EARNINGS PER LIMITED PARTNER UNIT

6 Months Ended

Jun. 30, 2022

12.EARNINGS PER LIMITED PARTNER UNIT

We utilize the two-class method in calculating basic and diluted earnings per limited partner unit ("EPU"). Net income attributable to ARLP is allocated to limited partners and participating securities under deferred compensation plans, which include rights to nonforfeitable distributions or distribution equivalents. Net losses attributable to ARLP are allocated to limited partners but not to participating securities. Our participating securities are outstanding restricted unit awards under our Long-Term Incentive Plan ("LTIP") and phantom units in notional accounts under our Supplemental Executive Retirement Plan ("SERP") and the MGP Amended and Restated Deferred Compensation Plan for Directors ("Directors' Deferred Compensation Plan").

The following is a reconciliation of net income attributable to ARLP used for calculating basic and diluted earnings per unit and the weighted-average units used in computing EPU for the three and six months ended June 30, 2022 and 2021:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021

	(in thousands, except per unit data)
Net income attributable to ARLP	$	161,478	$	44,035	$	198,130	$	68,783

Less:
Distributions to participating securities		(1,720)		(401)		(3,272)		(619)
Undistributed earnings attributable to participating securities		(3,645)		(825)		(3,245)		(934)

Net income attributable to ARLP available to limited partners	$	156,113	$	42,809	$	191,613	$	67,230

Weighted-average limited partner units outstanding – basic and diluted		127,195		127,195		127,195		127,195

Earnings per limited partner unit - basic and diluted (1)	$	1.23	$	0.34	$	1.51	$	0.53

(1)

Diluted EPU gives effect to all potentially dilutive common units outstanding during the period using the treasury stock method. Diluted EPU excludes all potentially dilutive units calculated under the treasury stock method if their effect is anti-dilutive. The combined total of LTIP, SERP and Directors' Deferred Compensation Plan units of 3,529 and 3,289 for the three and six months ended June 30, 2022, respectively, and 1,525 and 1,397 for the three and six months ended June 30, 2021, respectively, were considered anti-dilutive under the treasury stock method.