Exhibit 12.1
Computation of Ratio of Earnings to Fixed Charges and to Fixed Charges and Preference Dividends
| Year Ended December 31, | ||||||||||||
| 2016 | 2015 | 2014 | ||||||||||
(in thousands, except ratios): | ||||||||||||
Loss before income taxes | $ | (15,041 | ) | (14,712 | ) | (19,253 | ) | |||||
Interest expense | 1,818 | 3,240 | 5,466 | |||||||||
Rental expense attributable to interest | 4 | 5 | 3 | |||||||||
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Earnings | (13,219 | ) | (11,467 | ) | (13,784 | ) | ||||||
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Interest expense | $ | 1,818 | $ | 3,240 | $ | 5,466 | ||||||
Capitalized interest | — | — | — | |||||||||
Rental expense attributable to interest | 4 | 5 | 3 | |||||||||
Preferred stock dividends | — | — | — | |||||||||
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Fixed charges and preferred stock dividends | $ | 1,822 | $ | 3,245 | $ | 5,469 | ||||||
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Ratio of earnings to fixed charges (a) | (c) | (c) | (c) | |||||||||
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Ratio of earnings to fixed charges and preferred stock dividends (b) | (c) | (c) | (c) | |||||||||
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(a) The ratio has been computed by dividing earnings by fixed charges. For purposes of computing the ratio:
| • | earnings include income (loss) before income taxes, adjusted for interest expense and the portion of rental expense deemed to be representative of interest; and |
| • | fixed charges consist of interest expense, capitalized interest and the portion of rental expense deemed to be representative of interest. |
(b) The ratio has been computed by dividing earnings by fixed charges and preferred stock dividends. For purposes of computing the ratio:
| • | earnings include income (loss) before income taxes, adjusted for interest expense and the portion of rental expense deemed to be representative of interest; and |
| • | fixed charges and preferred stock dividends consist of interest expense, capitalized interest, the portion of rental expense deemed to be representative of interest and preferred stock dividends. |
(c) Due to Rosehill Operating’s loss before income taxes for the year ended December 31, 2016, 2015 and 2014, the ratio coverage was less than 1:1. To achieve ratio coverage of 1:1, the Company would have needed additional earnings of approximately $15.0 million, $14.7 million and $19.3 million for the year ended December 31, 2016, 2015 and 2014, respectively.
