US Cellular 2013 Annual Report Download - page 58

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United States Cellular Corporation
Notes to Consolidated Financial Statements (Continued)
NOTE 4 EARNINGS PER SHARE
Basic earnings per share attributable to U.S. Cellular shareholders is computed by dividing Net income
attributable to U.S. Cellular shareholders by the weighted average number of common shares
outstanding during the period. Diluted earnings per share attributable to U.S. Cellular shareholders is
computed by dividing Net income attributable to U.S. Cellular shareholders by the weighted average
number of common shares outstanding during the period adjusted to include the effects of potentially
dilutive securities. Potentially dilutive securities primarily include incremental shares issuable upon
exercise of outstanding stock options and the vesting of restricted stock units.
The amounts used in computing earnings per common share and the effects of potentially dilutive
securities on the weighted average number of common shares were as follows:
Year ended December 31, 2013 2012 2011
(Dollars and shares in thousands, except earnings per share)
Net income attributable to U.S. Cellular shareholders ............. $140,038 $111,006 $175,041
Weighted average number of shares used in basic earnings per share 83,968 84,645 84,877
Effect of dilutive securities:
Stock options ........................................ 211 184 224
Restricted stock units .................................. 551 401 347
Weighted average number of shares used in diluted earnings per
share .............................................. 84,730 85,230 85,448
Basic earnings per share attributable to U.S. Cellular shareholders . . . $ 1.67 $ 1.31 $ 2.06
Diluted earnings per share attributable to U.S. Cellular shareholders . . $ 1.65 $ 1.30 $ 2.05
Certain Common Shares issuable upon the exercise of stock options or vesting of restricted stock units
were not included in average diluted shares outstanding for the calculation of Diluted earnings per share
attributable to U.S. Cellular shareholders because their effects were antidilutive. The number of such
Common Shares excluded, if any, is shown in the table below.
Year Ended December 31, 2013 2012 2011
(Shares in thousands)
Stock options .................................... 2,010 2,123 1,591
Restricted stock units ............................... 190 369 250
On June 25, 2013, U.S. Cellular paid a special cash dividend of $5.75 per share, for an aggregate
amount of $482.3 million, to all holders of U.S. Cellular Common Shares and Series A Common Shares
as of June 11, 2013. Outstanding U.S. Cellular stock options and restricted stock unit awards were
equitably adjusted for the special cash dividend. The impact of such adjustments on the earnings per
share calculation was fully reflected for all years presented.
NOTE 5 ACQUISITIONS, DIVESTITURES AND EXCHANGES
U.S. Cellular assesses its existing wireless interests on an ongoing basis with a goal of improving the
competitiveness of its operations and maximizing its long-term return on investment. As part of this
strategy, U.S. Cellular reviews attractive opportunities to acquire additional operating markets and
wireless spectrum. In addition, U.S. Cellular may seek to divest outright or include in exchanges for other
wireless interests those interests that are not strategic to its long-term success.
Acquisitions did not have a material impact on U.S. Cellular’s consolidated financial statements for the
periods presented and pro forma results, assuming acquisitions had occurred at the beginning of each
period presented, would not be materially different from the results reported.
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