NOTE 14: EARNINGS PER SHARE

The Company computes earnings (loss) per common share (“EPS”) from continuing operations, discontinued operations and net earnings per common share under the two-class method which requires the allocation of all distributed and undistributed earnings to common stock and other participating securities based on their respective rights to receive distributions of earnings or losses. The Company’s Class A Common Stock and Class B Common Stock equally share in distributed and undistributed earnings. The Company accounts for the Warrants as participating securities, as holders of the Warrants, in accordance with and subject to the terms and conditions of the Warrant Agreement, are entitled to receive ratable distributions of the Company’s earnings concurrently with such distributions made to the holders of Common Stock, subject to certain restrictions relating to FCC rules and requirements. Under the terms of the Company’s RSU and PSU agreements, unvested RSUs and PSUs contain forfeitable rights to dividends and DEUs. Because the DEUs are forfeitable, they are defined as non-participating securities. As of September 30, 2015, there were 11,237 DEUs outstanding, which will vest at the time that the underlying RSU or PSU vests.

The Company computes basic EPS by dividing income from continuing operations, loss from discontinued operations, and net income, respectively, applicable to common shares by the weighted average number of common shares outstanding during the period. In accordance with the two-class method, undistributed earnings applicable to the Warrants have been excluded from the computation of basic EPS. Diluted EPS is computed by dividing income from continuing operations, loss from discontinued operations, and net income, respectively, by the weighted average number of common shares outstanding during the period as adjusted for the assumed exercise of all outstanding stock awards. The calculation of diluted EPS assumes that stock awards outstanding were exercised at the beginning of the period. The Warrants and stock awards are included in the calculation of diluted EPS only when their inclusion in the calculation is dilutive.

ASC Topic 260, “Earnings per Share,” states that the presentation of basic and diluted EPS is required only for common stock and not for participating securities. For the three and nine months ended September 30, 2015, 308,612 and 1,069,798 of the outstanding weighted-average Warrants, respectively, have been excluded from the below table. For the three and nine months ended September 28, 2014, 2,768,872 and 3,708,430 of the outstanding weighted-average Warrants, respectively, have been excluded from the below table.

The calculation of basic and diluted EPS is presented below (in thousands, except for per share data):



	Three Months Ended				Nine Months Ended
	September 30, 2015		September 28, 2014		September 30, 2015		September 28, 2014
EPS numerator:
Income from continuing operations, as reported	$	27,858	$	52,886	$	61,010	$	148,435
Less: Dividends distributed to Warrants	77		—		249		—
Less: Undistributed earnings allocated to Warrants	91		1,461		679		5,499
Income from continuing operations attributable to common shareholders for basic EPS	$	27,690	$	51,425	$	60,082	$	142,936
Add: Undistributed earnings allocated to dilutive securities (1)	—		2		2		15
Income from continuing operations attributable to common shareholders for diluted EPS	$	27,690	$	51,427	$	60,084	$	142,951



	Three Months Ended					Nine Months Ended
	September 30, 2015		September 28, 2014			September 30, 2015		September 28, 2014
(Loss) income from discontinued operations, as reported	$	—	$	(14,889	)	$	—	$	13,552
Less: Undistributed earnings allocated to Warrants	—		(411		)	—		502
(Loss) income from discontinued operations attributable to common shareholders for basic and diluted EPS (1)	$	—	$	(14,478	)	$	—	$	13,050

Net income attributable to common shareholders for basic EPS	$	27,690	$	36,947		$	60,082	$	155,986
Net income attributable to common shareholders for diluted EPS	$	27,690	$	36,949		$	60,084	$	156,001

EPS denominator:
Weighted average shares outstanding - basic	94,437		97,384			95,060		96,401
Impact of dilutive securities (1)	75		226			214		239
Weighted average shares outstanding - diluted	94,512		97,610			95,274		96,640

Basic Earnings (Loss) Per Common Share from:
Continuing Operations	$	0.29	$	0.53		$	0.63	$	1.48
Discontinued Operations	—		(0.15		)	—		0.14
Net Earnings Per Common Share	$	0.29	$	0.38		$	0.63	$	1.62

Diluted Earnings (Loss) Per Common Share from:
Continuing Operations	$	0.29	$	0.53		$	0.63	$	1.47
Discontinued Operations	—		(0.15		)	—		0.14
Net Earnings Per Common Share	$	0.29	$	0.38		$	0.63	$	1.61


(1)	The impact of dilutive securities associated with Equity Awards held by Tribune Publishing employees was immaterial. As such, all of the impact of dilutive securities has been allocated to diluted EPS from continuing operations.

Because of their anti-dilutive effect, 2,189,552 and 1,489,698 common share equivalents, comprised of NSOs, PSUs and RSUs, have been excluded from the diluted EPS calculation for the three and nine months ended September 30, 2015, respectively. Because of their anti-dilutive effect, 756,469 and 629,918 common share equivalents, comprised of NSOs and RSUs, have been excluded from the diluted EPS calculation for the three and nine months ended September 28, 2014, respectively.