Earnings Per Share

12 Months Ended

Dec. 31, 2021

Basic earnings per share (“EPS”) amounts are computed by dividing earnings, after the deduction of preferred stock dividends declared, by the average number of common shares outstanding. Diluted EPS amounts assume the issuance of common stock for all potentially dilutive share equivalents outstanding.

The information used to compute basic and diluted EPS attributable to Howmet common shareholders was as follows (shares in millions):


For the year ended December 31,	2021		2020		2019
Net income from continuing operations	$	258	$	211	$	126
Less: preferred stock dividends declared	2		2		2
Net income from continuing operations attributable to common shareholders	256		209		124
Income from discontinued operations	—		50		344
Net income attributable to common shareholders - basic	256		259		468
Add: interest expense related to convertible notes	—		—		9
Net income attributable to common shareholders - diluted	$	256	$	259	$	477

Average shares outstanding - basic	430		435		446
Effect of dilutive securities:
Stock options	—		—		1
Stock and performance awards	5		4		5
Convertible notes(1)	—		—		11
Average shares outstanding - diluted	435		439		463

(1)The convertible notes matured on October 15, 2019 (see Note R). No shares of the Company’s common stock were issued in connection with the maturity or the final conversion of the convertible notes. As of October 15, 2019, the calculation of average diluted shares outstanding ceased to include the approximately 15 million shares of common stock and the corresponding interest expense previously attributable to the convertible notes.

Common stock outstanding at December 31, 2021 and 2020 was approximately 422 million and 433 million, respectively.

The 5 million decrease in average shares outstanding (basic) for the year ended December 31, 2021 compared to the year ended December 31, 2020 was primarily due to the 13 million shares repurchased during 2021. As average shares outstanding are used in the calculation for both basic and diluted EPS, the full impact of share repurchases was not realized in EPS for the year ended December 31, 2021 as share repurchases occurred at varying points during the year ended December 31, 2021.

The following shares were excluded from the calculation of average shares outstanding – diluted as their effect was anti-dilutive (shares in millions).


For the year ended December 31,	2021	2020	2019

Stock options	—	1	1

(1)