Exhibit 7.1
Computation of Ratio of Earnings to Fixed Charges
(CAD in millions) | Predecessor | Successor | ||||||||||||||||||||||
Year Ended | Year Ended | Ten Months Ended | Two Months Ended | Year Ended | Year Ended | |||||||||||||||||||
December 31 | December 31 | October 30 | December 31 | December 31 | December 31 | |||||||||||||||||||
2005 | 2006 | 2007 | 2007 | 2008 | 2009 | |||||||||||||||||||
Earnings: | ||||||||||||||||||||||||
Income (loss) from continuing operations before income taxes, equity in net losses of affiliates and minorityinterests | 141.4 | 125.7 | 138.8 | (66.2 | ) | (987.3 | ) | 419.0 | ||||||||||||||||
Pre-tax dividends requirements | (2.8 | ) | (2.3 | ) | - | (2.6 | ) | (14.8 | ) | (19.9 | ) | |||||||||||||
Fixed charges | 36.9 | 31.4 | 21.7 | 51.8 | 311.8 | 307.9 | ||||||||||||||||||
Amortization of capitalized interest | 15.0 | 11.9 | 8.9 | 2.4 | 13.8 | 17.0 | ||||||||||||||||||
Capitalized interest | (15.0 | ) | (12.2 | ) | (9.5 | ) | (5.4 | ) | (39.0 | ) | (19.4 | ) | ||||||||||||
Earnings adjusted for fixed charges | 175.5 | 154.5 | 159.9 | (20.0 | ) | (715.5 | ) | 704.6 | ||||||||||||||||
Fixed charges: | ||||||||||||||||||||||||
Pre-tax preferred dividends | 2.8 | 2.3 | - | 2.6 | 14.8 | 19.9 | ||||||||||||||||||
Interest expensed and capitalized, including amortization of capitalized expenses related to indebtedness | 29.5 | 24.6 | 18.1 | 47.5 | 286.8 | 279.4 | ||||||||||||||||||
Portion or rent expense representative of interest (1) | 4.6 | 4.5 | 3.6 | 1.7 | 10.2 | 8.6 | ||||||||||||||||||
Total fixed charges | 36.9 | 31.4 | 21.7 | 51.8 | 311.8 | 307.9 | ||||||||||||||||||
Ratio of earnings to fixed charges (2) | 4.8 | 4.9 | 7.4 | — | — | 2.3 | ||||||||||||||||||
(1) | One quarter of rent expense is deemed to be representative of interest. |
(2) | For purposes of calculating the ratio of earnings to fixed charges, earnings represent income from continuing operations before income taxes, less capitalized interest and pre-tax preferred dividends, plus amortization of capitalized interest and fixed charges. Fixed charges include interest expense (including amortization of debt issuance costs), pre-tax preferred dividends, capitalized interest and the portion of operating rental expense that our management believes is representative of the interest component of rent expense. The ratio of earnings to fixed charges is not presented for the two months ended December 31, 2007, and the year ended December 31, 2008 as the earnings were inadequate to cover fixed charges during those periods by $71.8 and $1,027.3 respectively. |