Note 2 – Earnings Per Share

Basic earnings or loss per share is computed by dividing net income or loss available to MasTec’s common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings or loss per share is computed by dividing net income or loss available to MasTec’s common shareholders by the number of fully diluted shares, which includes the effect of dilutive potential issuances of common shares as determined using earnings from continuing operations, including the potential issuance of common shares upon the exercise, conversion or vesting of outstanding stock options and unvested restricted shares, as calculated under the treasury stock method, as well as shares associated with the Company’s convertible debt securities, which matured and were converted in 2014. For the three month period ended March 31, 2015, the Company reported a net loss from continuing operations. As a result, dilutive common shares have been excluded from the calculation of diluted net loss per share for the related period as their effect would have been anti-dilutive. Therefore, diluted net loss per share is the same as basic net loss per share for the three month period ended March 31, 2015.

Weighted average common stock equivalents totaling 807,567 for the three month period ended March 31, 2015 were excluded from the calculation of diluted earnings per share because their effect would have been anti-dilutive. Of this amount, 502,217 weighted average common stock equivalents would have been included in outstanding weighted average diluted shares for the three month period ended March 31, 2015 had the Company reported net income, rather than a net loss, from continuing operations. A total of 61,226 weighted average anti-dilutive common stock equivalents were not included in the Company’s diluted earnings per share calculations for the three month period ended March 31, 2014.

The following table provides details underlying the Company’s earnings per share calculations for the periods indicated (in thousands):



	For the Three Months Ended March 31,
	2015			2014
				As Restated
Net (loss) income attributable to MasTec:
Net (loss) income, continuing operations - basic ^(a)	$	(6,263	)	$	12,219
Interest expense, net of tax, convertible notes	—			78
Net (loss) income, continuing operations - diluted	$	(6,263	)	$	12,297
Net loss from discontinued operations - basic and diluted ^(a)	—			(122		)
Net (loss) income attributable to MasTec - diluted	$	(6,263	)	$	12,175
Weighted average shares outstanding:
Weighted average shares outstanding - basic	82,397			77,345
Dilutive common stock equivalents	—			850
Dilutive shares, convertible notes	—			8,427
Weighted average shares outstanding - diluted	82,397			86,622


(a)	Calculated as total net (loss) income less amounts attributable to non-controlling interests.

Convertibles Notes - Diluted Share Impact

In December 2014, $100 million aggregate principal amount of 4.25% senior convertible notes (the “4.25% Convertible Notes”) matured, at which time the holders elected to convert the notes. Upon conversion, the Company paid $97 million in cash and issued 2.4 million shares of common stock in respect of such notes. The 4.25% Convertible Notes were composed of $97 million of 4.25% Convertible Notes issued in 2011 (the “2011 4.25% Notes”) and $3 million of 4.25% Convertible Notes issued in 2009 (the “2009 4.25% Notes”). Additionally, in June 2014, $115 million aggregate principal amount of 4.0% senior convertible notes (the “4.0% Convertible Notes”) matured and were converted, and, upon conversion, the Company paid $105 million in cash and issued 4.2 million shares of common stock in respect thereof. The 4.0% Convertible Notes were composed of $105 million of 4.0% Convertible Notes issued in 2011 (the “2011 4.0% Notes”) and approximately $10 million of 4.0% Convertible Notes issued in 2009 (the “2009 4.0% Notes”). The 2009 4.0% Notes and the 2009 4.25% Notes are collectively referred to as the “2009 Convertible Notes,” and the 2011 4.0% Notes and the 2011 4.25% Notes are collectively referred to as the “2011 Convertible Notes.”

Until maturity of the 2009 Convertible Notes in 2014, dilutive shares associated with these notes were attributable to the underlying principal amounts and were reflected in the calculation of weighted average diluted earnings per share for the corresponding periods by application of the “if-converted” method. The 2011 Convertible Notes had an optional cash settlement feature, which allowed the Company to settle the principal amount in cash. Until their maturity in 2014, dilutive shares associated with the 2011 Convertible Notes were derived from the premium value of the notes in excess of their principal amounts, as calculated using the treasury stock method. These shares were referred to as the “premium shares.”

The 4.0% Convertible Notes were convertible at $15.76 per share, and the 4.25% Convertible Notes were convertible at $15.48 per share. The calculations underlying the number of premium shares included in the Company’s diluted share count for the period indicated were as follows (in thousands, except per share amounts):



	As of and for the Three Months Ended March 31, 2014
Premium Share Information:	2011 4.0% Notes		2011 4.25% Notes
Number of conversion shares, principal amount	6,683		6,268
Per share price, actual average	$	37.96	$	37.96
Premium value	$	148,360	$	140,925
Premium shares	3,909		3,712