4. Earnings Per Share and Dividends

Earnings Per Share

Basic earnings per share (“EPS”) measures the performance of an entity over the reporting period. Diluted EPS measures the performance of an entity over the reporting period while giving effect to all potentially dilutive common shares that were outstanding during the period. The treasury stock method is used to determine the dilutive potential of stock options and restricted stock units.

The following is a reconciliation of the numerator and denominator used in the basic and diluted EPS calculations (in thousands, except share and per share information):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2016		2015		2016		2015
Numerator
Net income attributable to RE/MAX Holdings, Inc.	$	6,961	$	4,970	$	11,901	$	7,688
Denominator for basic net income per share of Class A common stock
Weighted average shares of Class A common stock outstanding		17,636,590		12,225,678		17,610,470		12,022,769
Denominator for diluted net income per share of Class A common stock
Weighted average shares of Class A common stock outstanding		17,636,590		12,225,678		17,610,470		12,022,769
Add dilutive effect of the following:
Stock options		4,360		146,638		10,047		301,928
Restricted stock units		28,045		27,211		32,916		22,137
Weighted average shares of Class A common stock outstanding, diluted		17,668,995		12,399,527		17,653,433		12,346,834
Earnings per share of Class A common stock
Net income attributable to RE/MAX Holdings, Inc. per share of Class A common stock, basic	$	0.39	$	0.41	$	0.68	$	0.64
Net income attributable to RE/MAX Holdings, Inc. per share of Class A common stock, diluted	$	0.39	$	0.40	$	0.67	$	0.62

The one share of Class B common stock outstanding does not share in the earnings of RE/MAX Holdings and is therefore not a participating security. Accordingly, basic and diluted net income per share of Class B common stock has not been presented.

Dividends

The Company’s Board of Directors declared quarterly dividends of $0.15 per share on all outstanding shares of Class A common stock in both the first and second quarters of 2016, or $5,285,000 in total dividends. Of this amount, $2,638,000 was paid on March 23, 2016 and $2,647,000 was paid on June 2, 2016. The Company made corresponding distributions to non-controlling unitholders of $1,884,000 on both March 23, 2016 and June 2, 2016. The Company’s Board of Directors declared quarterly dividends of $0.125 per share on all outstanding shares of Class A common stock in both the first and second quarters of 2015, or $3,029,000 in total dividends. Of this amount, $1,500,000 was paid on April 8, 2015 and $1,529,000 was paid on June 4, 2015. The Company made corresponding distributions to non-controlling unitholders of $2,217,000 on both April 8, 2015 and June 4, 2015. Additionally, during the six months ended June 30, 2015, the Company’s Board of Directors declared a special dividend of $1.50 per share on all outstanding shares of Class A common stock, or $17,883,000 in total dividends, which along with a corresponding distribution to non-controlling unitholders of $26,602,000 was paid on April 8, 2015.

On August 3, 2016, the Company’s Board of Directors declared a quarterly dividend of $0.15 per share on all outstanding shares of Class A common stock, which is payable on August 31, 2016 to shareholders of record at the close of business on August 17, 2016.