Earnings Per Share

3 Months Ended

Mar. 31, 2014

Disclosure Text Block

Earnings per Share

4. Earnings Per Share

Basic earnings per share attributable to TDS shareholders is computed by dividing Net incomeavailable to common shareholders of TDS by the weighted average number of common shares outstanding during the period. Diluted earnings per share attributable to TDS shareholders is computed by dividing Net incomeavailable to common shareholders of TDS by the weighted average number of common shares outstanding during the period adjusted to include the effects of potentially dilutive securities. Potentially dilutive securities primarily include incremental shares issuable upon exercise of outstanding stock options and the vesting of restricted stock units.

The amounts used in computing earnings per common share and the effects of potentially dilutive securities on the weighted average number of common shares were as follows:

				Three Months Ended
				March 31,
				2014		2013
(Dollars and shares in thousands, except per share amounts)
Basic earnings per share attributable to TDS shareholders:
	Net income available to common shareholders of TDS used in basic earnings per share			$	18,242	$	1,407
Adjustments to compute diluted earnings:
	Noncontrolling interest adjustment				(165)		(37)
	Net income attributable to common shareholders of TDS used in diluted earnings per share			$	18,077	$	1,370
Weighted average number of shares used in basic earnings per share:
		Common Shares			101,821		101,095
		Series A Common Shares			7,167		7,160
			Total		108,988		108,255
Effects of dilutive securities:
	Stock options				303		112
	Restricted stock units				381		326
Weighted average number of shares used in diluted earnings per share					109,672		108,693
Basic earnings per share attributable to TDS shareholders				$	0.17	$	0.01
Diluted earnings per share attributable to TDS shareholders				$	0.16	$	0.01

Certain Common Shares issuable upon the exercise of stock options, vesting of restricted stock units or conversion of preferred shares were not included in average diluted shares outstanding for the calculation of Diluted earnings per share attributable to TDS shareholders because their effects were antidilutive. The number of such Common Shares excluded, if any, is shown in the table below.

	Three Months Ended
	March 31,
	2014	2013
(Shares in thousands)
Stock options	6,915	6,672
Preferred shares	57	61

On June 25, 2013, U.S. Cellular paid a special cash dividend of $5.75 per share, for an aggregate amount of $482.3 million, to all holders of U.S. Cellular Common Shares and Series A Common Shares as of June 11, 2013. Outstanding U.S. Cellular stock options and restricted stock unit awards were equitably adjusted for the special cash dividend. The impact of such adjustments on the earnings per share calculation was reflected for all periods presented.