EX-12.1 2 d231624dex121.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Computation of Ratio of Earnings to Fixed Charges

Exhibit 12.1

LAZARD LTD

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (a)

The following table sets forth the ratio of earnings to fixed charges for Lazard Ltd and its subsidiaries on a consolidated basis.

 

    Year Ended December 31,  
    2011     2010     2009     2008     2007  
   

(dollars in thousands)

 

Operating income (loss)

  $ 235,499      $ 243,650      $ (182,234   $ 25,140      $ 418,295   

Add—Fixed charges

    110,919        117,119        127,398        160,154        155,374   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss) before
fixed charges

  $ 346,418      $ 360,769      $ (54,836   $ 185,294      $ 573,669   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Fixed Charges:

         

Interest (b)

  $ 90,126      $ 97,709      $ 107,890      $ 139,899      $ 137,110   

Other (c)

    20,793        19,410        19,508        20,255        18,264   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total fixed charges

  $ 110,919      $ 117,119      $ 127,398      $ 160,154      $ 155,374   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Ratio of earnings to fixed charges

    3.12        3.08 (d)      (e)      1.16 (f)      3.69   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Deficiency in the coverage of operating income (loss) before fixed charges to total fixed charges

      $ 182,234       
     

 

 

     

 

Notes (dollars in thousands):

(a) For purposes of computing the ratio of earnings to fixed charges:

 

   

earnings for the years presented represent income before income taxes and fixed charges, and

 

   

fixed charges represent the interest expense and the portion of rental expense which represents an appropriate interest factor.

 

(b) The Company’s policy is to include interest expense on unrecognized tax benefits in income tax expense. Accordingly, such interest expense is not included in the computations of the ratio of earnings to fixed charges.

 

(c) Other fixed charges consist of the interest factor in rentals.

 

(d) Operating income for the year ended December 31, 2010 is presented after giving effect to (i) a restructuring charge of $87,108, (ii) a charge of $24,860 relating to the amendment of Lazard’s retirement policy with respect to RSU awards and (iii) benefits pursuant to the tax receivable agreement of $8,834 relating to the aforementioned items (see Notes 16, 18, and 19 of Notes to Consolidated Financial Statements). Excluding the impact of such items, the ratio of earnings to fixed charges would have been 3.96.

 

(e) Operating loss for the year ended December 31, 2009 is presented after giving effect to (i) a restructuring charge of $62,550, (ii) the acceleration of amortization expense of $86,514 relating to the vesting of RSUs held by Lazard’s former Chairman and Chief Executive Officer as the result of his death in October 2009 and (iii) the acceleration of amortization expense of $60,512 relating to the accelerated vesting of the unamortized portion of previously awarded deferred cash incentive awards (see Notes 16 and 18 of Notes to Consolidated Financial Statements). Excluding the impact of such items, the ratio of earnings to fixed charges would have been 1.21.

 

(f) Operating income for the year ended December 31, 2008 is presented after giving effect to a charge of $199,550 relating to the LAM Merger. Excluding the impact of such charge, the ratio of earnings to fixed charges would have been 2.40.