EX-12.1 6 y63600a1exv12w1.txt STATEMENT OF RATIOS OF EARNINGS TO FIXED CHARGES . . . Exhibit 12.1 Computation of Ratio of Earnings to Fixed Charges (Millions of dollars)
Years Ended December 31, ------------------------------------------------- 3/31/2003 2002 2001* 2000* 1999* 1998* --------- ---- ----- ----- ----- ----- (Qtr) EARNINGS: Income (loss) before taxes, minority interests, (6.3) (393.7) (246.6) 84.9 $(472.7) $329.9 equity in net earnings (losses) of affiliated companies, extraordinary item and cumulative effect of accounting change Amortization of previously capitalized interest expense 1.6 7.1 7.8 7.5 7.6 8.0 ------ ------ ------ ------ ------ ------ Earnings (loss) before fixed charges (4.7) (386.6) (238.8) 92.4 (465.1) 337.9 Gross fixed charges $ 37.7 $ 194.1 $235.0 $226.0 $ 126.2 $101.0 Less interest capitalized 0.1 -- (1.6) (4.5) (0.2) (1.9) ------ ------ ------ ------ ------ ------ Earnings (loss) $ 33.1 $(192.5) $ (5.4) $313.9 $(339.1) $437.0 ====== ====== ====== ====== ====== ====== FIXED CHARGES: Interest expense Expensed 31.6 161.8 215.7 209.6 116.8 90.6 Capitalized (0.1) -- 1.6 4.5 0.2 1.9 ------ ------ ------ ------ ------ ------ 31.5 161.8 217.3 214.1 117.0 92.5 Amortization of debt expenses, debt premiums and discounts 4.4 25.2 10.2 2.2 3.4 3.9 Portion of rental expense representative of interest factor 1.8 7.1 7.5 9.7 5.8 4.6 ------ ------ ------ ------ ------ ------ Total fixed charges 37.7 194.1 235.0 226.0 126.2 101.0 Preferred dividends 3.4 9.1 N/A N/A N/A N/A Combined fixed charges and preferred stock dividend ------ ------ ------ ------ ------ ------ requirements $ 41.1 $ 203.2 $235.0 $226.0 $ 126.2 $101.0 ====== ====== ====== ====== ====== ====== RATIO OF EARNINGS TO FIXED CHARGES 0.9 - (A) - (C) 1.4 - (E) 4.3 ====== ====== ====== ====== ====== ====== RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS 0.8 - (B) N/A N/A N/A N/A ====== ====== ====== ====== ====== ====== SUPPLEMENTAL INFORMATION TO INCORPORATE THE EFFECT OF SPECIAL ITEMS: EARNINGS: Income (loss) before taxes, minority interests, $ (6.3) $ (393.7) $(246.6) $ 84.9 $ (472.7) $329.9 equity in net earnings (losses) of affiliated companies, extraordinary item and cumulative effect of accounting change
Years Ended December 31, ------------------------------------------------- 3/31/2003 2002 2001* 2000* 1999* 1998* --------- ---- ----- ----- ----- ----- (Qtr) Special items and provisions, net (gains) (F) (1.9) 236.4 (40.6) 51.8 455.4 (190.9) Amortization of previously capitalized interest expense 1.6 7.1 7.8 7.5 7.6 8.0 ------ ------ ------ ------ ------ ------ Earnings (loss) before fixed charges (6.6) (150.2) (279.4) 144.2 (9.7) 147.0 Gross fixed charges 37.7 194.1 235.0 226.0 126.2 101.0 Less interest capitalized 0.1 -- (1.6) (4.5) (0.2) (1.9) ------ ------ ------ ------ ------ ------ Earnings (loss) $ 31.2 $ 43.9 $(46.0) $365.7 $ 116.3 $246.1 ====== ====== ====== ====== ====== ====== FIXED CHARGES: Interest expense Expensed 31.6 161.8 215.7 209.6 116.8 90.6 Capitalized (0.1) -- 1.6 4.5 0.2 1.9 ------ ------ ------ ------ ------ ------ 31.5 161.8 217.3 214.1 117.0 92.5 Amortization of debt expenses, debt premiums and discounts 4.4 25.2 10.2 2.2 3.4 3.9 Portion of rental expense representative of interest factor 1.8 7.1 7.5 9.7 5.8 4.6 ------ ------ ------ ------ ------ ------ Total fixed charges 37.7 194.1 235.0 226.0 126.2 101.0 Preferred dividends 3.4 9.1 N/A N/A N/A N/A Combined fixed charges and preferred stock dividend ------ ------ ------ ------ ------ ------ requirements $ 41.1 $ 203.2 $235.0 $226.0 $ 126.2 $101.0 ====== ====== ====== ====== ====== ====== RATIO OF EARNINGS TO FIXED CHARGES BEFORE SPECIAL ITEMS 0.8 0.2 - (D) 1.6 0.9 2.4 ====== ====== ====== ====== ====== ====== RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS BEFORE SPECIAL ITEMS 0.8 0.2 N/A N/A N/A N/A ====== ====== ====== ====== ====== ======
