EX-12.1 5 a07-9124_1ex12d1.htm EX-12.1

EXHIBIT 12-1

 

 

SMURFIT STONE CONTAINER ENTERPRISES, INC.

CALCULATION OF HISTORICAL RATIOS OF EARNINGS TO FIXED CHARGES

(In millions)

 

 

 

Year Ended December 31,

 

 

 

2002

 

2003

 

2004

 

2005

 

2006

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations before income taxes and cumulative effect of accounting change

 

$

43

 

$

(346

)

$

(126

)

$

(619

)

$

(110

)

 

 

 

 

 

 

 

 

 

 

 

 

Add (deduct):

 

 

 

 

 

 

 

 

 

 

 

Interest expense (a)

 

357

 

341

 

343

 

347

 

344

 

Interest component of rental expense (c)

 

40

 

39

 

34

 

34

 

38

 

Undistributed (earnings) loss of owned affiliates

 

(5

)

(4

)

1

 

3

 

3

 

Amortization/Deprec of capitalized interest (d)

 

5

 

5

 

5

 

5

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings available for fixed charges

 

$

440

 

$

35

 

$

257

 

$

(230

)

$

280

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed charges:

 

 

 

 

 

 

 

 

 

 

 

Interest expense (a)

 

$

357

 

$

341

 

$

343

 

$

347

 

$

344

 

Capitalized interest

 

7

 

7

 

5

 

8

 

8

 

Interest component of rental expense (c)

 

40

 

39

 

34

 

34

 

38

 

 

 

 

 

 

 

 

 

 

 

 

 

Total combined fixed charges

 

$

404

 

$

387

 

$

382

 

$

389

 

$

390

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to fixed charges

 

1.09

 

(b)

 

(b)

 

(b)

 

(b)

 

(a)             Interest expense includes amortization of debt issuance cost of $9 million in 2002, $10 million in 2003, $11 million in 2004, $9 million in 2005 and $9 million in 2006.

(b)            Earnings were inadequate to cover combined fixed charges for 2003 through 2006 by $352 million, $125 million, $619 million and $110 million, respectively.

(c)             The interest component of rental expense was deemed to be one-fourth of lease rental expense.

(d)            The amortization/deprec of captialized interest was estimated as the average of capitalized interest from 2002-2006, multiplied by 75%.