Harbinger Group Inc.
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SEC Filings

10-Q
HRG GROUP, INC. filed this Form 10-Q on 05/05/2017
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U.S. that were not more-likely-than-not to be realized.
For the three and six months ended March 31, 2016, the Company’s effective tax rate of (32.0)% and (40.4)%, respectively, differed from the expected U.S. statutory tax rate of 35.0% and was impacted by the expected utilization of a portion of Spectrum Brands’ U.S. net operating losses that were previously recorded with valuation allowance against Spectrum Brands’ earnings during the fiscal year 2016, the effects of the adoption of ASU 2016-09 that resulted in the recognition of excess tax benefits in the Company’s provision for income taxes rather than paid-in capital and recognition of tax benefits on losses from the Corporate and Other segment in the U.S. during the fiscal year 2016. The Company determined that a portion of the fiscal year 2016 losses related to the Corporate and Other segment were more-likely-than-not to be realized based on the expected taxable gain following the completion of any disposition resulting from the FGL Strategic Evaluation Process. The decrease in income tax benefits for the three months ended March 31, 2016 was principally due to current year losses from our Corporate and Other segment in the U.S. that were not more-likely-than-not to be realized. In addition, for the six months ended March 31, 2016, the effective tax rate was also reduced by $5.9 for non-recurring items related to the impact of tax law changes in state deferred tax rates on Spectrum Brands’ net deferred tax liabilities.

(12) Earnings Per Share
The following table sets forth the computation of basic and diluted earnings per share (“EPS”) (share amounts in thousands):
 
Three months ended March 31,
 
Six months ended March 31,
 
2017
 
2016
 
2017
 
2016
Net (loss) income from continuing operations attributable to controlling interest
$
(21.3
)
 
$
24.5

 
$
(46.8
)
 
$
2.7

Net (loss) income from discontinued operations attributable to controlling interest
(60.8
)
 
(49.2
)
 
176.9

 
(61.3
)
Net (loss) income attributable to controlling interest
$
(82.1
)
 
$
(24.7
)
 
$
130.1

 
$
(58.6
)
 
 
 
 
 
 
 
 
Weighted-average common shares outstanding - basic
199,981

 
198,521

 
199,579

 
198,068

Dilutive effect of unvested restricted stock and restricted stock units
—

 
1,501

 
—

 
2,130

Dilutive effect of stock options
—

 
1,040

 
—

 
1,172

Weighted-average shares outstanding - diluted
199,981

 
201,062

 
199,579

 
201,370

 
 
 
 
 
 
 
 
Net (loss) income per common share attributable to controlling interest:
 
 
 
 
 
 
 
Basic (loss) income from continuing operations
$
(0.11
)
 
$
0.12

 
$
(0.23
)
 
$
0.01

Basic (loss) income from discontinued operations
(0.30
)
 
(0.24
)
 
0.88

 
(0.31
)
Basic
$
(0.41
)
 
$
(0.12
)
 
$
0.65

 
$
(0.30
)
 
 
 
 
 
 
 
 
Diluted (loss) income from continuing operations
$
(0.11
)
 
$
0.12

 
$
(0.23
)
 
$
0.01

Diluted (loss) income from discontinued operations
(0.30
)
 
(0.24
)
 
0.88

 
(0.30
)
Diluted
$
(0.41
)
 
$
(0.12
)
 
$
0.65

 
$
(0.29
)
The number of shares of common stock outstanding used in calculating the weighted average thereof reflects the actual number of HRG common stock outstanding, excluding unvested restricted stock.
The following were excluded from the calculation of “Diluted net income (loss) per common share attributable to controlling interest” because the as-converted effect of the unvested restricted stock and stock units, stock options and warrants would have been anti-dilutive (share amounts in thousands):
 
Three months ended March 31,
 
Six months ended March 31,
 
2017
 
2016
 
2017
 
2016
Unvested restricted stock and restricted stock units
393

 
—

 
846

 
—

Stock options
1,820

 
—

 
1,708

 
—

Anti-dilutive warrants
235

 
—

 
177

 
—

For the three and six months ended March 31, 2016, there were 1.8 million outstanding warrants to purchase HRG common stock at an exercise price of $13.125 per share that were excluded from the calculation of “Diluted net income (loss) per common share attributable to controlling interest” because the exercise price per share was above the average stock price for the three and six months ended March 31, 2016.


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