Earnings per Common Share:

The following table sets forth the computation of basic and diluted earnings per common share (in millions, except per share amounts):



	For the Year Ended December 31,
	2015			2014			2013
Basic:
Numerator:
Income from continuing operations	$	253.7		$	276.2		$	382.5
Less: Net income attributable to noncontrolling interests included in continuing operations	(69.7		)	(59.7		)	(57.8		)
Less: Income allocated to participating securities	(1.0		)	(2.3		)	(3.4		)
Less: Convertible perpetual preferred stock dividends	(1.6		)	(6.3		)	(21.0		)
Less: Repurchase of convertible perpetual preferred stock	—			—			(71.6		)
Income from continuing operations attributable to HealthSouth common shareholders	181.4			207.9			228.7
(Loss) income from discontinued operations, net of tax, attributable to HealthSouth common shareholders	(0.9		)	5.5			(1.1		)
Less: Income from discontinued operations allocated to participating securities	—			(0.1		)	—
Net income attributable to HealthSouth common shareholders	$	180.5		$	213.3		$	227.6
Denominator:
Basic weighted average common shares outstanding	89.4			86.8			88.1
Basic earnings per share attributable to HealthSouth common shareholders:
Continuing operations	$	2.03		$	2.40		$	2.59
Discontinued operations	(0.01		)	0.06			(0.01		)
Net income	$	2.02		$	2.46		$	2.58

Diluted:
Numerator:
Income from continuing operations	$	253.7		$	276.2		$	382.5
Less: Net income attributable to noncontrolling interests included in continuing operations	(69.7		)	(59.7		)	(57.8		)
Add: Interest on convertible debt, net of tax	9.4			9.0			1.0
Income from continuing operations attributable to HealthSouth common shareholders	193.4			225.5			325.7
(Loss) income from discontinued operations, net of tax, attributable to HealthSouth common shareholders	(0.9		)	5.5			(1.1		)
Net income attributable to HealthSouth common shareholders	$	192.5		$	231.0		$	324.6
Denominator:
Diluted weighted average common shares outstanding	101.0			100.7			102.1
Diluted earnings per share attributable to HealthSouth common shareholders:
Continuing operations	$	1.92		$	2.24		$	2.59
Discontinued operations	(0.01		)	0.05			(0.01		)
Net income	$	1.91		$	2.29		$	2.58

The following table sets forth the reconciliation between basic weighted average common shares outstanding and diluted weighted average common shares outstanding (in millions):



	For the Year Ended December 31,
	2015	2014	2013
Basic weighted average common shares outstanding	89.4	86.8	88.1
Convertible perpetual preferred stock	1.0	3.2	10.5
Convertible senior subordinated notes	8.3	8.2	1.0
Restricted stock awards, dilutive stock options, and restricted stock units	2.3	2.5	2.5
Diluted weighted average common shares outstanding	101.0	100.7	102.1

For the year ended December 31, 2013, adding back amounts related to the repurchase of our preferred stock to our Income from continuing operations attributable to HealthSouth common shareholders causes a per share increase when calculating diluted earnings per common share resulting in an antidilutive per share amount. See Note 10, Convertible Perpetual Preferred Stock. Therefore, basic and diluted earnings per common share is the same for the year ended December 31, 2013.

Options to purchase approximately 0.1 million shares of common stock were outstanding as of December 31, 2015 and 2014 but were not included in the computation of diluted weighted-average shares because to do so would have been antidilutive.

In February 2013, our board of directors approved an increase in our existing common stock repurchase authorization from $125 million (authorized in October 2011) to $350 million. During the first quarter of 2013, we completed a tender offer for our common stock. As a result of the tender offer, we purchased 9.1 million shares at a price of $25.50 per share for a total cost of $234.1 million, including fees and expenses relating to the tender offer. The remaining repurchase authorization expired at the end of the tender offer.

In October 2013, our board of directors authorized the repurchase of up to $200 million of our common stock. In February 2014, our board of directors approved an increase in this common stock repurchase authorization from $200 million to $250 million. The repurchase authorization does not require the repurchase of a specific number of shares, has an indefinite term, and is subject to termination at any time by our board of directors. During 2015 and 2014, we repurchased 1.3 million and 1.3 million shares of our common stock in the open market for $45.3 million and $43.1 million, respectively.

In July 2013, our board of directors approved the initiation of a quarterly cash dividend of $0.18 per share on our common stock. The first quarterly dividend was declared in July 2013 and paid in October 2013. This $0.18 per share cash dividend on our common stock was declared and paid each quarter through July 2014. In July 2014, our board of directors approved an increase in the quarterly cash dividend on our common stock and declared a dividend of $0.21 per share. The cash dividend of $0.21 per common share was declared and paid each quarter through July 2015. In July 2015, our board of directors approved an increase in the quarterly cash dividend and declared a dividend of $0.23 per share. The cash dividend of $0.23 per common share was declared in July 2015 and October 2015 and paid in October 2015 and January 2016. As of December 31, 2015 and 2014, accrued common stock dividends of $21.3 million and $18.6 million were included in Other current liabilities in our consolidated balance sheet. Future dividend payments are subject to declaration by our board of directors.

In January 2004, we repaid our then-outstanding 3.25% Convertible Debentures using the net proceeds of a loan arranged by Credit Suisse First Boston. In connection with this transaction, we issued ten million warrants with an expiration date of January 16, 2014 to the lender to purchase shares of our common stock. The agreement underlying these warrants included antidilutive protection that required adjustments to the number of shares of common stock purchasable upon exercise and the exercise price for common stock upon the occurrence of certain events. Following our one-for-five reverse stock split in October 2006, the warrants were exercisable for two million shares of our common stock at an exercise price of $32.50. This antidilution protection also provided for adjustment upon payment of cash dividends on our common stock after a de minimis threshold. The payment in January 2014 of an $0.18 per share dividend on our common stock triggered the antidilutive adjustment for these warrants. When these warrants expired in January 2014, the resulting exercise price of each warrant was $32.16, and the resulting exercise rate was 0.2021 for each warrant. The warrants were not assumed exercised for dilutive shares outstanding for the year ended December 31, 2012 because they were antidilutive in that period.

The following table summarizes information relating to these warrants and their activity during 2013 and through their expiration date (number of warrants in millions):



	Number of Warrants		Weighted Average Exercise Price
Common stock warrants outstanding as of December 31, 2012	10.0		$	32.50
Cashless exercise	(4.8	)	32.50
Cash exercise	(2.3	)	32.50
Common stock warrants outstanding as of December 31, 2013	2.9		32.50
Cashless exercise	(1.8	)	32.16
Cash exercise	(1.0	)	32.16
Expired	(0.1	)	32.16
Common stock warrants outstanding as of January 16, 2014	—

The above exercises resulted in the issuance of 0.5 million and 0.2 million shares of common stock in 2013 and 2014, respectively. Cash exercises resulted in gross proceeds of $15.3 million and $6.3 million during 2013 and 2014, respectively.

On September 30, 2009, we issued 5.0 million shares of common stock and 8.2 million common stock warrants in full satisfaction of our obligation to do so under the January 2007 comprehensive settlement of the consolidated securities action brought against us by our stockholders and bondholders. Each warrant has a term of approximately seven years from the date of issuance and an exercise price of $41.40 per share. The warrants were not assumed exercised for dilutive shares outstanding because they were antidilutive in the periods presented.

See also Note 8, Long-term Debt, and Note 10, Convertible Perpetual Preferred Stock.