EX-12.1 3 h15047exv12w1.txt STATEMENT OF COMPUTATION OF RATIO OF EARNINGS 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)
QUARTER ENDED MARCH 31, ------------------- 2004 2003 2003 2002 -------- -------- ---------- ---------- EARNINGS Pretax income from continuing operations before preferred interests of subsidiaries........................................................... $547,343 $522,645 $1,930,925 $ 915,194 Add: Fixed charges excluding capitalized interest and preferred interest requirements of consolidated subsidiaries................................. 31,479 29,822 132,820 128,730 -------- -------- ---------- ---------- Adjusted Earnings............................................................ $578,822 $552,467 $2,063,745 $1,043,924 ======== ======== ========== ========== FIXED CHARGES AND PREFERRED STOCK DIVIDENDS Interest expense including capitalized interest (1).......................... $ 40,549 $ 37,696 $ 173,045 $ 155,667 Amortization of debt expense................................................. 567 531 2,163 1,859 Interest component of lease rental expenditures (2).......................... 4,013 2,827 14,458 11,895 Preferred interest requirements of consolidated subsidiaries (3)............. - 4,082 11,805 19,581 -------- -------- ---------- ---------- Fixed charges................................................................ 45,129 45,136 201,471 189,002 Preferred stock dividend requirements (4).................................... 2,226 2,361 9,968 17,540 -------- -------- ---------- ---------- Combined Fixed Charges and Preferred Stock Dividends......................... $ 47,355 $ 47,497 $ 211,439 $ 206,542 ======== ======== ========== ========== Ratio of Earnings to Fixed Charges.............................................. 12.83 12.24 10.24 5.52 ======== ======== ========== ========== Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends....... 12.22 11.63 9.76 5.05 ======== ======== ========== ========== 2001 2000 1999 ---------- ---------- -------- EARNINGS Pretax income from continuing operations before preferred interests of subsidiaries........................................................... $1,206,863 $1,203,681 $344,573 Add: Fixed charges excluding capitalized interest and preferred interest requirements of consolidated subsidiaries................................. 134,484 116,190 90,398 ---------- ---------- -------- Adjusted Earnings............................................................ $1,341,347 $1,319,871 $434,971 ========== ========== ======== FIXED CHARGES AND PREFERRED STOCK DIVIDENDS Interest expense including capitalized interest (1).......................... $ 178,915 $ 168,121 $132,986 Amortization of debt expense................................................. 2,460 2,726 4,854 Interest component of lease rental expenditures (2).......................... 9,858 7,343 5,789 Preferred interest requirements of consolidated subsidiaries (3)............. 8,608 - - ---------- ---------- -------- Fixed charges................................................................ 199,841 178,190 143,629 Preferred stock dividend requirements (4).................................... 32,495 33,386 24,788 ---------- ---------- -------- Combined Fixed Charges and Preferred Stock Dividends......................... $ 232,336 $ 211,576 $168,417 ========== ========== ======== Ratio of Earnings to Fixed Charges.............................................. 6.71 7.41 3.03 ========== ========== ======== Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends....... 5.77 6.24 2.58 ========== ========== ========
------------------ (1) The Company does not receive a tax benefit for $5 million of transaction costs written off to interest expense when the Company retired its preferred interests of subsidiaries in September 2003. Given the non-deductibility of the charge, $9 million of pre-tax income is required to cover the $5 million write-off. Accordingly, interest expense has been grossed up by $4 million. (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 to 34 percent applies for all periods presented. (3) The Company does not receive a tax benefit for a portion of its preferred interests of consolidated subsidiaries. As a result, these amounts represent the pre-tax earnings that would be required to cover preferred interests requirements of consolidated subsidiaries. (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 its preferred stock dividends.