EX-12.1 8 c02860exv12w1.htm RATIO OF EARNINGS TO FINANCIAL CHARGES exv12w1
 

Exhibit 12.1
Terra Industries Inc.
Ratio of earnings to fixed charges
                                         
    2001     2002     2003     2004     2005  
Earnings
                                        
Income (loss) from continuing operations
     (79,843 )     (36,174 )     (12,481 )     67,596     22,087
Income tax expense (benefit)
     (33,000 )     (24,000 )     (57,000 )     (5,000 )   14,217
 
                              
Earnings before income tax
     (112,843 )     (60,174 )     (69,481 )     62,596     36,304
 
                                  
Add:
                                  
Minority Interest Expense (Income)
     (2,247 )     1,510       (8,617 )     11,207     13,667
Equity Investee (Income) Loss
     (953 )     (983 )     (803 )     (893 )   21,415
Fixed Charges
     63,949       63,584       65,453       71,154     80,813
Distributed income of equity investees
     600       700       1,050       500     46,375
 
                              
 
     61,349       64,811       57,083       81,968     162,270
 
                                  
Subtract:
                                  
Preference Security and Preferred Dividends
     2,028       1,846       1,153       9,101     18,724
 
                                  
TOTAL EARNINGS
     (53,522 )     2,791       (13,551 )     135,463     179,850
 
                                  
Fixed charges
                                  
Interest expense
     53,594       53,800       55,072       53,134     53,478
Preference Security Dividend (TNCLP)
     2,028       1,846       1,153       8,072     13,590
Preferred dividends
     —       —       —       1,029     5,134
Deferred finance amortization-TCAPI
     3,271       2,790       3,816       4,086     2,778
Bond Discounts-TREC
     7       —       —       —     —
1/3 Rent expense on operating leases
     5,049       5,148       5,412       4,833     5,833
 
                              
 
     63,949       63,584       65,453       71,154     80,813
 
                                  
Ratio of earnings to fixed charges
     (0.8 )     0.0       (0.2 )     1.9     2.23
 
                                  
Dollar amount of Deficiency
     (117,471 )     (60,793 )     (79,004 )     —     —

 

 

RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED SHARE DIVIDEND REQUIREMENTS
(000’s)
                                         
    Year ended December 31,
    2001   2002   2003   2004   2005
EARNINGS
                                        
Net income (loss) from continuing operations
   $ (79,843 )   $ (36,174 )   $ (12,481 )   $ 67,596     $ 22,087  
Income tax expense (benefit)
     (33,000 )     (24,000 )     (57,000 )     (5,000 )     14,217  
     
Earnings (loss) before income taxes
     (112,843 )     (60,174 )     (69,481 )     62,596       36,304  
 
                                        
Minority interest expense (income) in consolidated subsidiaries
     (2,247 )     1,510       (8,617 )     11,207       13,667  
Income (loss) of equity investments
     (953 )     (983 )     (803 )     (893 )     21,415  
Fixed charges
     63,949       63,584       65,453       71,154       80,813  
Distributed income of equity investees
     600       700       1,050       500       46,375  
Less: preferred dividends
     —       —       —       (1,029 )     (5,134 )
Less: preference security dividends of Terra Nitrogen Company, L.P.
     (2,028 )     (1,846 )     (1,153 )     (8,072 )     (13,590 )
     
 
                                        
TOTAL EARNINGS (LOSS)
   $ (53,522 )   $ 2,791     $ (13,551 )   $ 135,463     $ 179,850  
     
 
                                        
FIXED CHARGES
                                        
Interest expense
   $ 53,594     $ 53,800     $ 55,072     $ 53,134     $ 53,478  
Amortization of debt expenses
     3,278       2,790       3,816       4,086       2,778  
One-third of rentals on operating leases
     5,049       5,148       5,412       4,833       5,833  
Preferred dividends
     —       —       —       1,029       5,134  
Preference security dividends of Terra Nitrogen Company, L.P.
     2,028       1,846       1,153       8,072       13,590  
     
 
                                        
TOTAL FIXED CHARGES
   $ 63,949     $ 63,584     $ 65,453     $ 71,154     $ 80,813  
     
 
                                        
EARNINGS EXCESS (DEFICIENCY) TO COVER FIXED CHARGES
   $ (117,471 )   $ (60,793 )   $ (79,004 )   $ 64,309     $ 99,037  
     
 
                                        
RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDENDS
     —       —       —       1.90       2.23