FERRO CORPORATION AND SUBSIDIARIES RATIO OF EARNINGS TO FIXED CHARGES
(dollars in thousands)
Three months ended
March 31,
2008
2007
2007
2006
2005
2004
2003
Earnings:
Income before income taxes
$
9,165
$
6,235
$
(109,318
)
$
26,441
$
27,173
$
33,369
$
11,391
Fixed charges
15,576
18,672
67,208
73,127
50,531
45,392
46,720
Minority interest & affiliate earnings
390
73
(420
)
(605
)
(603
)
(196
)
(1,178
)
Dividends from equity investees
—
—
1,485
1,590
1,069
5,292
1,358
Depreciation on interest capitalized
237
101
562
502
389
436
419
Less: Interest capitalization
(330
)
(71
)
(2,289
)
(1,763
)
(71
)
(214
)
(302
)
Total earnings
$
25,038
$
25,010
$
(42,772
)
$
99,292
$
78,488
$
84,079
$
58,408
Combined fixed charges and preferred stock dividends:
Interest expense
$
14,029
$
17,446
$
59,690
$
64,427
$
46,919
$
41,993
$
43,106
Interest capitalization
330
71
2,289
1,763
71
214
302
Amortization of discounts and capitalized expenses on debt
949
933
3,809
5,843
2,945
2,399
2,225
Interest portion of rental expense
268
222
1,420
1,094
596
786
1,087
Total fixed charges
15,576
18,672
67,208
73,127
50,531
45,392
46,720
Preferred stock dividends
227
286
1,035
1,252
1,490
1,705
2,088
Combined fixed charges and preferred stock dividends
$
15,803
$
18,958
$
68,243
$
74,379
$
52,021
$
47,097
$
48,808
Ratio of earnings to fixed charges:
Total earnings
$
25,038
$
25,010
$
(42,772
)
$
99,292
$
78,488
$
84,079
$
58,408
Divided by: Total fixed charges
$
15,576
$
18,672
$
67,208
$
73,127
$
50,531
$
45,392
$
46,720
Ratio of earning to fixed charges
1.61
1.34
—
1.36
1.55
1.85
1.25
Ratio of earnings to combined fixed charges and preferred stock dividends:
Total earnings
$
25,038
$
25,010
$
(42,772
)
$
99,292
$
78,488
$
84,079
$
58,408
Divided by: Combined fixed charges and preferred stock dividends
$
15,803
$
18,958
$
68,243
$
74,379
$
52,021
$
47,097
$
48,808
Ratio of earnings to combined fixed charges and preferred stock dividends
1.58
1.32
—
1.33
1.51
1.79
1.20
Notes:
Total earnings were insufficient to cover the fixed charges for the year 2007 by $110.0 million, and were insufficient to cover combined fixed charges for the year 2007 by $111.0 million, primarily due to non-cash impairment charges of $128.7 million. Accordingly, such ratios are not presented.
Fixed charges are equal to interest expense (including amortization of deferred financing costs and losses on sales of accounts receivable under the Company’s asset securitization program), plus the portion of rent expense estimated to represent interest. Losses on sales of accounts receivable under the Company’s asset securitization programs were $1.6 million and $1.8 million for the three months ended March 31, 2008 and 2007, respectively, and $7.0 million, $5.6 million, $3.9 million, $2.4 million and $1.4 million for the years ended December 31, 2007, 2006, 2005, 2004 and 2003, respectively.
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