EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2024


8.			EARNINGS PER SHARE

Basic earnings per common share attributable to common stockholders is calculated by dividing net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during the reporting period. Diluted earnings per common share attributable to common stockholders reflects the assumed conversion of all dilutive securities, calculated using the treasury stock method.

The table below illustrates the reconciliation of the earnings and number of shares used in our calculation of basic earnings per share attributable to common stockholders.


	Three Months Ended
(in millions, except per share amounts)	March 31, 2024		March 31, 2023
Net income attributable to common stockholders	$	47	$	87
Shares for basic earnings per share	35.5		37.4
Basic earnings per share	$	1.32	$	2.32

The table below illustrates the reconciliation of the earnings and number of shares used in our calculation of diluted earnings per share attributable to common stockholders.


	Three Months Ended
(in millions, except per share amounts)	March 31, 2024		March 31, 2023
Net income attributable to common stockholders	$	47	$	87
Add back of interest expense related to convertible notes, net of tax	5		4
Numerator used to calculate diluted earnings per share	$	52	$	91

Shares for basic earnings per share	35.5		37.4
Effect of dilutive shares outstanding
Employee SARs	—		0.2
Restricted stock units	0.1		0.3
2026 Convertible Notes ($575 million of principal)	3.6		3.5
2027 Convertible Notes ($575 million of principal)	3.0		3.0
Shares for diluted earnings per share	42.2		44.4
Diluted earnings per share	$	1.22	$	2.06

The computations of diluted earnings per share attributable to common stockholders in the table above exclude approximately 396,000 and 239,000 shares of common stock, the maximum number of shares issuable as of March 31, 2024 and March 31, 2023, respectively, upon the vesting of certain performance-based awards, because the performance conditions required to be met for the shares subject to such awards to vest were not achieved by the end of the reporting period.

In accordance with the applicable accounting guidance for calculating earnings per share, for the first quarter of 2024, we excluded from our calculation of diluted earnings per share 645,524 shares underlying stock appreciation rights (“SARs”) that may settle in shares of common stock because the exercise prices of such SARs, which ranged from $93.73 to $173.88, were greater than the average market price of our common stock for the applicable period.

For the first quarter of 2023, we excluded from our calculation of diluted earnings per share 237,249 shares underlying SARs that may settle in shares of common stock because the exercise prices of such SARs, which ranged from $153.10 to $173.88, were greater than the average market price of our common stock for the applicable period.