EX-12.1 3 dex121.htm RATIO OF EARNINGS TO FIXED CHARGES Ratio of Earnings to Fixed Charges
EXHIBIT 12.1
 
DAVITA INC.
 
RATIO OF EARNINGS TO FIXED CHARGES
 
The ratio of earnings to fixed charges is computed by dividing earnings by fixed charges. Earnings for this purpose are defined as pretax income from continuing operations adjusted by adding fixed charges other than interest capitalized during the period. Fixed charges are defined as the total of debt interest, amortization of financing costs, and the estimated interest component of rental expense on operating leases.
 
    
Nine months ended September 30, 2002

 
Year ended December 31,

      
2001

 
2000

 
1999

    
1998

 
1997

Earnings adjusted for fixed charges:
                                       
Income (loss) before income taxes, extraordinary items and cumulative effect of a change in accounting principle
  
$
216,776
 
$
240,938
 
$
44,935
 
$
(181,826
)
  
$
48,641
 
$
81,178
Add:
                                       
Interest expense and amortization of financing costs
  
 
52,178
 
 
72,438
 
 
116,637
 
 
110,797
 
  
 
84,003
 
 
29,082
Interest portion of rental expense
  
 
15,100
 
 
18,116
 
 
17,140
 
 
17,501
 
  
 
12,992
 
 
8,196
    

 

 

 


  

 

    
 
67,278
 
 
90,554
 
 
133,777
 
 
128,298
 
  
 
96,995
 
 
37,278
    

 

 

 


  

 

Earnings (loss) before income taxes, extraordinary items, cumulative effect of a change in accounting principle and fixed charges
  
$
284,054
 
$
331,492
 
$
178,712
 
$
(53,528
)
  
$
145,636
 
$
118,456
    

 

 

 


  

 

Fixed charges:
                                       
Interest expense and amortization of financing costs
  
 
52,178
 
 
72,438
 
 
116,637
 
 
110,797
 
  
 
84,003
 
 
29,082
Capitalized interest
  
 
1,261
 
 
751
 
 
1,125
 
 
709
 
  
 
804
 
 
685
Interest portion of rental expense
  
 
15,100
 
 
18,116
 
 
17,140
 
 
17,501
 
  
 
12,992
 
 
8,196
    

 

 

 


  

 

Total fixed charges
  
$
68,539
 
$
91,305
 
$
134,902
 
$
129,007
 
  
$
97,799
 
$
37,963
    

 

 

 


  

 

Ratio of earnings to fixed charges
  
 
4.14
 
 
3.63
 
 
1.32
 
 
(a
)
  
 
1.49
 
 
3.12
    

 

 

 


  

 


(a)
 
Due to the Company’s loss in 1999, the ratio coverage was less than 1:1. The Company would have had to generate additional earnings of $182,535 to achieve a coverage ratio of 1:1.