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Earnings Per Share

3 Months Ended

Dec. 31, 2017

Earnings per share attributable to RCIHH common shareholders

6. Earnings Per Share

Basic earnings per share (“EPS”) includes no dilution and is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in the earnings of the Company. Potential common stock shares consist of shares that may arise from outstanding dilutive common restricted stock, stock options and warrants (the number of which is computed using the “treasury stock method”) and from outstanding convertible debentures (the number of which is computed using the “if converted method”). Diluted EPS considers the potential dilution that could occur if the Company’s outstanding common restricted stock, stock options, warrants and convertible debentures were converted into common stock that then shared in the Company’s earnings (as adjusted for interest expense that would no longer occur if the debentures were converted).

The table below presents the reconciliation of the numerator and the denominator in the calculation of basic and diluted EPS (in thousands, except per share amounts):

	For the Three Months
	Ended December 31,
	2017		2016
Numerator -
Net income attributable to RCIHH common shareholders – basic	$	14,311	$	2,898
Adjustment to net income from assumed conversion of debentures(2)		-		5
Adjusted net income attributable to RCIHH common shareholders – diluted	$	14,311	$	2,903
Denominator(1)(3)-
Weighted average number of common shares outstanding – basic		9,719		9,768
Effect of potentially dilutive convertible debentures(2)		-		46
Adjusted weighted average number of common shares outstanding – diluted		9,719		9,814

Basic earnings per share	$	1.47	$	0.30
Diluted earnings per share	$	1.47	$	0.30

(1)	There were no outstanding restricted stock, warrants and options during the three months ended December 31, 2017 and 2016.

(2)	Convertible debentures (principal and accrued interest) outstanding at the beginning of the quarters ended December 31, 2017 and 2016 totaling $0 and $859,000, respectively, were convertible into common stock at a price of $10.25 and $12.50 per share until January 4, 2017, when the last conversion option expired in relation to the payment of the last convertible note.

(3)	Since January 4, 2017 to date, the Company has no outstanding convertible debt.