EX-12.2 13 dex122.htm STATEMENT RE COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Statement re Computation of Ratio of Earnings to Fixed Charges

Exhibit 12.2

 

NEWMONT MINING CORPORATION AND SUBSIDIARIES

 

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(Amounts in thousands except ratio)

 

The ratio of earnings to fixed charges represents income before income taxes, interest expense and cumulative effect of changes in accounting principles, divided by interest expense. Interest expense includes amortization of capitalized interest and the portion of rent expense representative of interest. The Company guaranteed certain third party debt and, during 2003, expected to be required to pay certain amounts associated with such debt. Therefore, related interest on such guaranteed debt has been included in the ratio of earnings to fixed charges in 2003.

 

     Years Ended December 31,
  
     2004
    2003
     2002
    2001
     2000
  

Earnings:

                                       

Income (loss) before income taxes(1)

    $ 764,367    $ 752,208     $ 118,884    $ (128,425 )   $ (30,033 )

Adjustments:

                                       

Net interest expense(2)

      97,610      88,579       129,565      98,080       106,120  

QMC interest expense(3)

      —        2,579       —        —         —    

Amortization of capitalized interest

      15,976      9,152       9,526      7,362       8,793  

Portion of rental expense representative of interest

      4,367      3,465       3,017      2,747       2,936  

Income (loss) of affiliate

      2,641      (42,467 )     35,595      22,513       (17,930 )

Minority interest of majority owned subsidiaries

      335,299      173,178       97,442      65,374       92,814  
    
  
 
  
 
     $ 1,220,260    $ 986,694     $ 394,029    $ 67,651     $ 162,700  
    
  
 
  
 

Fixed Charges:

                                       

Net interest expense(1)

    $ 97,610    $ 88,579     $ 129,565    $ 98,080     $ 106,120  

Capitalized interest

      13,058      8,945       5,226      10,633       5,534  

Portion of rental expense representative of interest

      4,367      3,465       3,017      2,747       2,936  
    
  
 
  
 
     $ 115,035    $ 100,989     $ 137,808    $ 111,460     $ 114,590  
    
  
 
  
 

Ratio of earnings to fixed charges

      10.6      9.8       2.9      (4 )     1.4  
(1) Pre-tax income (loss) before minority interest, equity income (loss) and impairment of affiliates and cumulative effect of a change in accounting principle, net of minority interest in income of affiliates.
(2) Includes interest expense of majority-owned subsidiaries and amortization of debt issuance costs.
(3) Represents interest expense related to Newmont’s guarantee of QMC Finance Pty Ltd debt. This guarantee obligation was extinguished during 2004 (see Note 20).
(4) The ratio was less than 1:1 for the years ended December 31, 2001, as earnings were inadequate to cover fixed charges by deficiencies of $43.8 million.