Earnings per share

9 Months Ended

Oct. 29, 2016

In calculating basic earnings per share ("EPS"), the Company follows the two-class method, which distinguishes between classes of securities based on the proportionate participation rights of each security type in the Company's undistributed income. The preferred shares issued on October 5, 2016 are considered participating securities as of October 29, 2016. Under the two-class method, income available to common shareholders is reduced by (a) the cumulative dividend on the Company’s preferred shares whether or not declared or paid during the period, (b) accretion relating to issuance costs of preferred shares and (c) the hypothetical distribution of undistributed earnings to preferred shareholders in accordance with contractual rights. For the 13 and 39 weeks ended October 29, 2016, the two-class method did not impact EPS as no hypothetical distribution of undistributed earnings were allocable to preferred shareholders. See Note 4 for additional discussion of the Company's preferred shares, including changes to the rights of preferred shareholders as of November 2, 2016 which will result in the preferred shares no longer being considered participating securities, and consequently, the two-class method will no longer apply.

The dilutive effect of share awards represents the potential impact of outstanding awards issued under the Company’s share-based compensation plans, including restricted shares and restricted stock units issued under the Omnibus Plan and stock options issued under the Share Saving Plans and the Executive Plans. The dilutive effect of preferred shares represents the potential impact for common shares that would be issued upon conversion. In computing diluted EPS, the Company also adjusts the numerator used in the basic EPS computation, subject to anti-dilution requirements, to add back the dividends (declared or cumulative undeclared) applicable to the preferred shares. Potential common share dilution related to share awards and preferred shares is determined using the treasury stock and if-converted methods, respectively.

The following table sets forth the computation of EPS for the 13 and 39 weeks ended October 29, 2016 and October 31, 2015:



	13 weeks ended					39 weeks ended
(in millions, except per share amounts)	October 29, 2016			October 31, 2015		October 29, 2016			October 31, 2015
Net income	$	17.0		$	15.0	$	245.7		$	196.0
Less: Dividends on preferred shares	(2.2		)	—		(2.2		)	—
Net income attributable to common shareholders	$	14.8		$	15.0	$	243.5		$	196.0

Basic weighted average number of shares outstanding	73.5			79.3		76.4			79.7
Plus: Dilutive effect of share awards	0.1			0.2		0.1			0.2
Plus: Dilutive effect of preferred shares	—			n/a		—			n/a
Diluted weighted average number of shares outstanding	73.6			79.5		76.5			79.9

Earnings per share – basic	$	0.20		$	0.19	$	3.19		$	2.46
Earnings per share – diluted	$	0.20		$	0.19	$	3.18		$	2.45

The calculation of diluted EPS for the 13 and 39 weeks ended October 29, 2016 and October 31, 2015 excludes the following share awards and potential impact of preferred shares on the basis that their effect would be anti-dilutive.

(in millions)

October 29, 2016

October 31, 2015

Share awards

Preferred shares

Total anti-dilutive shares