Net Income Per Share

9 Months Ended

Sep. 30, 2011

11. NET INCOME PER SHARE

Basic net income per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period, excluding any unvested restricted stock. In calculating diluted net income per share, the numerator is increased by interest expense on the convertible notes, net of amount capitalized and net of tax, and the denominator is increased by the weighted average number of shares resulting from potentially dilutive securities, assuming full conversion, consisting of stock compensation awards, convertible notes, convertible preferred stock and warrants.


	Three Months Ended September 30,					Nine Months Ended September 30,
	2011			2010		2011			2010
	(in millions)
Numerator:
Net income (loss)	$	(6.9	)	$	1.0	$	(44.7	)	$	(1.5	)
Net interest expense on convertible notes and convertible preferred stock dividends (a)	(b)				-	(b)			(b)
Net income (loss) if-converted	$	(6.9	)	$	1.0	$	(44.7	)	$	(1.5	)

Denominator:
Weighted average common shares		123.0			115.1		122.4			114.6
Less: Weighted average unvested restricted stock		1.7			1.9		1.7			2.0
Denominator for basic calculation		121.3			113.2		120.7			112.6

Weighted average effect of dilutive securities:
Stock compensation awards		-			0.4		2.1			0.4
Convertible notes		44.3			48.1		44.5			48.1
Convertible preferred stock:
Equivalent common shares (c)		25.2			4.7		17.9			1.6
Less: share issuance limitation (d)		2.4			-		-			-
Net allowable common shares		22.8			4.7		17.9			1.6
Subtotal		67.1			53.2		64.5			50.1
Less: shares excluded in a period of a net loss (e)		67.1			-		64.5			50.1
Weighted average effect of dilutive securities		-			53.2		-			-
Denominator for diluted calculation		121.3			166.4		120.7			112.6

Net income (loss) per share – basic	$	(.06	)	$	.01	$	(.37	)	$	(.01	)
Net income (loss) per share – diluted	$	(.06	)	$	.01	$	(.37	)	$	(.01	)

(a)	Interest expense on convertible notes and convertible preferred stock dividends net of amount capitalized and net of tax.

(b)

No dilutive effect is recognized in a period in which a net loss has occurred. In addition, there was no net interest expense in the three and nine months ended September 30, 2011. In the nine months ended September 30, 2010, net interest expense on convertible notes and convertible preferred stock dividends was less than $0.1 million.

(c)	The number of equivalent common shares is based on the arithmetic average of the daily volume weighted average prices per share of common stock for each of the last 20 trading days, and is determined as of the beginning of the period for purposes of calculating diluted earnings per share.

(d)

Prior to obtaining shareholder approval, the preferred stock may not be converted into an aggregate number of shares of common stock in excess of 19.99% of the shares of our common stock outstanding on May 25, 2010 (approximately 22.8 million shares), in compliance with the rules of the New York Stock Exchange. If a share issuance limitation were to exist at the time of share conversion, any preferred stock shares subject to the share issuance limitation would be subject to optional or mandatory redemption for, at USEC's option, cash or SWU consideration.

(e)	No dilutive effect is recognized in a period in which a net loss has occurred.

Options and warrants to purchase shares of common stock having an exercise price greater than the average share market price are excluded from the calculation of diluted earnings per share (options and warrants in millions):


	Three Months Ended September 30,		Nine Months Ended September 30,
	2011	2010	2011	2010
Options excluded from diluted earnings per share	3.1	2.6	3.1	2.6
Warrants excluded from diluted earnings per share	6.3	6.3	6.3	6.3
Exercise price of excluded options	$3.72 to	$5.18 to	$3.72 to	$5.18 to
	$14.28	$16.90	$14.28	$16.90
Exercise price of excluded warrants	$7.50	$7.50	$7.50	$7.50