Net Earnings (Loss) per Share

In accordance with ASC 260-10-45, Share-Based Payment Arrangements and Participating Securities and the Two-Class Method, unvested share-based payment awards that contain rights to receive non-forfeitable dividends are considered participating securities. The Company’s unvested restricted shares and unvested restricted stock units granted prior to July 15, 2015 and shares issuable under the Company’s deferred compensation plan are considered participating securities. Cash dividends to restricted stock units and performance-based stock units granted on or after July 15, 2015 are not distributed until and except to the extent that the restricted stock units vest, and in the case of performance-based stock units, until and except to the extent that the performance metrics are achieved or are otherwise deemed satisfied. Stock options do not receive cash dividends. As such, these awards are not considered participating securities.

Basic earnings per common share are calculated by dividing the net income, adjusted for preferred dividends and income allocated to participating securities, by the weighted average number of common shares outstanding during the period. Diluted net income per common share reflects the dilution that would occur if any potentially dilutive instruments were exercised or converted into common shares. The dilutive effect of participating securities is calculated using the more dilutive of the treasury stock method or two-class method. Other potentially dilutive securities include preferred stock, stock options, restricted stock units granted after July 15, 2015, and performance-based stock units and are included in diluted shares to the extent they are dilutive under the treasury stock method for the applicable periods.

During periods of net loss, no effect is given to the participating securities because they do not share in the losses of the Company. The Company’s outstanding non-participating securities consisting of dilutive stock options and restricted stock units of 132,686, 68,153, 155,113 and 137,466 for the 13 weeks ended January 28, 2017 and January 30, 2016, and the 39 weeks ended January 28, 2017 and January 30, 2016, respectively, and accretion/payments of dividends on preferred shares were also excluded from the calculation of loss per share using the two-class method because the effect would be antidilutive.

The following is a reconciliation of the Company’s basic and diluted income (loss) per share calculation:


	13 weeks ended						39 weeks ended
	January 28, 2017			January 30, 2016			January 28, 2017			January 30, 2016
Numerator for basic income (loss) per share:
Net income from continuing operations	$	70,276			80,262		$	35,451			45,308
Inducement fee paid upon conversion of Series J preferred stock		—			—			—			(3,657	)
Preferred stock dividends paid in shares		—			—			—			(1,783	)
Accretion of dividends on preferred stock		—			—			—			(4,204	)
Less allocation of dividends to participating securities		(168	)		(307	)		(559	)		(999	)
Less allocation of undistributed earnings to participating securities		(948	)		(1,871	)		(42	)		—

Net income from continuing operations available to common shareholders	$	69,160			78,084		$	34,850			34,665
Net loss from discontinued operations available to common shareholders		—			—			—			(39,146	)

Net income (loss) available to common shareholders	$	69,160			78,084		$	34,850			(4,481	)

Numerator for diluted income (loss) per share:
Net income from continuing operations available to common shareholders	$	69,160			78,084		$	34,850			34,665
Accretion of dividends on preferred stock^(a)		—			—			—			—
Allocation of undistributed earnings to participating securities		948			1,871			42			—
Less diluted allocation of undistributed earnings to participating securities		(946	)		(1,869	)		(42	)		—

Net income from continuing operations available to common shareholders	$	69,162			78,086		$	34,850			34,665
Net loss from discontinued operations available to common shareholders		—			—			—			(39,146	)

Net income (loss) available to common shareholders	$	69,162			78,086		$	34,850			(4,481	)

Denominator for basic income (loss) per share:
Basic weighted average common shares		71,581			74,856			72,232			71,987

Denominator for diluted income (loss) per share:
Basic weighted average common shares		71,581			74,856			72,232			71,987
Average dilutive options		68			68			77			136
Average dilutive non-participating securities		65			—			78			1

Diluted weighted average common shares		71,714			74,924			72,387			72,124

Basic income (loss) per common share:
Income from continuing operations	$	0.97			1.04		$	0.48			0.48
Loss from discontinued operations		—			—			—			(0.54	)

Basic income (loss) per common share	$	0.97			1.04		$	0.48			(0.06	)

Diluted income (loss) per common share:
Income from continuing operations	$	0.96			1.04		$	0.48			0.48
Loss from discontinued operations		—			—			—			(0.54	)

Diluted income (loss) per common share	$	0.96			1.04		$	0.48			(0.06	)

^(a)	Although the Company was in a net income position during the 39 weeks ended January 30, 2016, the dilutive effect of the Company’s convertible preferred shares were excluded from the calculation of income per share using the two-class method because the effect would be antidilutive.