EX-12 4 y83467exv12.txt COMPUTATION Exhibit 12 MERCK & CO., INC. AND SUBSIDIARIES Computation of Ratios of Earnings to Fixed Charges -------------------------------------------------- (In millions except ratio data)
Nine Months Ended September 30, Years Ended December 31, -------------------------------------------------------------------- 2002 2001 2000 1999 1998 1997 ---------- ----------- ----------- ---------- ---------- ---------- Income Before Taxes $ 7,513.8 $ 10,402.6 $ 9,824.1 $ 8,619.5 $ 8,133.1 $ 6,462.3 Add (Subtract): One-third of rents 62.0 77.7 67.0 66.7 56.4 46.6 Interest expense, gross 292.7 464.7 484.4 316.9 205.6 129.5 Interest capitalized, (28.0) (66.1) (99.0) (61.4) (36.9) (16.5) net of amortization Equity (income) loss from affiliates, (204.9) (113.8) (288.3) (352.7) 36.6 153.0 net of distributions Preferred stock dividends, net of tax 124.7 199.6 205.2 120.7 62.1 49.6 ---------- ----------- ----------- ---------- ---------- ---------- Earnings $ 7,760.3 $ 10,964.7 $ 10,193.4 $ 8,709.7 $ 8,456.9 $ 6,824.5 ========== =========== =========== ========== ========== ========== One-third of rents $ 62.0 $ 77.7 $ 67.0 $ 66.7 $ 56.4 $ 46.6 Interest expense, gross 292.7 464.7 484.4 316.9 205.6 129.5 Preferred stock dividends 178.1 285.1 293.1 172.4 88.7 70.9 ---------- ----------- ----------- ---------- ---------- ---------- Fixed Charges $ 532.8 $ 827.5 $ 844.5 $ 556.0 $ 350.7 $ 247.0 ========== =========== =========== ========== ========== ========== Ratio of Earnings to Fixed Charges 15 13 12 16 24 28 == == == == == ==
For purposes of computing these ratios, "earnings" consist of income before taxes, one-third of rents (deemed by the Company to be representative of the interest factor inherent in rents), interest expense, net of amounts capitalized, equity income (loss) from affiliates, net of distributions, and dividends on preferred stock of subsidiary companies. "Fixed charges" consist of one-third of rents, interest expense as reported in the Company's consolidated financial statements and dividends on preferred stock of subsidiary companies. We have corrected these ratios from those previously reported to reflect primarily (i) certain deductions from earnings from affiliates and (ii) the implied tax effect on preferred stock dividends paid by Merck.