Earnings Per Common Share

9 Months Ended

Sep. 30, 2024

Note 24—Earnings Per Common Share

The Company determines earnings per share using the two-class method. Under the two-class method, all earnings (distributed and undistributed) are allocated to Common Shares and participating securities based on their respective rights to receive dividends. The Company’s participating securities are grants of restricted share units that entitle the recipients to receive dividend equivalents during the vesting period on a basis equivalent to the dividends paid to holders of Common Shares.

Basic earnings per share is determined by dividing net income available to common shareholders (net income reduced by preferred dividends and income attributable to the participating securities) by the weighted average Common Shares outstanding during the period.

Diluted earnings per share is determined by dividing net income by the weighted average number of Common Shares and dilutive securities. The Company’s potentially dilutive securities are share-based compensation awards and the Exchangeable Notes. The number of dilutive securities included in diluted earnings per share is calculated using the treasury stock method for share-based compensation awards and the if-converted method for the Exchangeable Notes.

As discussed in Note 15— Long-Term Debt, effective June 21, 2024, the Company entered into a supplemental indenture affecting the terms of conversion of the 2024 Exchangeable Notes and the 2026 Exchangeable Notes. As a result of entering into the supplemental indenture, beginning with the quarter and the six months ended June 30, 2024, the number of shares included in the diluted weighted average shares outstanding will represent the number of shares required to settle the obligation in excess of the unpaid balance of the notes being exchanged.

The following table summarizes the basic and diluted earnings per share calculations:


	Quarter ended September 30,						Nine months ended September 30,
	2024			2023			2024			2023
	(in thousands except per share amounts)
Net income	$	41,407		$	61,422		$	114,449		$	146,743
Dividends on preferred shares		(10,455	)		(10,455	)		(31,364	)		(31,364	)
Effect of participating securities—share-based compensation awards		(106	)		(147	)		(323	)		(332	)
Net income attributable to common shareholders		30,846			50,820			82,762			115,047
Interest on Exchangeable Notes, net of income taxes		—			6,359			—			18,773
Loss attributable to participating securities		—			(4	)		—			(35	)
Diluted net income attributable to common shareholders	$	30,846		$	57,175		$	82,762		$	133,785
Weighted average basic shares outstanding		86,861			86,760			86,800			87,613
Dilutive securities:
Shares issuable pursuant to exchange of the Exchangeable Notes		—			24,328			—			24,328
Diluted weighted average shares outstanding		86,861			111,088			86,800			111,941
Basic earnings per share	$	0.36		$	0.59		$	0.95		$	1.31
Diluted earnings per share	$	0.36		$	0.51		$	0.95		$	1.20

Calculation of diluted earnings per share requires certain potentially dilutive shares to be excluded when the inclusion of such shares would be anti-dilutive. The following table summarizes the potentially dilutive shares excluded from the diluted earnings per share calculation:


	Quarter ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
	(in thousands)
Shares issuable under share-based compensation plan		151		188		210		166