EX-12.1 6 ratioofearningsex121121.htm EX-12.1 Ratio of Earnings Ex 12.1 (1) (2) (1)


EXHIBIT 12.1
THE GOODYEAR TIRE & RUBBER COMPANY AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
(Dollars in millions)
Year Ended December 31,
EARNINGS
2012
2011
2010
2009
2008
Pre-tax income (loss) before adjustment for minority interests in consolidated subsidiaries or income or loss from equity investees
$
406

$
599

$
(3
)
$
(365
)
$
176

Add:
 
 
 
 
 
Amortization of previously capitalized interest
8

9

9

8

8

Distributed income of equity investees
11

8

4

3

3

          Total additions
19

17

13

11

11

Deduct:
 
 
 
 
 
Capitalized interest (2)
22

31

26

14

23

Minority interest in pre-tax income of consolidated subsidiaries with no fixed charges
20

9

6

4

11

  Total deductions
42

40

32

18

34

TOTAL EARNINGS (LOSS)
$
383

$
576

$
(22
)
$
(372
)
$
153

 
 
 
 
 
 
FIXED CHARGES
 
 
 
 
 
Interest expense
$
357

$
330

$
316

$
311

$
320

Capitalized interest (2)
22

31

26

14

23

Amortization of debt discount, premium or expense
13

14

14

16

17

Interest portion of rental expense (1)
121

118

111

105

105

Proportionate share of fixed charges of investees accounted for by the equity method
1

1

1

1

1

 
 
 
 
 
 
TOTAL FIXED CHARGES
$
514

$
494

$
468

$
447

$
466

 
 
 
 
 
 
TOTAL EARNINGS BEFORE FIXED CHARGES
$
897

$
1,070

$
446

$
75

$
619

 
 
 
 
 
 
Preferred Dividends
$
29

22

$ *

$ *

$ *

 
 
 
 
 
 
Ratio of pre-tax income to net income
1.86

1.48

     *

     *

     *

 
 
 
 
 
 
Preferred Dividend Factor
$
54

$
33

$ *

$ *

$ *

Total Fixed Charges
514

494

468

447

466

TOTAL FIXED CHARGES AND PREFERRED DIVIDENDS
$
568

$
527

$
468

$
447

$
466

 
 
 
 
 
 
RATIO OF EARNINGS TO FIXED CHARGES
1.75

2.17

**

***

1.33

RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDENDS
1.58

2.03

**

***

1.33

*    No preferred stock was outstanding for these periods.
**    Earnings for the year ended December 31, 2010 were inadequate to cover fixed charges. The coverage deficiency was $22 million.
***    Earnings for the year ended December 31, 2009 were inadequate to cover fixed charges. The coverage deficiency was $372 million.
(1) Interest portion of rental expense is estimated to equal 1/3 of such expense, which is considered a reasonable approximation of the interest factor.
(2) Capitalized interest in 2012 includes a $13 million expense adjustment to correct capitalized interest recorded in prior periods.