EX-12.1 2 y27155exv12w1.htm EX-12.1: STATEMENT OF COMPUTATION OF RATIOS EX-12.1
 

Exhibit 12.1
LORAL SPACE & COMMUNICATIONS INC.
COMPUTATION OF DEFICIENCY OF EARNINGS TO COVER FIXED CHARGES
(in thousands)
(unaudited)
                                                           
                                              Successor  
    Predecessor Registrant       Registrant  
                                    For the Period       For the Period     Nine Months  
                                    January 1, 2005       October 2, 2005     Ended  
    Years Ended December 31,     to October 1,       to December 31,     September 30,  
    2001     2002     2003     2004     2005 (3)       2005     2006  
Income (loss) from continuing operations before income taxes, equity income (losses) in affiliates, minority interest, cumulative effect of change in accounting principle and extraordinary gain on acquisition of minority interest
   $ (229,851 )   $ (237,540 )   $ (368,355 )   $ (207,852 )   $ (65,570 )     $ (5,395 )   $ 9,558  
 
                                                          
Plus fixed charges:
                                                          
Interest Cost
     139,197       51,185       28,223       3,904       3,982         4,408       19,773  
Interest component of rent expense (1)
     15,913       15,380       10,402       9,059       4,949         1,625       5,036  
 
                                                          
Less: Capitalized interest, net of amortization
     (5,114 )     (10,293 )     (14,143 )     (957 )     —         —       (1,068 )
 
                                            
 
                                                          
Earnings available to cover fixed charges
     (79,855 )     (181,268 )     (343,873 )     (195,846 )     (56,639 )       638       33,299  
 
                                            
 
                                                          
Fixed Charges(2)
     (235,853 )     (155,751 )     (45,345 )     (12,963 )     (8,931 )       (8,700 )     (58,201 )
 
                                            
 
                                                          
Deficiency of earnings to cover fixed charges
   $ (315,708 )   $ (337,019 )   $ (389,218 )   $ (208,809 )   $ (65,570 )     $ (8,062 )   $ (24,902 )
 
                                            
 
(1)   The interest component of rent expense is deemed to be approximately 25% of total rent expense.
 
(2)   Preferred dividends have not been adjusted for income taxes for the periods of 2001 to October 1, 2005, due to the composition of the taxing jurisdictions underlying our operations and the resulting impact on our effective tax rate. Fixed charges exclude the accrual of preferred dividends and interest on unsecured debt obligations (excluding bank debt) from July 15, 2003, the date of our Chapter 11 filing through November 21, 2005, the date we emerged from Chapter 11.
 
(3)   Does not reflect the effect of the gain on the discharge of pre-petition obligations and fresh-start adjustments, and the interest expense and income tax benefit recognized in connection with the Plan of Reorganization.