Quarterly report pursuant to Section 13 or 15(d)

Earnings Per Share ("EPS") and Earnings Per Unit ("EPU")

v3.4.0.3
Earnings Per Share ("EPS") and Earnings Per Unit ("EPU")
3 Months Ended
Mar. 31, 2016
Earnings Per Share [Abstract]  
Earnings Per Share (“EPS”) and Earnings Per Unit (“EPU”)
Earnings Per Share (“EPS”) and Earnings Per Unit (“EPU”)
 
COPT and Subsidiaries EPS

We present both basic and diluted EPS.  We compute basic EPS by dividing net income available to common shareholders allocable to unrestricted common shares under the two-class method by the weighted average number of unrestricted common shares outstanding during the period.  Our computation of diluted EPS is similar except that:
 
the denominator is increased to include: (1) the weighted average number of potential additional common shares that would have been outstanding if securities that are convertible into COPT common shares were converted; and (2) the effect of dilutive potential common shares outstanding during the period attributable to share-based compensation using the treasury stock or if-converted methods; and
the numerator is adjusted to add back any changes in income or loss that would result from the assumed conversion into common shares that we added to the denominator.

Summaries of the numerator and denominator for purposes of basic and diluted EPS calculations are set forth below (in thousands, except per share data):
 
For the Three Months Ended March 31,
 
2016
 
2015
Numerator:
 
 
 
Income from continuing operations
$
8,096

 
$
10,987

Gain on sales of real estate, net

 
3,986

Preferred share dividends
(3,552
)
 
(3,552
)
Income from continuing operations attributable to noncontrolling interests
(1,270
)
 
(1,392
)
Income from continuing operations attributable to share-based compensation awards
(118
)
 
(122
)
Numerator for basic and diluted EPS from continuing operations attributable to COPT common shareholders
$
3,156

 
$
9,907

Discontinued operations

 
(238
)
Discontinued operations attributable to noncontrolling interests

 
12

Numerator for basic and diluted EPS on net income attributable to COPT common shareholders
$
3,156

 
$
9,681

Denominator (all weighted averages):
 
 
 
Denominator for basic EPS (common shares)
94,203

 
93,199

Dilutive effect of share-based compensation awards
95

 
198

Denominator for diluted EPS (common shares)
94,298

 
93,397

Basic EPS:
 
 
 
Income from continuing operations attributable to COPT common shareholders
$
0.03

 
$
0.10

Discontinued operations attributable to COPT common shareholders
0.00

 
0.00

Net income attributable to COPT common shareholders
$
0.03

 
$
0.10

Diluted EPS:
 
 
 
Income from continuing operations attributable to COPT common shareholders
$
0.03

 
$
0.10

Discontinued operations attributable to COPT common shareholders
0.00

 
0.00

Net income attributable to COPT common shareholders
$
0.03

 
$
0.10


 
Our diluted EPS computations do not include the effects of the following securities since the conversions of such securities would increase diluted EPS for the respective periods (in thousands):
 
Weighted Average Shares Excluded from Denominator
 
 
For the Three Months Ended March 31,
 
 
2016
 
2015
Conversion of common units
 
3,677

 
3,732

Conversion of Series I Preferred Units
 
176

 
176

Conversion of Series K Preferred Shares
 
434

 
434


 
The following share-based compensation securities were excluded from the computation of diluted EPS because their effects were antidilutive:
 
weighted average restricted shares and deferred share awards for the three months ended March 31, 2016 and 2015 of 405,000 and 400,000, respectively; and
weighted average options for the three months ended March 31, 2016 and 2015 of 379,000 and 474,000, respectively.

We had outstanding senior notes, which we redeemed in April 2015, with an exchange settlement feature, but such notes did not affect our diluted EPS reported above since the weighted average closing price of COPT’s common shares during each of the periods was less than the exchange prices per common share applicable for such periods.

COPLP and Subsidiaries EPU

We present both basic and diluted EPU.  We compute basic EPU by dividing net income available to common unitholders allocable to unrestricted common units under the two-class method by the weighted average number of unrestricted common units outstanding during the period.  Our computation of diluted EPU is similar except that:
 
the denominator is increased to include: (1) the weighted average number of potential additional common units that would have been outstanding if securities that are convertible into our common units were converted; and (2) the effect of dilutive potential common units outstanding during the period attributable to share-based compensation using the treasury stock or if-converted methods; and
the numerator is adjusted to add back any changes in income or loss that would result from the assumed conversion into common units that we added to the denominator.

Summaries of the numerator and denominator for purposes of basic and diluted EPU calculations are set forth below (in thousands, except per unit data):
 
For the Three Months Ended March 31,
 
2016
 
2015
Numerator:
 
 
 
Income from continuing operations
$
8,096

 
$
10,987

Gain on sales of real estate, net

 
3,986

Preferred unit distributions
(3,717
)
 
(3,717
)
Income from continuing operations attributable to noncontrolling interests
(979
)
 
(821
)
Income from continuing operations attributable to share-based compensation awards
(118
)
 
(122
)
Numerator for basic and diluted EPU from continuing operations attributable to COPLP common unitholders
$
3,282

 
$
10,313

Discontinued operations

 
(238
)
Discontinued operations attributable to noncontrolling interests

 
3

Numerator for basic and diluted EPU on net income attributable to COPLP common unitholders
$
3,282

 
$
10,078

Denominator (all weighted averages):
 
 
 
Denominator for basic EPU (common units)
97,880

 
96,931

Dilutive effect of share-based compensation awards
95

 
198

Denominator for diluted EPU (common units)
97,975

 
97,129

Basic EPU:
 
 
 
Income from continuing operations attributable to COPLP common unitholders
$
0.03

 
$
0.10

Discontinued operations attributable to COPLP common unitholders
0.00

 
0.00

Net income attributable to COPLP common unitholders
$
0.03

 
$
0.10

Diluted EPU:
 
 
 
Income from continuing operations attributable to COPLP common unitholders
$
0.03

 
$
0.10

Discontinued operations attributable to COPLP common unitholders
0.00

 
0.00

Net income attributable to COPLP common unitholders
$
0.03

 
$
0.10


 
Our diluted EPU computations do not include the effects of the following securities since the conversions of such securities would increase diluted EPU for the respective periods (in thousands):
 
Weighted Average Units Excluded from Denominator
 
 
For the Three Months Ended March 31,
 
 
2016
 
2015
Conversion of Series I preferred units
 
176

 
176

Conversion of Series K preferred units
 
434

 
434


 
The following share-based compensation securities were excluded from the computation of diluted EPU because their effects were antidilutive:
 
weighted average restricted units and deferred share awards for the three months ended March 31, 2016 and 2015 of 405,000 and 400,000, respectively; and
weighted average options for the three months ended March 31, 2016 and 2015 of 379,000 and 474,000, respectively.
 
We had outstanding senior notes, which we redeemed in April 2015, with an exchange settlement feature, but such notes did not affect our diluted EPU reported above since the weighted average closing price of COPT’s common shares during each of the periods was less than the exchange prices per common share applicable for such periods.