EX-12.1 5 dps-ex121_123113.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES DPS-EX12.1_12.31.13
Exhibit 12.1

DR PEPPER SNAPPLE GROUP, INC.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(In millions, except ratio amounts)
 
For the Years Ended December 31,
 
2013
 
2012
 
2011
 
2010
 
2009
Calculation of fixed charges ratio:
 
 
 
 
 
 
 
 
 
Income before provision for income taxes, equity in earnings of unconsolidated subsidiaries and cumulative effect of change in accounting policy(2)
$
542

 
$
978

 
$
925

 
$
821

 
$
868

 
 
 
 
 
 
 
 
 
 
Add/(deduct):
 
 
 
 
 
 
 
 
 
Fixed charges
138

 
142

 
131

 
147

 
265

Amortization of capitalized interest
4

 
3

 
2

 
2

 
2

Capitalized interest
(1
)
 
(2
)
 
(2
)
 
(3
)
 
(8
)
Total earnings available for fixed charges
$
683

 
$
1,121

 
$
1,056

 
$
967

 
$
1,127

 
 
 
 
 
 
 
 
 
 
Fixed charges:
 
 
 
 
 
 
 
 
 
Interest expense
$
123

 
$
125

 
$
114

 
$
128

 
$
243

Capitalized interest
1

 
2

 
2

 
3

 
8

Interest component of rental expense(1)
14

 
15

 
15

 
16

 
14

Total fixed charges
$
138

 
$
142

 
$
131

 
$
147

 
$
265

 
 
 
 
 
 
 
 
 
 
Ratio of earnings to fixed charges
4.9x

 
7.9x

 
8.1x

 
6.6x

 
4.3x

 
 
 
 
 


 
 
 
 
_________________________________
(1)
Represents a reasonable estimate of the interest component of rental expense incurred by us.

(2)
Due to the completion of the IRS audit for our 2006-2008 federal income tax returns in August 2013, we recognized $430 million of other expense, net, as we no longer anticipate collecting amounts from Mondelēz. Additionally, in June 2013, a bill was enacted by the Canadian government, which reduced amounts amortized for income tax purposes. As a result, we recognized $38 million of indemnity income due to the reduction of our long-term liability to Mondelēz. Refer to Note 12 of the Notes to our Audited Consolidated Financial Statements in Item 8, "Financial Statements and Supplementary Data" of this Annual Report for further information.