EX-12 5 dex12.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Computation of Ratio of Earnings to Fixed Charges

EXHIBIT 12

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

The ratio of earnings to fixed charges, as well as any deficiency of earnings is determined using the following applicable factors:

Earnings available for fixed charges are calculated first, by determining the sum of: (a) income from continuing operations before income taxes and equity income; (b) distributed equity income; (c) fixed charges, as defined below; and (d) amortization of capitalized interest, if any. From this total, we subtract capitalized interest and net income attributable to noncontrolling interests.

Fixed charges are calculated as the sum of (a) interest costs (both expensed and capitalized), (b) amortization of debt expense and discount or premium relating to any indebtedness and (c) that portion of rental expense that is representative of the interest factor.

 

       Three Months
Ended September 30,
     Nine Months
Ended September 30,
 

(in millions)

     2009      2008      2009      2008  

Fixed charges:

             

Interest expense

     $ 131       $ 146       $ 392       $ 424   

Capitalized interest

       2         3         7         8   

Portion of rental expense which represents interest factor

       23         22         68         68   
                                     

Total Fixed Charges

     $ 156       $ 171       $ 467       $ 500   
                                     

Earnings available for fixed charges:

             

Pre-tax income (loss)

     $ 158       $ 247       $ 433       $ (8

Add: Distributed equity income of affiliated companies

       3         4         8         32   

Add: Fixed charges

       156         171         467         500   

Less: Capitalized interest

       (2      (3      (7      (8

Less: Net income attributable to noncontrolling interests

       (6      (9      (20      (27
                                     

Total Earnings Available for Fixed Charges

     $ 309       $ 410       $ 881       $ 489   
                                     

Ratio of Earnings to Fixed Charges

       1.98         2.40         1.89         *   
                                     

 

*

Earnings for the nine months ended September 30, 2008 were inadequate to cover fixed charges by $11.