Note 14 - Earnings (Loss) Per Share

12 Months Ended

Dec. 31, 2024

Notes to Financial Statements

EARNINGS (LOSS) PER SHARE

NOTE 14—EARNINGS (LOSS) PER SHARE

Earnings per share (“EPS”) is not presented retrospectively for periods prior to the issuance of the tracking stock as the tracking stock was not a part of the Company’s capital structure during those periods and the issuance of the tracking stock changes the common shareholders’ relative residual interest in the Company. Therefore, EPS is presented for the Company’s single class of common stock up to the time the tracking stock was issued. EPS is presented prospectively under the two-class method starting on the date of initial distribution of the tracking stock. Refer to Note 9 for information related to the Company’s tracking stock.

The computation of basic and diluted EPS is shown on the following page:

(In thousands, except per share amounts)	Year ended December 31,
	2024		2023		2022
Earnings attribution
Single class of common stock (through 6/20/2023) *	$	—	$	31,382	$	116,042
Class A common stock		4,892		44,663		—
Class A restricted stock awards		282		1,897		—
Class B common stock		4,288		3,498		—
Class B restricted stock awards		152		144		—
Forfeitable dividends declared on unvested stock-based awards		1,578		729		—
Net income	$	11,192	$	82,313	$	116,042
* Common stock and restricted stock participated in earnings 1:1 and are shown on a combined basis through 6/20/2023 consistent with historical presentation
	Year ended December 31, 2024					June 21, 2023 - September 30, 2023
	Class A		Class B			Class A		Class B
Dual class EPS calculations
Numerator
Net earnings	$	4,892	$	4,288	$	44,663	$	3,498
Denominator
Weighted average shares used to compute basic earnings per share		42,986		8,641		42,115		8,428
Dilutive effect of stock option awards		486		87		482		111
Dilutive effect of restricted stock units		224		35		157		48
Dilutive effect of performance stock units		916		167		436		111
Dilutive effect of non-cash dividend declared but not issued		-		104		-		-
Weighted average shares used to compute diluted earnings per share		44,612		9,034		43,190		8,698
Earnings per common share (dual-class)
Basic	$	0.11	$	0.50		1.06		0.42
Diluted	$	0.11	$	0.47		1.03		0.40
	Jan. 1 - June 20, 2023				2022
	Single Class Portion of 2023				Single Class
Single class EPS calculations
Numerator
Net earnings	$	31,382			$	116,042
Denominator
Weighted average shares used to compute basic earnings per share		44,344				44,164
Dilutive effect of stock option awards		381				532
Dilutive effect of restricted stock units		—				6
Dilutive effect of performance stock units		27				—
Weighted average shares used to compute diluted earnings per share		44,752				44,702
Earnings per common share (single class)
Basic	$	0.71			$	2.63
Diluted	$	0.70			$	2.60

Unvested restricted stock awards have the nonforfeitable right to receive cash dividends on the same basis as common shares; therefore, unvested restricted stock is considered a participating security for the purpose of calculating EPS. Prior to the issuance of Class B common stock, the Company presented its EPS for its common stock and unvested restricted stock on a combined basis since both instruments participated in net earnings on the same basis and the resulting EPS is typically the same. Starting under the two-class method, the Company reports separately the net earnings allocated away from holders of Class A and Class B common stock to holders of unvested restricted stock awards.

Unvested restricted stock units and performance stock units include forfeitable dividend rights that are subject to the vesting conditions of the underlying awards; therefore, these awards are not considered participating securities and should not be allocated undistributed earnings for the purpose of calculating EPS. However, dividends or dividend equivalents declared and charged to retained earnings for these awards reduce the amount of net earnings available for distribution to common stockholders and should be reflected as such under the two-class method.

