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

Quarterly report pursuant to Section 13 or 15(d)

Earnings Per Share of the Company

Earnings Per Share of the Company

9 Months Ended

Sep. 30, 2016

Tanger Factory Outlet Centers, Inc [Member]

The following table sets forth a reconciliation of the numerators and denominators in computing the Company's earnings per share (in thousands, except per share amounts):



	Three months ended September 30,						Nine months ended September 30,
	2016			2015			2016			2015
Numerator
Net income attributable to Tanger Factory Outlet Centers, Inc.	$	69,104		$	44,075		$	169,671		$	103,068
Less allocation of earnings to participating securities	(627		)	(494		)	(1,649		)	(1,210		)
Net income available to common shareholders of Tanger Factory Outlet Centers, Inc.	$	68,477		$	43,581		$	168,022		$	101,858
Denominator
Basic weighted average common shares	95,156			94,746			95,075			94,675
Effect of notional units	426			—			393			—
Effect of outstanding options and certain restricted common shares	90			53			69			62
Diluted weighted average common shares	95,672			94,799			95,537			94,737
Basic earnings per common share:
Net income	$	0.72		$	0.46		$	1.77		$	1.08
Diluted earnings per common share:
Net income	$	0.72		$	0.46		$	1.76		$	1.08

We determine diluted earnings per share based on the weighted average number of common shares outstanding combined with the incremental weighted average shares that would have been outstanding assuming all potentially dilutive securities were converted into common shares at the earliest date possible.

The notional units are considered contingently issuable common shares and are included in earnings per share if the effect is dilutive using the treasury stock method and the common shares would be issuable if the end of the reporting period were the end of the contingency period. For the three and nine months ended September 30, 2016, 531,746 and 564,849 units were excluded from the computation, respectively, and for both the three and nine months ended September 30, 2015, 951,450 units were excluded from the computation, because these units would not have been issuable if the end of the reporting period were the end of the contingency period.

The effect of dilutive common shares is determined using the treasury stock method, whereby outstanding options are assumed exercised at the beginning of the reporting period and the exercise proceeds from such options and the average measured but unrecognized compensation cost during the period are assumed to be used to repurchase our common shares at the average market price during the period. For the three months ended September 30, 2016, there were no options excluded from the computation. For the nine months ended September 30, 2016 there were 145,300 options excluded from the computation and for the three and nine months ended September 30, 2015, 250,400 and 250,500 options were excluded from the computation, as they were anti-dilutive. The assumed exchange of the partnership units held by the Non-Company LPs as of the beginning of the year, which would result in the elimination of earnings allocated to the noncontrolling interest in the Operating Partnership, would have no impact on earnings per share since the allocation of earnings to a common limited partnership unit, as if exchanged, is equivalent to earnings allocated to a common share.

Certain of the Company's unvested restricted common share awards contain non-forfeitable rights to dividends or dividend equivalents. The impact of these unvested restricted common share awards on earnings per share has been calculated using the two-class method whereby earnings are allocated to the unvested restricted common share awards based on dividends declared and the unvested restricted common shares' participation rights in undistributed earnings. Unvested restricted common shares that do not contain non-forfeitable rights to dividends or dividend equivalents are included in the diluted earnings per share computation if the effect is dilutive, using the treasury stock method.