Dow Chemical 2011 Annual Report Download - page 203

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NOTE M – EARNINGS PER SHARE CALCULATIONS
The following tables provide the earnings per share calculations for the year ended December 31, 2011:
Net Income
In millions
Net income from continuing operations
Net income attributable to noncontrolling interests
Net income attributable to The Dow Chemical Company
Preferred stock dividends
Net income attributable to participating securities (1)
Net income attributable to common stockholders
2011
$ 2,784
(42)
$ 2,742
(340)
(30)
$ 2,372
Earnings Per Share Calculations - Basic
Dollars per share
Net income from continuing operations
Net income attributable to noncontrolling interests
Net income attributable to The Dow Chemical Company
Preferred stock dividends
Net income attributable to participating securities (1)
Net income attributable to common stockholders
2011
$ 2.42
(0.03)
$ 2.39
(0.30)
(0.03)
$ 2.06
Earnings Per Share Calculations - Diluted
Dollars per share
Net income from continuing operations
Net income attributable to noncontrolling interests
Net income attributable to The Dow Chemical Company
Preferred stock dividends (2)
Net income attributable to participating securities (1)
Net income attributable to common stockholders
2011
$ 2.40
(0.03)
$ 2.37
(0.29)
(0.03)
$ 2.05
Shares in millions
Weighted-average common shares - basic
Plus dilutive effect of stock options and awards
Weighted-average common shares - diluted
Stock options and deferred stock awards excluded from EPS calculations (3)
Conversion of preferred stock excluded from EPS calculations (4)
1,149.0
9.2
1,158.2
44.7
96.8
(1) Accounting Standards Codification Topic 260, "Earnings per Share," requires enterprises with
participating securities to use the two-class method to calculate earnings per share and to report
the most dilutive earnings per share amount. The Company's deferred stock awards are
considered participating securities due to Dow's practice of paying dividend equivalents on
unvested shares. The impact on earnings per share in 2010 and 2009 using the two-class method
was immaterial.
(2) Preferred stock dividends were not added back in the calculation of diluted earnings per share
because the effect of adding them back would have been antidilutive.
(3) These outstanding options to purchase shares of common stock and deferred stock awards were
excluded from the calculation of diluted earnings per share because the effect of including them
would have been antidilutive.
(4) Conversion of the Cumulative Convertible Perpetual Preferred Stock, Series A into shares of the
Company’s common stock was excluded from the calculation of diluted earnings per share
because the effect of including them would have been antidilutive.