EX-12 8 y05567exv12.htm EX-12: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12
 

Exhibit 12

SCHERING-PLOUGH CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in millions)

                                         
    Years Ended December 31  
    2004     2003     2002     2001     2000  
(Loss)/Income Before Income Taxes
   $ (168 )   $ (46 )   $ 2,563     $ 2,523     $ 3,188  
Less: Equity Income
     347       54       —       —       —  
 
                              
(Loss)/Income Before Income Taxes and Equity Income
     (515 )     (100 )     2,563       2,523       3,188  
 
                                        
Add Fixed Charges:
                                        
Preference Dividends
     34       —       —       —       —  
Interest Expense
     168       81       28       40       44  
One-third of Rental Expense
     30       30       27       24       24  
Capitalized Interest
     20       11       24       25       20  
 
                              
Total Fixed Charges
     252       122       79       89       88  
 
                                        
Less: Capitalized Interest
     20       11       24       25       20  
Less: Preference Dividends
     34       —       —       —       —  
Add: Amortization of Capitalized Interest
     9       9       8       7       7  
Add: Distributed Income of Equity Investees
     228       32       —       —       —  
 
                              
 
                                        
(Loss)/Earnings Before Income Taxes and Fixed Charges (other than Capitalized Interest)
   $ (80 )   $ 52     $ 2,626     $ 2,594     $ 3,263  
 
                              
Ratio of Earnings to Fixed Charges
     (0.3 ) *   0.4       33.2       29.1       37.1  
 
                              

*For the year ended December 31,2004, earnings were insufficient to cover fixed charges by $332.

“Earnings” consist of (loss)/income before income taxes and equity income, plus fixed charges (other than capitalized interest and preference dividends), amortization of capitalized interest and distributed income of equity investee. “Fixed charges” consist of interest expense, capitalized interest, preference dividends and one-third of rentals which Schering-Plough believes to be a reasonable estimate of an interest factor on leases.