EX-12 2 l30298aexv12.htm EX-12 EX-12
 

EXHIBIT 12
CHEMED CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(in thousands, except ratios)
                                         
    2003     2004     2005     2006     2007  
Pretax income/ (loss) from continuing operations before equity in earnings/ (loss) of affiliate
   $ 16,446     $ 36,936     $ 54,656     $ 90,284     $ 101,838  
 
                                        
Additions:
                                        
Fixed charges
     4,800       28,597       30,738       24,055       31,720  
Amortization of capitalized interest
     —       1       2       4       4  
 
                                        
Deductions:
                                        
Capitalized interest
     —       (72 )     (380 )     (751 )     (951 )
 
                              
 
                                        
Adjusted income/ (loss)
   $ 21,246     $ 65,462     $ 85,016     $ 113,592     $ 132,611  
 
                              
 
                                        
Fixed Charges:
                                        
Interest expense
   $ 3,211     $ 21,167     $ 21,264     $ 17,468     $ 11,244  
Capitalized interest
     —       72       380       751       951  
Interest component of rental expense
     1,589       4,028       5,123       5,406       5,727  
Loss on extinguishment of debt (a), (b), (c), (d)
     —       3,330       3,971       430       13,798  
 
                              
 
                                        
Fixed charges
   $ 4,800     $ 28,597     $ 30,738     $ 24,055     $ 31,720  
 
                              
 
                                        
Ratio of earnings to fixed charges (e)
     4.4 x     2.3 x     2.8 x     4.7 x     4.2 x
 
                              
 
                                        
 
(a)   The year ended December 31, 2004 includes interest penalties related to the retirement of the Company’s 7.31% senior notes due 2005 through 2009.
 
(b)   The year ended December 31, 2005 includes interest penalties related to the retirement of the Company’s floating rate notes due 2010.
 
(c)   The year ended December 31, 2006 includes interest penalties related to the retirement of the Company’s $84.4 million term loan due 2009 . Refer to Note 2 in the Notes to Consolidated Financial Statements for further discussion.
 
(d)   The year ended December 31, 2007 includes interest penalties related to the retirement of the Company’s $150 million fixed rate notes due 2011. Refer to Note 2 in the Notes to Consolidated Financial Statements for further discussion.
 
(e)   For purposes of computing the ratio of earnings to fixed charges, pretax income/ (loss) from continuing operations before equity in earnings/ (loss) of affiliate has been added to fixed charges and adjusted for capitalized interest to derive adjusted income/ (loss). Fixed charges consist of interest expense on debt (including the amortization of deferred financing costs), capitalized interest, prepayment penalties on the early extinguishment of debt and one-third (the proportion deemed representative of the interest component) of rental expense. Fixed charge amounts include interest from both continuing and discontinued operations.