Earnings Per Share

3 Months Ended

Mar. 31, 2012

Earnings Per Share [Abstract]

EARNINGS PER SHARE

15. EARNINGS PER SHARE

The Company’s unvested restricted share units contain rights to receive nonforfeitable dividends, and thus are participating securities requiring the two-class method of computing earnings per share (“EPS”). Under the two-class method, EPS is computed by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, undistributed earnings are allocated to both common shares and participating securities based on the weighted average shares outstanding during the period. The following table provides a reconciliation of net (loss) income from continuing operations and the number of common shares used in the computations of “basic” EPS, which utilizes the weighted-average number of common shares outstanding without regard to dilutive potential common shares, and “diluted” EPS, which includes all such shares (in thousands, except per share amounts):

	Three-Month Periods Ended March 31,
	2012			2011
Basic Earnings:
Continuing Operations:
(Loss) income from continuing operations	$	(11,966	)	$	37,325
Plus: Gain (loss) on disposition of real estate		665			(861	)
Plus: Loss attributable to non-controlling interests		(176	)		(67	)
(Loss) income from continuing operations attributable to DDR		(11,477	)		36,397
Preferred dividends		(6,967	)		(10,567	)
Basic — (Loss) income from continuing operations attributable to DDR common shareholders		(18,444	)		25,830
Less: Earnings attributable to unvested shares and operating partnership units		(292	)		(224	)
Basic — (Loss) income from continuing operations	$	(18,736	)	$	25,606
Discontinued Operations:
Basic — Loss from discontinued operations		(3,580	)		(1,085	)
Basic — Net (loss) income attributable to DDR common shareholders after allocation to participating securities	$	(22,316	)	$	24,521
Diluted Earnings:
Continuing Operations:
Basic — (Loss) income from continuing operations	$	(18,736	)	$	25,606
Less: Fair value of Otto Family warrants		—			(21,926	)
Diluted — (Loss) income from continuing operations		(18,736	)		3,680
Discontinued Operations:
Basic — Loss from discontinued operations		(3,580	)		(1,085	)
Diluted — Net (loss) income attributable to DDR common shareholders after allocation to participating securities	$	(22,316	)	$	2,595
Number of Shares:
Basic — Average shares outstanding		275,214			255,966
Effect of dilutive securities:
Warrants		—			4,840
Stock options		—			558
Value sharing equity program		—			1,198
Forward equity agreement		—			19
Diluted — Average shares outstanding		275,214			262,581
Basic Earnings Per Share:
(Loss) income from continuing operations attributable to DDR common shareholders	$	(0.07	)	$	0.10
Loss from discontinued operations attributable to DDR common shareholders		(0.01	)		—
Net (loss) income attributable to DDR common shareholders	$	(0.08	)	$	0.10
Dilutive Earnings Per Share:
(Loss) income from continuing operations attributable to DDR common shareholders	$	(0.07	)	$	0.01
Loss from discontinued operations attributable to DDR common shareholders		(0.01	)		—
Net (loss) income attributable to DDR common shareholders	$	(0.08	)	$	0.01

The following potentially dilutive securities are considered in the calculation of EPS as described below:

Potentially dilutive Securities:

• Warrants to purchase 10.0 million common shares issued in 2009 and exercised in March 2011 were dilutive for the three-month period ended March 31, 2011, and are included in the calculation of diluted EPS.

• Options to purchase 2.9 million and 3.4 million common shares were outstanding at March 31, 2012 and 2011, respectively. These outstanding options were not considered in the computation of diluted EPS for the three-month period ended March 31, 2012, as the options were anti-dilutive due to the Company’s loss from continuing operations. These outstanding options were considered in the computation of diluted EPS for the three-month period ended March 31, 2011.

• Shares subject to issuance under the Company’s value sharing equity program were not considered in the computation of diluted EPS for the three-month period ended March 31, 2012, as they were anti-dilutive due to the Company’s loss from continuing operations. These shares were considered in the computation of diluted EPS for the three-month period ended March 31, 2011.

• The 18,975,000 common shares that were subject to the forward equity agreements entered into in January 2012 were not included in the computation of diluted EPS using the treasury stock method for the three-month period ended March 31, 2012, as they were anti-dilutive due to the Company’s loss from continuing operations. The Company expects to physically settle the forward sale agreements on or about June 29, 2012. The forward equity agreement entered into in March 2011 for 9.5 million common shares was included in the computation of diluted EPS using the treasury stock method for the three-month period ended March 31, 2011. These shares were issued in April 2011.

• The exchange into common shares associated with operating partnership units was not included in the computation of diluted shares outstanding for all periods presented because the effect of assuming conversion was anti-dilutive.

• The Company’s senior convertible notes due 2040, which are convertible into common shares of the Company with a conversion price of $16.08 at March 31, 2012, were not included in the computation of diluted EPS for the three-month periods ended March 31, 2012 and 2011, because the Company’s common share price did not exceed the conversion price of the conversion features in these periods and would therefore be anti-dilutive. The Company’s senior convertible notes due 2012 and 2011, which were convertible into common shares of the Company, were not included in the computation of diluted EPS for all periods presented because the Company’s common share price did not exceed the conversion prices of the conversion features in these periods and would therefore be anti-dilutive. The senior convertible notes due 2012 were repaid at maturity in March 2012 and the senior convertible notes due 2011 were repaid at maturity in August 2011. In addition, the purchased options related to these two senior convertible notes issuances were not included in the computation of diluted EPS for all periods presented as the purchase options were anti-dilutive.