EX-12.1 2 x28902a2exv12w1.htm EX-12.1: CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES EX-12.1
 

EXHIBIT 12.1
EXPRESS SCRIPTS, INC.
STATEMENT OF RATIOS OF EARNINGS TO FIXED CHARGES
FOR THE YEARS ENDED DECEMBER 31, 2006, 2005, 2004, 2003, AND 2002
(Unaudited)
                                                 
    Historical     Pro Forma Combined (3) (4)  
                                            Year Ended  
    Year Ended December 31,     December 31,  
(in millions, except ratios)   2006     2005     2004     2003     2002     2006  
         
 
                                                
Fixed charges:
                                                
Interest expense (1)
   $ 96     $ 37     $ 42     $ 41     $ 44     $ 927  
Interest portion of rental expense (2)
     10       8       7       6       5       27  
         
 
                                                
Total fixed charges
     106       45       49       47       49       954  
 
                                                
Earnings:
                                                
Income before income taxes and cumulative effect of accounting change
    741       615       451       405       328       1,415  
Add: Undistributed loss from joint venture
     2       2       5       6       5       2  
         
 
                                                
Total adjusted earnings
   $ 849     $ 662     $ 505     $ 458     $ 382     $ 2,371  
 
                                                
Ratio of earnings to fixed charges
     8.0       14.6       10.3       9.7       7.8       2.5  
 
(1)   Interest expense includes the amortization on our deferred financing fees.
 
(2)   The interest portion of rental expenses has been estimated using an approximate interest factor.
 
(3)   The Pro Forma Combined reflects the acquisition and related adjustments using the pro forma financial information presented pursuant to Article 11 of Regulation S-X. For a discussion of the assumptions and adjustments made in preparation of the pro forma financial information presented in the prospectus/offer to exchange contained within the Registration Statement on Form S-4, see the section of this prospectus/offer to exchange entitled “Selected Unaudited Pro Forma Combined Financial Data”.
 
(4)   As disclosed in the Notes to the Unaudited Pro Forma Condensed Combined Financial Statement, the interest expense reflected in the Pro Forma Combined ratio of earnings to fixed charges is based on ESI paying Caremark Shareholders cash consideration of $29.69 per share calculated for the period from April 1, 2007 through July 1, 2007. It is possible that the actual cash consideration paid could be significantly different from this estimate. Any increase in the cash consideration could result in an increase in the amount of debt incurred to finance the transaction and a corresponding increase in annual interest expense. See the section of this prospectus/offer to exchange entitled “Unaudited Pro Forma Condensed Combined Financial Statements”.