NOTE 15 —EARNINGS PER SHARE

The Company has two classes of common stock and, as such, applies the “two-class method” of computing earnings per share (“EPS”) as prescribed in ASC 260, “Earnings Per Share”. In accordance with this guidance, earnings are allocated first to Class A and Class B Common Stock to the extent that dividends are actually paid and the remainder allocated assuming all of the earnings for the period have been distributed in the form of dividends.

The Company calculates Class A EPS as follows: (i) multiply 40% times the average Class A shares outstanding, then divide that amount by the product of 40% of the average Class A shares outstanding plus 60% of the average Class B shares outstanding to get a percentage, (ii) divide undistributed net income attributable to Greif, Inc. by the average Class A shares outstanding, then (iii) multiply item (i) by item (ii), and finally (iv) add item (iii) to the Class A cash dividend per share. Diluted shares are factored into the Class A calculation.

The Company calculates Class B EPS as follows: (i) multiply 60% times the average Class B shares outstanding, then divide that amount by the product of 40% of the average Class A shares outstanding plus 60% of the average Class B shares outstanding to get a percentage, (ii) divide undistributed net income attributable to Greif, Inc. by the average Class B shares outstanding, then (iii) multiply item (i) by item (ii), and finally (iv) add item (iii) to the Class B cash dividend per share. Class B diluted EPS is identical to Class B basic EPS.

The following table provides EPS information for each period, respectively:


	Three months ended				Nine months ended
	July 31				July 31
(In thousands, except per share data)	2011		2010		2011		2010

Numerator for basic and diluted EPS
Net income attributable to Greif, Inc.	$	62,940	$	65,975	$	155,265	$	133,428
Cash dividends		24,566		24,507		73,396		68,607

Undistributed net income attributable to Greif, Inc.	$	38,374	$	41,468	$	81,869	$	64,821

Denominator for basic EPS
Class A common stock		24,897,665		24,687,006		24,837,097		24,623,262
Class B common stock		22,362,266		22,444,488		22,386,818		22,456,340
Denominator for diluted EPS
Class A common stock		25,100,003		24,999,901		25,041,395		24,930,839
Class B common stock		22,362,266		22,444,488		22,386,818		22,456,340

EPS Basic
Class A common stock	$	1.08	$	1.13	$	2.66	$	2.29
Class B common stock	$	1.61	$	1.70	$	3.98	$	3.43

EPS Diluted
Class A common stock	$	1.07	$	1.12	$	2.65	$	2.28
Class B common stock	$	1.61	$	1.70	$	3.98	$	3.43

Dividends per share
Class A common stock	$	0.42	$	0.42	$	1.26	$	1.18
Class B common stock	$	0.63	$	0.63	$	1.88	$	1.76

Class A Common Stock is entitled to cumulative dividends of one cent a share per year after which Class B Common Stock is entitled to non-cumulative dividends up to a half-cent a share per year. Further distribution in any year must be made in proportion of one cent a share for Class A Common Stock to one and a half cents a share for Class B Common Stock. The Class A Common Stock has no voting rights unless four quarterly cumulative dividends upon the Class A Common Stock are in arrears. The Class B Common Stock has full voting rights. There is no cumulative voting for the election of directors.

Common stock repurchases

The Company’s Board of Directors has authorized the purchase of up to four million shares of Class A Common Stock or Class B Common Stock or any combination of the foregoing. During the first nine months of 2011, the Company repurchased no shares of Class A Common Stock and 50,000 shares of Class B Common Stock. As of July 31, 2011, the Company had repurchased 2,933,272 shares, including 1,416,752 shares of Class A Common Stock and 1,516,520 shares of Class B Common Stock, under this program. The total cost of the shares repurchased from November 1, 2009 through July 31, 2011 was approximately $5.8 million.

The following table summarizes the Company’s Class A and Class B common and treasury shares at the specified dates:


					Outstanding
	Authorized Shares		Issued Shares		Shares		Treasury Shares
July 31, 2011:
Class A Common Stock		128,000,000		42,281,920		24,957,182		17,324,738
Class B Common Stock		69,120,000		34,560,000		22,362,266		12,197,734
October 31, 2010:
Class A Common Stock		128,000,000		42,281,920		24,756,974		17,524,946
Class B Common Stock		69,120,000		34,560,000		22,412,266		12,147,734

The following is a reconciliation of the shares used to calculate basic and diluted earnings per share:


	Three months ended				Nine months ended
	July 31				July 31
	2011		2010		2011		2010
Class A Common Stock:
Basic shares		24,897,665		24,687,006		24,837,097		24,623,262
Assumed conversion of stock options		202,338		312,895		204,298		307,577

Diluted shares		25,100,003		24,999,901		25,041,395		24,930,839


Class B Common Stock:
Basic and diluted shares		22,362,266		22,444,488		22,386,818		22,456,340

No stock options were antidilutive for the nine month periods ended July 31, 2011 and 2010, respectively.