Earnings Per Share

12 Months Ended

Dec. 31, 2012

Earnings Per Share [Abstract]

Earnings Per Share

16. Earnings Per Share

Basic earnings per share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income by diluted weighted average shares. Diluted weighted average shares are determined using the weighted average number of common shares outstanding during the period plus the dilutive effect of potential future issues of common stock relating to CBIZ’s stock award programs, CBIZ’s convertible senior subordinated notes, business acquisitions, and other potentially dilutive securities. In calculating diluted earnings per share, the dilutive effect of stock awards is computed using the average market price for the period, in accordance with the treasury stock method.

As described in Note 8, CBIZ’s 2006 Notes and 2010 Notes may result in future issuances of CBIZ common stock. Under the net share settlement method, potential shares issuable under the 2006 Notes and 2010 Notes will be considered dilutive, and will be included in the calculation of diluted weighted average shares, if the Company’s market price per share exceeds the conversion price of $10.63 for the 2006 Notes and $7.41 of the 2010 Notes. As of December 31, 2012, 2011 and 2010, the Company’s average market price per share had not exceeded the conversion price of the 2006 Notes or 2010 Notes.

The following table sets forth the computation of basic and diluted earnings per share from continuing operations (in thousands, except per share data):

	Year Ended December 31,
	2012		2011		2010
Numerator:
Income from continuing operations	$	31,075	$	28,584	$	28,155
Denominator:
Basic
Weighted average common shares outstanding		49,002		49,328		57,692
Diluted
Stock Options(1)		—		61		106
Restricted stock awards(1)		186		179		135
Contingent shares(2)		64		31		260
Diluted weighted average common shares outstanding		49,252		49,599		58,193
Earnings Per Share:
Basic earnings per share from continuing operations	$	0.63	$	0.58	$	0.49
Diluted earnings per share from continuing operations	$	0.63	$	0.58	$	0.48

(1) For the years ended December 31, 2012, 2011 and 2010, a total of 8,202, 6,429 and 5,382 stock based awards (in thousands), respectively, were excluded from the calculation of diluted earnings per share as their exercise prices would render them anti-dilutive.

(2) Contingent shares represent additional shares to be issued for purchase price earned by former owners of businesses acquired by CBIZ once future conditions have been met. See Note 19 for further discussion of acquisitions.