EX-12 4 a08-18576_1ex12.htm EX-12

EXHIBIT 12

 

COMPUTATION OF RATIO OF INCOME FROM

CONTINUING OPERATIONS TO FIXED CHARGES

FOR SIX MONTHS ENDED JUNE 30,

(UNAUDITED)

 

(Dollars in millions)

 

2008

 

2007

 

 

 

 

 

 

 

Income from continuing operations before income taxes (1)

 

$

7,015

 

$

5,725

 

 

 

 

 

 

 

Add: Fixed charges, excluding capitalized interest

 

917

 

814

 

 

 

 

 

 

 

Income as adjusted before income taxes

 

$

7,932

 

$

6,539

 

 

 

 

 

 

 

Fixed charges:

 

 

 

 

 

Interest expense

 

$

714

 

$

597

 

Capitalized interest

 

8

 

3

 

Portion of rental expense representative of interest

 

203

 

217

 

 

 

 

 

 

 

Total fixed charges

 

$

925

 

$

817

 

 

 

 

 

 

 

Ratio of income from continuing operations to fixed charges

 

8.58

 

8.00

 

 

(1)          Income from continuing operations before income taxes excludes (a) amortization of capitalized interest and (b) the company’s share in the income and losses of less-than-fifty percent-owned affiliates.

 

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SEGMENT INFORMATION - ON CONTINUING OPERATIONS BASIS

(UNAUDITED)

 

 

 

Global Services

 

 

 

 

 

 

 

 

 

 

 

Global

 

Global

 

 

 

 

 

 

 

 

 

 

 

Technology

 

Business

 

Systems and

 

 

 

Global

 

Total

 

(Dollars in millions)

 

Services

 

Services

 

Technology

 

Software

 

Financing

 

Segments

 

Three Months Ended June 30, 2008:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

External revenue

 

$10,100

 

$5,107

 

$5,212

 

$5,574

 

$634

 

$26,626

 

Internal revenue

 

390

 

259

 

215

 

719

 

525

 

2,108

 

Total revenue

 

$10,489

 

$5,366

 

$5,427

 

$6,293

 

$1,159

 

$28,734

 

Pre-tax income

 

$994

 

$637

 

$400

 

$1,492

 

$428

 

$3,951

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue year-to-year change

 

14.5

%

15.0

%

1.3

%

18.2

%

23.5

%

12.9

%

Pre-tax income year-to-year change

 

26.2

%

31.2

%

20.7

%

19.4

%

28.7

%

24.0

%

Pre-tax income margin

 

9.5

%

11.9

%

7.4

%

23.7

%

36.9

%

13.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30, 2007:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

External revenue

 

$8,756

 

$4,338

 

$5,102

 

$4,777

 

$597

 

$23,571

 

Internal revenue

 

409

 

329

 

255

 

549

 

341

 

1,883

 

Total revenue

 

$9,165

 

$4,667

 

$5,357

 

$5,326

 

$938

 

$25,453

 

Pre-tax income

 

$788

 

$486

 

$332

 

$1,250

 

$332

 

$3,187

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-tax income margin

 

8.6

%

10.4

%

6.2

%

23.5

%

35.4

%

12.5

%

 

Reconciliations to IBM as Reported:

 

 

 

Three Months Ended

 

Three Months Ended

 

(Dollars in millions)

 

June 30, 2008

 

June 30, 2007

 

Revenue:

 

 

 

 

 

Total reportable segments

 

$

28,734

 

$

25,453

 

Eliminations/other

 

(1,915

)

(1,681

)

Total IBM Consolidated

 

$

26,820

 

$

23,772

 

 

 

 

 

 

 

Pre-tax income:

 

 

 

 

 

Total reportable segments

 

$

3,951

 

$

3,187

 

Eliminations/other

 

(138

)*

(46

)*

Total IBM Consolidated

 

$

3,814

 

$

3,142

 

 

*       Includes the gain from the divestiture of the company’s printing business and the interest expense associated with the debt to support the company’s accelerated share repurchase.

 

63


 

SEGMENT INFORMATION - ON CONTINUING OPERATIONS BASIS

(UNAUDITED)

 

 

 

Global Services

 

 

 

 

 

 

 

 

 

 

 

Global

 

Global

 

 

 

 

 

 

 

 

 

 

 

Technology

 

Business

 

Systems and

 

 

 

Global

 

Total

 

(Dollars in millions)

 

Services

 

Services

 

Technology

 

Software

 

Financing

 

Segments

 

Six Months Ended June 30, 2008:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

External revenue

 

$

19,777

 

$

10,018

 

$

9,431

 

$

10,421

 

$

1,266

 

$

50,913

 

Internal revenue

 

778

 

517

 

410

 

1,386

 

911

 

4,002

 

Total revenue

 

$

20,555

 

$

10,535

 

$

9,841

 

$

11,807

 

$

2,177

 

$

54,915

 

Pre-tax income

 

$

1,982

 

$

1,216

 

$

546

 

$

2,759

 

$

816

 

$

7,319

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue year-to-year change

 

15.2

%

15.1

%

(3.0

)%

16.2

%

14.5

%

11.6

%

Pre-tax income year-to-year change

 

34.9

%

27.3

%

27.5

%

20.7

%

15.6

%

25.2

%

Pre-tax income margin

 

9.6

%

11.5

%

5.5

%

23.4

%

37.5

%

13.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30, 2007:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

External revenue

 

$

17,013

 

$

8,521

 

$

9,622

 

$

9,028

 

$

1,211

 

$

45,397

 

Internal revenue

 

834

 

630

 

523

 

1,134

 

689

 

3,810

 

Total revenue

 

$

17,848

 

$

9,152

 

$

10,145

 

$

10,162

 

$

1,901

 

$

49,207

 

Pre-tax income

 

$

1,469

 

$

955

 

$

428

 

$

2,286

 

$

706

 

$

5,844

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pre-tax income margin

 

8.2

%

10.4

%

4.2

%

22.5

%

37.1

%

11.9

%

 

Reconciliations to IBM as Reported:

 

 

 

Six Months Ended

 

Six Months Ended

 

(Dollars in millions)

 

June 30, 2008

 

June 30, 2007

 

Revenue:

 

 

 

 

 

Total reportable segments

 

$

54,915

 

$

49,207

 

Eliminations/other

 

(3,593

)

(3,406

)

Total IBM Consolidated

 

$

51,322

 

$

45,801

 

 

 

 

 

 

 

Pre-tax income:

 

 

 

 

 

Total reportable segments

 

$

7,319

 

$

5,844

 

Eliminations/other

 

(307

)*

(124

)*

Total IBM Consolidated

 

$

7,012

 

$

5,721

 

 

*       Includes the gain from the divestiture of the company’s printing business and the interest expense associated with the debt to support the company’s accelerated share repurchase.

 

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