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Earnings per Share (Tables)

6 Months Ended

Jun. 30, 2022

For the three and six months ended June 30, 2022 and 2021, the Company’s basic earnings per share was determined as follows:


	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
	(in thousands, except share and per share amounts)
Net Income for Basic Earnings per Share Allocated to:
Class A Common Stock	$	2,517	$	4,597	$	5,324	$	8,779
Participating Shares of Restricted Class A Common Stock		6		6		14		11
Total Net Income for Basic Earnings per Share	$	2,523	$	4,603	$	5,338	$	8,790
Basic Weighted-Average Shares Outstanding		16,925,776		17,233,829		17,114,879		17,227,164
Add: Participating Shares of Restricted Class A Common Stock1		43,525		21,764		44,148		20,881
Total Basic Weighted-Average Shares Outstanding		16,969,301		17,255,593		17,159,027		17,248,045
Basic Earnings per Share	$	0.15	$	0.27	$	0.31	$	0.51

Certain unvested shares of Class A common stock granted to employees have nonforfeitable rights to dividends and therefore participate fully in the results of the Company from the date they are granted. They are included in the computation of basic earnings per share using the two-class method for participating securities.

Summary of diluted net income

For the three and six months ended June 30, 2022 and 2021, the Company’s diluted net income was determined as follows:


	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
	(in thousands)
Net Income Attributable to Non-Controlling Interests of Pzena Investment Management, LLC	$	14,090	$	22,225	$	28,913	$	42,873
Less: Assumed Corporate Income Taxes		3,858		5,652		8,006		10,757
Assumed After-Tax Income of Pzena Investment Management, LLC		10,232		16,573		20,907		32,116
Net Income of Pzena Investment Management, Inc.		2,523		4,603		5,338		8,790
Diluted Net Income	$	12,755	$	21,176	$	26,245	$	40,906

Summary of diluted earnings per share

For the three and six months ended June 30, 2022 and 2021, the Company’s diluted earnings per share were determined as follows:


	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
	(in thousands, except share and per share amounts)
Diluted Net Income Allocated to:
Class A Common Stock	$	11,279	$	19,249	$	23,208	$	37,186
Participating Shares of Restricted Class A Common Stock		6		6		14		11
Participating Class B Units		1,470		1,921		3,023		3,709
Total Diluted Net Income Attributable to Shareholders	$	12,755	$	21,176	$	26,245	$	40,906

Total Basic Weighted-Average Shares Outstanding		16,969,301		17,255,593		17,159,027		17,248,045
Dilutive Effect of Class B Units		56,876,382		55,286,341		56,733,942		55,355,592
Dilutive Effect of Options1		36,250		1,793,668		579,720		1,486,643
Dilutive Effect of Phantom Class B Units & Phantom Shares of Class A Common Stock		1,779,026		2,728,652		1,876,429		2,571,352
Dilutive Effect of Restricted Shares of Class A Common Stock2		11,891		33,018		16,198		31,456
Dilutive Weighted-Average Shares Outstanding		75,672,850		77,097,272		76,365,316		76,693,088
Add: Participating Class B Units and Class B-1 Units3		9,620,203		7,239,297		9,620,203		7,239,297
Total Dilutive Weighted-Average Shares Outstanding		85,293,053		84,336,569		85,985,519		83,932,385
Diluted Earnings per Share	$	0.15	$	0.25	$	0.31	$	0.49

Represents the dilutive effect of options to purchase operating company Class B units and Company Class A common stock.

Certain restricted shares of Class A common stock granted to employees are not entitled to dividend or dividend equivalent payments until they are vested and are therefore non-participating securities and are not included in the computation of basic earnings per share. They are included in the computation of diluted earnings per share when the effect is dilutive using the treasury stock method.

Unvested Class B units granted to employees have nonforfeitable rights to dividend equivalent distributions and therefore participate fully in the results of the operating company's operations from the date they are granted. Vested and unvested Class B-1 units are entitled to receive distributions for the duration of the holder’s employment with the operating company, will participate in additional value to the extent there has been appreciation subsequent to the issuance of the Class B-1 membership unit. Unvested Class B units and vested and unvested Class B-1 units are included in the computation of diluted earnings per share using the two-class method for participating securities.