EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2015

EARNINGS PER SHARE

Earnings per share

NOTE 9EARNINGS 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, however it excludes outstanding shares related to unvested stock awards.  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 the Spin-off date, we issued 381.4 million shares of our common stock.  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 for the periods presented.  For the three and six months ended June 30, 2015 we issued approximately 365,000 shares and 735,000 shares, respectively, of common stock in connection with our employee stock purchase plan.  The effect of the employee stock purchase plan was anti-dilutive for the three and six months ended June 30, 2015.

The following table presents the calculation of basic and diluted EPS for the three- and six-month periods ended June 30, 2015 and 2014:

	Three months ended June 30,						Six months ended June 30,
	2015			2014			2015			2014
	(in millions, except per-share amounts)
Basic EPS calculation
Net income / (loss)	$	(68	)	$	246		$	(168	)	$	469
Net income / (loss) allocated to participating securities	—			(4		)	—			(8		)
Net income / (loss) available to common stockholders	$	(68	)	$	242		$	(168	)	$	461
Weighted-average common shares outstanding - basic	382.7			381.8			382.4			381.8
Basic EPS	$	(0.18	)	$	0.63		$	(0.44	)	$	1.21
Diluted EPS calculation
Net income / (loss)	$	(68	)	$	246		$	(168	)	$	469
Net income / (loss) allocated to participating securities	—			(4		)	—			(8		)
Net income / (loss) available to common stockholders	$	(68	)	$	242		$	(168	)	$	461
Weighted average common shares outstanding - basic	382.7			381.8			382.4			381.8
Dilutive effect of potentially dilutive securities	—			—			—			—
Weighted-average common shares outstanding - diluted	382.7			381.8			382.4			381.8
Diluted EPS	$	(0.18	)	$	0.63		$	(0.44	)	$	1.21