EX-12 4 ex-12.txt EXHIBIT 12 COMPUTATION OF RATIO OF NET INCOME TO FIXED CHARGES AND NET INCOME TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS FOR NINE MONTHS ENDED SEPTEMBER 30 (UNAUDITED)
(Dollars in millions) 2001 2000 ---- ---- Income before income taxes (1) $7,684 $7,711 Add: Fixed charges, excluding capitalized interest 1,314 1,379 ------ ------ Income as adjusted before income taxes $8,998 $9,090 ====== ====== Fixed charges: Interest expense $ 973 $1,050 Capitalized interest 24 23 Portion of rental expense representative of interest 341 329 ------ ------ Total fixed charges $1,338 $1,402 ====== ====== Preferred stock dividends (2) 14 21 ------ ------ Combined fixed charges and preferred stock dividends $1,352 $1,423 ====== ====== Ratio of net income to fixed charges 6.72 6.48 Ratio of net income to combined fixed charges and preferred stock dividends 6.66 6.39
(1) Income before income taxes excludes the company's share in the income and losses of less-than-fifty percent-owned affiliates. (2) Included in the ratio computation are preferred stock dividends of $10 million for the first nine months of 2001 and $15 million for the first nine months of 2000, or $14 million and $21 million, respectively, representing the pre-tax income that would be required to cover those dividend requirements based on the company's effective tax rate for the nine months ended September 30, 2001 and 2000. - 26 - SEGMENT INFORMATION (UNAUDITED)
Hardware Segments ------------------------------------------------- Personal and Global Printing Enterprise (Dollars in millions) Services Technology Systems Systems ------------------------------------------------------------------------------------------------------------- THREE MONTHS ENDED SEPTEMBER 30, 2001: External revenue $8,682 $ 1,654 $ 2,829 $ 3,056 Internal revenue 684 628 18 175 ------ ------- ------- ------- Total revenue $9,366 $ 2,282 $ 2,847 $ 3,231 ====== ======= ======= ======= Pre-tax income (loss) $1,373 $ (258) $ (70) $ 194 ====== ======= ======= ======= Revenue year-to-year change 5.4% (21.9)% (28.7)% (2.2)% Pre-tax income year-to-year change 19.7% (242.5)% (179.5)% (29.2)% Pre-tax income margin 14.7% (11.3)% (2.5)% 6.0% THREE MONTHS ENDED SEPTEMBER 30, 2000*: External revenue $8,230 $ 2,250 $ 3,971 $ 3,164 Internal revenue 654 672 22 138 ------ ------- ------- ------- Total revenue $8,884 $ 2,922 $ 3,993 $ 3,302 ====== ======= ======= ======= Pre-tax income (loss) $1,147 $ 181 $ 88 $ 274 ====== ======= ======= ======= Pre-tax income margin 12.9% 6.2% 2.2% 8.3%
* Reclassified to conform with 2001 presentation. RECONCILIATIONS TO IBM AS REPORTED:
Three Months Ended Three Months Ended (Dollars in millions) September 30, 2001 September 30, 2000 ------------------ ------------------- Revenue: Total reportable segments $ 22,424 $ 23,601 Eliminations/other (1,996) (1,820) -------- -------- Total IBM Consolidated $ 20,428 $ 21,781 ======== ======== Pretax income: Total reportable segments $ 2,181 $ 2,444 Eliminations/other 81 360 -------- -------- Total IBM Consolidated $ 2,262 $ 2,804 ======== ========
