Zoetis (ZTS) 10-Q 2015 Q3 Quarterly report

Exhibit 12

ZOETIS INC. AND SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES^(a) 

	Nine Months
	Ended
	September 27,		Year Ended December 31,
(IN MILLIONS, EXCEPT RATIOS)	2015		2014		2013			2012		2011		2010
Determination of earnings:
Income before provision for taxes on income
and noncontrolling interests	$	476	$	820	$	690		$	710	$	394	$	178
Less: Net income/(loss) attributable to noncontrolling interests	2		4		(1		)	—		3		1
Income attributable to Zoetis Inc.	474		816		691			710		391		177
Add: fixed charges	95		131		127			37		43		43
Total earnings as defined	$	569	$	947	$	818		$	747	$	434	$	220
Fixed charges:
Interest expense, net of capitalized interest(a)	$	86	$	117	$	113		$	31	$	36	$	37
Capitalized interest	3		4		3			—		—		—
Interest portion of rent expense(b)	6		10		11			6		7		6
Fixed charges	$	95	$	131	$	127		$	37	$	43	$	43
Ratio of earning to fixed charges	6.0		7.2		6.4			20.2		10.1		5.1

^(a)  Interest expense includes amortization of debt discount and fees. Interest expense does not include interest related to uncertain tax positions.

^(b)  One-third of all rental expense is deemed to be interest, which we believe to be a conservative estimate of an interest factor in our leases.