EX-12.1 6 ex-12d1.htm EX-12.1 rig_Ex12_1_S4A

Exhibit 12.1

 

Transocean Ltd. and Subsidiaries

Computation of Ratio of Earnings to Fixed Charges

(In millions, except ratio amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Historical

 

 

 

Nine months

 

 

 

 

 

 

 

 

 

 

 

 

 

ended

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

Years ended December 31,

 

 

 

2017

 

2016

 

2015

 

2014

 

2013

 

2012

 

Earnings:

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Income (loss) from continuing operations before income tax expense

 

$
(2,892)

 

$

934 

 

$

1,015 

 

$
(1,788)

 

$

1,646 

 

$

875 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capitalized interest

 

 
91

 

 

176 

 

 

140 

 

 

133 

 

 

78 

 

 

54 

 

Equity in earnings (losses) of unconsolidated affiliates

 

 
1

 

 

2 

 

 

-

 

 

1 

 

 

-

 

 

-

 

Noncontrolling interest in pre-tax income of subsidiaries that have not incurred fixed charges

 

 

- 

 

 

- 

 

 

- 

 

 

- 

 

 

- 

 

 

- 

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed charges (see below)

 

 
468

 

 

601 

 

 

597 

 

 

649 

 

 

707 

 

 

811 

 

Amortization of capitalized interest

 

 
23

 

 

30 

 

 

28 

 

 

29 

 

 

27 

 

 

27 

 

Distribution of earnings of unconsolidated affiliates

 

 
1

 

 

1 

 

 

- 

 

 

- 

 

 

- 

 

 

- 

 

Earnings, as adjusted

 

$
(2,492)

 

$

1,388 

 

$

1,500 

 

$
(1,244)

 

$

2,302 

 

$

1,659 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed Charges:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rent expense

 

$
27

 

$

45 

 

$

72 

 

$

95 

 

$

128 

 

$

97 

 

Estimated interest portion of rent expense

 

$
9

 

$

16 

 

$

25 

 

$

33 

 

$

45 

 

$

34 

 

Interest expense, net of capitalized interest and including amortization of debt issue cost and debt discount or premium (a)

 

 
368

 

 

    409

 

 

   432

 

 
483

 

 

   584

 

 

   723

 

Capitalized interest

 

 
91

 

 

176 

 

 

140 

 

 

133 

 

 

78 

 

 

54 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total fixed charges

 

$
468

 

$

601 

 

$

597 

 

$

649 

 

$

707 

 

$

811 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to fixed charges (b)

 

 

(c)

 

 

2.31 

 

 

2.51 

 

 

(d)

 

 

3.26 

 

 

2.05 

 

(a)

Interest expense excludes interest on unrecognized tax benefits related to uncertain tax positions, as such amounts are recognized in income tax expense and are immaterial.

 

(b)

The ratio of earnings to fixed charges is calculated by dividing earnings by fixed charges.  For this purpose, “earnings” is the amount resulting from adding (i) income from continuing operations before income tax expense, (ii) fixed charges, (iii) amortization of capitalized interest, and (iv) distributed earnings of unconsolidated affiliates; and then subtracting (i) capitalized interest, (v) equity in earnings or losses of unconsolidated affiliates, and (iii) the noncontrolling interest in pre-tax income of subsidiaries that have not incurred fixed charges.  “Fixed charges” is the amount resulting from adding (i) interest expense, (ii) amortization of debt discount or premium, (iii) capitalized interest and (iv) an estimate of the interest component of rent expense.

 

(c)

Total fixed charges exceed adjusted earnings available for payment of fixed charges by $3.0 billion.  Adjusted earnings available for payment of fixed charges include a loss of $1.6 billion associated with the sale of 10 high-specification jackups and the novation of contracts relating to the construction of five high-specification jackups, together with related assets, and an aggregate loss of $1.5 billion associated with the impairment of eight drilling units and related assets, which were classified as held for sale at the time of impairment.

 

(d)

Total fixed charges exceed adjusted earnings available for payment of fixed charges by $1.9 billion.  Adjusted earnings available for payment of fixed charges include a loss of $3.0 billion associated with impairment of goodwill, an aggregate loss of $788 million associated with the impairment of the deepwater asset group and an aggregate loss of $268 million associated with the impairment of 14 drilling units and related assets, which were classified as held for sale at the time of impairment.