NET INCOME (LOSS) PER SHARE

Basic net income (loss) per share is calculated by dividing net income (loss) 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 convertible notes and convertible preferred stock dividends, 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. No dilutive effect is recognized in a period in which a net loss has occurred or in which the assumed conversion effect of convertible securities is antidilutive.

Net income (loss) per share information reported for the three months ended December 31, 2014 and nine months ended September 30, 2014 is not comparative to the share information reported for 2013 as a result of the emergence from Chapter 11 bankruptcy and the application of fresh start accounting.

All outstanding shares of Old Common Stock were cancelled as of the Effective Date. As there is no consolidated statements of operations for the Successor Company for the nine month period ended September 30, 2014, basic and diluted net income (loss) per share computations for the nine-month period are based on the weighted-average number of shares of Old Common Stock (as adjusted for dilutive effects of potential common shares) outstanding during the period prior to the cancellation of the Old Common Stock on September 30, 2014. Additionally, on the Effective Date, all shares of the Old Preferred Stock and all of the Old Notes that were issued and outstanding immediately prior to the Effective Date were cancelled.

On the Effective Date, the Company adopted the 2014 Equity Incentive Plan which authorizes the issuance of up to 1,000,000 shares of Class A Common Stock to the Company’s employees, officers, directors and other individuals providing services to the Company or its affiliates pursuant to options, stock appreciation rights, restricted stock units, restricted stock, performance awards, dividend equivalent rights and other stock based awards, as well as cash based awards. On November 21, 2014, Centrus issued stock options to officers and restricted stock units to the Board of Directors in accordance with the terms of the 2014 Equity Incentive Plan.

On July 1, 2013, the Predecessor Company effectuated a reverse stock split of 1-for-25 shares in order to regain compliance with the New York Stock Exchange ("NYSE") continued listing criteria related to minimum share price. Net income (loss) per share was adjusted for all predecessor periods presented to reflect the change in the number of shares.



	Successor			Predecessor
(In millions, except per share amounts)	Three Months Ended December 31, 2014			Nine Months Ended September 30, 2014		Year Ended December 31, 2013

Numerators:
Income (loss) from continuing operations	$	(42.3	)	$	340.1	$	(183.6	)
Income from discontinued operations	—			—		24.7
Net income (loss)	$	(42.3	)	$	340.1	$	(158.9	)
Interest expense on convertible notes (a)	—			9.0		—
Net income (loss) if converted - diluted	$	(42.3	)	$	349.1	$	(158.9	)

Denominator:
Weighted average common shares	9.0			5.0		5.0
Less: Weighted average unvested restricted stock	—			0.1		0.1
Denominator for basic calculation	9.0			4.9		4.9

Weighted average effect of dilutive securities:
Stock compensation awards (d)	—			—		—
Convertible notes	—			1.8		1.8
Convertible preferred stock:
Equivalent common shares (b)	—			27.2		10.3
Less: share issuance limitation (c)	—			26.3		9.4
Net allowable common shares	—			0.9		0.9
Subtotal	—			2.7		2.7
Less: shares excluded in a period of a net loss or antidilution	—			—		2.7
Weighted average effect of dilutive securities	—			2.7		—
Denominator for diluted calculation	9.0			7.6		4.9

Basic income (loss) per share:
Income (loss) from continuing operations	$	(4.70	)	$	69.41	$	(37.47	)
Income from discontinued operations	$	—		$	—	$	5.04
Net income (loss)	$	(4.70	)	$	69.41	$	(32.43	)
Diluted income (loss) per share:
Income (loss) from continuing operations	$	(4.70	)	$	45.93	$	(37.47	)
Income from discontinued operations	$	—		$	—	$	5.04
Net income (loss)	$	(4.70	)	$	45.93	$	(32.43	)


(a)	Interest expense on Old Notes and Old Preferred Stock dividends, net of tax, was $20.3 million in 2013. The tax rate is the statutory rate.

No dilutive effect is recognized in a period in which a net loss has occurred. In addition, for purposes of calculating income from discontinued operations per share, the calculation of (loss) from continuing operations per share provides a control number in determining whether potential common shares are dilutive or antidilutive. The control number concept requires that the same number of potentially dilutive securities applied in computing diluted earnings per share from continuing operations be applied to all other categories of income or loss (discontinued operations and net income/loss), regardless of their antidilutive effect on such categories. Therefore, no dilutive effect is recognized in the calculation of income from discontinued operations per share.


(b)	The number of equivalent shares of Old Common Stock for the Old Preferred Stock was based on the arithmetic average of the daily volume weighted average prices per share of Old Common Stock for each of the last 20 trading days, and was determined as of the beginning of the period for purposes of calculating diluted net income per share.

(c)

Prior to obtaining shareholder approval, the Company's Old Preferred Stock could not have been converted into an aggregate number of shares of Old Common Stock in excess of 19.99% of the shares of Old Common Stock outstanding on May 25, 2010 (approximately 0.9 million shares adjusted to take into account the 1-for-25 reverse stock split), in compliance with the rules of the NYSE. If a share issuance limitation were to exist at the time of share conversion or sale, any shares of Old Preferred Stock subject to the share issuance limitation would have been subject to optional or mandatory redemption for, at the Company's option, cash or SWU consideration. However, the Company’s ability to redeem may have been limited by Delaware law and the Bankruptcy Code.


(d)	Less than 0.1 million shares of common stock equivalents related to the 2014 Equity Incentive Plan were excluded from the calculation due to the anti-dilutive effect on periods 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 net income (loss) per share:



	Successor		Predecessor
	Three Months Ended December 31, 2014		Nine Months Ended September 30, 2014			Year Ended December 31, 2013
Options excluded from diluted net income per share	—		200			1,000
Warrants excluded from diluted net income per share	N/A		250,000			250,000
Exercise price of excluded options	$	—	$	283.25	to	$	177.50	to
			$	357.00		$	357.00
Exercise price of excluded warrants	N/A		$	187.50		$	187.50

In January 2013, the Compensation Committee of the Board of Directors approved the surrender and cancellation of unexercised stock options held by employees. The remaining options outstanding prior to the Effective Date were held by non-employee directors. Prior to the Effective Date, B&W and Toshiba held warrants to purchase up to 250,000 shares of Old Common Stock. Such options and warrants were cancelled pursuant to the Plan of Reorganization on the Effective Date.