Note 6. Net Income Per Share

6 Months Ended

Feb. 23, 2013

Earnings Per Share [Text Block]

6.Net Income Per Share

The Company calculates net income per share in accordance with US GAAP, which requires the Company to allocate income to its unvested participating securities as part of its earnings per share (“EPS”) calculations.  The following table sets forth the computation of basic earnings per share using the two-class method for amounts attributable to the Company’s shares of Common Stock and Class B Common Stock (in thousands, except per share data):

	Thirteen weeks ended				Twenty-six weeks ended
	February 23, 2013		February 25, 2012		February 23, 2013		February 25, 2012
Net income	$	26,642	$	19,196	$	57,402	$	44,998
Allocation of net income for Basic:
Common Stock	$	20,963	$	15,081	$	45,155	$	35,341
Class B Common Stock		5,209		3,765		11,233		8,832
Unvested participating shares		470		350		1,014		825
	$	26,642	$	19,196	$	57,402	$	44,998
Weighted average number of shares for Basic:
Common Stock		14,962		14,873		14,943		14,856
Class B Common Stock		4,647		4,640		4,647		4,640
Unvested participating shares		383		394		383		396
		19,992		19,907		19,973		19,892
Earnings per share for Basic:
Common Stock	$	1.40	$	1.01	$	3.02	$	2.38
Class B Common Stock	$	1.12	$	0.81	$	2.42	$	1.90

The  Company is required to calculate diluted EPS for Common Stock using the more dilutive of the following two methods:

• The treasury stock method; or

• The two-class method assuming a participating security is not exercised or converted.

For the thirteen and twenty-six weeks ended February 23, 2013, the Company’s diluted EPS assumes the conversion of all vested Class B Common Stock into Common Stock and uses the two-class method for its unvested participating shares.  The following table sets forth the computation of diluted earnings per share of Common Stock for the thirteen and twenty-six weeks ended February 23, 2013 as follows (in thousands, except per share data):

	Thirteen weeks ended February 23, 2013							Twenty-six weeks ended February 23, 2013
	Earnings to Common Shareholders			Common Shares		EPS		Earnings to Common Shareholders			Common Shares		EPS
As reported - Basic	$	20,963			14,962	$	1.40	$	45,155			14,943	$	3.02
Add: effect of dilutive potential common shares
Share-based awards		—			138				—			124
Class B Common Stock		5,209			4,647				11,233			4,647
Add: Undistributed earnings allocated to unvested participating shares		457			—				989			—
Less: Undistributed earnings reallocated to unvested participating shares		(433	)		—				(937	)		—
Diluted EPS – Common Stock	$	26,196			19,747	$	1.33	$	56,440			19,714	$	2.86

Share-based awards that would result in the issuance of 13,983 shares of Common Stock were excluded from the calculation of diluted earnings per share for the thirteen weeks ended February 23, 2013 because they were anti-dilutive.  There were no share-based awards that were excluded from the calculation of diluted earnings per share for the twenty-six weeks ended February 23, 2013 because they were anti-dilutive.  

For the thirteen and twenty-six weeks ended February 25, 2012, the Company’s diluted EPS assumes the conversion of all vested Class B Common Stock into Common Stock and uses the two-class method for its unvested participating shares. The following table sets forth the computation of diluted earnings per share of Common Stock for the thirteen and twenty-six weeks ended February 25, 2012  as follows (in thousands, except per share data):

	Thirteen weeks ended February 25, 2012							Twenty-six weeks ended February 25, 2012
	Earnings to Common Shareholders			Common Shares		EPS		Earnings to Common Shareholders			Common Shares		EPS
As reported - Basic	$	15,081			14,873	$	1.01	$	35,341			14,856	$	2.38
Add: effect of dilutive potential common shares
Share-based awards		—			92				—			79
Class B Common Stock		3,765			4,640				8,832			4,640
Add: Undistributed earnings allocated to unvested participating shares		337			—				799			—
Less: Undistributed earnings reallocated to unvested participating shares		(320	)		—				(759	)		—
Diluted EPS – Common Stock	$	18,863			19,605	$	0.96	$	44,213			19,575	$	2.26

Share-based awards that would result in the issuance of 17,454 and 16,369 shares of Common Stock were excluded from the calculation of diluted earnings per share for the thirteen and twenty-six weeks ended February 25, 2012, respectively, because they were anti-dilutive.