(4) Earnings Per Share

As further described in Note 2, the Company effected a one-for-ten split of its common stock on December 3, 2013. As a result of the reverse stock split, the change in the number of shares has been applied retroactively to all shares and per share amounts presented in our consolidated financial statements and accompanying notes for the years ended December 31, 2013, 2012 and 2011.

Basic and diluted loss per common share from continuing operations, income (loss) per common share from discontinued operations and net income (loss) per common share have been computed using the weighted average number of shares of common stock outstanding during the period. Basic earnings per share (“EPS”) excludes dilution and is computed by dividing net income (loss) applicable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted EPS is based upon the weighted average number of common shares outstanding during the period plus the additional weighted average common equivalent shares during the period. Common equivalent shares result from the assumed exercise of outstanding warrants, restricted stock and stock options, the proceeds of which are then assumed to have been used to repurchase outstanding shares of common stock. Inherently, stock warrants are deemed to be anti-dilutive when the average market price of the common stock during the period is less than the exercise prices of the stock warrants.

 

Pursuant to Accounting Standards Codification 260-10-45-18, an entity that reports a discontinued operation in a period shall use income (loss) from continuing operations, adjusted for preferred dividends, as the control number in determining whether potential common equivalent shares are dilutive or antidilutive. That is, the same number of potential common equivalent shares used in computing the diluted per-share amount for income (loss) from continuing operations shall be used in computing all other reported diluted per-share amounts even if those amounts would be antidilutive to their respective basic per-share amounts. For the years ended December 31, 2013, 2012, and 2011, no shares of common stock underlying stock options, restricted stock, or other common stock equivalents were included in the computation of diluted EPS from continuing operations because the inclusion of such shares would be antidilutive based on the net losses from continuing operations reported for those periods. Accordingly, for the years ended December 31, 2013, 2012, and 2011, no shares of common stock underlying stock options, restricted stock, or other common stock equivalents were included in the computations of diluted EPS from income (loss) from discontinued operations or diluted EPS from net income (loss) per common share, because such shares were excluded from the computation of diluted EPS from continuing operations for those periods based on the guidance referenced above.

For the purpose of the computation of EPS, shares issued in connection with acquisitions that are contingently returnable are classified as issued but are not included in the basic weighted average number of shares outstanding until all applicable conditions are satisfied such that the shares are no longer contingently returnable. As of December 31, 2013, 2012, and 2011, respectively, excluded from the computation of basic EPS are approximately 1.0 million, 1.3 million, and 0.1 million, respectively of contingently returnable shares that are subject to sellers’ indemnification obligations and were being held in escrow as of such dates.

The following table presents the calculation of basic and diluted net income (loss) per common share:

 

		Years Ended December 31,
		2013				2012				2011
Numerator:
Loss from continuing operations		$	(134,040	)		$	(6,597	)		$	(108	)
Income (loss) from discontinued operations			(98,251	)			9,124				(22,898	)
Net income (loss) attributable to common stockholders		$	(232,291	)		$	2,527			$	(23,006	)
Denominator:
Weighted average shares—basic			24,492				14,994				11,457
Common stock equivalents			—				—				—
Weighted average shares—diluted			24,492				14,994				11,457
Loss per common share from continuing operations—basic and diluted		$	(5.47	)		$	(0.44	)		$	(0.01	)
Income (loss) per common share from discontinued operations—basic and diluted		$	(4.01	)		$	0.61			$	(2.00	)
Total income (loss) per common share—basic and diluted		$	(9.48	)		$	0.17			$	(2.01	)
Antidilutive stock-based awards and warrants excluded			272				1,166				3,596

 

(a)	All per-share amounts and shares outstanding for all periods reflect the Company’s one-for-ten reverse stock split, which was effective December 3, 2013.

(b)	For the years ended December 31, 2013, 2012 and 2011 no common equivalent shares were included in the computation of diluted EPS because the inclusion of such shares would be antidilutive based on reported losses.

(c)	Antidilutive common stock equivalents include contingently issuable shares and a call option in connection with business acquisitions, litigation and stock-based awards. The decrease in antidilutive shares in 2012 is due primarily to the expiration of certain warrants in November 2011.