L-3 Holdings' Earnings (Loss) Per Common Share

9 Months Ended

Sep. 25, 2015

L-3 Holdings' Earnings (Loss) Per Common Share

13. L-3 Holdings’ Earnings (Loss) Per Common Share

A reconciliation of basic and diluted earnings per share (EPS) is presented in the table below.


	Third Quarter Ended						Year-to-Date Ended
	September 25, 2015			September 26, 2014			September 25, 2015			September 26, 2014
	(in millions, except per share data)
Reconciliation of net (loss) income:
Net (loss) income	$	(296	)	$	157		$	(63	)	$	470
Net income attributable to noncontrolling interests		(3	)		(3	)		(11	)		(9	)

Net (loss) income attributable to L-3 Holdings’ common shareholders	$	(299	)	$	154		$	(74	)	$	461

Earnings (loss) per share attributable to L-3 Holdings’ common shareholders:
Basic:
Weighted average common shares outstanding		80.0			85.1			81.5			85.7

Basic (loss) earnings per share:
Net (loss) income	$	(3.74	)	$	1.81		$	(0.91	)	$	5.38

Diluted:
Common and potential common shares⁽¹⁾:
Weighted average common shares outstanding		80.0			85.1			81.5			85.7
Assumed exercise of stock options		—			2.8			—			3.0
Unvested restricted stock awards		—			1.5			—			1.6
Employee stock purchase plan contributions		—			—			—			0.1
Performance unit awards		—			0.1			—			0.1
Assumed purchase of common shares for treasury		—			(2.9	)		—			(3.2	)
Assumed conversion of the CODES⁽²⁾		—			—			—			1.1

Common and potential common shares		80.0			86.6			81.5			88.4

Diluted (loss) earnings per share:
Net (loss) income	$	(3.74	)	$	1.78		$	(0.91	)	$	5.21

⁽¹⁾	Due to a loss for the quarterly and year-to-date periods ended September 25, 2015, zero incremental weighted average potential common shares are included because the effect would be antidilutive.

⁽²⁾

L-3 Holdings’ 3% Convertible Contingent Debt Securities (CODES) due 2035 were retired on June 20, 2014, and were dilutive for the year-to-date period ended September 26, 2014 as the average market price of L-3 Holdings’ common stock during the period that the CODES were outstanding was greater than the price at which the CODES would have been convertible into L-3 Holdings’ common stock. As of June 18, 2014, the final date of conversion, the conversion price was $88.71.

The computation of diluted EPS excludes shares for stock options, restricted stock awards, employee stock plan contributions and performance unit awards of 4.5 million for each of the quarterly and year-to-date periods ended September 25, 2015, and shares for stock options and employee stock purchase plan contributions of 0.6 million and 0.5 million for the quarterly and year-to-date periods ended September 26, 2014, respectively, as they were anti-dilutive.