Air Canada 2010 Annual Report Download - page 124

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2010 Air Canada Annual Report
124
12. EARNINGS PER SHARE
The following table outlines the calculation of basic and diluted earnings per share:
(in millions, except per share amounts) 2010 2009
Numerator:
Numerator for basic and diluted earnings per share:
Net income (loss) $ 107 $ (24)
Denominator:
Weighted-average shares 278 132
Effect of potential dilutive securities:
Contingently issuable shares - 5
Warrants 13 -
Stock options 1 -
Performance share units - -
14 5
Add back anti-dilutive impact - (5)
Adjusted denominator for diluted earnings per share 292 132
Basic earnings (loss) per share $ 0.38 $ (0.18)
Diluted earnings (loss) per share $ 0.37 $ (0.18)
The calculation of earnings per share is based on whole dollars and not on rounded millions.
As a result, the above amounts may not be recalculated to the per share amount disclosed above.
The dilutive effect of outstanding stock options on earnings per share is based on the application of the treasury stock
method. Under this method, the proceeds from the exercise of such securities are assumed to be used to purchase Class B
Voting Shares. Contingently issuable shares relate to the dilutive impact of the shares issued under the Pension MOUs, as
described in Note 8, from the date of the agreement in July 2009 to the date of their issuance on October 26, 2009.
Excluded from the 2010 calculation of diluted earnings per share were 2,368,152 (2009 – 3,724,659) outstanding options
where the options’ exercise prices were greater than the average market price of the common shares for the year. The
2,500 equity settled performance share units outstanding at December 31, 2010 (2009 – 561,846) were also excluded as
management determined that the performance vesting criteria will not be met. All outstanding warrants were included in
the 2010 calculation of diluted earnings per share. In 2009 there were 90,001,652 warrants excluded from the calculation
of diluted earnings per share as the warrants’ exercise prices were greater than the average market price of the common
shares for the year.