United Airlines 2010 Annual Report Download - page 112

NOTE 6—EARNINGS (LOSS) PER SHARE
The computations of UAL’s basic and diluted earnings (loss) per share are set forth below (in millions,
except per share amounts):
2010 2009 2008
Basic earnings (loss) per share:
Net income (loss) ................................................... $253 $(651) $(5,396)
Less: Income allocable to participating securities/preferred stock dividends ..... (1) — (3)
Earnings (loss) available to common stockholders ......................... $252 $(651) $(5,399)
Basic weighted-average shares outstanding .............................. 207 151 127
Earnings (loss) per share, basic ........................................ $1.22 $(4.32) $(42.59)
Diluted earnings (loss) per share:
Earnings (loss) available to common stockholders ......................... $252 $(651) $(5,399)
Effect of United 6% senior convertible notes ............................. 18 — —
Effect of Continental 4.5% convertible notes ............................. 2 — —
Effect of Continental 5% convertible notes ............................... 1 — —
Earnings (loss) available to common stockholders including the effect of dilutive
securities ....................................................... $273 $(651) $(5,399)
Basic weighted-average shares outstanding .............................. 207 151 127
Effect of United 6% senior convertible notes ............................. 40 — —
Effect of Continental 4.5% convertible notes ............................. 3 — —
Effect of employee stock options ...................................... 2 — —
Effect of Continental 5% convertible notes ............................... 1 — —
Diluted weighted-average shares outstanding ............................. 253 151 127
Earnings (loss) per share, diluted ...................................... $1.08 $(4.32) $(42.59)
Potentially dilutive shares excluded from diluted per share amounts:
United 4.5% senior limited subordination convertible notes ................. 22 22 22
Stock options ...................................................... 9 7 4
United 5% senior convertible notes ..................................... 3 3 3
Continental 6% convertible junior subordinated debentures .................. 1 — —
United 6% senior convertible notes ..................................... — 40 —
Restricted shares ................................................... — 1 2
2% preferred securities .............................................. — — 3
35 73 34
The adjustments to earnings (loss) available to common stockholders are net of the related effect of profit
sharing and income taxes, where applicable.
Approximately 2.0 million shares of UAL common stock remain to be issued to unsecured creditors and
employees under UAL Corporation’s Chapter 11 bankruptcy protection and are included in outstanding basic
shares for 2008, as the necessary conditions for issuance have been satisfied. UAL’s 6% Senior Notes due 2031
with a current principal amount of $615 million as of December 31, 2010, are callable at any time at 100% of par
value, and can be redeemed with either cash or UAL common stock at UAL’s option. These notes are not
included in the diluted earnings per share calculation, as it is UAL’s intent to use cash to redeem these notes.
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