Earnings per Share

9 Months Ended

Oct. 31, 2015

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 thirty-nine weeks ended October 31, 2015 and November 1, 2014, there were 19,000 and 29,000 stock options, respectively, and 348,000 and 572,000 shares of nonvested restricted stock, respectively, excluded from the calculation of diluted earnings per share because of antidilution. For the thirteen weeks ended October 31, 2015 and November 1, 2014, there were 18,000 and 27,000 stock options, respectively, and 366,000 and 600,000 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 thirty-nine and thirteen week periods ended October 31, 2015 and November 1, 2014:

	Thirty-Nine Weeks Ended
	October 31, 2015	November 1, 2014
Average number of common shares outstanding	15,111,527	14,951,546
Incremental shares from assumed exercises of stock options	257	1,172
Incremental shares from assumed vesting of nonvested restricted stock	54,750	31,864

Average number of common shares and common stock equivalents outstanding	15,166,534	14,984,582

	Thirteen Weeks Ended
	October 31, 2015	November 1, 2014
Average number of common shares outstanding	15,056,014	14,981,559
Incremental shares from assumed exercises of stock options	—	—
Incremental shares from assumed vesting of nonvested restricted stock	58,558	—

Average number of common shares and common stock equivalents outstanding	15,114,572	14,981,559