10. Earnings Per Share

The following is a reconciliation of net earnings of Flowserve Corporation and weighted average shares for calculating net earnings per common share. Earnings per weighted average common share outstanding was calculated as follows:


	Three Months Ended June 30,
(Amounts in thousands, except per share data)	2011		2010
Net earnings of Flowserve Corporation	$	98,732	$	91,647
Dividends on restricted shares not expected to vest		4		4

Earnings attributable to common and participating shareholders	$	98,736	$	91,651


Weighted average shares:
Common stock		55,483		55,588
Participating securities		264		325

Denominator for basic earnings per common share		55,747		55,913
Effect of potentially dilutive securities		495		559

Denominator for diluted earnings per common share		56,242		56,472


Earnings per common share:
Basic	$	1.77	$	1.64
Diluted		1.76		1.62

	Six Months Ended June 30,
(Amounts in thousands, except per share data)	2011		2010
Net earnings of Flowserve Corporation	$	195,715	$	171,868
Dividends on restricted shares not expected to vest		7		8

Earnings attributable to common and participating shareholders	$	195,722	$	171,876


Weighted average shares:
Common stock		55,420		55,423
Participating securities		281		351

Denominator for basic earnings per common share		55,701		55,774
Effect of potentially dilutive securities		590		712

Denominator for diluted earnings per common share		56,291		56,486


Earnings per common share:
Basic	$	3.51	$	3.08
Diluted		3.48		3.04

Diluted earnings per share above is based upon the weighted average number of shares as determined for basic earnings per share plus shares potentially issuable in conjunction with stock options, restricted share units and performance share units.