EX-12.1 10 h98574exv12w1.txt COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12.1 APACHE CORPORATION STATEMENT OF COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES AND COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS (IN THOUSANDS)
SIX MONTHS ENDED JUNE 30, ------------------------- 2002 2001 2001 2000 ---------- ---------- ---------- ---------- EARNINGS Pretax income (loss) from continuing operations before preferred interests of subsidiaries .............................................. $ 372,778 $ 808,887 $1,206,863 $1,203,681 Add: Fixed charges excluding capitalized interest and preferred interest requirements of consolidated subsidiaries ..................... 65,041 71,198 134,484 116,190 ---------- ---------- ---------- ---------- Adjusted Earnings ........................................................ $ 437,819 $ 880,085 $1,341,347 $1,319,871 ========== ========== ========== ========== FIXED CHARGES AND PREFERRED STOCK DIVIDENDS Interest expense including capitalized interest(1) ....................... $ 78,333 $ 93,966 $ 178,915 $ 168,121 Amortization of debt expense ............................................. 800 1,034 2,460 2,726 Interest component of lease rental expenditures(2) ....................... 6,372 5,066 9,858 7,343 Preferred interest requirements of consolidated subsidiaries ............. 10,525(3) -- 8,608 -- ---------- ---------- ---------- ---------- Fixed charges ............................................................ 96,030 100,066 199,841 178,190 Preferred stock dividend requirements(4) ................................. 12,815 16,222 32,495 33,386 ---------- ---------- ---------- ---------- Combined Fixed Charges and Preferred Stock Dividends ..................... $ 108,845 $ 116,288 $ 232,336 $ 211,576 ========== ========== ========== ========== Ratio of Earnings to Fixed Charges .......................................... 4.56 8.80 6.71 7.41 ========== ========== ========== ========== Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends ... 4.02 7.57 5.77 6.24 ========== ========== ========== ========== 1999 1998 1997 ---------- ---------- ---------- EARNINGS Pretax income (loss) from continuing operations before preferred interests of subsidiaries .............................................. $ 344,573 $ (187,563) $ 258,640 Add: Fixed charges excluding capitalized interest and preferred interest requirements of consolidated subsidiaries ..................... 90,398 78,728 78,531 ---------- ---------- ---------- Adjusted Earnings ........................................................ $ 434,971 $ (108,835) $ 337,171 ========== ========== ========== FIXED CHARGES AND PREFERRED STOCK DIVIDENDS Interest expense including capitalized interest(1) ....................... $ 132,986 $ 119,703 $ 105,148 Amortization of debt expense ............................................. 4,854 4,496 6,438 Interest component of lease rental expenditures(2) ....................... 5,789 3,808 3,438 Preferred interest requirements of consolidated subsidiaries ............. -- -- -- ---------- ---------- ---------- Fixed charges ............................................................ 143,629 128,007 115,024 Preferred stock dividend requirements(4) ................................. 24,788 2,905 -- ---------- ---------- ---------- Combined Fixed Charges and Preferred Stock Dividends ..................... $ 168,417 $ 130,912 $ 115,024 ========== ========== ========== Ratio of Earnings to Fixed Charges .......................................... 3.03 --(5) 2.93 ========== ========== ========== Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends ... 2.58 --(5) 2.93 ========== ========== ==========
(1) Apache guaranteed and is contingently liable for certain debt. Fixed charges, relating to the debt for which Apache was contingently liable, have not been included in the fixed charges for any of the periods shown above. (2) Represents the portion of rental expense assumed to be attributable to interest factors of related rental obligations determined at interest rates appropriate for the period during which the rental obligations were incurred. Approximately 32 percent to 34 percent applies for all periods presented. (3) The $11 million represents the total amount required to cover the preferred interest requirements of consolidated subsidiaries of $9 million reported on the Statement of Consolidated Operations. The Company does not receive a tax benefit for a certain portion of preferred interest. Consequently, an additional $2 million of pre-tax earnings is required to cover these fixed charges. (4) The Company does not receive a tax benefit for its preferred stock dividends. As a result, this amount represents the pre-tax earnings that would be required to cover preferred stock dividends of $8 million. (5) Earnings were inadequate to cover fixed charges and combined fixed charges and preferred stock dividends by $237 million and $240 million, respectively, due to the $243 million write-down of the carrying value of United States oil and gas properties.