EXHIBIT 12
COMPUTATION OF RATIO OF INCOME FROM
CONTINUING OPERATIONS TO FIXED CHARGES
FOR SIX MONTHS ENDED JUNE 30,
(UNAUDITED)
(Dollars in millions) |
| 2004 |
| 2003 |
| ||
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|
|
| ||
Income from continuing operations before income taxes (1) |
| $ | 5,126 |
| $ | 4,442 |
|
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|
|
|
| ||
Add: Fixed charges, excluding capitalized interest |
| 514 |
| 571 |
| ||
|
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|
|
|
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Income as adjusted before income taxes |
| $ | 5,640 |
| $ | 5,013 |
|
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|
|
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Fixed charges: |
|
|
|
|
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Interest expense |
| $ | 281 |
| $ | 343 |
|
Capitalized interest |
| 3 |
| 9 |
| ||
Portion of rental expense representative of interest |
| 233 |
| 228 |
| ||
|
|
|
|
|
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Total fixed charges |
| $ | 517 |
| $ | 580 |
|
|
|
|
|
|
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Ratio of income from continuing operations to fixed charges |
| 10.91 |
| 8.64 |
|
(1) Income from continuing operations before income taxes excludes (a) amortization of capitalized interest and (b) the company’s share in the income and losses of less-than-fifty percent-owned affiliates.
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2
SEGMENT INFORMATION - ON CONTINUING OPERATIONS BASIS
(UNAUDITED)
|
|
|
| Hardware Segments |
| |||||
(Dollars in millions) |
| Global |
| Systems and |
| Personal |
| |||
Three Months Ended June 30, 2004: |
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|
|
| |||
|
|
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|
|
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External revenue |
| $ | 11,327 |
| $ | 4,154 |
| $ | 3,165 |
|
Internal revenue |
| 759 |
| 276 |
| 40 |
| |||
Total revenue |
| $ | 12,086 |
| $ | 4,430 |
| $ | 3,205 |
|
Pre-tax income (loss) |
| $ | 1,089 |
| $ | 603 |
| $ | 27 |
|
|
|
|
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|
|
|
| |||
Revenue year-to-year change |
| 6.7 | % | 11.4 | % | 15.8 | % | |||
Pre-tax income year-to-year change |
| (6.8 | )% | 151.3 | % | 437.5 | % | |||
Pre-tax income margin |
| 9.0 | % | 13.6 | % | 0.8 | % | |||
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Three Months Ended June 30, 2003: |
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| |||
|
|
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|
|
|
|
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External revenue |
| $ | 10,635 |
| $ | 3,786 |
| $ | 2,723 |
|
Internal revenue |
| 695 |
| 192 |
| 44 |
| |||
Total revenue |
| $ | 11,330 |
| $ | 3,978 |
| $ | 2,767 |
|
Pre-tax income (loss) |
| $ | 1,168 |
| $ | 240 |
| $ | (8 | ) |
|
|
|
|
|
|
|
| |||
Pre-tax income margin |
| 10.3 | % | 6.0 | % | (0.3 | )% |
Reconciliations to IBM as Reported:
(Dollars in millions) |
| Three Months Ended |
| Three Months Ended |
| ||
Revenue: |
|
|
|
|
| ||
Total reportable segments |
| $ | 24,845 |
| $ | 23,152 |
|
Eliminations/other |
| (1,692 | ) | (1,521 | ) | ||
Total IBM Consolidated |
| $ | 23,153 |
| $ | 21,631 |
|
|
|
|
|
|
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Pretax income: |
|
|
|
|
| ||
Total reportable segments |
| $ | 2,979 |
| $ | 2,459 |
|
Eliminations/other |
| (136 | ) | 7 |
| ||
Total IBM Consolidated |
| $ | 2,843 |
| $ | 2, 466 |
|
3
(Dollars in millions) |
| Software |
| Global |
| Enterprise |
| Total |
| ||||
Three Months Ended June 30, 2004: |
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External revenue |
| $ | 3,458 |
| $ | 652 |
| $ | 269 |
| $ | 23,025 |
|
Internal revenue |
| 457 |
| 286 |
| 2 |
| 1,820 |
| ||||
Total revenue |
| $ | 3,915 |
| $ | 938 |
| $ | 271 |
| $ | 24,845 |
|
Pre-tax income (loss) |
| $ | 958 |
| $ | 348 |
| $ | (46 | ) | $ | 2,979 |
|
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|
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|
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|
|
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Revenue year-to-year change |
| 1.4 | % | (5.1 | )% | 18.9 | % | 7.3 | % | ||||
Pre-tax income year-to-year change |
| 12.7 | % | 17.6 | % | 47.1 | % | 21.1 | % | ||||
Pre-tax income margin |
| 24.5 | % | 37.1 | % | (17.0 | )% | 12.0 | % | ||||
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Three Months Ended June 30, 2003: |
