EX-12 4 dex12.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Computation of ratio of earnings to fixed charges

Exhibit 12

Humana Inc.

Computation of Ratio of Earnings to Fixed Charges

 

     For the year ended December 31,  
     2005     2004     2003     2002     2001  
     (Dollars in thousands)  

Income before income taxes

   $ 421,714     $ 415,850     $ 344,716     $ 209,934     $ 183,080  

Fixed charges

     66,434       49,246       40,972       44,349       52,010  
                                        

Total earnings

   $ 488,148     $ 465,096     $ 385,688     $ 254,283     $ 235,090  
                                        

Interest charged to expense

   $ 39,315     $ 23,172     $ 17,367     $ 17,252     $ 25,302  

One-third of rent expense

     27,119       26,074       23,605       27,097       26,708  
                                        

Total fixed charges

   $ 66,434     $ 49,246     $ 40,972     $ 44,349     $ 52,010  
                                        

Ratio of earnings to fixed charges (1)(2)

     7.3 x     9.4 x     9.4 x     5.7 x     4.5 x
                                        

Notes

 

  (1) For the purposes of determining the ratio of earnings to fixed charges, earnings consist of income or loss before income taxes and fixed charges. Fixed charges include gross interest expense, amortization of deferred financing expenses and an amount equivalent to interest included in rental charges. One-third of rental expense represents a reasonable approximation of the interest amount.
  (2) There are no shares of preferred stock outstanding.