Earnings Per Share

3 Months Ended

Mar. 31, 2022

The Company computes (loss) earnings per share ("EPS") using the two-class method. The two-class method is an earnings allocation formula that treats a participating security as having rights to earnings that otherwise would have been available to common stockholders. The outstanding shares of Series B Preferred Stock are participating securities because holders have non-forfeitable dividend rights and participate in undistributed earnings with common stock.

Basic EPS was computed by dividing net (loss) income allocable to common stockholders, after deducting undistributed earnings allocated to participating securities, by the weighted-average number of shares of common stock outstanding.

For the calculation of diluted EPS, net income for basic EPS is adjusted by the effect of dilutive securities. Diluted EPS attributable to common stockholders is computed by dividing the resulting net income for basic EPS adjusted by the effect of dilutive preferred stock by the weighted-average number of shares adjusted for the effect of dilutive shares. The Company also applied the if-converted method to calculate dilution on the Series B Preferred Stock, which resulted in 31.0 million additional shares. This calculation was anti-dilutive.

The Company had a net loss for the three months ended March 31, 2022. Therefore, the effect of stock-based awards including options, restricted stock and restricted stock units outstanding at March 31, 2022 were excluded in the computation of diluted loss per share because their inclusion would have been anti-dilutive.

The following table sets forth the computation of basic and diluted EPS of common stock for the three months ended March 31, 2022 and 2021:


		Three Months Ended March 31,
(in thousands, except per share data)		2022	2021
Basic (loss) earnings per share:
Numerator	Net (loss) income attributable to common stockholders	($9,523)	$2,418
	Less: Net income allocable to participating preferred stock	—	914
	Net (loss) income allocable to common stockholders	(9,523)	1,504

Denominator	Weighted average number of common stock outstanding	51,736	51,031

	Basic (loss) earnings per share:	($0.18)	$0.03

Diluted (loss) earnings per share:
Numerator	Net (loss) income allocable to common stockholder	($9,523)	$1,504

Denominator	Weighted average number of shares
	Common stock outstanding	51,736	51,031
	Dilutive effect of restricted stock and restricted stock units	—	1,265
	Weighted number of shares used for diluted (loss) earnings per share	51,736	52,296

	Diluted (loss) earnings per share	($0.18)	$0.03

The following represents the weighted average number of shares that could potentially dilute basic earnings per share in the future:


	Three Months Ended March 31,
(in thousands)	2022	2021
Convertible preferred stock	32,186	—
Stock-based compensation awards(1):
Stock options	1,507	800
Restricted stock awards and restricted stock units	3,668	22

(1) SARs and Phantom stocks are payable in cash and will therefore have no impact on number of shares.