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External revenue |
| $ | 3,471 |
| $ | 681 |
| $ | 227 |
| $ | 21,523 |
|
Internal revenue |
| 390 |
| 307 |
| 1 |
| 1,629 |
| ||||
Total revenue |
| $ | 3,861 |
| $ | 988 |
| $ | 228 |
| $ | 23,152 |
|
Pre-tax income (loss) |
| $ | 850 |
| $ | 296 |
| $ | (87 | ) | $ | 2,459 |
|
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|
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|
|
|
|
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Pre-tax income margin |
| 22.0 | % | 30.0 | % | (38.2 | )% | 10.6 | % |
4
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|
| Hardware Segments |
| |||||
(Dollars in millions) |
| Global |
| Systems and |
| Personal |
| |||
Six Months Ended June 30, 2004: |
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|
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|
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|
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External revenue |
| $ | 22,426 |
| $ | 7,930 |
| $ | 5,991 |
|
Internal revenue |
| 1,521 |
| 512 |
| 63 |
| |||
Total revenue |
| $ | 23,947 |
| $ | 8,442 |
| $ | 6,054 |
|
Pre-tax income (loss) |
| $ | 2,080 |
| $ | 773 |
| $ | 16 |
|
|
|
|
|
|
|
|
| |||
Revenue year-to-year change |
| 7.9 | % | 13.0 | % | 16.6 | % | |||
Pre-tax income year-to-year change |
| (3.3 | )% | 84.5 | % | 120.8 | % | |||
Pre-tax income margin |
| 8.7 | % | 9.2 | % | 0.3 | % | |||
|
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Six Months Ended June 30, 2003: |
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|
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| |||
|
|
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|
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|
|
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External revenue |
| $ | 20,804 |
| $ | 7,094 |
| $ | 5,113 |
|
Internal revenue |
| 1,394 |
| 377 |
| 80 |
| |||
Total revenue |
| $ | 22,198 |
| $ | 7,471 |
| $ | 5,193 |
|
Pre-tax income (loss) |
| $ | 2,151 |
| $ | 419 |
| $ | (77 | ) |
|
|
|
|
|
|
|
| |||
Pre-tax income margin |
| 9.7 | % | 5.6 | % | (1.5 | )% |
Reconciliations to IBM as Reported:
(Dollars in millions) |
| Six Months Ended |
| Six Months Ended |
| ||
Revenue: |
|
|
|
|
| ||
Total reportable segments |
| $ | 48,656 |
| $ | 44,693 |
|
Eliminations/other |
| (3,253 | ) | (2,997 | ) | ||
Total IBM Consolidated |
| $ | 45,403 |
| $ | 41,696 |
|
|
|
|
|
|
| ||
Pretax income: |
|
|
|
|
| ||
Total reportable segments |
| $ | 5,305 |
| $ | 4,397 |
|
Eliminations/other |
| (172 | ) | 50 |
| ||
Total IBM Consolidated |
| $ | 5,133 |
| $ | 4,447 |
|
5
(Dollars in millions) |
| Software |
| Global |
| Enterprise |
| Total |
| ||||
Six Months Ended June 30, 2004: |
|
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|
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|
|
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|
|
|
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|
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|
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External revenue |
| $ | 6,924 |
| $ | 1,317 |
| $ | 544 |
| $ | 45,132 |
|
Internal revenue |
| 858 |
| 566 |
| 4 |
| 3,524 |
| ||||
Total revenue |
| $ | 7,782 |
| $ | 1,883 |
| $ | 548 |
| $ | 48,656 |
|
Pre-tax income (loss) |
| $ | 1,812 |
| $ | 722 |
| $ | (98 | ) | $ | 5,305 |
|
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|
|
|
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|
|
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Revenue year-to-year change |
| 5.5 | % | (5.1 | )% | 16.6 | % | 8.9 | % | ||||
Pre-tax income year-to-year change |
| 21.7 | % | 26.9 | % | 36.4 | % | 20.7 | % | ||||
Pre-tax income margin |
| 23.3 | % | 38.3 | % | (17.9 | )% | 10.9 | % | ||||
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Six Months Ended June 30, 2003: |
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|
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External revenue |
| $ | 6,600 |
| $ | 1,382 |
| $ | 468 |
| $ | 41,461 |
|
Internal revenue |
| 777 |
| 602 |
| 2 |
| 3,232 |
| ||||
Total revenue |
| $ | 7,377 |
| $ | 1,984 |
| $ | 470 |
| $ | 44,693 |
|
Pre-tax income (loss) |
| $ | 1,489 |
| $ | 569 |
| $ | (154 | ) | $ | 4,397 |
|
|
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|
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|
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Pre-tax income margin |
| 20.2 | % | 28.7 | % | (32.8 | )% | 9.8 | % |
6