EX-12 9 a2072306zex-12.txt EXHIBIT 12 EXHIBIT 12 CENDANT CORPORATION AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (DOLLARS IN MILLIONS)
YEAR ENDED DECEMBER 31, ---------------------------------------------------- 2001 2000 1999 1998 1997 -------- -------- -------- -------- -------- EARNINGS AVAILABLE TO COVER FIXED CHARGES: Income (loss) before income taxes, minority interest and equity in Homestore.com $ 759 $1,106 $ (574) $ 315 $ 257 Plus: Fixed charges 991 574 625 677 409 Less: Equity income (loss) in unconsolidated affiliates (5) 17 18 14 51 Minority interest 37 131 96 80 -- ------ ------ ------ ------ ------ Earnings available to cover fixed charges $1,718 $1,532 $ (63) $ 898 $ 615 ====== ====== ====== ====== ====== FIXED CHARGES:(a) Interest, including amortization of deferred financing costs $ 816 $ 381 $ 463 $ 509 $ 379 Other charges, financing costs -- -- -- 28 -- Minority interest 37 131 96 80 -- Interest portion of rental payment 138 62 66 60 30 ------ ------ ------ ------ ------ Total fixed charges $ 991 $ 574 $ 625 $ 677 $ 409 ====== ====== ====== ====== ====== RATIO OF EARNINGS TO FIXED CHARGES 1.73x(b) 2.67x(b) (c) 1.33x(b) 1.50x(b) ====== ====== ====== ====== ======
------------------------------ (a) Consists of interest expense on all indebtedness (including amortization of deferred financing costs) and the portion of operating lease rental expense that is representative of the interest factor. Interest expense on all indebtedness is detailed as follows:
YEAR ENDED DECEMBER 31, ---------------------------------------------------- 2001 2000 1999 1998 1997 -------- -------- -------- -------- -------- Incurred by the Company's PHH subsidiary $ 258 $ 156 $ 133 $ 166 $ 110 Related to the Company's stockholder litigation settlement liability 131 63 -- -- -- Related to the debt under management and mortgage programs incurred by the Company's car rental subsidiary 189 -- -- -- -- All other 238 162 330 343 269
The interest expense of $131 million related to the Company's stockholder litigation settlement liability does not reflect $25 million of interest income related to the Company's stockholder litigation settlement trust. Such interest income economically offsets a portion of the $131 million of interest expense on the Company's Consolidated Statement of Operations. (b) Income (loss) before income taxes, minority interest and equity in Homestore.com includes other charges and a net loss on the disposition of businesses of $695 million, $119 million, $810 million (exclusive of financing costs of $30 million) and $704 million for 2001, 2000, 1998 and 1997, respectively. Excluding such charges, the ratio of earnings to fixed charges is 2.43x, 2.88x, 2.52x and 3.22x for 2001, 2000, 1998 and 1997, respectively. (c) Earnings were inadequate to cover fixed charges for 1999 (deficiency of $688 million) as a result of other charges of $3,032 million, partially offset by $1,109 million related to the net gain on dispositions of businesses. Excluding such charges and net gain, the ratio of earnings to fixed charges is 2.98x.