Earnings per Common Share

9 Months Ended

Sep. 30, 2011

Earnings per Common Share

Earnings per Common Share

(14)  Earnings per Common Share

The Company calculates basic and diluted earnings per common share using the two-class method. Under the two-class method, net earnings are allocated to each class of common stock and participating security as if all of the net earnings for the period had been distributed. The Company’s participating securities consist of unvested restricted stock awards that contain a non-forfeitable right to receive dividends and, therefore, are considered to participate in undistributed earnings with common stockholders.

Basic earnings per common share excludes dilution and is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares outstanding for the period, as adjusted for the potential dilutive effect of stock-based awards. We exclude potentially dilutive securities from the computation of diluted earnings per share when the effect of their inclusion would be anti-dilutive.

The following table sets forth the computation of basic and diluted earnings per common share for the three- and nine-month periods ended September 30, 2011 and 2010:

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
(In thousands, except per share data)	2011		2010			2011		2010
Earnings from continuing operations	$	5,384	$	5,659		$	17,894	$	16,598
Income (loss) from discontinued operations	—		(333		)	—		4,310
Net earnings	$	5,384	$	5,326		17,894		20,908
Less: Net income attributable to noncontrolling interests	2,654		2,767			9,011		10,183
Net earnings attributable to FirstCity	$	2,730	$	2,559		$	8,883	$	10,725
Less: Net earnings allocable to participating securities	25		—			60		—
Net earnings allocable to common shares	$	2,705	$	2,559		$	8,823	$	10,725
Weighted-average common shares - basic	10,290		10,160			10,279		10,054
Dilutive effect of restricted stock shares	25		—			4		—
Dilutive effect of stock options	11		120			14		108
Weighted-average common shares, as adjusted - diluted	10,326		10,280			10,297		10,162
Earnings from continuing operations per share:
Basic	$	0.26	$	0.28		$	0.86	$	0.64
Diluted	$	0.26	$	0.28		$	0.86	$	0.63
Income (loss) from discontinued operations per share:
Basic	$	—	$	(0.03	)	$	—	$	0.43
Diluted	$	—	$	(0.03	)	$	—	$	0.43
Net earnings per share:
Basic	$	0.26	$	0.25		$	0.86	$	1.07
Diluted	$	0.26	$	0.25		$	0.86	$	1.06

For the three-month periods ended September 30, 2011 and 2010, potentially dilutive securities representing approximately 700,000 and 680,000 shares of common stock, respectively, were excluded from the computation of diluted earnings per common share because their effect would have been anti-dilutive. For the nine-month periods ended September 30, 2011 and 2010, potentially dilutive securities representing approximately 769,000 and 710,000 shares of common stock, respectively, were excluded from the computation of diluted earnings per common share because their effect would have been anti-dilutive.