Exhibit 12.1
Shea Homes Limited Partnership and Subsidiaries
Statement Re: Computation of Earnings to Fixed Charges
The following table sets forth information regarding our ratio of earnings to fixed charges for the periods shown. In calculating the ratio of earnings to fixed charges, earnings are calculated as (a) income (loss) before income taxes, excluding income (loss) from joint ventures, plus (b) fixed charges, plus (c) capitalized interest included in cost of sales, plus (d) distributed income of equity investees, minus (e) interest capitalized. Fixed charges are comprised of (a) interest incurred and (b) the portion of rental expense deemed to be representative of an interest factor. For the years ended December 31, 2010, 2009, 2008 and 2007, earnings were insufficient to cover fixed charges for each such year by $9.7 million, $350.8 million, $553.9 million and $401.4 million, respectively. For the nine months ended September 30, 2011 and 2010, earnings were insufficient to cover fixed charges for the period by $69.0 million and $21.4 million, respectively.
| Nine Months Ended September 30, | Fiscal Year Ended December 31, | |||||||||||||||||||||||||||
| 2011 | 2010 | 2010 | 2009 | 2008 | 2007 | 2006 | ||||||||||||||||||||||
| (In millions, except ratios) | ||||||||||||||||||||||||||||
Earnings: | ||||||||||||||||||||||||||||
(Loss) / income before income taxes, excluding equity in income (loss) from joint ventures | $ | (109,766 | ) | $ | (58,895 | ) | $ | (67,395 | ) | $ | (433,189 | ) | $ | (600,907 | ) | $ | (476,268 | ) | $ | 454,806 | ||||||||
Plus: | ||||||||||||||||||||||||||||
Fixed charges | 53,906 | 43,316 | 62,111 | 59,339 | 57,718 | 79,448 | 85,334 | |||||||||||||||||||||
Capitalized interest included in cost of sales | 27,014 | 31,541 | 48,782 | 81,729 | 46,064 | 46,632 | 60,913 | |||||||||||||||||||||
Distribution of earnings from Unconsolidated Joint Ventures | — | — | 400 | 630 | 937 | 28,198 | 7,066 | |||||||||||||||||||||
Less: | ||||||||||||||||||||||||||||
Interest capitalized | (40,164 | ) | (37,398 | ) | (53,553 | ) | (59,339 | ) | (57,718 | ) | (79,488 | ) | (85,334 | ) | ||||||||||||||
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Total earnings as calculated | (69,010 | ) | (21,436 | ) | (9,655 | ) | (350,830 | ) | (553,906 | ) | (401,438 | ) | 522,785 | |||||||||||||||
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Fixed charges: | ||||||||||||||||||||||||||||
Interest incurred | 53,906 | 43,316 | 62,111 | 59,339 | 57,718 | 79,488 | 85,334 | |||||||||||||||||||||
Portion of rental expense deemed to be representative of an interest factor | — | — | — | |||||||||||||||||||||||||
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Total fixed charges | $ | 53,906 | $ | 43,316 | $ | 62,111 | $ | 59,339 | $ | 57,718 | $ | 79,488 | $ | 85,334 | ||||||||||||||
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Ratio of earnings to fixed charges | — | — | — | — | — | — | 6.1x | |||||||||||||||||||||
