EX-12 2 exhibit12ratioofearningsto.htm COMPUTATION OF EARNINGS TO FIXED CHARGES Exhibit


EXHIBIT 12.

Computation of Earnings to Fixed Charges

Ratio of Earnings to Fixed Charges:
Nine Months Ended 
 September 30, 2018
 
Year Ended December 31,
Dollars in Millions
 
2017
 
2016
 
2015
 
2014
Earnings
 
 
 
 
 
 
 
 
 
Earnings from continuing operations before income taxes
$
4,463

 
$
5,131

 
$
5,915

 
$
2,077

 
$
2,381

Less:
 
 
 
 
 
 
 
 
 
Noncontrolling interest in pretax income/(loss) of
 
 
 
 
 
 
 
 
 
subsidiaries that have not incurred fixed charges
7

 
(63
)
 
16

 
51

 
38

Equity in net income of affiliates
73

 
75

 
77

 
83

 
107

Capitalized interest
15

 
15

 
10

 
2

 
3

Adjusted Income
4,368

 
5,104

 
5,812

 
1,941

 
2,233

Add:
 
 
 
 
 
 
 
 
 
Fixed charges
185

 
252

 
226

 
231

 
254

Distributed income of equity investments
73

 
98

 
99

 
105

 
153

Total Earnings
$
4,626

 
$
5,454

 
$
6,137

 
$
2,277

 
$
2,640

 
 
 
 
 
 
 
 
 
 
Fixed Charges
 
 
 
 
 
 
 
 
 
Interest expense
$
135

 
$
196

 
$
167

 
$
184

 
$
203

Capitalized interest
15

 
15

 
10

 
2

 
3

One-third of rental expense(a)
35

 
41

 
49

 
45

 
48

Total Fixed Charges
$
185

 
$
252

 
$
226

 
$
231

 
$
254

 
 
 
 
 
 
 
 
 
 
Ratio of Earnings to Fixed Charges
25.01

 
21.64

 
27.15

 
9.86

 
10.39


(a)
Rents included in the computation consist of one-third of rental expense which the Company believes to be a reasonable estimate of an interest factor in its leases.

E-12-1