Earnings Per Share

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

EARNINGS PER SHARE

NOTE 15 — EARNINGS PER SHARE

Basic earnings per share is calculated by dividing net income by the weighted-average number of shares outstanding during the period. Diluted earnings per share is calculated by dividing net income by the weighted-average number of common shares outstanding, after giving effect to all dilutive potential common shares outstanding during the period. Basic common shares outstanding exclude 387,365 common shares in both 2019 and 2018 and 453,365 common shares in 2017 that are held in escrow and subject to forfeiture. The common shares held in escrow include 387,365 common shares that are subject to forfeiture to indemnify the Company for certain representations and warranties in connection with the acquisition of Wunderlich, and in 2017 included 66,000 common shares held in escrow issued to the former members of Great American Group, LLC that were subject to forfeiture upon the final settlement of claims for goods held for sale in connection with the transaction with Alternative Asset Management Acquisition Corp. in 2009. In August 2018, the shares held in escrow issued to the former members of Great American Group, LLC were released and 21,233 of the 66,000 shares held in escrow were cancelled to satisfy the resolution of escrow claims. The shares that remain in escrow are subject to forfeiture upon the final settlement of claims as more fully described in the related escrow instructions. Dilutive common shares outstanding includes contingently issuable shares that are currently in escrow and subject to release if the conditions for the final settlement of claims in accordance with the escrow instructions were satisfied at the end of the respective years. Securities that could potentially dilute basic net income per share in the future that were not included in the computation of diluted net income per share were 1,334,810, 1,920,670 and 709,358 for the year ended December 31, 2019, 2018 and 2017, respectively, because to do so would have been anti-dilutive.

Basic and diluted earnings per share were calculated as follows:

	Year Ended December 31,
	2019			2018		2017
Net income attributable to B. Riley Financial, Inc.	$	81,611		$	15,509	$	11,556
Preferred stock dividends		(264	)		—		—
Net income applicable to common shareholders	$	81,347		$	15,509	$	11,556
Weighted average common shares outstanding:
Basic		26,401,036			25,937,305		23,181,388
Effect of dilutive potential common shares:
Restricted stock units and warrants		1,082,700			677,249		901,397
Contingently issuable shares		45,421			150,302		208,119
Diluted		27,529,157			26,764,856		24,290,904
Basic income per common share	$	3.08		$	0.60	$	0.50
Diluted income per common share	$	2.95		$	0.58	$	0.48