Paychex 2015 Annual Report Download - page 67

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PAYCHEX, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Note B — Basic and Diluted Earnings Per Share
Basic and diluted earnings per share were calculated as follows:
Year ended May 31,
In millions, except per share amounts 2015 2014 2013
Basic earnings per share:
Net income ............................................... $674.9 $627.5 $569.0
Weighted-average common shares outstanding ................... 362.9 364.5 363.8
Basic earnings per share ..................................... $ 1.86 $ 1.72 $ 1.56
Diluted earnings per share:
Net income ............................................... $674.9 $627.5 $569.0
Weighted-average common shares outstanding ................... 362.9 364.5 363.8
Dilutive effect of common share equivalents ..................... 1.7 1.6 0.9
Weighted-average common shares outstanding, assuming dilution . . . 364.6 366.1 364.7
Diluted earnings per share ................................... $ 1.85 $ 1.71 $ 1.56
Weighted-average anti-dilutive common share equivalents ........ 0.3 0.7 6.5
Weighted-average common share equivalents that had an anti-dilutive impact are excluded from the
computation of diluted earnings per share.
In May 2014, the Company announced that its Board of Directors (the “Board”) approved a program to
repurchase up to $350.0 million of the Company’s common stock with authorization expiring on May 31, 2017.
During fiscal 2015, the Company repurchased 3.9 million shares for $182.4 million under this program. During
fiscal 2014, the Company repurchased 6.2 million shares for $249.7 million under a previous Board-approved
program to repurchase up to $350.0 million of its common stock which expired on May 31, 2014. All shares
repurchased were retired.
Note C — Investment Income, Net
Investment income, net, consisted of the following items:
Year ended May 31,
In millions 2015 2014 2013
Interest income on corporate funds .................................. $7.8 $6.9 $6.7
Interest expense ................................................. (0.7) (1.1) (0.1)
Net loss from equity-method investments ............................. (0.7) (0.4) —
Investment income, net ........................................... $6.4 $5.4 $6.6
Note D — Stock-Based Compensation Plans
The Paychex, Inc. 2002 Stock Incentive Plan, as amended and restated, effective on October 13, 2010 (the
“2002 Plan”) upon its approval by the Company’s stockholders, authorizes grants of up to 39.1 million shares of
the Company’s common stock. As of May 31, 2015, there were 18.6 million shares available for future grants
under the 2002 Plan.
All stock-based awards to employees are recognized as compensation costs in the consolidated financial
statements based on their fair values measured as of the date of grant. These costs are recognized as an expense
in the Consolidated Statements of Income and Comprehensive Income on a straight-line basis over the requisite
service period and increase additional paid-in capital.
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