Earnings per Share (EPS)

9 Months Ended

Sep. 30, 2023

Basic EPS is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted EPS is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding. As such, the Company includes the 2028 Convertible Notes and share-based compensation awards in its potentially dilutive securities. Generally, dilutive securities are not included in the computation of loss per share when a company reports a net loss from continuing operations as the impact would be anti-dilutive.

For all but performance units, the potentially dilutive impact of the Company’s share-based compensation awards is determined using the treasury stock method. Under the treasury stock method, awards are treated as if they had been exercised with any proceeds used to repurchase common stock at the average market price during the period. Any incremental difference between the assumed number of shares issued and purchased is included in the diluted share computation. For performance units, their contingent features result in an assessment for any potentially dilutive common stock by using the end of the reporting period as if it were the end of the contingency period for all units granted.

A conversion of the 2028 Convertible Notes may result in payment in the Company’s common stock. For diluted EPS purposes, the potentially dilutive common stock is assumed to have been converted at the beginning of the period (or at the time of issuance, if later). In periods where the potentially dilutive common stock is included in the computation of diluted EPS, the numerator will be adjusted to add back tax adjusted interest expense, which includes the amortization of debt issuance costs, related to the convertible debt.

The computation of diluted EPS excluded aggregate share-based compensation awards of less than 0.1 million for the three and nine months ended September 30, 2023 and 2022 because to do so would have been anti-dilutive for those periods. Because the potential dilutive impact of such share-based compensation awards is calculated under the treasury stock method, anti-dilution generally occurs when the exercise prices or unrecognized compensation cost per share of such awards are higher than the Company’s average stock price during the applicable period. Anti-dilution also occurs when a company reports a net loss from continuing operations, and the dilutive impact of all share-based compensation awards are excluded accordingly.

The following illustrates the earnings allocation method utilized in the calculation of basic and diluted EPS.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
	(In millions, except per share data)
Basic EPS numerator:
Income from continuing operations, net of income taxes	$	128.8	$	384.4	$	617.0	$	675.9
Less: Net income attributable to noncontrolling interests	11.4		8.5		49.3		8.5
Income from continuing operations attributable to common stockholders	117.4		375.9		567.7		667.4


Income (loss) from discontinued operations, net of income taxes	2.5		(0.8)		(0.1)		(2.3)


Net income attributable to common stockholders	$	119.9	$	375.1	$	567.6	$	665.1

Diluted EPS numerator:
Income from continuing operations, net of income taxes	$	128.8	$	384.4	$	617.0	$	675.9
Add: Tax adjusted interest expense related to 2028 Convertible Notes	3.0		2.6		9.1		6.1
Less: Net income attributable to noncontrolling interests	11.4		8.5		49.3		8.5
Income from continuing operations attributable to common stockholders	120.4		378.5		576.8		673.5
Income (loss) from discontinued operations, net of income taxes	2.5		(0.8)		(0.1)		(2.3)
Net income attributable to common stockholders	$	122.9	$	377.7	$	576.7	$	671.2

EPS denominator:
Weighted average shares outstanding — basic	133.2		144.1		140.0		141.4
Dilutive impact of share-based compensation awards	0.6		1.7		0.6		1.6
Dilutive impact of 2028 Convertible Notes	16.1		16.1		16.1		12.6
Weighted average shares outstanding — diluted	149.9		161.9		156.7		155.6

Basic EPS attributable to common stockholders:
Income from continuing operations	$	0.88	$	2.61	$	4.06	$	4.72
Income (loss) from discontinued operations	0.02		(0.01)		(0.01)		(0.02)
Net income attributable to common stockholders	$	0.90	$	2.60	$	4.05	$	4.70

Diluted EPS attributable to common stockholders:
Income from continuing operations	$	0.80	$	2.34	$	3.68	$	4.33
Income (loss) from discontinued operations	0.02		(0.01)		—		(0.02)
Net income attributable to common stockholders	$	0.82	$	2.33	$	3.68	$	4.31