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EARNINGS (LOSS) PER SHARE
12 Months Ended
Jun. 30, 2020
Earnings Per Share [Abstract]  
EARNINGS (LOSS) PER SHARE
(13) EARNINGS (LOSS) PER SHARE
Basic earnings per share is computed by dividing net income attributable to stockholders by the weighted average number of shares of common stock outstanding for the period. Net income attributable to stockholders includes the adjustment recorded in the period to reflect redeemable limited partners' capital at the redemption amount, which is due to the exchange benefit obtained by limited partners through the ownership of Class B common units. Except when the effect would be anti-dilutive, the diluted earnings (loss) per share calculation, which is calculated using the treasury stock method, includes the impact of shares that could be issued under the outstanding stock options, non-vested restricted stock units and awards, shares of non-vested performance share awards and the effect of the assumed redemption of Class B common units through the issuance of Class A common shares.
The following table provides a reconciliation of the numerator and denominator used for basic and diluted earnings (loss) per share (in thousands, except per share amounts):
 
Year Ended June 30,
 
2020
2019
2018
 
 
 
Previous revenue standard (a)
Numerator for basic earnings (loss) per share:
 
 
 
Net income from continuing operations attributable to stockholders (b)
$
598,119

$
15,706

$
191,040

Net income (loss) from discontinued operations attributable to stockholders
556

(24,650
)
(158
)
Net income (loss) attributable to stockholders
$
598,675

$
(8,944
)
$
190,882

 
 
 
 
Numerator for diluted earnings (loss) per share:
 
 
 
Net income from continuing operations attributable to stockholders (b)
$
598,119

$
15,706

$
191,040

Adjustment of redeemable limited partners' capital to redemption amount
(468,311
)

(157,581
)
Net income from continuing operations attributable to non-controlling interest
161,318


224,548

Net income from continuing operations
291,126

15,706

258,007

Tax effect on Premier, Inc. net income (c)
(40,154
)

(70,257
)
Adjusted net income from continuing operations
$
250,972

$
15,706

$
187,750

 
 
 
 
Net income (loss) from discontinued operations attributable to stockholders
$
556

$
(24,650
)
$
(158
)
Net income (loss) from discontinued operations attributable to non-controlling interest in Premier LP
498


(279
)
Adjusted net income (loss) from discontinued operations
$
1,054

$
(24,650
)
$
(437
)
 
 
 
 
Adjusted net income (loss)
$
252,026

$
(8,944
)
$
187,313

 
 
 
 

 
Year Ended June 30,
 
2020
2019
2018
 
 
 
Previous revenue standard (a)
Denominator for basic earnings (loss) per share:
 
 
 
Weighted average shares (d)
67,035

59,188

53,518

 
 
 
 
Denominator for diluted earnings (loss) per share:
 
 
 
Weighted average shares (d)
67,035

59,188

53,518

Effect of dilutive securities: (e)
 
 
 
Stock options
329

577

275

Restricted stock
248

297

295

Performance share awards
67

207

252

Class B shares outstanding
55,935


83,000

Weighted average shares and assumed conversions
123,614

60,269

137,340

 
 
 
 
Basic earnings (loss) per share:
 
 
 
Basic earnings per share from continuing operations
$
8.92

$
0.27

$
3.57

Basic earnings (loss) per share from discontinued operations
0.01

(0.42
)
0.00

Basic earnings (loss) per share attributable to stockholders
$
8.93

$
(0.15
)
$
3.57

 
 
 
 
Diluted earnings (loss) per share:
 
 
 
Diluted earnings per share from continuing operations
$
2.03

$
0.27

$
1.37

Diluted earnings (loss) per share from discontinued operations
0.01

(0.42
)
(0.01
)
Diluted earnings (loss) per share attributable to stockholders
$
2.04

$
(0.15
)
$
1.36


(a)
The Company adopted Topic 606 effective July 1, 2018. Comparative results are presented under Topic 605. Refer to Note 2 - Significant Accounting Policies for more information.
(b)
Net income from continuing operations attributable to stockholders was calculated as follows (in thousands):
 
Year Ended June 30,
 
2020
2019
2018
 
 
 
Previous revenue standard (a)
Net income from continuing operations
$
291,126

$
334,677

$
258,007

Net income from continuing operations attributable to non-controlling interest
(161,318
)
(200,907
)
(224,548
)
Adjustment of redeemable limited partners' capital to redemption amount
468,311

(118,064
)
157,581

Net income from continuing operations attributable to stockholders
$
598,119

$
15,706

$
191,040

(c)
Represents income tax expense related to Premier, Inc. retaining the portion of net income attributable to income from non-controlling interest in Premier, LP for the purpose of diluted earnings (loss) per share.
(d)
Weighted average number of common shares used for basic earnings per share excludes weighted average shares of non-vested stock options, non-vested restricted stock, non-vested performance share awards and Class B shares outstanding for the years ended June 30, 2020, 2019 and 2018.
(e)
For the year ended June 30, 2020, the effect of 0.8 million stock options were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. For the year ended June 30, 2019, the effect of 70.8 million Class B common units exchangeable for Class A common shares and 0.4 million stock options were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect. For the year ended June 30, 2018, the effect of 1.6 million stock options were excluded from diluted weighted average shares outstanding as they had an anti-dilutive effect.
Pursuant to the terms of the Exchange Agreement, on a quarterly basis, the Company has the option, as determined by the independent Audit and Compliance Committee, to settle the exchange of Class B common units of Premier LP by member owners for cash, an equal number of Class A common shares of Premier, Inc. or a combination of cash and shares of Class A common stock. In connection with the exchange of Class B common units by member owners, regardless of the consideration used to settle the exchange, an equal number of shares of Premier's Class B common stock are surrendered by member owners and retired (see Note 11 - Redeemable Limited Partners' Capital). The following table presents certain information regarding the exchange of Class B common units and associated Class B common stock for Premier's Class A common stock and/or cash in connection with the quarterly exchanges pursuant to the terms of the Exchange Agreement, including activity related to the Class A and Class B common units and Class A and Class B common stock through the date of the applicable quarterly exchange:
Quarterly Exchange by Member Owners
Class B Common Shares Retired Upon Exchange (a)
Class B Common Shares Outstanding After Exchange (a)
Class A Common Shares Outstanding After Exchange (b)
Percentage of Combined Voting Power Class B/Class A Common Stock
July 31, 2019
1,310,771

62,767,860

63,274,182

49.8%/50.2%
October 31, 2019
6,873,699

55,581,646

66,552,023

46%/54%
January 31, 2020
4,866,082

50,715,564

71,066,141

42%/58%
April 30, 2020
502,466

50,213,098

71,574,119

41%/59%
July 31, 2020 (c)
69,684

50,143,414

71,724,149

41%/59%
(a)
The number of Class B common shares retired or outstanding are equivalent to the number of Class B common units retired upon exchange or outstanding after the exchange, as applicable.
(b)
The number of Class A common shares outstanding after exchange also includes activity related to the Company's share repurchase program (see Note 12 - Stockholders' Equity (Deficit)) and equity incentive plan (see Note 14 - Stock-Based Compensation).
(c)
As the quarterly exchange occurred on July 31, 2020, the impact of the exchange is not reflected in the consolidated financial statements for the year ended June 30, 2020.