Net Earnings Per Share

3 Months Ended

Mar. 27, 2020

NOTE 11. NET EARNINGS PER SHARE

Basic net earnings per share (“EPS”) is calculated by dividing net earnings attributable to common stockholders by the weighted average number of shares of common stock outstanding for the applicable period. Diluted EPS is similarly calculated, except that the calculation includes the dilutive effect of the assumed issuance of shares under stock-based compensation plans under the treasury stock method, except where the inclusion of such shares would have an anti-dilutive impact. There were 5.7 million anti-dilutive options excluded from the diluted EPS calculation for the three months ended March 27, 2020 and 1.7 million anti-dilutive options excluded from the diluted EPS calculation for the three months ended March 29, 2019.

As described in Note 5, upon conversion of the Convertible Notes, holders will receive cash, shares of our common stock, or a combination thereof, at our election. Our intention is to settle such conversions through cash up to the principal amount of the Convertible Notes and, if applicable, through shares of our common stock for conversion value, if any, in excess of the principal amount of the Convertible Notes. We believe we have the ability to settle these obligations as intended, and therefore we have accounted for the conversion features under the treasury stock method in our calculation of EPS. Because the fair value of our common stock is below the conversion price, the Convertible Notes had no impact on our earnings per share for the three months ended March 27, 2020 and March 29, 2019.

The impact of our Mandatory Convertible Preferred Stock (“MCPS”) calculated under the if-converted method was anti-dilutive for both the three month periods ended March 27, 2020 and March 29, 2019, and 18.4 million and 16.7 million shares were excluded from the diluted EPS calculation for each respective period.

Information related to the calculation of net earnings per share of common stock is summarized as follows ($ and shares in millions, except per share amounts):


	Three Months Ended
	March 27, 2020		March 29, 2019
Numerator
Net earnings from continuing operations	$	42.3	$	164.0
Mandatory convertible preferred stock cumulative dividends	(17.3)		(17.3)
Net earnings attributable to common stockholders from continuing operations	$	25.0	$	146.7

Denominator
Weighted average common shares outstanding used in basic earnings per share	336.8		335.1
Incremental common shares from:
Assumed exercise of dilutive options and vesting of dilutive Stock Awards	3.2		4.4

Weighted average common shares outstanding used in diluted earnings per share	340.0		339.5

Net earnings from continuing operations per common share - Basic	$	0.07	$	0.44
Net earnings from continuing operations per common share - Diluted	$	0.07	$	0.43

We declared and paid cash dividends per common share for both periods as presented below. We declared and paid the MCPS dividend in the first quarter of 2019, while the MCPS dividend in the first quarter of 2020 was declared and accrued as follows:


	Dividend Per Common Share		Amount ($ in millions)		Dividend per MCPS		Amount ($ in millions)
2020:
First quarter	$	0.07	$	23.5	$	12.50	$	17.3





2019:
First quarter	$	0.07	$	23.4	$	12.50	$	17.3

The first quarter 2020 MCPS dividends were paid on April 1, 2020.