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Earnings per Common Share
 3 Months Ended
Mar. 31, 2013
Earnings per Common Share

Note 5. Earnings per Common Share

Earnings per common share, basic, is computed by dividing net income less preferred stock dividends (i.e., net income allocable to common shareholders) by the weighted-average number of common shares outstanding for the period.

Earnings per common share, diluted, is computed by dividing net income adjusted for the interest on the convertible notes by the weighted-average number of common shares – diluted. Dilutive securities are included in the calculation of diluted earnings per common share using the treasury stock method and the if-converted method in accordance with Accounting Standards Codification ("ASC") Topic 260, “Earnings per Share.” Dilutive securities include the common stock equivalents of convertible preferred stock and convertible notes, options granted pursuant to the Company’s stock option plans and outstanding restricted stock units granted to employees and non-employee directors (see Note 14).

Weighted-average common shares outstanding—diluted is the same as weighted-average common shares outstanding—basic in periods when a net loss is reported or in periods when diluted earnings per share is higher than basic earnings per share.

The following table summarizes the computation of basic and diluted earnings per share:

 

 

 

 

 

 

Three Months Ended
March 31,

 

 

 

2013

2012

 

 

 

Earnings per common share—basic

 

 

Net income             

$              41,660             

$              31,802             

Less: Preferred stock dividends             

              (783)

              (2,625)

 

 

 

Net income allocable to common shareholders             

$              40,877             

$              29,177             

 

 

 

Weighted-average common shares outstanding—basic             

              71,060             

              64,983             

 

 

 

Basic earnings per common share             

$              0.58             

$              0.45             

 

 

 

Earnings per common share—diluted

 

 

Net income             

$              41,660             

$              31,802             

Interest on convertible debt, net of tax             

              1,209

              —

 

 

 

Net income including assumed conversions             

$              42,869

$              31,802

 

 

 

Weighted-average common shares outstanding—basic             

              71,060             

              64,983             

Convertible notes weighted-average shares outstanding             

              15,000             

              —             

Preferred stock weighted-average shares outstanding             

              5,924             

              19,858             

Options, restricted stock and other dilutive securities             

              213             

              89             

 

 

 

Weighted-average common shares outstanding—diluted             

              92,197             

              84,930             

 

 

 

Dilutive earnings per common share             

$              0.47             

$              0.37             

 

 

 

Options with an exercise price in excess of the average market value of the Company’s common stock during the period have been excluded from the calculation of earnings per common share—diluted, as their effect would be antidilutive. For the three months ended March 31, 2013 and 2012, dilutive securities outstanding totaling approximately 5,979,000 and 9,463,000, respectively, were excluded from the calculation as their effect would have been antidilutive.