EX-12 2 gt-q12014xratioofearningse.htm EX-12 GT - Q1 2014 - Ratio of Earnings Ex_12.1 (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)
Three Months Ended March 31,
Year Ended December 31,
EARNINGS
2014
2013
2012
2011
2010
2009
Pre-tax income (loss) before adjustment for minority interests in consolidated subsidiaries or income or loss from equity investees
$
(35
)
$
782

$
406

$
599

$
(3
)
$
(365
)
Add:
 
 
 
 
 
 
Amortization of previously capitalized interest
3

10

8

9

9

8

Distributed income of equity investees
21

21

11

8

4

3

          Total additions
24

31

19

17

13

11

Deduct:
 
 
 
 
 
 
Capitalized interest
7

39

22

31

26

14

Minority interest in pre-tax income of consolidated subsidiaries with no fixed charges
4

26

20

9

6

4

  Total deductions
11

65

42

40

32

18

TOTAL EARNINGS (LOSS)
$
(22
)
$
748

$
383

$
576

$
(22
)
$
(372
)
 
 
 
 
 
 
 
FIXED CHARGES
 
 
 
 
 
 
Interest expense
$
105

$
392

$
357

$
330

$
316

$
311

Capitalized interest
7

39

22

31

26

14

Amortization of debt discount, premium or expense
5

15

13

14

14

16

Interest portion of rental expense (1)
30

119

121

118

111

105

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

1

1

1

1

1

 
 
 
 
 
 
 
TOTAL FIXED CHARGES
$
147

$
566

$
514

$
494

$
468

$
447

 
 
 
 
 
 
 
TOTAL EARNINGS BEFORE FIXED CHARGES
$
125

$
1,314

$
897

$
1,070

$
446

$
75

 
 
 
 
 
 
 
Preferred Dividends
$
7

$
29

$
29

22

$ *

$ *

Ratio of pre-tax income to net income
1.00

1.20

1.86

1.48

     *

     *

 
 
 
 
 
 
 
Preferred Dividend Factor
$
7

$
35

$
54

$
33

$ *

$ *

Total Fixed Charges
147

566

514

494

468

447

TOTAL FIXED CHARGES AND PREFERRED DIVIDENDS
$
154

$
601

$
568

$
527

$
468

$
447

 
 
 
 
 
 
 
RATIO OF EARNINGS TO FIXED CHARGES
**

2.32

1.75

2.17

***

****

RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDENDS
**

2.19

1.58

2.03

***

****

*    No preferred stock was outstanding for these periods.
**    Earnings for the quarter ended March 31, 2014 were inadequate to cover fixed charges and preferred dividends. The coverage deficiency was $29 million.
***    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.