Exhibit 12
Black Hills Corporation
Computation of Ratio of Earnings to Fixed Charges
(Dollars in thousands)
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| Year ended December 31, |
| Nine Months Ended |
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| 2010 |
| 2011 |
| 2012 |
| 2013 |
| 2014 |
| 2015 |
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Ratio = Earnings/Fixed Charges |
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Earnings as defined by Regulation S-K |
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Income (loss) from continuing operations |
| $ | 67,361 |
| $ | 44,374 |
| $ | 109,417 |
| $ | 118,307 |
| $ | 130,889 |
| $ | (17,935 | ) |
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Add |
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Income Taxes |
| 24,508 |
| 20,445 |
| 60,219 |
| 63,040 |
| 66,625 |
| (14,640 | ) | ||||||
(Income) loss from equity investee |
| (1,559 | ) | (1,121 | ) | (10 | ) | 86 |
| 1 |
| 5,514 |
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Income (loss) from continuing operations before equity in earnings of subsidiaries and income tax |
| 90,310 |
| 63,698 |
| 169,626 |
| 181,433 |
| 197,515 |
| (27,061 | ) | ||||||
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Plus |
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Fixed Charges as Defined |
| 107,824 |
| 118,649 |
| 120,011 |
| 115,820 |
| 76,636 |
| 64,635 |
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Distributed income of equity investees |
| 2,444 |
| 2,197 |
| 261 |
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Less |
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Interest capitalized |
| (4,381 | ) | (11,260 | ) | (682 | ) | (1,061 | ) | (982 | ) | (1,037 | ) | ||||||
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Total Adjusted Earnings |
| $ | 196,197 |
| $ | 173,284 |
| $ | 289,216 |
| $ | 296,192 |
| $ | 273,169 |
| $ | 36,536 |
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Fixed Charges as defined in Regulation S-K |
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Interest expensed per SEC reports (includes amortization of deferred financing costs) |
| $ | 101,295 |
| $ | 105,424 |
| $ | 117,072 |
| $ | 112,918 |
| $ | 72,035 |
| $ | 60,796 |
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Interest capitalized |
| 4,381 |
| 11,260 |
| 682 |
| 1,061 |
| 982 |
| 1,037 |
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Total interest per SEC 10K 10Q |
| 105,676 |
| 116,684 |
| 117,754 |
| 113,979 |
| 73,017 |
| 61,833 |
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Estimate of interest within rental expense |
| 2,148 |
| 1,965 |
| 2,257 |
| 1,841 |
| 3,619 |
| 2,802 |
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Subtotal |
| 107,824 |
| 118,649 |
| 120,011 |
| 115,820 |
| 76,636 |
| 64,635 |
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Fixed Charges as Defined |
| $ | 107,824 |
| $ | 118,649 |
| $ | 120,011 |
| $ | 115,820 |
| $ | 76,636 |
| $ | 64,635 |
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Ratio of Earnings to Fixed Charges |
| 1.82 |
| 1.46 |
| 2.41 |
| 2.56 |
| 3.56 |
| 0.57 | (1) | ||||||
(1) Total adjusted earnings for the nine months ended September 30, 2015 include $178 million of a ceiling test impairment and, as a result, the ratio of earnings to fixed charges for the nine months ended September 30, 2015 is below 1.0. To achieve a ratio of 1.0, an additional $29 million of total adjusted earnings for the nine months ended September 30, 2015 would be needed.
