EX-12 13 c86082exv12.txt STATEMENT RE: COMPUTATION OF RATIOS OF EARNINGS . . . EXHIBIT 12 EXTENDICARE HEALTH SERVICES, INC. RATIO OF EARNINGS TO FIXED CHARGES
PROFORMA -------------------------------------- ACTUAL FOR THREE 3 MONTHS 12 MONTHS MONTHS ENDED ENDED ENDED ------------------------------- MAR. 31 DEC. 31 MAR. 31 MAR. 31 2004 2003 2004 2003 ------- -------- -------- ------- Earnings before income taxes from continuing operations 17,454 41,923 14,986 3,828 Add: fixed charges 6,877 28,267 9,345 9,503 Add: Amortization of interest capitalized - - - - Less: interest capitalized (131) (75) (131) - ------------------------------------------------------------------------- Earnings before fixed charges 24,200 70,115 24,200 13,331 ========================================================================= Fixed charges: Interest expense (including amortization of deferred financing costs) 5,732 24,109 8,200 8,495 Interest capitalized 131 75 131 - Estimate of interest within lease expense 1,014 4,083 1,014 1,008 ------------------------------------------------------------------------- Total fixed charges 6,877 28,267 9,345 9,503 ========================================================================= Earnings to fixed charge ratio 3.52 2.48 2.59 1.40 ========================================================================= Dollar Amount Of The Deficiency (if less than 1:1 Ratio) not applic not applic not applic not applic ========================================================================= ESTIMATE OF INTEREST WITHIN RENT EXPENSE: ----------------------------------------- Lease expense 2,264 9,113 2,264 2,251 Multiplier 8 8 8 8 ------------------------------------------------------------------------- Value of rented equipment/assets 18,112 72,904 18,112 18,008 Lessors' equity assumed at 20% 3,622 14,581 3,622 3,602 ------------------------------------------------------------------------- Debt of lessor 14,490 58,323 14,490 14,406 Estimated interest rate 7.0% 7.0% 7.0% 7.0% ------------------------------------------------------------------------- Lessor financing charge 1,014 4,083 1,014 1,008 ------------------------------------------------------------------------- PROFORMA IMPACT OF DEBT OFFERING -------------------------------- Actual fixed charges 9,345 38,139 Interest savings from debt offering (2,468) (9,872) ------------------------------------ Proforma interest expense 6,877 28,267 ==================================== Earnings before fixed charges 14,986 32,051 Proforma adjustment to earnings 2,468 9,872 ------------------------------------ Proforma earnings before fixed charges 17,454 41,923 ====================================
ACTUAL FOR 12 MONTHS ENDED ---------------------------------------------------------------------------------- MAR. 31 DEC. 31 DEC. 31 DEC. 31 DEC. 31 DEC. 31 DEC. 31 2004 2003 2002 2001 2000 1999 1998 ------- ------- ------- ------- ------- ------- ------- Earnings before income taxes from continuing operations 43,209 32,051 6,337 (39,932) (82,346) (123,180) 109,252 Add: fixed charges 37,980 38,139 38,422 44,387 53,588 60,251 66,175 Add: Amortization of interest capitalized - - - - - - - Less: interest capitalized (206) (75) - - - (301) (1,099) --------------------------------------------------------------------------------- Earnings before fixed charges 80,983 70,115 44,759 4,455 (28,758) (63,230) 174,328 ================================================================================= Fixed charges: Interest expense (including amortization of deferred financing costs) 33,686 33,981 33,654 37,857 46,541 52,499 57,955 Interest capitalized 206 75 - - - 301 1,099 Estimate of interest within lease expense 4,088 4,083 4,768 6,530 7,047 7,451 7,121 --------------------------------------------------------------------------------- Total fixed charges 37,980 38,139 38,422 44,387 53,588 60,251 66,175 ================================================================================= Earnings to fixed charge ratio 2.13 1.84 1.16 0.10 (0.54) (1.05) 2.63 ================================================================================= Dollar Amount Of The Deficiency (if less than 1:1 Ratio) not applic not applic not applic 39,932 82,346 123,481 not applic ================================================================================= ESTIMATE OF INTEREST WITHIN RENT EXPENSE: ----------------------------------------- Lease expense 9,126 9,113 10,642 14,575 15,731 16,631 15,895 Multiplier 8 8 8 8 8 8 8 --------------------------------------------------------------------------------- Value of rented equipment/assets 73,008 72,904 85,136 116,600 125,848 133,048 127,160 Lessors' equity assumed at 20% 14,602 14,581 17,027 23,320 25,170 26,610 25,432 --------------------------------------------------------------------------------- Debt of lessor 58,406 58,323 68,109 93,280 100,678 106,438 101,728 Estimated interest rate 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% 7.0% --------------------------------------------------------------------------------- Lessor financing charge 4,088 4,083 4,768 6,530 7,047 7,451 7,121 ---------------------------------------------------------------------------------
EXTENDICARE HEALTH SERVICES, INC. PROFORMA INTEREST EXPENSE FOR 2003 ASSUMING REFINANCE OCCURRED ON JANUARY 1, 2003
UPDATED INTEREST BALANCE RATE EXPENSE ------- ---- ------- Actual Interest expense for 2003 33,981 Repay Senior Subordinated Notes due 2007 (200,000) 9.350% (18,700) Draw on line of credit - 4.300% - New Senior Subordinated Notes 121,875 7.229% 8,810 Amortization of deferred finance charges: Deduct: amortization on Senior Sub Notes due 2007 (643) Add: amortization on new Senior Sub Notes due 2014 661 -------------- Change in interest expense (9,872) -------------- -------------- Proforma interest expense for 2003 24,109 ==============
EXTENDICARE HEALTH SERVICES, INC. PROFORMA INTEREST EXPENSE FOR 2003 ASSUMING REFINANCE OCCURRED ON JANUARY 1, 2003
UPDATED INTEREST BALANCE RATE EXPENSE ------- ---- ------- Actual Interest expense for Q1-2004 8,200 Repay Senior Subordinated Notes due 2007 (200,000) 9.350% (4,675) Draw on line of credit - 4.300% - New Senior Subordinated Notes 121,875 7.229% 2,203 Amortization of deferred finance charges: Deduct: amortization on Senior Sub Notes due 2007 (161) Add: amortization on new Senior Sub Notes due 2014 165 ---------- Change in interest expense (2,468) ---------- ---------- Proforma interest expense for Q1-2004 5,732 ==========