EX-12.1 20 h12863exv12w1.txt COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12.1 HANOVER COMPRESSOR COMPANY COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (AMOUNTS IN THOUSANDS OF DOLLARS, EXCEPT RATIO AMOUNTS)
YEAR ENDED DECEMBER 31, --------------------------------------------------- 2003(1) 2002(2) 2001 2000 1999 --------- -------- -------- -------- -------- Earnings: Income (loss) from continuing operations before income taxes.............. $(107,766) $(92,419) $112,000 $ 74,948 $ 60,463 Add: Interest on indebtedness and amortization of capitalized interest, debt expense and discount ................................................... 85,524 40,453 31,760 15,110 9,115 Leasing expense and the estimated interest factor attributable to rents... 49,881 96,863 71,347 46,132 22,486 Equity in income of non-consolidated affiliates in excess of distributions of income................................................. (4,637) (2,223) (9,350) (3,518) (1,188) --------- -------- -------- -------- -------- Earnings (loss) as adjusted............................................ $ 23,002 $ 42,674 $205,757 $132,672 $ 90,876 ========= ======== ======== ======== ======== Fixed charges: Interest on indebtedness, amortization of debt expense and discount and $ 86,033 $ 42,577 $ 34,250 $ 16,871 $ 10,597 capitalized interest.................................................... Leasing expense and the estimated interest factor attributable to rents... 49,881 96,863 71,347 46,132 22,486 --------- -------- -------- -------- -------- Total fixed charges.................................................... $ 135,914 $139,440 $105,597 $ 63,003 $ 33,083 ========= ======== ======== ======== ======== Ratio of earnings to fixed charges........................................ -- -- 1.95 2.11 2.75 ========= ======== ======== ======== ========
-------------- (1) Due to Hanover's loss for the year ended December 31, 2003, the ratio was less than 1:1. Hanover would have had to generate additional pre-tax earnings of $112.9 million to achieve coverage of 1:1. During the year, we recorded $250.6 million in pre-tax charges. For a description of these pre-tax charges, see footnote 21 in the notes to the consolidated financial statements included in Hanover's Annual Report on Form 10-K for the year ended December 31, 2003. (2) Due to Hanover's loss for the year ended December 31, 2002, the ratio was less than 1:1. Hanover would have had to generate additional pre-tax earnings of $96.8 million to achieve coverage of 1:1. During 2002, we recorded $182.7 million in pre-tax charges. For a description of these pre-tax charges, see footnote 27 in the notes to the consolidated financial statements included in Hanover's Annual Report on Form 10-K for the year ended December 31, 2002.