Mercury Insurance 2015 Annual Report Download - page 93

Download and view the complete annual report

Please find page 93 of the 2015 Mercury Insurance annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 122

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122

81
The following table presents a summary of restricted stock unit awards activity during the years indicated:
Year Ended December 31,
2015 2014 2013
Shares
Weighted-
Average Fair
Value per Share Shares
Weighted-
Average Fair
Value per Share Shares
Weighted-
Average Fair
Value per Share
Outstanding at January 1 167,000 $ 41.15 170,500 $ 39.64 169,000 $ 42.22
Granted 100,250 $ 53.80 93,500 $ 45.17 84,500 $ 36.82
Vested — — —
Forfeited/Canceled (4,000) $ 43.10 (16,500) $ 43.99 (3,000) $ 36.82
Expired — $ — (80,500) $ 44.01 (80,000) $ 40.22
Outstanding at December 31 263,250 $ 45.94 167,000 $ 41.15 170,500 $ 39.64
The restricted stock units vest at the end of a three-year performance period beginning with the year of the grant, and then
only if, and to the extent that, the Company’s performance during the performance period achieves the threshold established by
the Compensation Committee of the Company’s Board of Directors. For 2013, 2014 and 2015 grants, vesting is based on the
Company’s cumulative underwriting income, annual underwriting income, and net earned premium growth. As of December 31,
2015, 1,000, 8,000, and 6,000 target restricted stock units granted in 2015, 2014 and 2013, respectively, have been forfeited because
the recipients were no longer employed by the Company. Expired shares represent shares that did not meet the vesting requirements.
The fair value of each restricted stock unit grant was determined based on the closing price of the Company's common
stock on the grant date. Compensation cost is recognized based on management’s best estimate that performance goals will be
achieved. If such goals are not met, no compensation cost would be recognized and any previously recognized compensation cost
would be reversed.
16. Earnings Per Share
The following table presents a reconciliation of the numerators and denominators of the basic and diluted earnings per share
calculations:
Year Ended December 31,
2015 2014 2013
Income
(Numerator)
Weighted
Shares
(Denominator)
Per-
Share
Amount
Income
(Numerator)
Weighted
Shares
(Denominator)
Per-
Share
Amount
Income
(Numerator)
Weighted
Shares
(Denominator)
Per-
Share
Amount
(Amounts and numbers in thousands, except per-share data)
Basic EPS
Income available
to common
stockholders $ 74,479 55,157 $ 1.35 $ 177,949 55,008 $ 3.23 $ 112,143 54,947 $ 2.04
Effect of dilutive
securities:
Options — 15 — 12 — 17
RSUs —37 —— ——
Diluted EPS
Income available
to common
stockholders after
assumed
conversions $ 74,479 55,209 $ 1.35 $ 177,949 55,020 $ 3.23 $ 112,143 54,964 $ 2.04
Potentially dilutive securities representing approximately 67,000, 252,000, and 359,000 shares of common stock for 2015,
2014, and 2013, respectively, were excluded from the computation of diluted earnings per common share because their effect
would have been anti-dilutive.