Whole Earth Brands, 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

9 Months Ended

Sep. 30, 2022

NOTE 12: EARNINGS PER SHARE

Basic earnings (loss) per common share (“EPS”) is calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Warrants issued are not considered outstanding at the date of issuance. RSUs and RSAs also are not considered outstanding until they have vested. Contingently issuable shares associated with outstanding PSUs that have cliff vesting based on achievement of a performance condition were not included in the earnings per share calculations for the periods presented as the applicable vesting conditions had not been satisfied.

Diluted EPS is calculated by dividing net income (loss) by the weighted average shares outstanding assuming dilution. Dilutive common shares outstanding is computed using the treasury stock method and reflects the additional shares that would be outstanding if dilutive warrants were exercised and restricted stock units and restricted stock awards were settled for common shares during the period.

For warrants that are liability-classified, during the periods when the impact would be dilutive, the Company assumes share settlement of the instruments as of the beginning of the reporting period and adjusts the numerator to remove the change in the fair value of warrant liability and adjusts the denominator to include the dilutive shares using the treasury stock method.

The computation of basic and diluted earnings (loss) per common share is shown below (in thousands, except for share and per share data):


	Three Months Ended				Nine Months Ended
	September 30, 2022		September 30, 2021		September 30, 2022		September 30, 2021
EPS numerator:
Net (loss) income attributable to common shareholders	$	(2,521)	$	8,806	$	1,531	$	476
Less: Change in fair value of warrant liabilities	—		(2,178)		—		—
Numerator - diluted	$	(2,521)	$	6,628	$	1,531	$	476

EPS denominator:
Weighted average shares outstanding - basic	41,976,865		38,492,878		41,311,366		38,453,611
Effect of dilutive securities	—		1,372,872		17,719		1,493,119
Weighted average shares outstanding - diluted	41,976,865		39,865,750		41,329,085		39,946,730

Net (loss) earnings per share:
Basic	$	(0.06)	$	0.23	$	0.04	$	0.01
Diluted	$	(0.06)	$	0.17	$	0.04	$	0.01

For the three months ended September 30, 2022, 20,263,300 warrants, 1,937,099 RSUs, and 131,470 RSAs were excluded from the diluted EPS calculation because they were determined to be anti-dilutive. For the nine months ended September 30, 2022, 20,263,300 warrants and 1,937,099 RSUs were excluded from the diluted EPS calculation because they were determined to be anti-dilutive. For the nine months ended September 30, 2021, 142,702 warrants were excluded from the diluted EPS calculation because they were determined to be anti-dilutive. Additionally, at September 30, 2022 and 2021, 784,822 and 323,555 PSUs, respectively, were excluded from the diluted EPS calculations because they are subject to performance conditions that were not satisfied.