Best Buy 2016 Annual Report Download - page 90

82
The following table presents a reconciliation of the numerators and denominators of basic and diluted earnings per share from
continuing operations attributable to Best Buy Co., Inc. in fiscal 2016, 2015 and 2014 ($, except per share amounts, and shares
in millions):
2016 2015 2014
Numerator (in millions):
Net earnings from continuing operations attributable to Best Buy Co., Inc., shareholders $ 807 $ 1,246 $ 695
Denominator (in millions):
Weighted-average common shares outstanding 346.5 349.5 342.1
Effect of potentially dilutive securities:
Stock options and other 4.2 4.1 5.5
Weighted-average common shares outstanding, assuming dilution 350.7 353.6 347.6
Net earnings per share from continuing operations attributable to Best Buy Co., Inc.
shareholders
Basic $ 2.33 $ 3.57 $ 2.03
Diluted $ 2.30 $ 3.53 $ 2.00
Repurchase of Common Stock
In June 2011, our Board of Directors authorized a $5.0 billion share repurchase program. There is no expiration date governing
the period over which we can repurchase shares under the June 2011 share repurchase program.
On January 22, 2016, we entered into a variable notional accelerated share repurchase agreement ("ASR") with a third party
financial institution to repurchase $150 million to $175 million of our common stock. Under the agreement, we paid $175
million at the beginning of the contract and received an initial delivery of 4.4 million shares on January 25, 2016. We retired
these shares and recorded a $120 million reduction to stockholders' equity. As of January 30, 2016 the remaining $55 million
was included as a reduction of stockholders' equity in "Prepaid Share Repurchase". We accounted for the variable component of
shares to be delivered under the ASR as a forward contract indexed to our common stock, which met all of the criteria for
equity classification, and therefore, was not accounted for as a derivative instrument but instead was accounted for as a
component of equity. The ASR continued to meet the requirements for equity classification as of January 30, 2016.
The delivery of 4.4 million shares reduced our outstanding shares used to determine our weighted average common shares
outstanding for purposes of calculating basic and diluted earnings per share for the twelve months ended January 30, 2016. We
evaluated the ASR agreement for potential dilutive effects of any shares remaining to be received or owed upon settlement and
determined the additional shares to be received would be anti-dilutive, and therefore they were not included in our calculation
of diluted earnings per share for the the twelve months ended January 30, 2016.
The ASR was settled on February 17, 2016 for a final notional amount of $165 million. Accordingly we received 1.6 million
shares, which were retired, and a $10 million cash payment from our counter-party equal to the difference between the $175
million up-front payment and the final notional amount. The final notional amount was determined based upon the volume-
weighted average share price of our common stock during the term of the ASR agreement. The number of shares delivered was
based upon the final notional amount and the volume-weighted average share price of our common stock during the term of the
agreement, less an agreed-upon discount.