Stock-Based Compensation and Equity

9 Months Ended

Sep. 30, 2024

Equity [Abstract]

Stock-Based Compensation and Equity

Stock-Based Compensation and Equity

Stock-Based Compensation

In June 2024, our stockholders approved the Amended and Restated 2017 Share Incentive Plan (the “Plan”), which authorizes the issuance of up to 4,000,000 additional shares of our common stock and makes certain other changes. The Plan is more fully described in the registration statement on Form S-8 filed on June 14, 2024. Our 2017 Share Incentive Plan and certain other stock-based compensation plans that we maintain are more fully described in the 2023 Annual Report. We recorded stock-based compensation expense of $13.5 million and $9.1 million during the three months ended September 30, 2024 and 2023, respectively, and $31.2 million and $25.8 million during the nine months ended September 30, 2024 and 2023, respectively, which was included in Stock-based compensation expense in the consolidated financial statements.

Restricted and Conditional Awards

Nonvested restricted share awards (“RSAs”), restricted share units (“RSUs”), and performance share units (“PSUs”) at September 30, 2024 and changes during the nine months ended September 30, 2024 were as follows:

	RSA and RSU Awards			PSU Awards
	Shares	Weighted-Average Grant Date Fair Value		Shares	Weighted-Average Grant Date Fair Value
Nonvested at January 1, 2024	447,358	$	77.69	526,413	$	105.92
Granted (a)	296,907	63.91		213,645	82.95
Vested (b)	(180,619)	75.39		(309,670)	86.19
Forfeited	(6,831)	72.38		(3,364)	101.11
Adjustment (c)	—	—		107,760	83.17
Nonvested at September 30, 2024 (d)	556,815	$	70.26	534,784	$	102.35

__________

(a)The grant date fair value of RSAs and RSUs reflect our stock price on the date of grant on a one-for-one basis. The grant date fair value of PSUs was determined utilizing a Monte Carlo simulation model to generate an estimate of our future stock price over the three-year performance period. To estimate the fair value of PSUs granted during the nine months ended September 30, 2024, we used a risk-free interest rate of 4.1%, an expected volatility rate of 20.5%, and assumed a dividend yield of zero.

(b)The grant date fair value of shares vested during the nine months ended September 30, 2024 was $40.3 million. Employees have the option to take immediate delivery of the shares upon vesting or defer receipt to a future date pursuant to previously made deferral elections. At September 30, 2024 and December 31, 2023, we had an obligation to issue 1,390,983 and 1,196,955 shares, respectively, of our common stock underlying such deferred awards, which is recorded within Total stockholders’ equity as a Deferred compensation obligation of $78.4 million and $62.0 million, respectively.

(c)Vesting and payment of the PSUs is conditioned upon certain company and/or market performance goals being met during the relevant three-year performance period. The ultimate number of PSUs to be vested will depend on the extent to which the performance goals are met and can range from zero to three times the original awards. As a result, we recorded adjustments at September 30, 2024 to reflect the number of shares expected to be issued when the PSUs vest.

(d)At September 30, 2024, total unrecognized compensation expense related to these awards was approximately $46.7 million, with an aggregate weighted-average remaining term of 1.8 years.

Earnings Per Share

The following table summarizes basic and diluted earnings (dollars in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net income — basic and diluted	$	111,698	$	125,040	$	413,816	$	564,040
Weighted-average shares outstanding — basic	220,221,366		215,097,114		220,149,886		214,052,907
Effect of dilutive securities	182,783		155,855		275,358		374,518
Weighted-average shares outstanding — diluted	220,404,149		215,252,969		220,425,244		214,427,425

For the three and nine months ended September 30, 2024 and 2023, potentially dilutive securities excluded from the computation of diluted earnings per share were insignificant.

Acquisitions of Noncontrolling Interests

On May 30, 2023, we acquired the remaining 3% interest in an international jointly owned investment (which we already consolidated) from the noncontrolling interest holders for nominal consideration, bringing our ownership interest to 100%. No gain or loss was recognized on the transaction. We recorded an increase of approximately $1.2 million to Additional paid-in capital in our consolidated statements of equity for the nine months ended September 30, 2023 related to the difference between the consideration transferred and the carrying value of the noncontrolling interest related to this investment.

On July 18, 2023, we acquired the remaining 10% interest in a domestic jointly owned investment (which we already consolidated) from the noncontrolling interest holders for $2.4 million, bringing our ownership interest to 100%. No gain or loss was recognized on the transaction. We recorded an increase of approximately $2.5 million to Additional paid-in capital in our consolidated statements of equity for the three and nine months ended September 30, 2023 related to the difference between the consideration transferred and the carrying value of the noncontrolling interest related to this investment.

