Net Income Per Share

12 Months Ended

Dec. 31, 2020

NET INCOME (LOSS) PER COMMON SHARE

Basic net income (loss) per common share is calculated by dividing income (loss) allocable to common stockholders by the weighted average number of shares of common stock outstanding during the period. In calculating diluted net income (loss) per common share, the number of shares is increased by the weighted average number of potential shares related to stock compensation awards. No dilutive effect is recognized in a period in which a net loss has occurred.

On November 17, 2020, the Company completed the purchase of 62,854 shares of its outstanding Series B Preferred Stock at a price per share of $954.59, less any applicable withholding taxes. (Refer to Note 16 - Stockholders’ Equity). The purchase price per share represented a 25% discount from the aggregate liquidation preference, including accrued but unpaid dividends, of $1,272.78 per share as of September 30, 2020. Since origination, the carrying value on the Balance Sheet was $43.80 per share based on values assigned in the originating securities exchange. The liquidation amount at origination was $1,000.00 per share.

The aggregate purchase price of approximately $60 million, less accrued but unpaid dividends attributable to the purchased and retired Series B preferred shares, is considered for purposes of Net Income per Share to be a deemed dividend to the extent it exceeds the carrying value on the Balance Sheet, or $41.9 million.

The weighted average number of common and common equivalent shares and the calculation of basic and diluted income (loss) per common share are as follows:


	Year Ended December 31,
	2020		2019
Numerator (in millions):
Net income (loss)	$	54.4	$	(16.5)
Preferred stock dividends - undeclared and cumulative	6.7		7.8
Distributed earnings allocable to retired preferred shares	41.9		$	—
Net income (loss) allocable to common stockholders	$	5.8	$	(24.3)

Denominator (in thousands):
Average common shares outstanding - basic	9,825		9,566
Potentially dilutive shares related to stock options and restricted stock units (a)	298		—
Average common shares outstanding - diluted	10,123		9,566

Net income (loss) per common share (in dollars):
Basic	$	0.59	$	(2.54)
Diluted	$	0.57	$	(2.54)

(a) Common stock equivalents excluded from the diluted calculation as a result of a net loss in the period (in thousands)	—		67

Options outstanding and considered anti-dilutive as their exercise price exceeded the average share market price (in thousands)	—		352