The Company calculates earnings per share in accordance with ASC . For purposes of calculating earnings (loss) per share (“EPS”), a company that has participating security holders (for example, holders of unvested restricted stock that have non-forfeitable dividend rights and the Company’s Series A Preferred Stock) is required to utilize the -class method for calculating EPS unless the treasury stock method results in lower EPS. The -class method is an allocation of earnings/(loss) between the holders of common stock and a company’s participating security holders. Under the -class method, earnings/(loss) for the reporting period is calculated by taking the net income (loss) for the period, less both the dividends declared in the period on participating securities (whether or paid) and the dividends accumulated for the period on cumulative preferred stock (whether or earned) for the period. Our common shares outstanding are comprised of shareholder owned common stock and shares of unvested restricted stock held by participating security holders. Basic EPS is calculated by dividing income or loss attributable to common stockholders by the weighted average number of shares of common stock outstanding, excluding participating shares. To calculate diluted EPS, basic EPS is further adjusted to include the effect of potentially dilutive stock options outstanding and Series A Preferred Stock outstanding as of the beginning of the period. 

 

 

At Successor), the Company had outstanding () million warrants to purchase shares of common stock, () million outstanding unvested stock awards, () million outstanding vested stock options and million shares of Series A Preferred Stock, all of which could potentially be dilutive. For all periods presented, the weighted-average dilutive impact, if any, of these shares was excluded from the calculation of diluted earnings (loss) per common share because their inclusion would have been anti-dilutive. As a result, dilutive earnings (loss) per share is equal to basic earnings (loss) per share. 

 

The table below shows our basic and diluted EPS calculations for the -month period ended and the period from through Successor):

 

		Successor
(in thousands, except share and per share amounts)		Three Months Ended July 31, 2019				December 6, 2018 through July 31, 2019
Net income (loss) attributable to Concrete Pumping Holdings, Inc.		$	2,762			$	(10,513	)
Less: Undistributed earnings allocated to participating securities			(53	)			-
Less: Preferred stock - cumulative dividends			(456	)			(1,159	)
Net income (loss) attributable to common stockholders (numerator for basic earnings per share)		$	2,253			$	(11,672	)
Add back: Undistributed earnings allocated to participating securities			53				-
Less: Undistributed earnings reallocated to participating securities			(51	)			-
Add back: Preferred stock - cumulative dividends			456				-
Numerator for diluted earnings per share		$	2,711			$	(11,672	)
Weighted average shares (denominator):
Weighted average shares - basic			49,940,411				37,155,182
Weighted average shares - diluted			53,122,690				37,155,182
Basic earnings (loss) per share		$	0.05			$	(0.31	)
Diluted earnings (loss) per share		$	0.05			$	(0.31	)

 

 

Under the terms and conditions of the Company’s Participating Preferred Stock Agreement, the holders of the preferred stock had the right to receive dividends or dividend equivalents should the Company declare dividends on its common stock on a -for- per-share basis. Under the -class method, undistributed earnings was calculated by the earnings for the period less the cumulative preferred stock dividends earned for the period. The undistributed earnings were then allocated on a pro-rata basis to the common and preferred stockholders on a -for- per-share basis. The weighted-average number of common and preferred shares outstanding during the period was then used to calculate basic EPS for each class of shares. As a result, the undistributed earnings available to common shareholders was calculated by earnings (loss) for the period less the cumulative preferred stock dividends earned for the period less undistributed earnings allocated to the holders of the preferred stock.

 

In periods in which the Company had a net loss or undistributed net loss, basic loss per share was calculated by dividing the loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. The -class method was used, because the holders of the preferred stock did participate in losses.

 

The table below shows our basic and diluted EPS calculations for the Predecessor periods from through and from through

 

		Predecessor
(in thousands)		November 1, 2018 through December 5, 2018				Three Months Ended July 31, 2018				Nine Months Ended July 31, 2018
Net (loss) income attributable to Concrete Pumping Holdings, Inc		$	(22,575	)		$	4,825			$	26,993
Less: Preferred stock - cumulative dividends			(126	)		$	(1,050	)			(1,050	)
Less: Undistributed earnings allocated to preferred shares			-			$	(892	)			(6,127	)
Net (loss) income available to common shareholders		$	(22,701	)		$	2,883			$	19,816
Weighted average shares (denominator):
Weighted average shares - basic		$	7,576,289			$	7,576,289			$	7,576,289
Weighted average shares - diluted		$	7,576,289			$	8,510,779			$	8,510,779
Antidilutive stock options		$	932,746				-				-
Basic income (loss) per share		$	(3.00	)		$	0.38			$	2.62
Diluted income (loss) per share		$	(3.00	)		$	0.34			$	2.33