Earnings (Loss) Per Share

6 Months Ended

Jun. 30, 2012

Earnings (Loss) Per Share

4. Earnings (Loss) Per Share

A company that has participating security holders (for example, unvested restricted stock that has non-forfeitable dividend rights) is required to utilize the two-class method for purposes of calculating earnings (loss) per share (“EPS”). The two-class method is an allocation of earnings/(loss) between the holders of common stock and a company’s participating security holders. Under the two-class method, earnings/(loss) for the reporting period are allocated between common shareholders and other security holders, based on their respective rights to receive distributed earnings (i.e., dividends) and undistributed earnings (i.e., net income or loss). Currently, the Company has one class of security and has participating security holders consisting of shareholders of unvested restricted stock. The following table shows basic and diluted EPS calculations

	Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011
	(Dollars in thousands, except per share amounts)
Basic and Diluted Earnings (Loss) Per Common Share:
Net income (loss)	$	10,638		$	(27,980	)	$	12,903		$	(47,859	)
Less: distributed and undistributed earnings allocated to participating securities		(149	)		(206	)		(308	)		(365	)
Earnings (loss) attributable to common stockholders	$	10,489		$	(28,186	)	$	12,595		$	(48,224	)
Basic weighted-average shares outstanding		47,398,088			46,719,233			47,367,051			46,717,408
Dilutive effect of common stock equivalents		354,641			—			310,016			—
Diluted weighted-average common shares outstanding, assuming conversion of common stock equivalents		47,752,729			46,719,233			47,677,067			46,717,408
Basic Earnings (Loss) Per Common Share	$	0.22		$	(0.60	)	$	0.27		$	(1.03	)
Diluted Earnings (Loss) Per Common Share	$	0.22		$	(0.60	)	$	0.26		$	(1.03	)

Diluted EPS includes the dilutive effect of common stock equivalents and is computed using the weighted-average number of common stock and common stock equivalents outstanding during the reporting period. Common stock equivalents include most types of stock options and unvested restricted stock. A total of 1.0 million unvested performance-based stock options were excluded from the calculation of diluted EPS for both the three and six months ended June 30, 2012 as the performance-based conditions were not met at June 30, 2012. Diluted EPS for the three and six months ended June 30, 2012 also excluded options to purchase approximately 4.8 million shares and 5.1 million shares, respectively, of common stock because the effect of their inclusion would be anti-dilutive. For the same reason, diluted EPS for both the three and six months ended June 30, 2011 excluded options to purchase approximately 5.2 million shares of common stock. In addition, diluted EPS for the three and six months ending June 30, 2011 excluded common stock equivalents because the effect of their inclusion would decrease the reported loss per share. Using the treasury stock method, the weighted-average common stock equivalents excluded from diluted EPS was 0.4 million shares for both the three and six months ended June 30, 2011.