EX-12.1 2 exhibit12110-k2015.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Exhibit


 
 
 
 
 
 
 
 
 
Exhibit 12.1
Kansas City Southern
 
 
 
 
 
 
 
 
 
 
 
 
 
Computation of Ratio of Earnings to Fixed Charges
Dollars in millions
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2015 (ii)
 
2014 (ii)
 
2013
 
2012(iii)
 
2011(iv)
Earnings:
 
 
 
 
 
 
 
 
 
Pretax income from continuing operations, excluding equity in earnings of unconsolidated affiliates (i)
$
654.3

 
$
692.0

 
$
532.8

 
$
597.1

 
$
436.8

Interest expense
81.9

 
72.8

 
80.6

 
100.4

 
129.1

Portion of rents representative of an appropriate interest factor
21.3

 
25.4

 
35.5

 
36.2

 
40.2

Distributed income of equity investments
16.5

 
25.5

 
12.5

 
19.8

 
18.1

  Pretax income as adjusted
 
$
774.0

 
$
815.7

 
$
661.4

 
$
753.5

 
$
624.2

 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed Charges:
 
 
 
 
 
 
 
 
 
Interest expense
$
81.9

 
$
72.8

 
$
80.6

 
$
100.4

 
$
129.1

Capitalized interest
0.7

 
0.9

 
1.1

 
0.9

 
1.0

Portion of rents representative of an appropriate interest factor
21.3

 
25.4

 
35.5

 
36.2

 
40.2

  Fixed charges before preference dividends
 
103.9

 
99.1

 
117.2

 
137.5

 
170.3

Preference security dividend as defined by Item 503(d)(B) of Regulation S-K
0.3

 
0.3

 
0.3

 
0.3

 
2.2

  Total fixed charges
 
$
104.2

 
$
99.4

 
$
117.5

 
$
137.8

 
$
172.5

 
 
 
 
 
 
 
 
 
 
 
 
 
Ratio of earnings to fixed charges and preference dividends
7.4

 
8.2

 
5.6

 
5.5

 
3.6

 
 
 
 
 
 
 
 
 
 
Ratio of earnings to fixed charges
7.4

 
8.2

 
5.6

 
5.5

 
3.7

Note: Excludes amortization of capitalized interest due to immateriality.
(i) During 2015, 2014, 2013, 2012 and 2011, the Company recognized pre-tax debt retirement and exchange costs of $7.6 million, $6.6 million, $119.2 million, $20.1 million, and $38.7 million, respectively, related to debt restructuring activities that occurred during the periods.
(ii) During 2015 and 2014, the Company recognized pre-tax lease termination costs of $9.6 million and $38.3 million, respectively, due to the early termination of certain operating leases and the related purchase of equipment.
(iii) During 2012, the Company recognized a pre-tax gain of $43.0 million within operating expenses for the elimination of deferred statutory profit sharing liability, net as a result of the organizational restructuring during the period.
(iv) During 2011, the Company recognized a pre-tax gain of $25.6 million within operating expenses for insurance recoveries related to hurricane damage.