Quarterly report pursuant to Section 13 or 15(d)

Earnings Per Share (EPS)

v2.3.0.15
Earnings Per Share (EPS)
9 Months Ended
Sep. 30, 2011
Earnings Per Share ("EPS")  
Earnings Per Share ("EPS")

15.                               Earnings Per Share (“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 our 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

 

For the Nine Months

 

 

 

Ended September 30,

 

Ended September 30,

 

 

 

2011

 

2010

 

2011

 

2010

 

Numerator:

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations

 

$

4,893

 

$

4,696

 

$

(27,700

)

$

21,647

 

Gain on sales of real estate, net

 

—

 

2,477

 

2,717

 

2,829

 

Preferred share dividends

 

(4,025

)

(4,025

)

(12,076

)

(12,076

)

(Income) loss from continuing operations attributable to noncontrolling interests

 

(755

)

33

 

877

 

(1,192

)

Income from continuing operations attributable to restricted shares

 

(262

)

(267

)

(781

)

(807

)

Numerator for basic EPS from continuing operations attributable to COPT common shareholders

 

(149

)

2,914

 

(36,963

)

10,401

 

Dilutive effect of common units in the Operating Partnership on diluted EPS from continuing operations

 

—

 

—

 

(2,410

)

—

 

Numerator for diluted EPS from continuing operations attributable to COPT common shareholders

 

$

(149

)

$

2,914

 

$

(39,373

)

$

10,401

 

 

 

 

 

 

 

 

 

 

 

Numerator for basic EPS from continuing operations attributable to COPT common shareholders

 

$

(149

)

$

2,914

 

$

(36,963

)

$

10,401

 

Discontinued operations

 

2,577

 

1,753

 

(12,120

)

4,276

 

Discontinued operations attributable to noncontrolling interests

 

(149

)

(127

)

778

 

(324

)

Numerator for basic EPS on net income (loss) attributable to COPT common shareholders

 

2,279

 

4,540

 

(48,305

)

14,353

 

Dilutive effect of common units in the Operating Partnership

 

—

 

—

 

(3,188

)

—

 

Numerator for diluted EPS on net income (loss) attributable to COPT common shareholders

 

$

2,279

 

$

4,540

 

$

(51,493

)

$

14,353

 

 

 

 

 

 

 

 

 

 

 

Denominator (all weighted averages):

 

 

 

 

 

 

 

 

 

Denominator for basic EPS (common shares)

 

71,312

 

58,656

 

68,718

 

58,333

 

Dilutive effect of share-based compensation awards

 

—

 

296

 

—

 

367

 

Dilutive effect of common units

 

—

 

—

 

4,371

 

—

 

Denominator for diluted EPS

 

71,312

 

58,952

 

73,089

 

58,700

 

 

 

 

 

 

 

 

 

 

 

Basic EPS:

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations attributable to COPT common shareholders

 

$

—

 

$

0.05

 

$

(0.54

)

$

0.18

 

Discontinued operations attributable to COPT common shareholders

 

0.03

 

0.03

 

(0.16

)

0.07

 

Net income (loss) attributable to COPT common shareholders

 

$

0.03

 

$

0.08

 

$

(0.70

)

$

0.25

 

Diluted EPS:

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations attributable to COPT common shareholders

 

$

—

 

$

0.05

 

$

(0.54

)

$

0.17

 

Discontinued operations attributable to COPT common shareholders

 

0.03

 

0.03

 

(0.16

)

0.07

 

Net income (loss) attributable to COPT common shareholders

 

$

0.03

 

$

0.08

 

$

(0.70

)

$

0.24

 

 

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

 

For the Nine Months

 

 

 

Ended September 30,

 

Ended September 30,

 

 

 

2011

 

2010

 

2011

 

2010

 

Conversion of common units

 

4,336

 

4,453

 

—

 

4,674

 

Conversion of convertible preferred units

 

176

 

176

 

176

 

176

 

Conversion of convertible preferred shares

 

434

 

434

 

434

 

434

 

 

The following share-based compensation securities were excluded from the computation of diluted EPS because their effect was antidilutive:

 

·                  weighted average restricted shares for the three months ended September 30, 2011 and 2010 of 629,000 and 667,000, respectively, and for the nine months ended September 30, 2011 and 2010 of  635,000 and 664,000, respectively; and

·                  weighted average options for the three months ended September 30, 2011 and 2010 of 697,000 and 650,000, respectively, and for the nine months ended September 30, 2011 and 2010 of 655,000 and 616,000, respectively.

 

As discussed in Note 8, we have outstanding senior notes that have an exchange settlement feature but did not affect our diluted EPS reported above since the weighted average closing price of our common shares during each of the periods was less than the exchange prices per common share applicable for such periods.