Earnings per Share

6 Months Ended

Aug. 03, 2013

Earnings per Share

Earnings per Share

4. Earnings per Share

Basic earnings per common share amounts are calculated using the weighted average number of common shares outstanding for the period. Diluted earnings per common share amounts are calculated using the weighted average number of common shares outstanding plus the additional dilution for all potentially dilutive securities, such as nonvested restricted stock and stock options.  During loss periods, diluted loss per share amounts are based on the weighted average number of common shares outstanding, because the inclusion of common stock equivalents would be antidilutive.

The dilutive effect of stock-based compensation arrangements is accounted for using the treasury stock method.  This method assumes that the proceeds the Company receives from the exercise of stock options are used to repurchase common shares in the market.  The Company includes as assumed proceeds the amount of compensation cost attributed to future services and not yet recognized, and the amount of tax benefits, if any, that would be credited to additional paid-in capital assuming exercise of outstanding options and vesting of nonvested restricted stock.  For the twenty-six weeks ended August 3, 2013 and July 28, 2012, there were 46,000 and 45,000 stock options, respectively, and 609,000 and 351,000 shares of nonvested restricted stock, respectively, excluded from the calculation of diluted earnings per share because of antidilution.  For the thirteen weeks ended August 3, 2013 and July 28, 2012, there were 46,000 and 40,000 stock options, respectively, and 657,000 and 414,000 shares of nonvested restricted stock, respectively, excluded from the calculation of diluted earnings per share because of antidilution.

The following table provides a reconciliation of the average number of common shares outstanding used to calculate basic earnings per share to the number of common shares and common stock equivalents outstanding used in calculating diluted earnings per share for the twenty-six and thirteen week periods ended August 3, 2013 and July 28, 2012:

	Twenty-Six Weeks Ended
	August 3, 2013	July 28, 2012
Average number of common shares outstanding	14,776,427	14,654,456
Incremental shares from assumed exercises of stock options	1,517	1,548
Incremental shares from assumed vesting of nonvested restricted stock	—	—
Average number of common shares and common stock equivalents outstanding	14,777,944	14,656,004

	Thirteen Weeks Ended
	August 3, 2013	July 28, 2012
Average number of common shares outstanding	14,801,217	14,673,403
Incremental shares from assumed exercises of stock options	—	—
Incremental shares from assumed vesting of nonvested restricted stock	—	—
Average number of common shares and common stock equivalents outstanding	14,801,217	14,673,403