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Note 13: Earnings Per Share
Beginning in the first quarter of 2015, we began applying the two-class method of calculating basic and diluted earnings per
share (the “Two-Class Method”) as it became significantly more dilutive than the previously applied treasury stock method as a
result of stock repurchases increasing the average number of unvested restricted awards as a percentage of total common shares
outstanding.
The Two-Class Method is an earnings allocation formula that treats a participating security, as having rights to earnings that
otherwise would have been available to common shareholders and assumes all earnings for the period are distributed. Our
unvested service-based restricted stock awards granted are participating securities as they entitle recipients to receive
nonforfeitable dividends during the vesting period on a basis equivalent to the dividends paid to holders of common stock.
Our calculation of basic and diluted earnings per share is as follows:
Year Ended December 31,
In thousands, except per share data 2015 2014 2013
Numerator
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 49,446 $ 124,677 $ 222,688
Loss from discontinued operations, net of tax . . . . . . . . . . . . . . . . . . . . . . . . (5,109) (18,059) (47,896)
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 44,337 $ 106,618 $ 174,792
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 49,446 $ 124,677 $ 222,688
Dividends and undistributed income allocated to participating shares. . . . . . (1,329) (3,929) (5,473)
Income from continuing operations to common shares - basic. . . . . . . . . . . . 48,117 120,748 217,215
Effect of reallocating undistributed income from continuing operations to
participating shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 58 179
Income from continuing operations to common shares - diluted . . . . . . . . . . $ 48,118 $ 120,806 $ 217,394
Denominator
Weighted average common shares - basic. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,467 20,192 27,216
Dilutive effect of share-based payment awards . . . . . . . . . . . . . . . . . . . 20 81 235
Dilutive effect of convertible debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 230 718
Weighted average common shares - diluted(1). . . . . . . . . . . . . . . . . . . . . . . . . 17,487 20,503 28,169
Basic earnings (loss) per common share:
Continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2.75 $ 5.98 $ 7.98
Discontinued operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.29) (0.89) (1.76)
Basic earnings per common share. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2.46 $ 5.09 $ 6.22
Diluted earnings (loss) per common share:
Continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2.75 $ 5.89 $ 7.72
Discontinued operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.29) (0.88) (1.70)
Diluted earnings per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2.46 $ 5.01 $ 6.02
Stock options and share-based awards not included in diluted EPS
calculation because their effect would have be antidilutive . . . . . . . . . . . . . . 71113
(1) Participating securities were included in the calculation of diluted earnings per share using the two-class method, as this calculation was more dilutive
than the calculation using the treasury stock method.
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