EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2016

NOTE 3. EARNINGS PER SHARE

Basic earnings per share is computed by dividing reported net earnings by the weighted-average number of common shares outstanding during the period. Diluted earnings per share reflect the additional dilution for all potentially dilutive securities such as stock options. The following is a reconciliation of the number of shares (denominator) used in the basic and diluted earnings per share computations (shares in thousands):


	Three months ended September 30,
	2016			2015
		Per Share			Per Share
	Shares	Amount		Shares	Amount
Basic	17,338	$	0.45	16,979	$	0.38
Effect of dilutive stock options	382		-	364		(0.01)
Diluted	17,720	$	0.45	17,343	$	0.37


	Nine months ended September 30,
	2016			2015
		Per Share			Per Share
	Shares	Amount		Shares	Amount
Basic	17,270	$	1.05	16,898	$	0.92
Effect of dilutive stock options	333		(0.02)	383		(0.02)
Diluted	17,603	$	1.03	17,281	$	0.90

Excluded from the computation of diluted earnings per share are options where the exercise prices are greater than the market price as their effects would be anti-dilutive in the computation of diluted earnings per share. For the three and nine months ended September 30, 2016, options for 314 thousand and 885 thousand shares, respectively, were excluded from the computation. For the three and nine months ended September 30, 2015, 687 thousand and 645 thousand shares, respectively, were excluded from the computation.