EX-12 2 a10-9787_1ex12.htm EX-12

EXHIBIT 12

 

3M COMPANY AND SUBSIDIARIES

CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES

(Millions)

 

 

 

Year

 

Year

 

Year

 

Year

 

Year

 

 

 

2009

 

2008

 

2007

 

2006

 

2005

 

EARNINGS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes*

 

$

4,632

 

$

5,108

 

$

6,115

 

$

5,625

 

$

4,817

 

 

 

 

 

 

 

 

 

 

 

 

 

Add:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense (including amortization of capitalized interest

 

236

 

231

 

229

 

139

 

112

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest component of the ESOP benefit expense

 

1

 

3

 

5

 

8

 

10

 

 

 

 

 

 

 

 

 

 

 

 

 

Portion of rent under operating leases representative of the interest component

 

76

 

77

 

70

 

70

 

64

 

 

 

 

 

 

 

 

 

 

 

 

 

Less:

 

 

 

 

 

 

 

 

 

 

 

Equity in undistributed income of 20-50% owned companies

 

4

 

6

 

5

 

6

 

4

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL EARNINGS AVAILABLE FOR FIXED CHARGES

 

$

4,941

 

$

5,413

 

$

6,414

 

$

5,836

 

$

4,999

 

 

 

 

 

 

 

 

 

 

 

 

 

FIXED CHARGES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on debt (including capitalized interest)

 

246

 

243

 

235

 

138

 

105

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest component of the ESOP benefit expense

 

1

 

3

 

5

 

8

 

10

 

 

 

 

 

 

 

 

 

 

 

 

 

Portion of rent under operating leases representative of the interest component

 

76

 

77

 

70

 

70

 

64

 

 

 

 

 

 

 

 

 

 

 

 

 

TOTAL FIXED CHARGES

 

$

323

 

$

323

 

$

310

 

$

216

 

$

179

 

 

 

 

 

 

 

 

 

 

 

 

 

RATIO OF EARNINGS TO FIXED CHARGES

 

15.3

 

16.8

 

20.7

 

27.0

 

27.9

 

*                 2009 results included net pre-tax charges of $194 million related to restructuring actions partially offset by a gain on sale of real estate. 2008 results included net pre-tax charges of $269 million, with charges related to restructuring actions, exit activities and a loss on sale of businesses partially offset by a gain on sale of real estate. 2007 results included pre-tax gains of $681 million, with net benefits from gains related to the sale of businesses and a gain on sale of real estate, which were partially offset by increases in environmental liabilities, restructuring actions, and exit activities. 2006 results included pre-tax gains of $523 million, with net benefits from gains related to the sale of certain portions of 3M’s branded pharmaceuticals business partially offset by restructuring actions, acquired in-process research and development expenses, settlement costs of a previously disclosed antitrust class action, and environmental obligations related to the pharmaceuticals business.