EX-12 3 y08100exv12.txt COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Exhibit 12 SCHERING-PLOUGH CORPORATION AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (Dollars in millions) (unaudited)
Years Ended December 31 Three Months Ended March 31, 2005 2004 2003 2002 2001 2000 ---------- ---------- ---------- ---------- ---------- ---------- Income/(Loss) Before Income Taxes $ 191 $ (168) $ (46) $ 2,563 $ 2,523 $ 3,188 Less: Equity Income 220 347 54 -- -- -- ---------- ---------- ---------- ---------- ---------- ---------- (Loss)/Income Before Income Taxes and Equity Income (29) (515) (100) 2,563 2,523 3,188 Add Fixed Charges: Preference Dividends 22 34 -- -- -- -- Interest Expense 45 168 81 28 40 44 One-third of Rental Expense 9 30 30 27 24 24 Capitalized Interest 3 20 11 24 25 20 ---------- ---------- ---------- ---------- ---------- ---------- Total Fixed Charges 79 252 122 79 89 88 Less: Capitalized Interest 3 20 11 24 25 20 Less: Preference Dividends 22 34 -- -- -- -- Add: Amortization of Capitalized Interest 2 9 9 8 7 7 Add: Distributed Income of Equity Investees 18 228 32 -- -- -- ---------- ---------- ---------- ---------- ---------- ---------- Earnings/(Loss) Before Income Taxes and Fixed Charges (other than Capitalized Interest) $ 45 $ (80) $ 52 $ 2,626 $ 2,594 $ 3,263 ========== ========== ========== ========== ========== ========== Ratio of Earnings to Fixed Charges 0.6* (0.3)** 0.4** 33.2 29.1 37.1 ========== ========== ========== ========== ========== ==========
* For the three months ended March 31, 2005, earnings were insufficient to cover fixed charges by $34 million. ** For the years ended December 31, 2004 and 2003, earnings were insufficient to cover fixed charges by $332 million and $70 million, respectively. "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.