EXHIBIT 12
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
STATEMENT RE: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
Year Ended December 31,
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1997 1998 1999 2000 2001 2002
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Income (loss) from continuing
operations before income taxes
(benefit), minority interest
and equity in earnings of and
interest earned from investments
in unconsolidated affiliates 164.8 156.8 265.7 157.5 (248.7) (171.1)
Add: Interest earned from investments in
unconsolidated affiliates 2.6 2.6 3.7 4.3 4.3 5.1
Add: Distributed earnings 33.1 23.8 88.5 228.0 37.6 18.5
Less: Equity in earnings (losses)
of venture capital investments 33.7 39.6 139.9 277.3 (84.5) (59.3)
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Income (loss) from continuing
operations before income taxes
(benefit), minority interest and
equity in earnings of
unconsolidated affiliates 166.8 143.6 218.0 112.5 (122.3) (88.2)
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Fixed Charges:
Interest expense 28.0 29.8 34.0 32.7 27.3 31.4
Rental expense 3.8 3.4 3.1 2.7 2.7 2.8
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Total fixed charges 31.8 33.2 37.1 35.4 30.0 34.2
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Income (loss) from continuing
operations before income taxes
(benefit), minority interest
and equity in earnings of
investments in unconsolidated
affiliates plus fixed charges 198.6 176.8 255.1 147.9 (92.3) (54.0)
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Ratio of earnings to fixed charges(a) 6.3 5.3 6.9 4.2 - -
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SUPPLEMENTAL RATIO - ratio of earnings to
fixed charges inclusive of interest
credited on policyholder contract
balances:
Income (loss) from continuing operations
before income taxes (benefit), minority
interest and equity in earnings of and
interest earned from
investments in unconsolidated affiliates 164.8 156.8 265.7 157.5 (248.7) (171.1)
Add: Interest earned from investments in
unconsolidated affiliates 2.6 2.6 3.7 4.3 4.3 5.1
Add: Distributed earnings 33.1 23.8 88.5 228.0 37.6 18.5
Less: Equity in earnings (losses) of
venture capital investments 33.7 39.6 139.9 277.3 (84.5) (59.3)
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Adjusted income (loss) from continuing
operations before income taxes (benefit),
minority interest and equity in earnings
of unconsolidated affiliates 166.8 143.6 218.0 112.5 (122.3) (88.2)
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Fixed Charges:
Interest expense 28.0 29.8 34.0 32.7 27.3 31.4
Rental expense 3.8 3.4 3.1 2.7 2.7 2.8
Interest credited on policyholder
contract balances 65.5 111.7 105.6 109.5 133.2 181.4
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Total fixed charges 97.3 144.9 142.7 144.9 163.2 215.6
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Adjusted income from continuing operations
before income taxes (benefit), minority
interest and equity in earnings of
investments in unconsolidated affiliates
plus fixed charges 264.1 288.5 360.7 257.4 40.9 127.4
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Ratio of earnings to fixed charges
including interest credited on
policyholder contract balances(b) 2.7 2.0 2.5 1.8 0.3 0.6
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For purposes of computing these ratios, earnings consist of income from continuing operations before income
taxes (benefit), minority interest and equity in earnings of investments in unconsolidated affiliates plus the
distributed income of equity investees and fixed charges. Fixed charges consist of interest expense and an
imputed interest component for rental expense.
(a) Due to our losses during 2001 and 2002, the ratio coverages for those periods were less than 1:1. We
would need $122.3 million in additional earnings for the year ended December 31, 2001 to achieve a 1:1
coverage ratio. For 2002, we would need $88.2 million in additional earnings to achieve a 1:1 coverage
ratio.
(b) Due to our loss during 2001, the ratio coverages, including interest credited on policyholder contract
balances, for those periods were less than 1:1. We would need $122.3 million in additional earnings for
the year ended December 31, 2001 to achieve a 1:1 coverage ratio. For 2002, we would need $88.9 million
in additional earnings to achieve a 1:1 coverage ratio.