* Restated (A) Due to the loss recorded in 2002, the ratio coverage was less than 1:1. Phelps Dodge would have needed to generate additional earnings of $386.6 million to achieve a coverage of 1:1 in 2002. (B) Due to the loss recorded in 2002, the ratio coverage was less than 1:1. Phelps Dodge would have needed to generate additional earnings of $395.7 million to achieve a coverage of 1:1 in 2002. (C) Due to the loss recorded in 2001, the ratio coverage was less than 1:1. Phelps Dodge would have needed to generate additional earnings of $240.4 million to achieve a coverage of 1:1 in 2001. (D) Due to the loss recorded in 2001, the ratio coverage was less than 1:1. Phelps Dodge would have needed to generate additional earnings of $281.0 million to achieve a coverage of 1:1 in 2001. (E) Due to the loss recorded in 1999, the ratio coverage was less than 1:1. Phelps Dodge would have needed to generate additional earnings of $465.3 million to achieve a coverage of 1:1 in 1999. (F) As previously reported in the consolidated financial statements of the Company for the corresponding period. Phelps Dodge Corporation Schedule of Capitalized Interest Amortization
Reported in Financial Qtr Year Statements 1995 1996 1997 1998 1999 2000 2001 2002 3/31/2003 ---- ---------- ---- ---- ---- ---- ---- ---- ---- ---- --------- 1985 100 10 -- -- -- -- -- -- -- -- 1986 100 10 10 -- -- -- -- -- -- -- 1987 3,200 320 320 320 -- -- -- -- -- -- 1988 6,300 630 630 630 630 -- -- -- -- -- 1989 1,500 150 150 150 150 150 -- -- -- -- 1990 1,300 130 130 130 130 130 130 -- -- -- 1991 8,300 830 830 830 830 830 830 830 -- -- 1992 7,900 790 790 790 790 790 790 790 790 -- 1993 17,500 1,750 1,750 1,750 1,750 1,750 1,750 1,750 1,750 438 1994 20,700 2,070 2,070 2,070 2,070 2,070 2,070 2,070 2,070 518 1995 3,100 -- 310 310 310 310 310 310 310 78 1996 1,900 -- -- 190 190 190 190 190 190 48 1997 11,700 -- -- -- 1,170 1,170 1,170 1,170 1,170 293 1998 1,900 -- -- -- -- 190 190 190 190 48 1999 200 -- -- -- -- -- 20 20 20 5 2000 4,500 -- -- -- -- -- -- 450 450 113 2001 1,600 -- -- -- -- -- -- -- 160 40 2002 -- -- -- -- -- -- -- -- -- -- ----- ----- ----- ----- ----- ----- ----- ----- ----- 6,690 6,990 7,170 8,020 7,580 7,450 7,770 7,100 1,578
Analysis of Special Items
Qtr 3/31/2003 2002 2001 2000 1999 1998 --------- ----- ----- ----- ----- ----- Asset impairments -- 146.5 -- -- 332.3 -- Environmental provisions 1.3 14.0 31.1 -- 28.2 -- Restructuring costs -- 23.6 29.8 7.3 94.9 -- Restructuring reassessments -- -- -- -- -- -- Disposition of Accuride Corporation -- -- -- -- -- (198.7) Curtailment and indefinite closure provision -- 7.0 -- 44.5 -- -- Early retirement program -- -- -- -- -- 2.3 Disposition of MAPICO -- -- -- -- -- 5.5 Gain on sale of Sossego -- -- (39.9) -- -- -- Environmental insurance recoveries, net -- (34.3) (61.8) -- -- -- Settlement for legal loss contingency -- 1.0 (9.0) -- -- -- Hopkinsville facility write-down -- -- 3.3 -- -- -- Sale of non-core real estate -- (22.6) -- -- -- -- Historic lawsuit settlements -- 101.2 -- -- -- -- Termination of a foreign postretirement benefit plan (3.2) -- -- -- -- -- -- -- -- -- -- -- Other -- -- 5.9 -- -- -- ----- ----- ----- ----- ----- ----- (1.9) 236.4 (40.6) 51.8 455.4 (190.9)