Net Income per Common Share

12 Months Ended

Jul. 31, 2020

Net Income per Common Share

Basic net income per common share is computed by dividing net income (after deducting the applicable preferential Class A Common Stock dividends) by the weighted average Common Shares outstanding. The Company utilizes the two-class method to calculate income per share.

Reconciliations of the numerator and denominator of the basic and diluted per share computations for the Company’s Class A and Class B common stock are summarized as follows:


	Years ended July 31,
	2020		2019		2018
Numerator (in thousands):
Net Income (Numerator for basic and diluted income per Class A Nonvoting Common Share)	$	112,369	$	131,258	$	91,060
Less:
Preferential dividends	(828)		(815)		(799)
Preferential dividends on dilutive stock options	(10)		(13)		(14)
Numerator for basic and diluted income per Class B Voting Common Share	$	111,531	$	130,430	$	90,247
Denominator (in thousands):
Denominator for basic income per share for both Class A and Class B	52,763		52,596		51,677
Plus: Effect of dilutive equity awards	468		727		847
Denominator for diluted income per share for both Class A and Class B	53,231		53,323		52,524
Net income per Class A Nonvoting Common Share:
Basic	$	2.13	$	2.50	$	1.76
Diluted	$	2.11	$	2.46	$	1.73
Net income per Class B Voting Common Share:
Basic	$	2.11	$	2.48	$	1.75
Diluted	$	2.10	$	2.45	$	1.72

Potentially dilutive securities attributable to outstanding stock options and restricted stock units were excluded from the calculation of diluted earnings per share where the combined exercise price and average unamortized fair value were greater than the average market price of Brady's Class A Nonvoting Common Stock because the effect would have been anti-dilutive. The amount of anti-dilutive shares were 387,382, 372,255, and 751,200 for the fiscal years ended July 31, 2020, 2019, and 2018, respectively.