted for the effects of any dilutive shares. Using the if-converted method, net earnings are adjusted for interest expense, net of any tax effects, applicable to the Notes discussed in Note 10. The number of shares is adjusted by adding the number of dilutive shares, assuming they are issued, during the same reporting period. The treasury stock method is used to calculate the dilutive number of shares related to the Company’s restricted stock.

For the year ended December 31, 2013, dilutive shares under the treasury stock method mentioned above were immaterial. For the years ended December 31, 2012 and 2011, the Company did not have any dilutive shares under the treasury stock method since the exercise prices of the options were greater than the weighted-average market value of the shares, which excludes them from the diluted earnings per share calculation.

There were no calculations of diluted earnings per share for the year ended December 31, 2011 using the if-converted method, as the add back of the tax effected interest expense on the convertible debt resulted in antidilution.

The calculation of the basic and diluted earnings per share are as follows:

	For the Years Ended December 31,
	2013		2012		2011
	($000 omitted)
Numerator:
Net earnings attributable to Stewart		63,026		109,182		2,348
Interest expense, net of tax effects		1,408		3,139		—
If-converted net earnings attributable to Stewart		64,434		112,321		2,348
Denominator (000):
Basic average shares outstanding		22,096		19,294		19,131
Dilutive average number of shares relating to convertible senior notes		2,467		5,047		—
Dilutive average number of shares relating to restricted shares grant		178		43		—
Dilutive average shares outstanding		24,741		24,384		19,131
Basic earnings per share attributable to Stewart		2.85		5.66		0.12
Diluted earnings per share attributable to Stewart		2.60		4.61		0.12