EX-12 7 mhp-ex12x20121231xq4.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES MHP-EX12-2012.12.31-Q4


Exhibit (12)
The McGraw Hill Companies, Inc.
Computation of Ratio of Earnings to Fixed Charges
(in millions)
 
 
Years ended December 31,
 
 
2012
 
2011
 
2010
 
2009
 
2008
 
Earnings:
 
 
 
 
 
 
 
 
 
 
Income from continuing operations before taxes on income
$
1,130

1 
$
1,000

2 
$
943

3 
$
876

4 
$
932

5 
Fixed charges 6
130

  
134

  
137

  
132

  
136

  
Total earnings
$
1,260

  
$
1,134

  
$
1,080

  
$
1,008

  
$
1,068

  
Fixed charges: 6
 
 
 
 
 
 
 
 
 
 
Interest expense
$
81

  
$
86

  
$
89

  
$
89

  
$
92

  
Portion of rental payments deemed to be interest
48

  
47

  
47

  
42

  
43

  
Amortization of debt issuance costs and discount
1

  
1

  
1

  
1

  
1

  
Total fixed charges
$
130

  
$
134

  
$
137

  
$
132

  
$
136

  
Ratio of earnings to fixed charges:
9.7

x 
8.5

x 
7.9

x 
7.6

x 
7.9

x 

1
Includes the impact of the following items: $135 million charge for Growth and Value Plan costs, a $68 million restructuring charge, transaction costs of $15 million for our S&P Dow Jones Indices LLC joint venture, an $8 million charge related to a reduction in our lease commitments, partially offset by a vacation accrual reversal of $52 million.
2
Includes the impact of the following items: a $32 million restructuring charge and a $10 million charge for Growth and Value Plan costs.
3
Includes the impact of the following items: a $16 million charge for subleasing excess space in our New York facilities, an $11 million restructuring charge and a $7 million gain on the sale of certain equity interests at Standard & Poor's Ratings.
4  
Includes the impact of the following items: a $14 million loss on the sale of Vista Research, Inc., an $11 million gain on the sale of BusinessWeek and a $4 million net restructuring charge.
5 Includes a $48 million restructuring charge.
6 "Fixed charges" consist of (1) interest on debt and interest related to the sale leaseback of Rock-McGraw, Inc. (see Note 13 - Commitments and Contingencies to the consolidated financial statements under Item 8, Consolidated Financial Statements and Supplementary Data, in this Form 10-K), (2) the portion of our rental expense deemed representative of the interest factor in rental expense, and (3) amortization of debt issue costs and discount to any indebtedness.