Earnings (Loss) Per Share

3 Months Ended

Mar. 31, 2020

Basic net income per share is computed by dividing net income, less any dividends, accretion or decretion, redemption or induced conversion on the preferred stock, by the weighted average number of common shares outstanding during the period. As the preferred stock participates in dividends alongside the Company’s common stock (per their participating dividends), the preferred stock would constitute participating securities under ASC 260-10 and are applied to earnings per share using the two-class method. Under this method, all earnings (distributed and undistributed) are allocated to common shares and participating securities based on their respective rights to receive dividends.

Diluted net income per share is calculated using the more dilutive of the if-converted or the two-class method. For the three months ended March 31, 2020 and 2019, the two-class method was more dilutive and was computed by adjusting the denominator used in the basic net income per share computation by the weighted average number of common shares outstanding and potentially dilutive securities outstanding during the period plus, when their effect is dilutive, incremental shares consisting of shares subject to stock options, shares issuable upon vesting of RSAs, RSUs, PBRSUs and shares issuable upon conversion of preferred stock.

Basic and diluted net income (loss) per common share are calculated as follows (in millions, except share and per share data):


	Three Months Ended March 31,
	2020		2019
Basic EPS:
Net income (loss)	$	18.2	$	0.2
Less dividends on preferred shares	(5.4)		(5.0)
Less income allocated to preferred shareholders	(6.2)		—
Net income (loss) available/(allocated) to common shareholders - basic	$	6.6	$	(4.8)
Diluted EPS:
Net income (loss)	$	18.2	$	0.2
Less dividends on preferred shares	(5.4)		(5.0)
Less income allocated to preferred shareholders	(5.0)		—
Net income (loss) available/(allocated) to common shareholders - diluted	$	7.8	$	(4.8)
Basic weighted-average common shares	114,441,043		109,802,632
Add: Effect of dilutive equity awards	11,893,514		—
Add: Effect of dilutive warrants	43,285,621		—
Diluted weighted average common shares	169,620,178		109,802,632
Net income (loss) per common share (basic)	$	0.06	$	(0.04)
Net income (loss) per common share (diluted)	$	0.05	$	(0.04)

Because of their anti-dilutive effect, 525,414 common share equivalents comprised of stock options, PBRSUs, and RSUs have been excluded from the diluted earnings per share calculation for the three months ended March 31, 2020.

For the three months ended March 31, 2019, 24,607,310 common share equivalents have been excluded from the diluted earnings per share calculation because of their anti-dilutive effect. Additionally, for the three months ended March 31, 2019, the Investor's and Intermountain's exercisable warrants to acquire up to 60 million and 1.5 million shares, respectively, of the Company's common stock have been excluded from the diluted earnings per share calculation because they are anti-dilutive.