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Earnings Per Common Share ("EPS") (Tables)
 6 Months Ended
Jun. 30, 2019
Earnings Per Share [Abstract]  
Earnings Per Common Share

The following table summarizes the components of basic and diluted EPS (in millions, except per share data):

 

 

 

Quarter Ended

 

 

Year to Date Ended

 

 

 

6/30/2019

 

 

6/30/2018

 

 

6/30/2019

 

 

 

6/30/2018

 

Net Income – Yum China Holdings, Inc.

 

$

178

 

 

$

143

 

 

$

400

 

 

 

$

431

 

Weighted-average common shares outstanding

   (for basic calculation) (a)

 

 

378

 

 

 

386

 

 

 

378

 

 

 

 

386

 

Effect of dilutive share-based awards (a)

 

 

8

 

 

 

10

 

 

 

8

 

 

 

 

11

 

Effect of dilutive warrants (b)

 

 

3

 

 

 

2

 

 

 

3

 

 

 

 

3

 

Weighted-average common and dilutive potential

   common shares outstanding (for diluted calculation)

 

 

389

 

 

 

398

 

 

 

389

 

 

 

 

400

 

Basic Earnings Per Common Share

 

$

0.47

 

 

$

0.37

 

 

$

1.06

 

 

 

$

1.12

 

Diluted Earnings Per Common Share

 

$

0.46

 

 

$

0.36

 

 

$

1.03

 

 

 

$

1.08

 

Share-based awards excluded from the diluted EPS

   computation (c)

 

 

2

 

 

 

1

 

 

 

2

 

 

 

 

1

 

 

(a)

As a result of the separation, shares of Yum China common stock were distributed to YUM’s shareholders of record as of October 19, 2016 and included in the calculated weighted-average common shares outstanding. Holders of outstanding YUM equity awards generally received both adjusted YUM awards and Yum China awards, or adjusted awards on shares of common stock of either YUM or Yum China in their entirety. Any subsequent exercise of these awards, whether held by the Company’s employees or YUM’s employees, would increase the number of common shares outstanding. The outstanding equity awards are included in the computation of diluted EPS, if there is dilutive effect.

 

(b)

Pursuant to the investment agreements dated September 1, 2016, Yum China issued to strategic investors two tranches of warrants on January 9, 2017, with each tranche initially providing the right to purchase 8,200,405 shares of Yum China common stock, at an exercise price of $31.40 and $39.25 per share, respectively, subject to customary anti-dilution adjustments. The warrants may be exercised at any time through October 31, 2021. The outstanding warrants are included in the computation of diluted EPS, if there is dilutive effect when the average market price of Yum China common stock for the period exceeds the exercise price of the warrants.

 

(c)

These outstanding stock appreciation rights, restricted stock units and performance share units were not included in the computation of diluted EPS because to do so would have been antidilutive for the quarters and years to date presented.