Earnings (Loss) Per Share

9 Months Ended

Sep. 27, 2020

Earnings (Loss) Per Share

Earnings (Loss) Per Share

7. Earnings (Loss) Per Share

We compute earnings (loss) per share using the two-class method. The two-class method requires an earnings allocation formula that determines earnings (loss) per share for common shareholders and participating security holders according to dividends declared and participating rights in undistributed earnings. The Series B Preferred Stock and time-based restricted stock awards are participating securities because holders of such shares have non-forfeitable dividend rights and participate in undistributed earnings with common stock. Under the two-class method, total dividends provided to the holders of participating securities and undistributed earnings allocated to participating securities, are subtracted from net income attributable to the Company in determining net income (loss) attributable to common shareholders.  Additionally, any accretion to the redemption value for the Series B Preferred Stock is treated as a deemed dividend in the two-class EPS calculation.

The calculations of basic and diluted earnings (loss) per common share are as follows (in thousands, except per-share data):

	Three Months Ended				Nine Months Ended
	September 27,		September 29,		September 27,		September 29,
	2020		2019		2020		2019
Basic earnings (loss) per common share
Net income attributable to the Company	$	15,708	$	385	$	44,765	$	7,008
Dividends paid to participating securities and accretion		(3,548)		(3,473)		(10,546)		(9,029)
Net income attributable to participating securities		(703)		—		(1,809)		—
Net income (loss) attributable to common shareholders	$	11,457	$	(3,088)	$	32,410	$	(2,021)
Basic weighted average common shares outstanding		32,616		31,601		32,347		31,581
Basic earnings (loss) per common share	$	0.35	$	(0.10)	$	1.00	$	(0.06)
Diluted earnings (loss) per common share
Net income (loss) attributable to common shareholders	$	11,457	$	(3,088)	$	32,410	$	(2,021)
Weighted average common shares outstanding		32,616		31,601		32,347		31,581
Dilutive effect of outstanding equity awards (a)		355		—		296		—
Diluted weighted average common shares outstanding (b)		32,971		31,601		32,643		31,581
Diluted earnings (loss) per common share	$	0.35	$	(0.10)	$	0.99	$	(0.06)

(a) Excludes 132 equity awards for the nine months ended September 27, 2020 as the effect of including such awards would have been anti-dilutive.

(b) The Company had 252.5 shares of Series B Preferred Stock outstanding as of September 27, 2020 and December 29, 2019. For the fully diluted calculation, the Series B Preferred stock dividends were added back to net income (loss) attributable to common shareholders. The Company then applied the if-converted method to calculate dilution on the Series B Preferred Stock, which resulted in 5.0 million additional common shares.  This calculation was anti-dilutive for both periods presented and as such was excluded.