Earnings Per Share

9 Months Ended

Sep. 30, 2012

Earnings Per Share

18. Earnings Per Share

Telesat has awarded employee stock options, which, if all exercised, could result in dilution of Loral’s ownership interest in Telesat to approximately 61.6%. The following table presents the dilutive impact of Telesat stock options on Loral’s reported income from continuing operations for the purpose of computing diluted earnings per share (in thousands).

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Income (loss) from continuing operations — basic	$	65,404		$	(97,555	)	$	54,796		$	(39,524	)
Less: Adjustment for dilutive effect of Telesat stock options		(1,890	)		—			(207	)		—
Income (loss) from continuing operations— diluted	$	63,514		$	(97,555	)	$	54,589		$	(39,524	)

Telesat stock options are excluded from the calculation of diluted loss per share for the three and nine months ended September 30, 2011, as the effect would be antidilutive.

Basic income per share is computed based upon the weighted average number of shares of voting and non-voting common stock outstanding. The following is the computation of common shares outstanding for diluted earnings per share (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2012		2011		2012		2011
Common and potential common shares outstanding for diluted earnings per share:
Weighted average common shares outstanding		30,745		30,706		30,684		30,680
Stock options		30		—		76		—
Unvested restricted stock		2		—		2		—
Unvested restricted stock units		220		—		218		—
Common shares outstanding for diluted earnings per share		30,997		30,706		30,980		30,680

For the three and nine months ended September 30, 2011, all stock options outstanding, unvested restricted stock and unvested restricted stock units are excluded from the calculation of diluted loss per share as the effect would have been antidilutive. The following summarizes stock options outstanding, unvested restricted stock and unvested restricted stock units excluded from the calculation of diluted loss per share:

	Three Months Ended  September 30,		Nine Months Ended September 30,
	2011		2011
Stock options outstanding		169		287
Unvested restricted stock		2		3
Unvested restricted stock units		227		225