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Net Income Per Share
 9 Months Ended
Sep. 30, 2013
Earnings Per Share [Abstract]  
Net Income Per Share

6. NET INCOME PER SHARE

Predecessor Ambac common stock (and related stock options and restricted stock units) was cancelled upon emergence from bankruptcy on the Effective Date. Pursuant to the Reorganization Plan, 45,000,000 shares of new common stock at par value of $0.01 per share and 5,047,138 warrants were issued. Warrants entitle such holders to acquire up to 5,047,138 shares of new common stock at an exercise price of $16.67 per share at any time on or prior to April 30, 2023. For the five months ended September 30, 2013, 6,312 warrants were exercised, resulting in an issuance of 2,524 shares of common stock. As of September 30, 2013, Successor Ambac had 5,040,826 warrants outstanding. Successor Ambac’s common stock and warrants began trading on NASDAQ under the symbols “AMBC” and “AMBCW,” respectively, on May 1, 2013. As a result, the earnings per share information for Predecessor Ambac is not meaningful to investors in Successor Ambac’s common stock and warrants.

 

Basic net income per share is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding. Diluted net income per share is computed by dividing net income attributable to common stockholders by the weighted-average number of common shares outstanding plus all dilutive potential common shares outstanding during the period. All dilutive potential common shares outstanding consider common stock deliverable pursuant to warrants issued under the Reorganization Plan. The following table provides a reconciliation of the common shares used for basic earnings per share and diluted earnings per share:

 

    Successor Ambac          Predecessor Ambac  
    Three months ended
September 30, 2013		          Three months ended
September 30, 2012		  

Weighted average number of common shares used for basic earnings per share

     45,002,463            302,469,966   

Effect of potential dilutive shares:

        

Warrants

     1,352,412            —     

Restricted stock units

     —              112,310   
 

 

 

        

 

 

  

Weighted average number of common shares and potential dilutive shares used for diluted earnings per share

   $ 46,354,875          $ 302,582,276   
 

 

 

        

 

 

  

Anti-dilutive shares excluded from the above reconciliation:

        

Warrants

     —              —     

Stock options

     —              800,575   

Restricted stock units

     —              —     

 

    Successor Ambac          Predecessor Ambac  
    Five months ended
September 30, 2013		          Four months ended
April 30, 2013		     Nine months ended
September 30, 2012		  

Weighted average number of common shares used for basic earnings per share

     45,001,741            302,469,544        302,468,502   

Effect of potential dilutive shares:

          

Warrants

     1,443,874            —          —     

Restricted stock units

     —              109,701        —     
 

 

 

        

 

 

    

 

 

  

Weighted average number of common shares and potential dilutive shares used for diluted earnings per share

   $ 46,445,615          $ 302,579,245      $ 302,468,502   
 

 

 

        

 

 

    

 

 

  

Anti-dilutive shares excluded from the above reconciliation:

          

Warrants

     —              —          —     

Stock options

     —              475,550        846,185   

Restricted stock units

     —              —          71,550