EX-12 3 l16500aexv12.txt EX-12 COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES . . . EXHIBIT 12 THE GOODYEAR TIRE & RUBBER COMPANY AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
9 Months Ended September (Dollars in millions) 30, 12 Months Ended December 31, --------- ---------------------------------------------------- 2005 2004 2003 2002 2001 2000 ------ ------ ------- ------ ------ ------ EARNINGS Income (loss) before income taxes $ 502 $ 323 $ (690) $ (19) $ (339) $ 70 Add: Amortization of previously capitalized interest 9 11 11 10 10 10 Minority interest in net income of consolidated subsidiaries with fixed charges 73 63 36 57 28 45 Proportionate share of fixed charges of investees accounted for by the equity method - - 7 5 4 6 Proportionate share of net loss of investees accounted for by the equity method 1 1 21 17 43 29 ------ ------ ------- ------ ------ ------ Total additions 83 75 75 89 85 90 Deduct: Capitalized interest 5 7 8 7 2 12 Minority interest in net income of consolidated subsidiaries 3 6 15 5 15 8 Undistributed proportionate share of net income of investees accounted for by the equity method 1 6 4 2 - 3 ------ ------ ------- ------ ------ ------ Total deductions 9 19 27 14 17 23 TOTAL EARNINGS $ 576 $ 379 $ (642) $ 56 $ (271) $ 137 ====== ====== ======= ====== ====== ====== FIXED CHARGES Interest expense $ 306 $ 369 $ 296 $ 243 $ 298 $ 283 Capitalized interest 5 6 8 7 2 12 Amortization of debt discount, premium or expense 22 61 44 9 6 1 Interest portion of rental expense (1) 69 92 89 76 74 73 Proportionate share of fixed charges of investees accounted for by the equity method - - 7 5 4 6 ------ ------ ------- ------ ------ ------ TOTAL FIXED CHARGES $ 402 $ 528 $ 444 $ 340 $ 384 $ 375 ====== ====== ======= ====== ====== ====== TOTAL EARNINGS BEFORE FIXED CHARGES $ 978 $ 907 $ (198) $ 396 $ 113 $ 512 ====== ====== ======= ====== ====== ====== RATIO OF EARNINGS TO FIXED CHARGES 2.43 1.72 * 1.16 ** 1.36
------------- * Earnings for the year ended December 31, 2003 were inadequate to cover fixed charges. The coverage deficiency was $642 million. ** Earnings for the year ended December 31, 2001 were inadequate to cover fixed charges. The coverage deficiency was $271 million. (1) Interest component of rental expense is estimated to equal 1/3 of such expense, which is considered a reasonable approximation of the interest factor.