Earnings Per Share and Dividends

3 Months Ended

Mar. 31, 2014

Earnings Per Share and Dividends

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 shares and per share information):

	Three months ended March31, 2014
Numerator
Net income attributable to RE/MAX Holdings, Inc.	$	2,408
Denominator for basic net income per share of Class A    common stock
Weighted average shares of Class A common stock    outstanding		11,607,971
Denominator for diluted net income per share of Class A    common stock
Weighted average shares of Class A common stock    outstanding		11,607,971
Add dilutive effect of the following:
Stock options		602,217
Restricted stock units		44,286
Weighted average shares of Class A common stock    outstanding, diluted		12,254,474
Earnings per share of Class A common stock
Net income attributable to RE/MAX Holdings, Inc.    per share of Class A common stock, basic	$	0.21
Net income attributable to RE/MAX Holdings, Inc.    per share of Class A common stock, diluted	$	0.20

EPS information is not applicable for reporting periods prior to the completion of the IPO which became effective on October 7, 2013. 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 Declared

During the first quarter of 2014, the Company’s Board of Directors declared a quarterly dividend of $0.0625 per share on outstanding shares of Class A common stock, which was paid on April 18, 2014.  No dividends were declared or paid during the three months ended March 31, 2013. On May 8, 2014, the Company’s Board of Directors declared a quarterly dividend of $0.0625 per share on all outstanding shares of Class A common stock, which is payable on June 5, 2014 to shareholders of record at the close of business on May 22, 2014.