Earnings (Loss) Per Share and Stock Repurchase Program

12 Months Ended

Dec. 31, 2018

Earnings (Loss) Per Share and Stock Repurchase Program

Earnings (Loss) Per Share

Basic earnings per share (or "EPS") is computed by dividing net income (loss) by the weighted average common shares outstanding. Diluted earnings per share is computed by dividing net income (loss), as adjusted for changes to income that would result from the assumed settlement of the dilutive equity instruments included in diluted weighted average common shares outstanding, by the diluted weighted average common shares outstanding. For all years presented, we have outstanding various equity-based compensation awards that are considered in our diluted EPS calculation when to do so would not be anti-dilutive, and is inclusive of awards disclosed in Note 21 to these consolidated financial statements. For those instruments that are indexed to our common stock, they are generally dilutive when the market price of the underlying indexed share of common stock is in excess of the exercise price. Additionally, in connection with the Delek/Alon Merger (disclosed in Note 3), we assumed certain equity instruments, including conversion options (associated with Convertible Debt) and Warrants, that may be dilutive for the periods in which they were outstanding (see discussion of these instruments in Note 11). The Convertible Debt conversion options were dilutive during the period they were outstanding when the incremental EPS calculated by dividing the increase in income associated with the elimination of interest expense on the convertible debt, net of tax, by the number of shares that would be issued upon conversion using the treasury stock method (which is applicable because of the cash settlement feature associated with the underlying principal) is dilutive to the overall diluted EPS calculation. The Warrants were generally dilutive during the periods they were outstanding when the market price of the underlying indexed share of common stock was in excess of the exercise price. All such instruments that may otherwise be dilutive may not be dilutive when there is net loss for the period. We also assumed Call Options in connection with the Delek/Alon Merger which were not reflected in the diluted weighted average common shares outstanding because to do so would have been antidilutive.

The following table sets forth the computation of basic and diluted earnings per share.



	Year Ended December 31,
	2018			2017			2016
Numerator:
Numerator for EPS - continuing operations
Income (loss) from continuing operations	$	383.6		$	328.5		$	(219.7	)
Less: Income from continuing operations attributed to non-controlling interest	26.7			33.8			20.3
Income (loss) from continuing operations attributable to Delek (numerator for basic EPS - continuing operations attributable to Delek)	356.9			294.7			(240.0		)
Interest on convertible debt, net of tax	2.6			—			—
Numerator for diluted EPS - continuing operations attributable to Delek	$	359.5		$	294.7		$	(240.0	)

Numerator for EPS - discontinued operations
Income (loss) from discontinued operations	$	(8.7	)	$	(5.9	)	$	86.3
Less: Income from discontinued operations attributed to non-controlling interest	8.1			—			—
Income (loss) from discontinued operations attributable to Delek	$	(16.8	)	$	(5.9	)	$	86.3

Denominator:
Weighted average common shares outstanding (denominator for basic EPS)	82,797,110			71,566,225			61,921,787
Dilutive effect of convertible debt	1,525,846			—			—
Dilutive effect of warrants	967,352			—			—
Dilutive effect of stock-based awards	1,478,093			736,858			—
Weighted average common shares outstanding, assuming dilution	86,768,401			72,303,083			61,921,787

EPS:
Basic income (loss) per share:
Income (loss) from continuing operations	$	4.31		$	4.12		$	(3.88	)
(Loss) income from discontinued operations	$	(0.20	)	(0.08		)	1.39
Total basic income (loss) per share	$	4.11		$	4.04		$	(2.49	)
Diluted income (loss) per share:
Income (loss) from continuing operations	$	4.14		$	4.08		$	(3.88	)
(Loss) income from discontinued operations	$	(0.19	)	(0.08		)	1.39
Total diluted income (loss) per share	$	3.95		$	4.00		$	(2.49	)

The following equity instruments were excluded from the diluted weighted average common shares outstanding because their effect would be anti-dilutive:

Antidilutive stock-based compensation (because average share price is less than exercise price)	1,462,112						2,297,127
Antidilutive due to loss	—						276,094
Total antidilutive stock-based compensation	1,462,112			—			2,573,221

Antidilutive convertible debt instruments (because average share price is less than exercise price)	—			2,811,652			—
Total antidilutive convertible debt instruments	—			2,811,652			—

Antidilutive warrants (because average share price is less than exercise price)	—			2,806,291			—
Total antidilutive warrants	—			2,806,291			—

Stock Repurchase Program

In December 2016, our Board of Directors authorized a share repurchase program for up to $150.0 million of Delek common stock. Any share repurchases under the repurchase program may be implemented through open market transactions or in privately negotiated transactions, in accordance with applicable securities laws. The timing, price and size of repurchases will be made at the discretion of management and will depend on prevailing market prices, general economic and market conditions and other considerations. The repurchase program does not obligate us to acquire any particular amount of stock and does not expire. We repurchased 762,623 shares, for a total of $25.0 million, pursuant to this repurchase program in December 2017.

On February 26, 2018, the Board of Directors approved a new $150.0 million authorization to repurchase Delek common stock. This amount has no expiration date and is in addition to any remaining amounts previously authorized. On November 6, 2018, the Board of Directors authorized the repurchase of an additional $500.0 million of Delek common stock. During the year ended December 31, 2018, we repurchased 9,022,386 shares of our common stock for a total of $365.3 million. The purchases included the 2.0 million shares of our common stock purchased from Alon Israel in connection with Delek’s rights pursuant to a Stock Purchase Agreement dated April 14, 2015, by and between Delek and Alon Israel. Alon Israel delivered a right of first offer notice to Delek on January 16, 2018, informing Delek of Alon Israel’s intention to sell the 2.0 million shares, and Delek accepted such offer on January 17, 2018. The total purchase price for the 2.0 million shares was approximately $75.3 million, or $37.64 per share.

As of December 31, 2018, there was approximately $409.7 million of authorization remaining under Delek's aggregate stock repurchase program (based on repurchases that had settled as of December 31, 2018).