Quarterly report pursuant to Section 13 or 15(d)

Earnings Per Unit of the Operating Partnership

v3.5.0.2
Earnings Per Unit of the Operating Partnership
9 Months Ended
Sep. 30, 2016
Tanger Properties Limited Partnership [Member]  
Earnings Per Unit of the Operating Partnership
Earnings Per Unit of the Operating Partnership

The following table sets forth a reconciliation of the numerators and denominators in computing earnings per unit (in thousands, except per unit amounts):
 
 
Three months ended September 30,
 
Nine months ended September 30,
 
 
2016
 
2015
 
2016
 
2015
Numerator
 
 

 
 
 
 

 
 

Net income attributable to partners of the Operating Partnership
 
$
72,772

 
$
46,439

 
$
178,680

 
$
108,600

Less allocation of earnings to participating securities
 
(629
)
 
(495
)
 
(1,651
)
 
(1,211
)
Net income available to common unitholders of the Operating Partnership
 
$
72,143

 
$
45,944

 
$
177,029

 
$
107,389

Denominator
 
 
 
 
 
 
 
 
Basic weighted average common units
 
100,209

 
99,824

 
100,127

 
99,753

Effect of notional units
 
426

 

 
393

 

Effect of outstanding options and certain restricted common units
 
90

 
53

 
69

 
62

Diluted weighted average common units
 
100,725

 
99,877

 
100,589

 
99,815

Basic earnings per common unit:
 
 
 
 
 
 
 
 
Net income
 
$
0.72

 
$
0.46

 
$
1.77

 
$
1.08

Diluted earnings per common unit:
 
 
 
 
 
 
 
 
Net income
 
$
0.72

 
$
0.46

 
$
1.76

 
$
1.08



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

The notional units are considered contingently issuable common units and are included in earnings per unit 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, 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 units 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 units at the average market price during the period. The market price of a common unit is considered to be equivalent to the market price of a Company common share. 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.

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