EX-12 3 exhibit12.htm EXHIBIT 12 exhibit12.htm  
Exhibit 12

SOUTHERN UNION COMPANY
  
 
    
 
    
 
    
 
    
 
  
 
  
 
    
 
    
 
    
 
    
 
  
RATIO OF EARNINGS TO FIXED CHARGES
  
 
  
 
    
 
    
 
    
 
    
 
  
The following table sets forth the ratio of earnings to fixed charges for Southern Union on a historical basis for the years ended December 31, 2011, 2010, 2009, 2008 and 2007. For the purpose of calculating such ratios, “earnings” consist of pre-tax income from continuing operations before income or loss from equity investees, adjusted to reflect distributed income from equity investments, and fixed charges, less capitalized interest. “Fixed charges” consist of interest costs, amortization of debt discount, premiums and issuance costs and an estimate of interest implicit in rentals. No adjustment has been made to earnings for the amortization of capital interest for the periods presented as such amount is immaterial. Interest on FIN 48 liabilities is excluded from the computation of fixed charges as it is recorded by Southern Union in income tax expense versus interest expense.
  
 
  
 
    
 
    
 
    
 
    
 
  
 
  
Year Ended December 31,
  
 
  
2011
    
2010
    
2009
    
2008
    
2007
  
 
  
(In thousands)
  
FIXED CHARGES:
  
 
    
 
    
 
    
 
    
 
  
Interest Expense
   $ 213,159     $ 210,008     $ 191,022     $ 204,272     $ 202,403  
Net amortization of debt discount,
                                        
   premium and issuance expense
     6,073       6,657       5,778       3,136       743  
Capitalized Interest
     1,160       6,646       25,747       18,963       14,708  
Interest portion of rental expense
     6,972       6,685       7,576       6,386       6,645  
 
                                        
Total Fixed Charges
   $ 227,364     $ 229,996     $ 230,123     $ 232,757     $ 224,499  
 
                                        
EARNINGS:
                                        
Consolidated pre-tax income from
                                        
   continuing operations
   $ 359,204     $ 349,677     $ 251,480     $ 399,926     $ 323,970  
Earnings of equity investments
     (98,935 )     (105,415 )     (80,790 )     (75,030 )     (100,914 )
Distributed income from equity
                                        
   investments
     3,330       3,500       -       77,150       103,550  
Capitalized interest
     (1,160 )     (6,646 )     (25,747 )     (18,963 )     (14,708 )
Total fixed charges (from above)
     227,364       229,996       230,123       232,757       224,499  
 
                                        
Earnings Available for Fixed Charges
   $ 489,803     $ 471,112     $ 375,066     $ 615,840     $ 536,397  
 
                                        
 
                                        
Ratio of Earnings to Fixed Charges
     2.2       2.0       1.6       2.6       2.4