Earnings (Loss) Per Share

3 Months Ended

Mar. 31, 2021

Earnings (Loss) Per ShareBasic earnings per share is calculated by dividing net earnings attributable to Encore by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is calculated based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares during the period. Dilutive potential common shares include outstanding stock options, non-vested share awards, and the dilutive effect of the convertible and exchangeable senior notes, if applicable.

The Company adopted ASU 2020-06 on January 1, 2021, using a modified retrospective approach. Effective January 1, 2021, the dilutive effect of the Company’s convertible and exchangeable notes are calculated using the if-converted method. Prior to the adoption, the dilutive effect of the convertible and exchangeable notes was calculated using the treasury stock method. Since all of the Company’s convertible and exchangeable notes require net share settlement, using the if-converted method results in a similar dilutive effect as using the treasury stock method under the previous accounting standard, due to the fact that only in-the-money shares are included in the dilutive effect. The Company did not have any dilutive effect from its convertible and exchangeable notes during the three months ended March 31, 2021 or 2020.

In computing the diluted net loss per share for the three months ended March 31, 2020, dilutive potential common shares were excluded from the diluted loss per share calculation because of their anti-dilutive effect.

On August 12, 2015, the Company’s Board of Directors approved a $50.0 million share repurchase program. On May 5, 2021, the Company announced that the Board of Directors had approved an increase in the size of the repurchase program from $50.0 million to $300.0 million (an increase of $250.0 million). Repurchases under this program are expected to be made with cash on hand and may be made from time to time, subject to market conditions and other factors, in the open market, through private transactions, block transactions, or other methods as determined by the Company’s management and Board of Directors, and in accordance with market conditions, other corporate considerations, and applicable regulatory requirements. The program does not obligate the Company to acquire any particular amount of common stock, and it may be modified or suspended at any time at the Company’s discretion. During the three months ended March 31, 2021, the Company repurchased 517,860 shares of our common stock for approximately $20.4 million, or $39.37 per share. The Company’s practice is to retire the shares repurchased.

A reconciliation of shares used in calculating earnings per basic and diluted shares follows (in thousands, except per share amounts):


	Three Months Ended March 31,
	2021		2020
Net income (loss) attributable to Encore Capital Group, Inc. stockholders	$	94,630	$	(10,454)

Total weighted-average basic shares outstanding	31,469		31,308
Dilutive effect of stock-based awards	363		—


Total weighted-average dilutive shares outstanding	31,832		31,308

Basic earnings (loss) per share	$	3.01	$	(0.33)
Diluted earnings (loss) per share	$	2.97	$	(0.33)

Anti-dilutive employee stock options outstanding were approximately 13,000 during the three months ended March 31, 2021 and 2020.