Exhibit 12
The Williams Companies, Inc.
Computation of Ratio of Earnings to Fixed Charges
Computation of Ratio of Earnings to Fixed Charges
Years Ended December 31, | ||||||||||||||||||||
2006 | 2005 | 2004 | 2003 | 2002 | ||||||||||||||||
(Dollars in millions) | ||||||||||||||||||||
Earnings: | ||||||||||||||||||||
Income (loss) from continuing operations before income taxes and cumulative effect of change in accounting principles | $ | 539.1 | $ | 531.3 | $ | 224.5 | $ | (62.8 | ) | $ | (908.7 | ) | ||||||||
Minority interest in income and preferred returns of consolidated subsidiaries | 40.0 | 25.7 | 21.4 | 19.4 | 41.8 | |||||||||||||||
Less: Equity earnings | (98.9 | ) | (65.6 | ) | (49.9 | ) | (20.3 | ) | (73.0 | ) | ||||||||||
Income from continuing operations before income taxes and cumulative effect of change in accounting principles, minority interest in income and preferred returns of consolidated subsidiaries and equity earnings | 480.2 | 491.4 | 196.0 | (63.7 | ) | (939.9 | ) | |||||||||||||
Add: | ||||||||||||||||||||
Fixed charges: | ||||||||||||||||||||
Interest accrued, including proportionate share from 50% owned investees | 700.4 | 684.7 | 838.5 | 1,298.3 | 1,172.4 | |||||||||||||||
Rental expense representative of interest factor | 15.5 | 19.2 | 19.7 | 26.7 | 23.8 | |||||||||||||||
Preferred distributions | — | — | — | 47.8 | 58.1 | |||||||||||||||
Total fixed charges | 715.9 | 703.9 | 858.2 | 1,372.8 | 1,254.3 | |||||||||||||||
Distributed income of equity-method investees | 113.0 | 107.7 | 60.5 | 21.5 | 81.3 | |||||||||||||||
Less: | ||||||||||||||||||||
Capitalized interest | (17.2 | ) | (7.2 | ) | (6.7 | ) | (45.5 | ) | (27.3 | ) | ||||||||||
Preferred distributions | — | — | — | (47.8 | ) | (58.1 | ) | |||||||||||||
Total earnings as adjusted | $ | 1,291.9 | $ | 1,295.8 | $ | 1,108.0 | $ | 1,237.3 | $ | 310.3 | ||||||||||
Fixed charges | 715.9 | 703.9 | $ | 858.2 | $ | 1,372.8 | $ | 1,254.3 | ||||||||||||
Ratio of earnings to fixed charges | 1.80 | 1.84 | 1.29 | (a | ) | (a | ) | |||||||||||||
(a) | Earnings were inadequate to cover fixed charges by $135.5 million for the year ended December 31, 2003, and $944.0 million for the year ended December 31, 2002. |