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Global Enterprise Total (Dollars in millions) Software Financing Investments Segments -------------------------------------------------------------------------------------------------------------------- THREE MONTHS ENDED SEPTEMBER 30, 2001: External revenue $ 3,201 $ 814 $ 242 $ 20,478 Internal revenue 236 204 1 1,946 ---------- ------- ----- -------- Total revenue $ 3,437 $ 1,018 $ 243 $ 22,424 ========== ======= ===== ======== Pre-tax income (loss) $ 704 $ 314 $ (76) $ 2,181 ========== ======= ===== ======== Revenue year-to-year change 9.8% (6.9)% (12.6)% (5.0)% Pre-tax income year-to-year change 36.7% 6.8% (38.2)% (10.8)% Pre-tax income margin 20.5% 30.8% (31.3)% 9.7% THREE MONTHS ENDED SEPTEMBER 30, 2000*: External revenue $ 2,918 $ 868 $ 277 $ 21,678 Internal revenue 211 225 1 1,923 ---------- ------- ----- -------- Total revenue $ 3,129 $ 1,093 $ 278 $ 23,601 ========== ======= ===== ======== Pre-tax income (loss) $ 515 $ 294 $ (55) $ 2,444 ========== ======= ===== ======== Pre-tax income margin 16.5% 26.9% (19.8%) 10.4%
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Hardware Segments ------------------------------------------------- Personal and Global Printing Enterprise (Dollars in millions) Services Technology Systems Systems ------------------------------------------------------------------------------------------------------------- NINE MONTHS ENDED SEPTEMBER 30, 2001: External revenue $25,895 $ 6,091 $ 9,072 $ 9,669 Internal revenue 1,923 1,795 50 547 ------- ------- -------- ------- Total revenue $27,818 $ 7,886 $ 9,122 $10,216 ======= ======= ======== ======= Pre-tax income (loss) $ 3,748 $ (81) $ (136) $ 1,111 ======= ======= ======== ======= Revenue year-to-year change 7.8% (1.4)% (16.0)% 2.4% Pre-tax income year-to-year change 16.6% (120.9)% nm 6.3% Pre-tax income margin 13.5% (1.0)% (1.5)% 10.9% NINE MONTHS ENDED SEPTEMBER 30, 2000*: External revenue $23,966 $ 5,826 $ 10,820 $ 9,500 Internal revenue 1,849 2,172 44 475 ------- ------- -------- ------- Total revenue $25,815 $ 7,998 $ 10,864 $ 9,975 ======= ======= ======== ======= Pre-tax income (loss) $ 3,214 $ 388 $ (4) $ 1,045 ======= ======= ======== ======= Pre-tax income margin 12.5% 4.9% (0.0)% 10.5%
nm - not meaningful * Reclassified to conform with 2001 presentation. RECONCILIATIONS TO IBM AS REPORTED:
Nine Months Ended Nine Months Ended (Dollars in millions) September 30, 2001 September 30, 2000 ------------------ ------------------- Revenue: Total reportable segments $ 68,800 $ 68,436 Eliminations/other (5,760) (5,656) -------- -------- Total IBM Consolidated $ 63,040 $ 62,780 ======== ======== Pretax income: Total reportable segments $ 7 ,278 $ 7,153 Eliminations/other 375 594 -------- -------- Total IBM Consolidated $ 7,653 $ 7,747 ======== ========
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Global Enterprise Total (Dollars in millions) Software Financing Investments Segments ----------------------------------------------------------------------------------------------------------------------- NINE MONTHS ENDED SEPTEMBER 30, 2001: External revenue $ 9,155 $ 2,486 $ 782 $63,150 Internal revenue 686 647 2 5,650 --------- ------- ----- ------- Total revenue $ 9,841 $ 3,133 $ 784 $68,800 ========= ======= ===== ======= Pre-tax income (loss) $ 2,001 $ 878 $(243) $ 7,278 ========= ======= ===== ======= Revenue year-to-year change 2.3% (2.7)% (16.8)% 0.5% Pre-tax income year-to-year change 9.2% (1.1)% (15.7)% 1.7% Pre-tax income margin 20.3% 28.0% (31.0)% 10.6% NINE MONTHS ENDED SEPTEMBER 30, 2000*: External revenue $ 9,027 $ 2,525 $ 939 $62,603 Internal revenue 595 695 3 5,833 --------- ------- ----- ------- Total revenue $ 9,622 $ 3,220 $ 942 $68,436 ========= ======= ===== ======= Pre-tax income (loss) $ 1,832 $ 888 $(210) $ 7,153 ========= ======= ===== ======= Pre-tax income margin 19.0% 27.6% (22.3)% 10.5%
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