Ecovyst, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Earnings per Share

Earnings per Share

6 Months Ended

Jun. 30, 2023

18. Earnings per Share:

Basic earnings per share is calculated as income available to common stockholders, divided by the weighted average number of common shares outstanding during the period. The weighted average number of common shares outstanding during the period for the computation of basic earnings per share excludes restricted stock awards that have legally been issued but are nonvested during the period, as the sale of these shares is prohibited pending satisfaction of certain vesting conditions by the award recipients in order to earn the rights to the shares.

Diluted earnings per share is calculated as income available to common stockholders, divided by the weighted average number of common and potential common shares outstanding during the period, if dilutive. Potential common shares reflect (1) unvested restricted stock awards and restricted stock units with service vesting conditions, (2) performance stock units with vesting conditions considered probable of achievement and (3) options to purchase common stock, all of which have been included in the diluted earnings per share calculation using the treasury stock method.

The reconciliation from basic to diluted weighted average shares outstanding is as follows:


	Three months ended June 30,		Six months ended June 30,
	2023	2022	2023	2022
Weighted average shares outstanding – Basic	118,651,402	138,035,764	120,335,414	137,876,185
Dilutive effect of unvested common shares and restricted stock units with service conditions, performance stock units considered probable of vesting and assumed stock option exercises and conversions	1,269,340	1,113,796	1,496,528	1,299,474
Weighted average shares outstanding – Diluted	119,920,742	139,149,560	121,831,942	139,175,659

Basic and diluted income per share are calculated as follows:


	Three months ended June 30,				Six months ended June 30,
	2023		2022		2023		2022
Numerator:
Net income	$	26,122	$	19,245	$	24,651	$	27,120

Denominator:
Weighted average shares outstanding – Basic	118,651,402		138,035,764		120,335,414		137,876,185
Weighted average shares outstanding – Diluted	119,920,742		139,149,560		121,831,942		139,175,659

Net income per share:
Basic income per share	$	0.22	$	0.14	$	0.20	$	0.20
Diluted income per share	$	0.22	$	0.14	$	0.20	$	0.19

The table below presents the details of the Company’s weighted average equity-based awards outstanding during each respective period that were excluded from the calculation of diluted earnings per share:


	Three months ended June 30,		Six months ended June 30,
	2023	2022	2023	2022
Restricted stock awards with performance only targets not achieved	—	603,993	99,495	608,921
Stock options with performance only targets not achieved	—	321,368	103,907	324,014
Anti-dilutive restricted stock units and performance stock units	685,656	821,278	630,668	—
Anti-dilutive stock options	520,757	807,301	607,783	807,301

Restricted stock awards and stock options with performance only vesting conditions were not included in the dilution calculation, as the performance targets have not been achieved nor were probable of achievement as of the end of the respective periods. These awards and stock options were canceled on March 7, 2023 (see Note 17 to these condensed consolidated financial statements for additional information). Certain stock options to purchase shares of common stock were excluded from the computation of diluted earnings per share for the respective periods because the options’ exercise price was greater than the average market price of the common shares. These stock options and anti-dilutive awards are not included in the dilution calculation, as their inclusion would have the effect of increasing diluted income per share or reducing diluted loss per share.