EX-12 3 e11099exv12.htm EX-12: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12
 

Exhibit 12

Cendant Corporation and Subsidiaries
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in millions)

                     
        Six Months Ended June 30,  
        2005     2004  
Earnings before fixed charges:
                
   
 
                
Income before income taxes and minority interest
   $ 767     $ 929  
   
 
                
Plus:  
Fixed charges
     423       483  
   
 
                
   
Amortization of capitalized interest
     3       3  
   
 
                
Less:  
Minority interest in pre-tax income of subsidiaries that have not
incurred fixed charges
     –       6  
   
 
                
   
Capitalized interest
     3       3  
   
 
            
   
 
                
Earnings available to cover fixed charges
   $ 1,190     $ 1,406  
   
 
            
   
 
                
Fixed charges (a):
                
   
 
                
Interest, including amortization of deferred financing costs  (b)
   $ 350     $ 411  
   
 
                
Interest portion of rental payment
     73       72  
   
 
            
   
 
                
Total fixed charges
   $ 423     $ 483  
   
 
            
   
 
                
Ratio of earnings to fixed charges
     2.81x       2.91x  
   
 
            

 
(a)  
Consists of interest expense on all indebtedness (including amortization of deferred financing costs and capitalized interest) and the portion of operating lease rental expense that is representative of the interest factor. Interest expense on all indebtedness is detailed as follows:
                     
         
        Six Months Ended June 30,  
        2005     2004  
Related to the debt under management programs incurred by the Company’s vehicle rental business   $ 148     $ 131  
 
                
All other     202       280  

(b)  
Does not include interest expense from discontinued operations of $11 million and $42 million for the six months ended June 30, 2005 and 2004, respectively.

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