EARNINGS PER SHARE

12 Months Ended

Jun. 30, 2019

EARNINGS PER SHARE

Basic net earnings per common share are calculated by dividing Net earnings attributable to Procter & Gamble less preferred dividends (net of related tax benefits) by the weighted average number of common shares outstanding during the year. For fiscal years 2018 and 2017, Diluted net earnings per common share are calculated by dividing Net earnings attributable to Procter & Gamble by the diluted weighted average number of common shares outstanding during the year. The diluted shares are determined using the treasury stock method on the basis of the weighted average number of common shares outstanding plus the dilutive effect of stock options and other stock-based awards (see Note 7) and the assumed conversion of preferred stock (see Note 8).

For fiscal year 2019, Diluted net earnings per common share do not include the assumed conversion of preferred stock because to do so would have been antidilutive, due to the lower Net earnings driven by the Shave Care impairment charges (see Note 4). Therefore, Diluted net earnings per common share are calculated by dividing Net earnings attributable to Procter & Gamble less preferred dividends (net of related tax benefit) by the diluted weighted average number of common shares outstanding during the year. The diluted shares are determined using the treasury stock method on the basis of the weighted average number of common shares outstanding plus the dilutive effect of stock options and other stock-based awards.

Net earnings per share were calculated as follows:



Years ended June 30	2019		2018		2017
CONSOLIDATED AMOUNTS	Total		Total		Continuing Operations		Discontinued Operations		Total
Net earnings	$	3,966	$	9,861	$	10,194	$	5,217	$	15,411
Less: Net earnings attributable to noncontrolling interests	69		111		85		—		85
Net earnings attributable to P&G	3,897		9,750		10,109		5,217		15,326
Less: Preferred dividends, net of tax	263		265		247		—		247
Net earnings attributable to P&G available to common shareholders (Basic)	$	3,634	$	9,485	$	9,862	$	5,217	$	15,079

Net earnings attributable to P&G available to common shareholders (Diluted)	$	3,634	$	9,750	$	10,109	$	5,217	$	15,326

SHARES IN MILLIONS
Basic weighted average common shares outstanding	2,503.6		2,529.3		2,598.1		2,598.1		2,598.1
Add: Effect of dilutive securities
Impact of stock options and other unvested equity awards ⁽¹⁾	35.9		32.5		43.0		43.0		43.0
Conversion of preferred shares ⁽²⁾	—		94.9		99.3		99.3		99.3
Diluted weighted average common shares outstanding	2,539.5		2,656.7		2,740.4		2,740.4		2,740.4

NET EARNINGS PER SHARE ⁽³⁾
Basic	$	1.45	$	3.75	$	3.79	$	2.01	$	5.80
Diluted	$	1.43	$	3.67	$	3.69	$	1.90	$	5.59


⁽¹⁾	Weighted average outstanding stock options of approximately 13 million in 2019, 48 million in 2018 and 20 million in 2017 were not included in the Diluted net earnings per share calculation because the options were out of the money or to do so would have been antidilutive (i.e., the assumed proceeds upon exercise would have exceeded the market value of the underlying common shares).

⁽²⁾

Despite being included in Diluted net earnings per common share, the actual conversion to common stock occurs when the preferred shares are sold. Shares may only be sold after being allocated to the ESOP participants pursuant to the repayment of the ESOP's obligations through 2035. In fiscal year 2019, weighted average outstanding preferred shares of 90 million were not included in the Diluted net earnings per share calculation because to do so would have been antidilutive, due to lower Net earnings driven by the Shave Care impairment charges (see Note 4).

⁽³⁾

Net earnings per share are calculated on Net earnings attributable to Procter & Gamble.