Airgas Specialty Gases 10-Q 2006 Q3 Quarterly report

EXHIBIT 11

Airgas, Inc.
Earnings Per Share Computations
(In thousands, except per share amounts)

	Three Months Ended					Nine Months Ended
	December 31,					December 31,
Basic Earnings per Share Computation	2005			2004		2005			2004
Numerator:
Income from continuing operations	$	32,702		$	22,929	$	91,517		$	67,662
Income (loss) from discontinued operations		(1,877	)		44		(1,424	)		204
Net earnings	$	30,825		$	22,973	$	90,093		$	67,866
Denominator:
Basic shares outstanding		77,037			75,150		76,646			74,673
Basic earnings per share from continuing operations	$	0.42		$	0.31	$	1.19		$	0.91
Basic earnings (loss) per share from discontinued operations		(0.02	)		—		(0.01	)		—
Basic net earnings per share	$	0.40		$	0.31	$	1.18		$	0.91

	Three Months Ended					Nine Months Ended
	December 31,					December 31,
Diluted Earnings per Share Computation	2005			2004(4)		2005			2004(4)
Numerator:
Income from continuing operations	$	32,702		$	22,929	$	91,517		$	67,662
Plus: Preferred stock dividends(1) (2)		711			—		2,134			—
Plus: Income taxes on earnings of National Welders(3)		184			—		509			—
Income from continuing operations assuming preferred stock conversion	$	33,597		$	22,929	$	94,160		$	67,662
Income (loss) from discontinued operations		(1,877	)		44		(1,424	)		204
Net earnings assuming preferred stock conversion	$	31,720		$	22,973	$	92,736		$	67,866
Denominator:
Basic shares outstanding		77,037			75,150		76,646			74,673
Incremental shares from assumed conversions:
Stock options and warrants		2,211			2,211		2,022			2,057
Preferred stock of National Welders(1)		2,327			—		2,327			—
Diluted shares outstanding		81,575			77,361		80,995			76,730
Diluted earnings per share from continuing operations	$	0.41		$	0.30	$	1.16		$	0.88
Diluted earnings (loss) per share from discontinued operations		(0.02	)		—		(0.02	)		—
Diluted net earnings per share	$	0.39		$	0.30	$	1.14		$	0.88

(1) - Pursuant to a joint venture agreement between the Company and the holders of the preferred stock of National Welders, between June 6, 2005 and June 30, 2009, the preferred shareholders have the option to exchange their 3.2 million preferred shares of National Welders either for cash at a price of $17.78 per share or to tender them to the joint venture in exchange for approximately 2.3 million shares of Airgas common stock. If Airgas common stock has a market value of $24.45 per share, the stock and cash redemption options are equivalent.

(b) - If the preferred stockholders of National Welders convert their preferred stock to Airgas common stock, the 5% preferred stock dividend, recognized as “Minority interest in earnings of consolidated affiliate,” would no longer be paid to the preferred stockholders, resulting in additional net earnings for Airgas.

(3) - The earnings of National Welders for tax purposes are treated as a deemed dividend to Airgas, net of an 80% dividend exclusion. Upon the assumed conversion of National Welders preferred stock to Airgas common stock, National Welders would become a wholly owned subsidiary of Airgas. As a wholly owned subsidiary, the net earnings of National Welders would not be subject to additional tax at the Airgas level.

(4) - The assumed conversion of National Welders preferred stock to Airgas common stock is not presented because it was anti-dilutive.