Company: ARVN
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001655759-25-000085
Chunk: 134

Company: ARVINAS, INC.
Filing Date: 2025-05-01
Form: 10-Q
Item: Part I, Item 8
Chunk 134
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 in the same period for 2024. The primary reconciling items between the federal statutory rate of 21.0% for the three months ended March 31, 2025 and the Company’s overall effective tax rate of 0.2% was the effect of equity compensation and the valuation allowance recorded against the full amount of its net deferred tax assets. The primary reconciling items between the federal statutory rate of 21.0% for the 

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three months ended March 31, 2024 and the Company’s overall effective tax rate of (0.2)% was the effect of equity compensation and the valuation allowance recorded against the full amount of its net deferred tax assets.

A valuation allowance is established when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The realization of deferred tax assets depends on the generation of future taxable income during the period in which related temporary differences become deductible. The Company continues to establish a valuation allowance against the full amount of its net deferred tax assets since it is more likely than not that benefits will not be realized, including those benefits created in the current year. This assessment is based on the Company's historical cumulative losses, which provide strong objective evidence that cannot be overcome with projections of income, as well as the fact the Company expects continuing losses in the future. 

11. Earnings (Loss) Per Common Share 

Basic and diluted earnings (loss) per common share was calculated as follows:For the Three Months EndedMarch 31,(dollars and shares in millions, except per share amounts)20252024Net income (loss)$82.9 $(69.4)Basic weighted average common shares outstanding72.5 71.7 Denominator adjustments for diluted EPS:Number of stock options and RSUs0.2 — Denominator adjustments for diluted EPS:0.2 — Diluted weighted average common shares outstanding72.7 71.7 Earnings (loss) per common share Basic$1.14 $(0.97)Diluted$1.14 $(0.97)The weighted average number of common shares included in the computation of basic and diluted net loss per common share for the three months ended March 31, 2024 gives effect to pre-funded warrants issued in November 2023 which allowed holders to acquire up 3,422,380 shares of common stock at a nominal exercise price of $0.001 per share and were classified as equity. The shares