The Company declared a non-cash dividend to Class A shareholders during the fourth quarter, which resulted in the issuance of 0.6 million shares of Class B common shares. Since the dividend involved different classes of common stock, the distribution of the shares was accounted for prospectively for EPS purposes and the $6 million non-cash dividend was attributed to Class A net earnings under the two-class method. A second non-cash dividend was declared to Class A shareholders in December 2024 and was accounted for similarly for EPS purposes except that the numbers of Class B shares had not been issued and were not determinable at December 31, 2024. The Company estimated the number of Class B common shares and unvested awards for Class B diluted EPS purposes.

The Company also declared a non-cash dividend to Class B shareholders during the fourth quarter, which resulted in the issuance of 0.2 million shares of Class B common shares. Since the Class B shareholders’ proportional interest in the Company’s overall net assets did not remain the same, the distribution of the shares was accounted for prospectively for EPS purposes and the $2 million non-cash dividend was attributed to Class B net earnings under the two-class method.

For accounting purposes, Class B’s participation rights in net earnings are, in substance, discretionary based on the power of the Company’s Board of Directors to add or modify expense allocation policies, redefine CORE assets, and redetermine CORE’s per-ton usage fees at any time, in its sole discretion, without shareholder approval. Therefore, no amount of the Company’s net earnings shall be allocated to Class B for the purpose of calculating EPS other than actual cash dividends declared during the period for the tracking stock. However, during 2024, dividends declared by the Company were in excess of consolidated net income, which resulted in an undistributed net loss for reporting purposes. The resulting undistributed net loss was allocated proportionately between outstanding Class A and Class B common stock based on the rights to residual net assets upon liquidation being equal between holders of Class A and Class B common stock. Refer to Note 9 for information regarding dividends declared on Class B common stock.

Diluted EPS was calculated using the treasury stock method for stock options and restricted stock units. For performance stock units, the awards were first evaluated under the contingently issuable shares guidance, which requires a determination as to whether shares would be issuable if the end of the reporting period were the end of the contingency period. For shares determined to be issuable under performance stock unit awards, the treasury stock method was then applied to determine the dilutive impact of the awards, if any. Unvested restricted stock awards are considered potential common shares as well as participating securities, as discussed previously, and were included in diluted EPS using the more dilutive of the treasury stock method or the two-class method. Since these awards share in cash dividends on a 1:1 basis with common shares, applying the treasury stock method would be antidilutive compared to the basic EPS calculation that allocates earnings to participating securities under the two-class method discussed previously.

As discussed in Note 9, the Board of Directors retains the ability, in its sole discretion, to exchange all outstanding shares of Class B common stock into Class A common stock based on an exchange ratio determined by a 20-day trailing volume-weighted average price for each class of stock. The conversion right was evaluated for diluted EPS purposes under the if-converted method, which determines the potential dilutive effect, if any, on Class A shareholders assuming that conversion occurs. The hypothetical conversion assumed to have occurred would have resulted in the issuance of approximately 8 million shares and potential common shares and 7.4 million shares and

potential common shares of Class A common stock for 2024 and 2023, respectively, based on year-to-date outstanding averages for those years, and would have effectively redistributed Class B’s net earnings to Class A.

For the year ended December 31, 2024, diluted EPS for Class A common stock excluded 313 thousand RSUs, 316 thousand PSUs at target, and the hypothetical conversion of Class B common stock into Class A common stock, as discussed above, because the effect would have been antidilutive. For the year ended December 31, 2024, diluted EPS for Class B common stock excluded four thousand RSU equivalents and four thousand PSU equivalents because the effective would have been antidilutive.

Diluted EPS for the period from January 1, 2023 through June 20, 2023, the period for which a single class of common stock existed, excluded all outstanding restricted stock units, or 684 thousand units in total, because the effect would have been antidilutive. In addition, diluted EPS for the same period excluded outstanding performance stock units originally granted in 2022, or 249 thousand units at target, based on the guidance for contingently issuable shares. For the period from June 21, 2023 through December 31, 2023, the hypothetical conversion of Class B common stock into Class A common stock was immaterial, and no other potential common shares were excluded from the computation of diluted EPS for either class of common stock.

Diluted EPS for 2022 excluded 249 thousand target performance stock units based on the guidance for contingently issuable shares.