EX-12.01 9 ex-12_01.htm COMPUTATION OF RATIOS OF EARNINGS (LOSS) TO FIXED CHARGES ex-12_01.htm
 
 
 

EXHIBIT 12.01

EASTMAN CHEMICAL COMPANY AND SUBSIDIARIES

Computation of Ratios of Earnings (Loss) to Fixed Charges


(Dollars in millions)
  
2008
  
2007
  
2006
  
2005
  
2004
                     
Earnings (loss) from continuing operations before income taxes and cumulative effect of change in accounting principle (1)
$ 
 
 
429
$ 
 
 
470
$ 
 
 
594
$ 
 
 
763
$ 
 
 
37
Add:
                    
Interest expense
  
95
  
107
  
105
  
113
  
123
Appropriate portion of rental expense (2)
  
15
  
18
  
21
  
21
  
21
Amortization of capitalized interest
  
8
  
9
  
11
  
11
  
15
Earnings (loss) as adjusted
$ 
547
$ 
604
$ 
731
$ 
908
$ 
196
                     
Fixed charges:
                    
Interest expense
$ 
95
$ 
107
$ 
105
$ 
113
$ 
123
Appropriate portion of rental expense (2)
  
15
  
18
  
21
  
21
  
21
Capitalized interest
  
12
  
10
  
7
  
5
  
3
Total fixed charges
$ 
122
$ 
135
$ 
133
$ 
139
$ 
147
                     
Ratio of earnings (loss) to fixed charges
  
4.5x
  
4.5x
  
5.5x
  
6.5x
  
1.3x
                     
                     
(1)  
Because the Company is exiting the PET business in the European region, results related to sales of PET products manufactured at the Spain, the Netherlands, and United Kingdom sites are presented as discontinued operations for all periods presented.  For additional information, see Note 2, "Discontinued Operations", to the Company's consolidated financial statements in Part II, Item 8 of this 2008 Annual Report on Form 10-K.
 
(2)  
For all periods presented, the interest component of rental expense is estimated to equal one-third of such expense.
 

 
203