ATM Program and Forward Equity

On May 2, 2022, we established a continuous “at-the-market” offering program (“ATM Program”) with a syndicate of banks, pursuant to which shares of our common stock having an aggregate gross sales price of up to $1.0 billion may be sold (i) directly through or to the banks acting as sales agents or as principal for their own accounts or (ii) through or to participating banks or their affiliates acting as forward sellers on behalf of any forward purchasers pursuant to a forward sale agreement (our “ATM Forwards”).

During 2023, we settled the ATM Forwards in full prior to the maturity date of each ATM Forward via physical delivery of the outstanding shares of common stock in exchange for cash proceeds. The forward sale price that we received upon physical settlement of the ATM Forwards was (i) subject to adjustment on a daily basis based on a floating interest rate factor equal to a specified daily rate less a spread (i.e., if the specified daily rate is less than the spread on any day, the interest rate factor will result in a daily reduction of the applicable forward sale price) and (ii) decreased based on amounts related to expected dividends on shares of our common stock during the term of the ATM Forwards.

We determined that our ATM Forwards met the criteria for equity classification and were therefore exempt from derivative accounting. We recorded the ATM Forwards at fair value at inception, which we determined to be zero. Subsequent changes to fair value are not required under equity classification.

The following table sets forth certain information regarding the settlement of our forward equity during the periods presented (dollars in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Shares of common stock delivered	—		—		—		3,081,867
Net proceeds	$	—	$	—	$	—	$	249,806

Reclassifications Out of Accumulated Other Comprehensive Loss

The following tables present a reconciliation of changes in Accumulated other comprehensive loss by component for the periods presented (in thousands):

	Three Months Ended September 30, 2024
	Gains and (Losses) on Derivative Instruments		Foreign Currency Translation Adjustments		Total
Beginning balance	$	15,963	$	(268,603)	$	(252,640)
Other comprehensive income before reclassifications	(10,816)		28,630		17,814
Amounts reclassified from accumulated other comprehensive loss to:
Non-operating income	(2,520)		—		(2,520)
Interest expense	(406)		—		(406)
Total	(2,926)		—		(2,926)
Net current period other comprehensive income	(13,742)		28,630		14,888
Net current period other comprehensive income attributable to noncontrolling interests	—		(235)		(235)
Ending balance	$	2,221	$	(240,208)	$	(237,987)

	Three Months Ended September 30, 2023
	Gains and (Losses) on Derivative Instruments		Foreign Currency Translation Adjustments		Total
Beginning balance	$	23,879	$	(303,810)	$	(279,931)
Other comprehensive income before reclassifications	10,262		(8,844)		1,418
Amounts reclassified from accumulated other comprehensive loss to:
Non-operating income	(2,787)		—		(2,787)
Interest expense	(659)		—		(659)
Total	(3,446)		—		(3,446)
Net current period other comprehensive loss	6,816		(8,844)		(2,028)
Net current period other comprehensive loss attributable to noncontrolling interests	—		139		139
Ending balance	$	30,695	$	(312,515)	$	(281,820)

	Nine Months Ended September 30, 2024
	Gains and (Losses) on Derivative Instruments		Foreign Currency Translation Adjustments		Total
Beginning balance	$	9,650	$	(264,517)	$	(254,867)
Other comprehensive income before reclassifications	2,092		24,268		26,360
Amounts reclassified from accumulated other comprehensive loss to:
Non-operating income	(7,586)		—		(7,586)
Interest expense	(1,935)		—		(1,935)
Total	(9,521)		—		(9,521)
Net current period other comprehensive income	(7,429)		24,268		16,839
Net current period other comprehensive loss attributable to noncontrolling interests	—		41		41
Ending balance	$	2,221	$	(240,208)	$	(237,987)

	Nine Months Ended September 30, 2023
	Gains and (Losses) on Derivative Instruments		Foreign Currency Translation Adjustments		Total
Beginning balance	$	36,079	$	(319,859)	$	(283,780)
Other comprehensive income before reclassifications	6,404		7,092		13,496
Amounts reclassified from accumulated other comprehensive loss to:
Non-operating income	(10,656)		—		(10,656)
Interest expense	(1,132)		—		(1,132)
Total	(11,788)		—		(11,788)
Net current period other comprehensive income	(5,384)		7,092		1,708
Net current period other comprehensive loss attributable to noncontrolling interests	—		252		252
Ending balance	$	30,695	$	(312,515)	$	(281,820)

See Note 9 for additional information on our derivatives activity recognized within Other comprehensive income (loss) for the periods presented.

Dividends Declared

During the third quarter of 2024, our board of directors declared a quarterly dividend of $0.875 per share, which was paid on October 15, 2024 to stockholders of record as of September 30, 2024.

During the nine months ended September 30, 2024, we declared dividends totaling $2.610 per share.