Net Earnings Per Share

12 Months Ended

Dec. 31, 2019

EARNINGS PER SHARE

Basic earnings per share (“EPS”) is calculated by dividing net income by the weighted average number of shares of common stock outstanding for the applicable period. Diluted EPS is computed based on the weighted average number of common shares outstanding plus the effect of dilutive potential shares outstanding during the period using the treasury stock method. Dilutive potential common shares include employee equity options, nonvested shares and similar instruments granted by the Company.

The Company’s issuance of shares of its common stock to Danaher as partial consideration for the transfer of the Dental business by Danaher to the Company on September 17, 2019, together with the 100 shares of the Company’s common stock previously held by Danaher, resulted in 127.9 million shares of the Company’s common stock being held by Danaher, which are being utilized for the calculation of both basic and diluted EPS for the years ended December 31, 2018 and 2017. In connection with the IPO, an additional 30.8 million shares were issued on September 20, 2019.

For periods prior to the Separation, the Company’s stock-based compensation expense includes expense for Danaher equity awards granted to certain of the Company’s employees. As these equity awards related to Danaher common stock, rather than common stock of the Company, the calculation of diluted EPS does not include the potential dilutive impact of these equity awards for periods prior to the Split-Off. At the time of the Split-Off, the equity awards held by certain employees to purchase Danaher shares were converted into equity awards to purchase the Company’s shares and the converted equity awards have been included in the Company’s calculation of diluted EPS. Refer to Note 14 for additional information.

The table below presents the computation of basic and diluted EPS:



	Year Ended
	December 31, 2019		December 31, 2018		December 31, 2017
Numerator:
Net income	$	217.6	$	230.7	$	301.1

Denominator:
Weighted-average common shares outstanding used in basic EPS	136.2		127.9		127.9
Incremental common shares from:
Assumed exercise of dilutive options and vesting of dilutive RSUs	0.2		—		—
Weighted average common shares outstanding used in diluted EPS	136.4		127.9		127.9

Earnings per share:
Basic	$	1.60	$	1.80	$	2.35
Diluted	$	1.60	$	1.80	$	2.35