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(5) Earnings Attributable to Liberty Media Corporation Stockholders Per Common Share
Basic earnings (loss) per common share ("EPS") is computed by dividing net earnings (loss) by the weighted average number of common shares outstanding (“WASO”) for the period. Diluted EPS presents the dilutive effect on a per share basis of potential common shares as if they had been converted at the beginning of the periods presented, including any necessary adjustments to earnings (loss) attributable to shareholders.
Excluded from diluted EPS for the three and six months ended June 30, 2019 are approximately 22 million potentially dilutive shares of Series A Liberty SiriusXM common stock, 2 million potentially dilutive shares of Series A Liberty Braves common stock and 5 million potentially dilutive shares of Series A Liberty Formula One common stock, primarily due to warrants issued in connection with the Bond Hedge Transaction (as defined in note 9), because their inclusion would be antidilutive. The Amended Warrant Transactions (as defined in note 9) may have a dilutive effect with respect to the shares comprising the basket of Liberty’s tracking stocks as specified in the indenture, as amended, related to Liberty’s 1.375% Cash Convertible Notes due 2023 (the “Securities Basket”) underlying the warrants to the extent that the settlement price exceeds the strike price of the warrants, and the warrants are settled in shares comprising such Securities Basket. The warrants and any potential future settlement have been attributed to the Formula One Group.
Series A, Series B and Series C Liberty SiriusXM Common Stock
The basic and diluted EPS calculations are based on the following weighted average outstanding shares of common stock.
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Liberty SiriusXM Common Stock |
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Three months ended |
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Six months ended |
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June 30, 2019 |
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June 30, 2018 |
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June 30, 2019 |
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June 30, 2018 |
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numbers of shares in millions |
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Basic WASO |
|
319 |
|
333 |
|
321 |
|
335 |
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Potentially dilutive shares |
|
4 |
|
4 |
|
4 |
|
4 |
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Diluted WASO |
|
323 |
|
337 |
|
325 |
|
339 |
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Series A, Series B and Series C Liberty Braves Common Stock
The basic and diluted EPS calculations are based on the following weighted average outstanding shares of common stock.
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Liberty Braves Common Stock |
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Three months ended |
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Six months ended |
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June 30, 2019 (b) |
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June 30, 2018 (a)(b) |
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June 30, 2019 (a)(b) |
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June 30, 2018 (a)(b) |
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numbers of shares in millions |
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Basic WASO |
|
51 |
|
51 |
|
51 |
|
51 |
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Potentially dilutive shares |
|
10 |
|
9 |
|
10 |
|
9 |
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Diluted WASO |
|
61 |
|
60 |
|
61 |
|
60 |
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(a) |
Potentially dilutive shares are excluded from the computation of diluted EPS during periods in which losses are reported since the result would be antidilutive. |
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(b) |
As discussed in note 2, the number of notional shares representing the Formula One Group’s intergroup interest in the Braves Group is 9,084,940 shares. The intergroup interest is a quasi-equity interest which is not represented by outstanding shares of common stock; rather, the Formula One Group has an attributed value in the Braves Group which is generally stated in terms of a number of shares of stock issuable to the Formula One Group with respect to its interest in the Braves Group. Each reporting period, the notional shares representing the intergroup interest are marked to fair value. As the notional shares underlying the intergroup interest are not represented by outstanding shares of common stock, such shares have not been officially designated Series A, B or C Liberty Braves common stock. However, Liberty has assumed that the notional shares (if and when issued) would be comprised of Series C Liberty Braves common stock in order to not dilute voting percentages.
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Therefore, the market price of Series C Liberty Braves common stock is used for the quarterly mark-to-market adjustment through the unaudited attributed condensed consolidated statements of operations. The notional shares representing the intergroup interest have no impact on the basic WASO. However, the notional shares representing the intergroup interest are included in the diluted WASO as if the shares had been issued and outstanding during the period. An adjustment is also made to the numerator in the diluted earnings per share calculation for the unrealized gain or loss incurred from marking the intergroup interest to fair value during the period as follows:
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Three months ended |
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Six months ended |
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June 30, 2019 |
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June 30, 2018 |
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June 30, 2019 |
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June 30, 2018 |
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amounts in millions |
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Basic earnings (loss) attributable to Liberty Braves stockholders |
$ |
26 |
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(2) |
|
(45) |
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(54) |
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Unrealized (gain) loss on the intergroup interest |
|
2 |
|
28 |
|
28 |
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33 |
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Diluted earnings (loss) attributable to Liberty Braves stockholders |
$ |
28 |
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26 |
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(17) |
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(21) |
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Series A, Series B and Series C Liberty Formula One Common Stock
The basic and diluted EPS calculations are based on the following weighted average outstanding shares of common stock.
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Liberty Formula One Common Stock |
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Three months ended |
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Six months ended |
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June 30, 2019 (a) |
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June 30, 2018 |
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June 30, 2019 (a) |
|
June 30, 2018 (a) |
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numbers of shares in millions |
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Basic WASO |
|
231 |
|
231 |
|
231 |
|
231 |
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Potentially dilutive shares |
|
2 |
|
1 |
|
2 |
|
1 |
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Diluted WASO |
|
233 |
|
232 |
|
233 |
|
232 |
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(a) |
Potentially dilutive shares are excluded from the computation of diluted EPS during periods in which losses are reported since the result would be antidilutive. |
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