EX-12.1 3 d548768dex121.htm EX-12.1 EX-12.1

Exhibit 12.1

Calculation of Ratio of Earnings to Fixed Charges

 

     Year Ended December 31,     Three Months Ended  
(dollars in millions)    2008     2009     2010     2011     2012     March 31, 2013  

Earnings available for fixed charges:

            

Income (loss) before income taxes and earnings from unconsolidated affiliates

   $ 2,982      $ 2,328      $ 2,180      $ (4,919   $ (6,991   $ 189   

Adjustments:

            

Fixed charges

     1,172        1,562        1,395        1,487        1,474        428   

Amortization of capitalized interest

     14        24        27        31        34        8   

Capitalized interest

     (86     (56     (35     (24     (9     (1

Earnings from Non-Controlling Interests

     (6     (6     (3     —         —         —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings available for fixed charges

   $ 4,076      $ 3,852      $ 3,564      $ (3,425   $ (5,492   $ 624   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Fixed charges:

            

Interest expense including capitalized interest

   $ 489      $ 796      $ 591      $ 694      $ 686      $ 230   

Portion of rent expense representative of interest (1)

     683        766        804        793        788        198   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Fixed charges

   $ 1,172      $ 1,562      $ 1,395      $ 1,487      $ 1,474      $ 428   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ratio of earnings to fixed charges (2)

     3.48        2.47        2.55        —         —         1.46   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) The portion of operating rental expense that management believes is representative of interest is estimated to be 33%.
(2) Due primarily to T-Mobile’s non-cash impairment charges in the years ended December 31, 2012 and 2011, the ratio coverage was less than 1:1 in each of these periods. The Company would have needed to generate additional earnings of $7.0 billion and $4.9 billion in the year ended December 31, 2012 and 2011, respectively, to achieve a coverage of 1:1 in each of these periods.