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5. Earnings per Share
Basic earnings per share amounts are calculated by dividing net income by the weighted-average number of common shares outstanding during the period. Diluted earnings per share amounts are calculated based upon the weighted-average number of common shares and potentially dilutive shares of common stock outstanding during the period. Potentially dilutive shares are excluded from the computation in periods in which they have an anti-dilutive effect. Diluted earnings per share reflect the potential dilution that could occur if holders of options exercised their options into common stock. During the twelve and forty weeks ended September 30, 2012, stock options outstanding of 293,000 and 306,000, respectively, were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive for the periods presented. During the twelve and forty weeks ended October 2, 2011, stock options outstanding of 249,000 and 226,000, respectively, were not included in the computation of diluted earnings per share because to do so would have been anti-dilutive for the periods presented. The Company uses the treasury stock method to calculate the effect of outstanding stock options. The computations for basic and diluted earnings per share are as follows (in thousands, except per share data):
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Twelve Weeks Ended
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Forty Weeks Ended
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September 30,
2012
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October 2,
2011
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September 30,
2012
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October 2,
2011
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Net income
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$
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3,533
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$
|
2,069
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$
|
21,839
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$
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17,672
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|
|
|
|
|
|
|
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Basic weighted average shares outstanding
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14,300
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|
15,024
|
|
14,517
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|
15,154
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Dilutive effect of stock options and awards
|
|
239
|
|
253
|
|
261
|
|
241
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Diluted weighted average shares outstanding
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14,539
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|
15,277
|
|
14,778
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|
15,395
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Earnings per share:
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|
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|
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Basic
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$
|
0.25
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$
|
0.14
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$
|
1.50
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$
|
1.17
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Diluted
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|
$
|
0.24
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$
|
0.14
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$
|
1.48
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$
|
1.15
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