EX-12.0 4 dex120.htm COMPUTATION OF RATIO OF EARNINGS Prepared by R.R. Donnelley Financial -- Computation of Ratio of Earnings
 
EXHIBIT 12
(PAGE 1 OF 2)
MATTEL, INC. AND SUBSIDIARIES
 
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Amounts in thousands, except ratios)
 
(Unaudited)
 
 
    
FOR THE
SIX MONTHS ENDED
     
FOR THE YEARS ENDED DECEMBER 31, (a)(b)
  
    
June 30, 2002
     
June 30, 2001
     
2001
    
2000
    
1999
    
1998
    
1997
  
EARNINGS AVAILABLE FOR FIXED CHARGES:
                                                           
Income (loss) from continuing operations before income taxes, cumulative effect of change in accounting principles and extraordinary items
   
$
19,181
 
   
$
(36,022
)
   
$
430,010
 
  
$
225,424
 
  
$
170,164
 
  
$
459,446
 
  
$
425,082
 
Less (plus) minority interest and undistributed income (loss) of less-than-majority-owned affiliates, net
   
 
211
 
   
 
242
 
   
 
170
 
  
 
440
 
  
 
145
 
  
 
(165
)
  
 
(144
)
Add:
                                                           
Interest expense
   
 
58,680
 
   
 
74,512
 
   
 
155,132
 
  
 
152,979
 
  
 
131,609
 
  
 
110,833
 
  
 
90,130
 
Appropriate portion of rents(c)
   
 
8,651
 
   
 
8,463
 
   
 
14,923
 
  
 
14,748
 
  
 
11,974
 
  
 
16,262
 
  
 
17,665
 
    
  
  
 
 
 
 
Earnings available for fixed charges
   
$
86,723
 
   
$
47,195
 
   
$
600,235
 
  
$
393,591
 
  
$
313,892
 
  
$
586,376
 
  
$
532,733
 
    
  
  
 
 
 
 
FIXED CHARGES:
                                                           
Interest expense
   
$
58,680
 
   
$
74,512
 
   
$
155,132
 
  
$
152,979
 
  
$
131,609
 
  
$
110,833
 
  
$
90,130
 
Capitalized interest
   
 
49
 
   
 
—  
 
   
 
6
 
  
 
507
 
  
 
527
 
  
 
993
 
  
 
991
 
Appropriate portion of rents(c)
   
 
8,651
 
   
 
8,463
 
   
 
14,923
 
  
 
14,748
 
  
 
11,974
 
  
 
16,262
 
  
 
17,665
 
    
  
  
 
 
 
 
Fixed charges
   
$
67,380
 
   
$
82,975
 
   
$
170,061
 
  
$
168,234
 
  
$
144,110
 
  
$
128,088
 
  
$
108,786
 
    
  
  
 
 
 
 
Ratio of earnings to fixed charges
   
 
1.29
X
   
 
0.57
(d)
   
 
3.53
X
  
 
2.34
X
  
 
2.18
X
  
 
4.58
X
  
 
4.90
X
    
  
  
 
 
 
 
(a)
 
Although Mattel merged with The Learning Company, Inc. (“Learning Company”) in May 1999, the results of operations of Learning Company have not been included in this calculation since the Consumer Software segment was reported as a discontinued operation effective March 31, 2000.
 
(b)
 
The ratio of earnings to fixed charges for 1997 has been restated for the effects of the March 1997 merger of Tyco Toys, Inc. (“Tyco”) into Mattel, which was accounted for as a pooling of interests.
 
(c)
 
Portion of rental expenses which is deemed representative of an interest factor, not to exceed one-third of total rental expense.
 
(d)
 
Earnings did not cover fixed charges by $35.8 million for the six-month period ended June 30, 2001.

 
EXHIBIT 12
(Page 2 of 2)
MATTEL, INC. AND SUBSIDIARIES
 
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
(Amounts in thousands, except ratios)
 
(Unaudited)
 
 
    
FOR THE
SIX MONTHS ENDED
     
FOR THE YEARS ENDED DECEMBER 31, (a)(b)
  
    
June 30,
2002
     
June 30,
2001
     
2001
     
2000
     
1999
     
1998
     
1997
  
EARNINGS AVAILABLE FOR FIXED CHARGES:
                                                               
Income (loss) from continuing operations before income taxes, cumulative effect of change in accounting principles and extraordinary items
   
$
19,181
 
   
$
(36,022
)
   
$
430,010
 
   
$
225,424
 
   
$
170,164
 
   
$
459,446
 
   
$
425,082
 
Less (plus) minority interest and undistributed income (loss) of less-than-majority-owned affiliates, net
   
 
211
 
   
 
242
 
   
 
170
 
   
 
440
 
   
 
145
 
   
 
(165
)
   
 
(144
)
Add:
                                                               
Interest expense
   
 
58,680
 
   
 
74,512
 
   
 
155,132
 
   
 
152,979
 
   
 
131,609
 
   
 
110,833
 
   
 
90,130
 
Appropriate portion of
    rents(c)
   
 
8,651
 
   
 
8,463
 
   
 
14,923
 
   
 
14,748
 
   
 
11,974
 
   
 
16,262
 
   
 
17,665
 
    
  
  
  
  
  
  
Earnings available for fixed charges
   
$
86,723
 
   
$
47,195
 
   
$
600,235
 
   
$
393,591
 
   
$
313,892
 
   
$
586,376
 
   
$
532,733
 
    
  
  
  
  
  
  
FIXED CHARGES:
                                                               
Interest expense
   
$
58,680
 
   
$
74,512
 
   
$
155,132
 
   
$
152,979
 
   
$
131,609
 
   
$
110,833
 
   
$
90,130
 
Capitalized interest
   
 
49
 
   
 
—  
 
   
 
6
 
   
 
507
 
   
 
527
 
   
 
993
 
   
 
991
 
Dividends—Series B preferred stock
   
 
—  
 
   
 
—  
 
   
 
—  
 
   
 
—  
 
   
 
—  
 
   
 
—  
 
   
 
2,537
 
Dividends—Series C preferred stock
   
 
—  
 
   
 
—  
 
   
 
—  
 
   
 
—  
 
   
 
3,980
 
   
 
7,960
 
   
 
7,968
 
Appropriate portion of
    rents(c)
   
 
8,651
 
   
 
8,463
 
   
 
14,923
 
   
 
14,748
 
   
 
11,974
 
   
 
16,262
 
   
 
17,665
 
    
  
  
  
  
  
  
Fixed charges
   
$
67,380
 
   
$
82,975
 
   
$
170,061
 
   
$
168,234
 
   
$
148,090
 
   
$
136,048
 
   
$
119,291
 
    
  
  
  
  
  
  
Ratio of earnings to combined fixed charges and preferred stock dividends
   
 
1.29
X
   
 
0.57
(d)
   
 
3.53
X
   
 
2.34
X
   
 
2.12
X
   
 
4.31
X
   
 
4.47
X
    
  
  
  
  
  
  
 
(a)
 
Although Mattel merged with Learning Company in May 1999, the results of operations of Learning Company have not been included in this calculation since the Consumer Software segment was reported as a discontinued operation effective March 31, 2000.
 
(b)
 
The ratio of earnings to fixed charges for 1997 has been restated for the effects of the March 1997 merger of Tyco into Mattel, which was accounted for as a pooling of interests.
 
(c)
 
Portion of rental expenses which is deemed representative of an interest factor, not to exceed one-third of total rental expense.
 
(d)
 
Earnings did not cover fixed charges by $35.8 million for the six-month period ended June 30, 2001.

2