EARNINGS PER SHARE

12 Months Ended

Dec. 31, 2014

EARNINGS PER SHARE

Earnings per share

NOTE 13EARNINGS PER SHARE

We compute earnings per share (EPS) using the two-class method required for participating securities.  Undistributed earnings allocated to participating securities are subtracted from net income in determining net income attributable to common stockholders.  Restricted stock awards are considered participating securities because holders of such shares have non-forfeitable dividend rights in the event of our declaration of a dividend for common shares.

The denominator of basic EPS is the sum of the daily weighted-average number of common shares outstanding during the periods presented and vested stock awards that have not yet been issued as common stock.  The denominator of diluted EPS is based on the basic shares outstanding, adjusted for the effect of outstanding option awards, to the extent they are dilutive.

On December 1, 2014, the Spin-off date, 381.4 million shares of our common stock were distributed, of which approximately 18.5% was retained by Occidental.  For comparative purposes, and to provide a more meaningful calculation of weighted-average shares outstanding, we have assumed this amount to be outstanding as of the beginning of each period prior to the Spin-off presented in the calculation of weighted-average shares.  In addition, we have assumed the vested stock awards granted in  December 2014 were also outstanding for each of the periods presented prior to the Spin-off, resulting in a weighted-average basic share count of 381.8 million shares.  The effect of stock options granted in December 2014 was anti-dilutive.

The following table presents the calculation of basic and diluted EPS for the years ended December 31:

	2014			2013			2012
	(in millions, except per-share amounts)
Basic EPS calculation
Net income / (loss)	$	(1,434	)	$	869		$	699
Net income / (loss) allocated to participating securities	—			(14		)	(11		)
Net income / (loss) available to common stockholders	$	(1,434	)	$	855		$	688
Weighted-average common shares outstanding - basic	381.9			381.8			381.8
Basic EPS	$	(3.75	)	$	2.24		$	1.80
Diluted EPS calculation
Net income / (loss)	$	(1,434	)	$	869		$	699
Net income / (loss) allocated to participating securities	—			(14		)	(11		)
Net income / (loss) available to common stockholders	$	(1,434	)	$	855		$	688
Weighted average common shares outstanding - basic	381.9			381.8			381.8
Dilutive effect of potentially dilutive securities	—			—			—
Weighted-average common shares outstanding - diluted	381.9			381.8			381.8
Diluted EPS	$	(3.75	)	$	2.24		$	1.80