Earnings per share

9 Months Ended

Sep. 30, 2014

Earnings Per Share [Abstract]

Earnings per share

5. Earnings per share

The Company computes earnings (loss) per share by applying the guidance stated in ASC 260, Earnings per Share. The treasury stock method has been used to compute earnings (loss) per share. The Company has issued warrants (“Private Placement Warrants”) that represent the right to purchase shares of the Company’s common stock, stock appreciation rights (“SAR”), restricted stock and contingent consideration, all of which have been evaluated for their potentially dilutive effect under the treasury stock method. Refer to Note 12, “Stockholders’ equity” for a further description of the Private Placement Warrants, Note 11, “2012 Incentive compensation plan” for a further description of the SAR and restricted stock and Note 8, “Fair value of financial instruments”, for a further description of the contingent consideration.

Computation of dilutive common shares

The Company utilizes the treasury stock method described in ASC 260-10-55 to determine the number of treasury shares assumed to be purchased from the hypothetical proceeds of exercise, with any residual shares representing the incremental common shares to be issued and included in diluted earnings (loss) per share. As of September 30, 2014, the Company’s Private Placement Warrants, SAR, restricted stock and contingent consideration were evaluated for their potentially dilutive effect under the treasury stock method.

As of September 30, 2013, the Company’s Private Placement Warrants, SAR and restricted stock were evaluated for their potentially dilutive effect. Due to the loss reported in the unaudited condensed consolidated statements of operations, any potentially issuable shares of Company common stock associated with the Private Placement Warrants, SAR and restricted stock were not included in the dilutive EPS calculation for the three or nine months ended September 30, 2013. These potential shares were excluded from the diluted EPS calculation because they would have had an anti-dilutive effect under the treasury stock method.

The computations of basic and diluted earnings (loss) per share for the three and nine months ended September 30, 2014 and 2013, were as follows:

	Three months ended September 30,						Nine months ended September 30,
	2014			2013			2014			2013
Numerator:
Net income (loss)	$	8,431		$	(9,981	)	$	14,917		$	(15,008	)
Change in the value of Private Placement Warrants		(858	)		—			(1,190	)		—
	$	7,573		$	(9,981	)	$	13,727		$	(15,008	)
Denominator:
Weighted average common shares outstanding-basic		10,794,229			10,266,176			10,676,792			9,536,687
Incremental shares from assumed exercise of Private Placement Warrants, SAR, restricted stock and contingent consideration		373,369			—			448,324			—
Weighted average common shares outstanding-diluted		11,167,598			10,266,176			11,125,116			9,536,687
Earnings (loss) per share of common stock – basic and diluted
Earnings (loss) per share of common stock – basic	$	0.78		$	(0.97	)	$	1.40		$	(1.57	)
Earnings (loss) per share of common stock – diluted	$	0.68		$	(0.97	)	$	1.23		$	(1.57	)