Exhibit 12.1
Continental Resources, Inc.
Ratio of Earnings to Fixed Charges
(in thousands, except ratio)
Six Months Ended June 30, | Year Ended December 31, | |||||||||||||||||||||||||||||||
Pro forma | Historical | Pro forma | Historical | |||||||||||||||||||||||||||||
2012 | 2012 | 2011 | 2011 | 2010 | 2009 | 2008 | 2007 | |||||||||||||||||||||||||
Earnings | ||||||||||||||||||||||||||||||||
Income before income taxes | $ | 767,666 | $ | 767,666 | $ | 687,445 | $ | 687,445 | $ | 258,467 | $ | 110,008 | $ | 518,530 | $ | 296,777 | ||||||||||||||||
Plus: Fixed charges | 88,089 | 55,969 | 175,916 | 76,722 | 53,147 | 23,232 | 12,188 | 12,939 | ||||||||||||||||||||||||
Less: Capitalized interest | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Pro forma adjustments: | ||||||||||||||||||||||||||||||||
Plus : Reduction in revolver interest expense | 5,306 | — | 1,733 | — | — | — | — | — | ||||||||||||||||||||||||
Less: Interest expense on Senior Notes | (36,152 | ) | — | (97,736 | ) | — | — | — | — | — | ||||||||||||||||||||||
Less: Amortization of Senior Notes costs | (1,274 | ) | — | (3,191 | ) | — | — | — | — | — | ||||||||||||||||||||||
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Earnings, as defined | $ | 823,635 | $ | 823,635 | $ | 764,167 | $ | 764,167 | $ | 311,614 | $ | 133,240 | $ | 530,718 | $ | 309,716 | ||||||||||||||||
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Fixed charges | ||||||||||||||||||||||||||||||||
Interest expense | $ | 55,969 | $ | 55,969 | $ | 76,722 | $ | 76,722 | $ | 53,147 | $ | 23,232 | $ | 12,188 | $ | 12,939 | ||||||||||||||||
Capitalized interest | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Pro forma adjustments: | ||||||||||||||||||||||||||||||||
Less: Reduction in revolver interest expense | (5,306 | ) | — | (1,733 | ) | — | — | — | — | — | ||||||||||||||||||||||
Plus: Interest expense on Senior Notes | 36,152 | — | 97,736 | — | — | — | — | — | ||||||||||||||||||||||||
Plus: Amortization of Senior Notes costs | 1,274 | — | 3,191 | — | — | — | — | — | ||||||||||||||||||||||||
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Fixed charges, as defined | $ | 88,089 | $ | 55,969 | $ | 175,916 | $ | 76,722 | $ | 53,147 | $ | 23,232 | $ | 12,188 | $ | 12,939 | ||||||||||||||||
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Ratio of earnings to fixed charges | 9.4x | (1) | 14.7x | 4.3x | (1) | 10.0x | 5.9x | 5.7x | 43.5x | 23.9x | ||||||||||||||||||||||
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(1) | Because the net proceeds of the offering of the Old Notes were used to repay indebtedness and because of the increase in interest related to the Old Notes, our ratio of earnings to fixed charges changed by 10% or more. Earnings for the year ended December 31, 2011 and the six months ended June 30, 2012 covered fixed charges by $687.4 million and $767.7 million, respectively. After giving effect to the application of the net proceeds of the offering of the Old Notes and the offering of the Existing Notes, our pro forma ratio of earnings to fixed charges for the year ended December 31, 2011 and the six months ended June 30, 2012 would have been 4.3x and 9.4x, respectively. |