EX-12 5 file002.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

EXHIBIT 12

RITE AID CORPORATION AND SUBSIDIARIES

STATEMENT REGARDING COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

RATIO OF EARNINGS TO FIXED CHARGES

We have calculated the ratio of earnings to fixed charges in the following table by dividing earnings by fixed charges. For this purpose, earnings include pre-tax income from continuing operations plus fixed charges, before capitalized interest. Fixed charges include interest, whether expensed or capitalized, amortization of debt expense, preferred stock dividend requirement and that portion of rental expense which is representative of the interest factor in those rentals.


  Year Ended
(Dollar in thousand)
  February 28,
2004
(52 Weeks)
March 1,
2003
(52 Weeks)
March 2,
2002
(52 Weeks)
March 3,
2001
(53 Weeks)
February 26,
2000
(52 Weeks)
                               
Fixed charges:                              
Interest expense $ 313,498   $ 330,020   $ 396,064   $ 649,926   $ 542,028  
Interest portion of net rental expense (1)   184,391     189,528     181,493     159,247     148,669  
Fixed charges before capitalized interest and preferred stock dividend requirements   497,889     519,548     577,557     809,173     690,697  
Preferred stock dividend requirement (2)   37,074     49,540     42,354     42,445     15,554  
Capitalized interest   133     301     806     1,836     5,292  
Total fixed charges $ 535,096   $ 569,389   $ 620,717   $ 853,454   $ 711,543  
Earnings:                              
Income (loss) from continuing operations before income taxes, and cumulative effect of accounting change   34,584   $ (154,482 $ (837,385 $ (1,283,602 $ (1,129,036
Share of loss from equity method investees           12,092     36,675     15,181  
Preferred stock dividend requirement   (37,074   (49,540   (42,354   (42,445   (15,554
Fixed charges before capitalized interest   534,963     569,088     619,911     851,618     706,251  
Total adjusted earnings (loss)   532,473     365,066     (247,736   (437,754   (423,158
Earnings to fixed charges, deficiency $ (2,623 $ (204,323 $ (868,453 $ (1,291,208 $ (1,134,701
(1) The interest portion of net rental expense is estimated to be equal to one-third of the minimum rental expense for the period.
(2) The preferred stock divided requirement is computed as the pre-tax earnings that would be required to cover preferred stock dividends.