Exhibit 12.1
| Terra Industries Inc. | ||||||||||||||||||||
| Ratio of earnings to fixed charges | ||||||||||||||||||||
| 2002 | 2003 | 2004 | 2005 | 2006 | ||||||||||||||||
| Earnings Income (loss) from continuing operations | (36,174 | ) | (12,481 | ) | 67,596 | 22,087 | 4,213 | |||||||||||||
| Income tax expense (benefit) | (24,000 | ) | (57,000 | ) | (5,000 | ) | 14,217 | 9,247 | ||||||||||||
| Earnings before income tax | (60,174 | ) | (69,481 | ) | 62,596 | 36,304 | 13,460 | |||||||||||||
| Add: | ||||||||||||||||||||
| Minority Interest Expense (Income) | 1,510 | (8,617 | ) | 11,207 | 13,667 | 11,286 | ||||||||||||||
| Equity Investee (Income) Loss | — | — | — | (21,415 | ) | (17,013 | ) | |||||||||||||
| Fixed Charges | 60,794 | 61,637 | 67,068 | 78,052 | 69,137 | |||||||||||||||
| Distributed income of equity investees | — | — | — | 46,375 | 35,875 | |||||||||||||||
| 62,304 | 53,020 | 78,275 | 116,679 | 99,285 | ||||||||||||||||
| Subtract: | ||||||||||||||||||||
| Preference Security and Preferred Dividends | 1,846 | 1,153 | 9,101 | 18,741 | 13,961 | |||||||||||||||
| TOTAL EARNINGS | 284 | (17,614 | ) | 131,770 | 134,242 | 98,784 | ||||||||||||||
| Fixed charges Interest expense | 53,800 | 55,072 | 53,134 | 53,478 | 47,991 | |||||||||||||||
| Preference Security Dividend (TNCLP) | 1,846 | 1,153 | 8,072 | 13,607 | 8,861 | |||||||||||||||
| Preferred dividends | — | — | 1,029 | 5,134 | 5,100 | |||||||||||||||
| 1/3 Rent expense on operating leases | 5,148 | 5,412 | 4,833 | 5,833 | 7,185 | |||||||||||||||
| 60,794 | 61,637 | 67,068 | 78,052 | 69,137 | ||||||||||||||||
| Ratio of earnings to fixed charges | 0.0 | (0.3 | ) | 2.0 | 1.7 | 1.4 | ||||||||||||||
| Dollar amount of excess (deficiency) | (60,510 | ) | (79,251 | ) | 64,702 | 56,190 | 29,647 | |||||||||||||
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED SHARE DIVIDEND REQUIREMENTS
(000’s)
(000’s)
| 2002 | 2003 | 2004 | 2005 | 2006 | ||||||||||||||||
EARNINGS | ||||||||||||||||||||
| Net income (loss) from continuing operations | $ | (36,174 | ) | $ | (12,481 | ) | $ | 67,596 | $ | 22,087 | $ | 4,213 | ||||||||
| Income tax expense (benefit) | (24,000 | ) | (57,000 | ) | (5,000 | ) | 14,217 | 9,247 | ||||||||||||
| Earnings (loss) before income taxes | (60,174 | ) | (69,481 | ) | 62,596 | 36,304 | 13,460 | |||||||||||||
| Minority interest expense (income) in consolidated subsidiaries | 1,510 | (8,617 | ) | 11,207 | 13,667 | 11,286 | ||||||||||||||
| Income (loss) of equity investments | — | — | — | (21,415 | ) | (17,013 | ) | |||||||||||||
| Fixed charges | 60,794 | 61,637 | 67,068 | 78,052 | 69,137 | |||||||||||||||
| Distributed income of equity investees | — | — | — | 46,375 | 35,875 | |||||||||||||||
| Less: preferred dividends | — | — | (1,029 | ) | (5,134 | ) | (5,100 | ) | ||||||||||||
| Less: preference security dividends of Terra Nitrogen Company, L.P. | (1,846 | ) | (1,153 | ) | (8,072 | ) | (13,607 | ) | (8,861 | ) | ||||||||||
TOTAL EARNINGS (LOSS) | $ | 284 | $ | (17,614 | ) | $ | 131,770 | $ | 134,242 | $ | 98,784 | |||||||||
FIXED CHARGES | ||||||||||||||||||||
| Interest expense | $ | 53,800 | $ | 55,072 | $ | 53,134 | $ | 53,478 | $ | 47,991 | ||||||||||
| One-third of rentals on operating leases | 5,148 | 5,412 | 4,833 | 5,833 | 7,185 | |||||||||||||||
| Preferred dividends | — | — | 1,029 | 5,134 | 5,100 | |||||||||||||||
| Preference security dividends of Terra Nitrogen Company, L.P. | 1,846 | 1,153 | 8,072 | 13,607 | 8,861 | |||||||||||||||
TOTAL FIXED CHARGES | $ | 60,794 | $ | 61,637 | $ | 67,068 | $ | 78,052 | $ | 69,137 | ||||||||||
EARNINGS EXCESS (DEFICIENCY) TO COVER FIXED CHARGES | $ | (60,510 | ) | $ | (79,251 | ) | $ | 64,702 | $ | 56,190 | $ | 29,647 | ||||||||
RATIO OF EARNINGS TOFIXED CHARGES AND PREFERRED DIVIDENDS | 0.0 | (0.3 | ) | 2.0 | 1.7 | 1.4 | ||||||||||||||