EXHIBIT 12.1 | ||||||||||||||||||||||||||||
The Dow Chemical Company and Subsidiaries | ||||||||||||||||||||||||||||
Computation of Ratio of Earnings to Fixed Charges and Combined Fixed Charges and Preferred Stock Dividend Requirements | ||||||||||||||||||||||||||||
Six Months Ended June 30 | For the Year Ended December 31 | |||||||||||||||||||||||||||
In millions, except ratio (Unaudited) | 2009 | 2008 | 2008 | 2007 | 2006 | 2005 | 2004 | |||||||||||||||||||||
Income (Loss) from Continuing Operations Before Income Taxes | $ | (684 | ) | $ | 2,271 | $ | 1,277 | $ | 4,192 | $ | 4,938 | $ | 6,363 | $ | 3,769 | |||||||||||||
Add (deduct): | ||||||||||||||||||||||||||||
Equity in earnings of nonconsolidated affiliates | (187 | ) | (525 | ) | (787 | ) | (1,122 | ) | (959 | ) | (964 | ) | (923 | ) | ||||||||||||||
Distributed income of earnings of nonconsolidated affiliates | 617 | 614 | 836 | 774 | 616 | 495 | 370 | |||||||||||||||||||||
Capitalized interest | (45 | ) | (51 | ) | (97 | ) | (85 | ) | (73 | ) | (56 | ) | (48 | ) | ||||||||||||||
Amortization of capitalized interest | 45 | 42 | 84 | 79 | 70 | 70 | 65 | |||||||||||||||||||||
Preferred security dividends | (20 | ) | (36 | ) | (63 | ) | (81 | ) | (77 | ) | (65 | ) | (54 | ) | ||||||||||||||
Adjusted earnings | $ | (274 | ) | $ | 2,315 | $ | 1,250 | $ | 3,757 | $ | 4,515 | $ | 5,843 | $ | 3,179 | |||||||||||||
Fixed charges: | ||||||||||||||||||||||||||||
Interest expense and amortization of debt discount | 679 | 296 | 648 | 584 | 616 | 702 | 747 | |||||||||||||||||||||
Capitalized interest | 45 | 51 | 97 | 85 | 73 | 56 | 48 | |||||||||||||||||||||
Preferred security dividends | 20 | 36 | 63 | 81 | 77 | 65 | 54 | |||||||||||||||||||||
Rental expense – interest component | 54 | 61 | 120 | 124 | 131 | 133 | 135 | |||||||||||||||||||||
Total fixed charges | $ | 798 | $ | 444 | $ | 928 | $ | 874 | $ | 897 | $ | 956 | $ | 984 | ||||||||||||||
Earnings available for the payment of fixed charges | $ | 524 | $ | 2,759 | $ | 2,178 | $ | 4,631 | $ | 5,412 | $ | 6,799 | $ | 4,163 | ||||||||||||||
Ratio of earnings to fixed charges (1) | - | 6.2 | 2.3 | 5.3 | 6.0 | 7.1 | 4.2 | |||||||||||||||||||||
Earnings required for combined fixed charges and preferred stock dividends: | ||||||||||||||||||||||||||||
Preferred stock dividends | $ | 142 | - | - | - | - | - | - | ||||||||||||||||||||
Adjustment to pretax basis (at 35 percent) | 76 | - | - | - | - | - | - | |||||||||||||||||||||
$ | 218 | $ | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||||
Combined fixed charges and preferred stock dividend requirements | $ | 1,016 | $ | 444 | $ | 928 | $ | 874 | $ | 897 | $ | 956 | $ | 984 | ||||||||||||||
Ratio of earnings to combined fixed charges and preferred stock dividend requirements (1) | - | 6.2 | 2.3 | 5.3 | 6.0 | 7.1 | 4.2 | |||||||||||||||||||||
(1) For the six month period ended June 30, 2009, the Company's earnings were insufficient to cover fixed charges by $274 million and insufficient to cover fixed charges and preferred stock dividend requirements by $492 million. The six month period ended June 30, 2009 included restructuring charges of $681 million, a one-time increase in cost of sales related to fair valuation of Rohm and Haas inventories of $209 million and acquisition-related costs of $134 million. |
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