EARNINGS PER SHARE

Basic and diluted earnings per share are based on the weighted-average number of shares of common stock and potential common stock outstanding during the period. Potential common stock, for purposes of determining diluted earnings per share, includes the effects of dilutive restricted stock units, stock options and convertible securities. The effect of such potential common stock is computed using the treasury stock method or the if-converted method, as applicable.

The following tables present a reconciliation of the numerator and denominator of the basic and diluted earnings per share computation for income from continuing operations for the years ended December 31, 2013, 2012 and 2011. In the table below, income represents the numerator and weighted-average shares represent the denominator:



	Years Ended December 31,
	2013					2012							2011
	Income		Shares	$ per Share		Loss			Shares	$ per Share			Income		Shares		$ per Share
	(in millions except per share data)
BASIC EARNINGS PER SHARE
Income (loss) from continuing operations attributable to The AES Corporation common stockholders	$	284	743	$	0.38	$	(960	)	755	$	(1.27	)	$	506	$	778	$	0.65
EFFECT OF DILUTIVE SECURITIES
Stock options	—		1	—		—			—	—			—		2		—
Restricted stock units	—		4	—		—			—	—			—		3		—
DILUTED EARNINGS PER SHARE	$	284	748	$	0.38	$	(960	)	755	$	(1.27	)	$	506	$	783	$	0.65

The calculation of diluted earnings per share excluded 6 million, 7 million and 6 million options outstanding at December 31, 2013, 2012 and 2011, respectively, that could potentially dilute basic earnings per share in the future. These options were not included in the computation of diluted earnings per share because their exercise price exceeded the average market price during the related period.

The calculation of diluted earnings per share excluded 1 million options outstanding at December 31, 2012, that could potentially dilute earnings per share in the future. These options were not included in the computation of diluted earnings per share for the year ended December 31, 2012, because their inclusion would be anti-dilutive given the loss from continuing operations in the related period. Had the Company generated income from continuing operations in the year ended December 31, 2012, 1 million of potential common shares of common stock related to the restricted stock units would have been included in diluted average shares outstanding.

The calculation of diluted earnings per share also excluded 1 million restricted stock units outstanding at December 31, 2013 and 2012, that could potentially dilute basic earnings per share in the future. These restricted stock units were not included in the computation of diluted earnings per share because the average amount of compensation cost per share attributed to future service and not yet recognized exceeded the average market price during the related period and thus to include the restricted units would have been anti-dilutive. The calculation of diluted earnings per share also excluded 6 million restricted stock units outstanding at December 31, 2012, that could potentially dilute earnings per share in the future. These restricted units were not included in the computation of diluted earnings per share for the year ended December 31, 2012, because their impact would be anti-dilutive given the loss from continuing operations. Had the Company generated income from continuing operations in the year ended December 31, 2012, 4 million of potential common shares of common stock related to the restricted stock units would have been included in diluted average shares outstanding.

For the years ended December 31, 2013, 2012 and 2011, all convertible debentures were omitted from the earnings per share calculation because they were anti-dilutive.

During the year ended December 31, 2013, 1 million shares of common stock were issued under the Company’s profit sharing plan and 1 million shares of common stock were issued upon the exercise of stock options.