Earnings Per Share

The Company’s restricted stock is considered a participating security pursuant to the two-class method for computing earnings per share (“EPS”). The Class A Common Units (“Units”), which are reflected as noncontrolling interests in the Consolidated Balance Sheets, are considered convertible participating securities as they are entitled to participate in any dividends paid to the Company’s common shareholders. The Units are included in the computation of basic EPS using the two-class method. The Class A common stock issuable in connection with conversion of the 2016 Senior Notes, 2018 Senior Notes and 2020 Senior Notes is included in the computation of diluted EPS using the if-converted method. The loss from continuing operations attributable to Forest City Enterprises, Inc. for the three and nine months ended September 30, 2015 and nine months ended September 30, 2014 was allocated solely to holders of common stock as the participating security holders do not share in losses.

The reconciliation of the basic and diluted EPS computations is shown in the following table:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Numerators (in thousands)
Earnings (loss) from continuing operations attributable to Forest City Enterprises, Inc.	$	(302,219	)	$	686		$	(52,672	)	$	(89,748	)
Undistributed earnings allocated to participating securities	—			(17		)	—			—
Earnings (loss) from continuing operations attributable to common shareholders ‑ Basic and Diluted	$	(302,219	)	$	669		$	(52,672	)	$	(89,748	)
Net earnings (loss) attributable to Forest City Enterprises, Inc.	$	(302,219	)	$	686		$	(52,672	)	$	(76,786	)
Undistributed earnings allocated to participating securities	—			(17		)	—			—
Net earnings (loss) attributable to common shareholders ‑ Basic and Diluted	$	(302,219	)	$	669		$	(52,672	)	$	(76,786	)
Denominators
Weighted average shares outstanding ‑ Basic	255,417,396			198,893,584			230,778,223			198,328,900
Effect of stock options and performance shares	—			750,295			—			—
Weighted average shares outstanding ‑ Diluted ⁽¹⁾	255,417,396			199,643,879			230,778,223			198,328,900
Earnings Per Share
Earnings (loss) from continuing operations attributable to common shareholders ‑ Basic and Diluted	$	(1.18	)	$	—		$	(0.23	)	$	(0.45	)
Net earnings (loss) attributable to common shareholders ‑ Basic and Diluted	$	(1.18	)	$	—		$	(0.23	)	$	(0.39	)

(1)

Incremental shares from dilutive options, restricted stock, performance shares and convertible units aggregating 17,959,278, 25,382,494 and 37,238,228, for the three and nine months ended September 30, 2015 and the nine months ended September 30, 2014, respectively, were not included in the computation of diluted EPS because their effect is anti-dilutive due to the loss from continuing operations. Incremental shares from restricted stock, Class A common units and convertible securities aggregating 36,120,026 for the three months ended September 30, 2014 were not included in the computation of diluted EPS because their effect is anti-dilutive. Weighted-average options, restricted stock and performance shares of 2,666,555 and 2,304,807 for the three and nine months ended September 30, 2015, respectively, and 3,240,497 and 3,470,348 for the three and nine months ended September 30, 2014, respectively, were not included in the computation of diluted EPS because their effect is anti-dilutive under the treasury stock method.