Exhibit 12.1
INVESCO MORTGAGE CAPITAL INC. AND SUBSIDIARIES
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
The following table sets forth our ratio of earnings to combined fixed charges and preferred dividends for each of the periods presented. The ratio of earnings to combined fixed charges and preferred dividends was computed by dividing earnings by our combined fixed charges and preferred dividends. For purposes of calculating this ratio, “earnings” include pre-tax income from continuing operations before adjustment for income or loss from equity investees plus fixed charges. “Fixed charges” consist of interest on all indebtedness determined in accordance with GAAP. “Preferred dividends” consist of dividends paid on our issued and outstanding preferred stock.
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| | | Six Months
Ended
June 30,
2017 | | | Years Ended December 31, | |
| | | | 2016 | | | 2015 | | | 2014 | | | 2013 | | | 2012 | |
Net Income (Loss) | | $ | 147,252 | | | $ | 257,698 | | | $ | 114,055 | | | $ | (217,540 | ) | | $ | 157,474 | | | $ | 335,126 | |
Add: (Income) Loss from Equity Investees | | | 1,688 | | | | (2,392 | ) | | | (12,630 | ) | | | (6,786 | ) | | | (5,345 | ) | | | (7,169 | ) |
Less: Preferred Dividends | | | (11,432 | ) | | | (22,864 | ) | | | (22,864 | ) | | | (17,378 | ) | | | (10,851 | ) | | | (5,395 | ) |
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Adjusted Earnings | | | 137,508 | | | | 232,442 | | | | 78,561 | | | | (241,704 | ) | | | 141,278 | | | | 322,562 | |
Add: Fixed Charges | | | | | | | | | | | | | | | | | | | | | | | | |
Interest Expense | | | 82,479 | | | | 157,354 | | | | 277,973 | | | | 281,895 | | | | 332,252 | | | | 237,405 | |
Preferred Dividends | | | 11,432 | | | | 22,864 | | | | 22,864 | | | | 17,378 | | | | 10,851 | | | | 5,395 | |
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Total Combined Fixed Charges | | | 93,911 | | | | 180,218 | | | | 300,837 | | | | 299,273 | | | | 343,103 | | | | 242,800 | |
Total Earnings Available for Fixed Charges and Preferred Dividends | | $ | 231,419 | | | $ | 412,660 | | | $ | 379,398 | | | $ | 57,569 | | | $ | 484,381 | | | $ | 565,362 | |
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Ratio of Earnings to Combined Fixed Charges and Preferred Dividends | | | 2.5x | | | | 2.3x | | | | 1.3x | | | | * | | | | 1.4x | | | | 2.3x | |
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| * | Due to voluntary discontinuation of hedge accounting for our interest rate swap agreements effective December 31, 2013, the ratio was less than 1:1 for the year ended December 31, 2014. We would have needed to generate additional earnings before income taxes of $241,704 to achieve a coverage of 1:1. |
