Exhibit 12
INTERNATIONAL PAPER COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
(Dollar amounts in millions)
(Unaudited)
For the Years Ended December 31, | Nine Months Ended September 30, | |||||||||||||||||||||||||||||
2001 | 2002 | 2003 | 2004 | 2005 | 2005 | 2006 | ||||||||||||||||||||||||
TITLE | ||||||||||||||||||||||||||||||
A) | Earnings (loss) from continuing operations before income taxes and minority interest | $ | (1,259.1 | ) | $ | 264.1 | $ | 198.1 | $ | 662.8 | $ | 530.1 | $ | 717.4 | $ | (719.0 | ) | |||||||||||||
B) | Minority interest expense, net of taxes | (144.0 | ) | (47.0 | ) | (83.5 | ) | (26.6 | ) | (12.4 | ) | (8.5 | ) | (14.5 | ) | |||||||||||||||
C) | Fixed charges excluding capitalized interest | 1,171.1 | 1,007.4 | 949.6 | 865.6 | 758.7 | 563.2 | 557.3 | ||||||||||||||||||||||
D) | Amortization of previously capitalized interest | 31.8 | 43.3 | 41.4 | 42.2 | 39.7 | 30.2 | 28.0 | ||||||||||||||||||||||
E) | Equity in undistributed earnings of affiliates | 14.1 | 20.3 | 2.9 | (13.4 | ) | 8.5 | 3.5 | (2.4 | ) | ||||||||||||||||||||
F) | Earnings (loss) from continuing operations before income taxes, and fixed charges | $ | (186.1 | ) | $ | 1,288.1 | $ | 1,108.5 | $ | 1,530.6 | $ | 1,324.6 | $ | 1,305.8 | $ | (150.6 | ) | |||||||||||||
Fixed Charges | ||||||||||||||||||||||||||||||
G) | Interest and amortization of debt expense | $ | 970.5 | $ | 811.5 | $ | 803.7 | $ | 782.2 | $ | 683.4 | $ | 507.3 | $ | 498.2 | |||||||||||||||
H) | Interest factor attributable to rentals | 71.7 | 80.9 | 78.8 | 67.9 | 65.3 | 48.6 | 49.5 | ||||||||||||||||||||||
I) | Preferred dividends of subsidiaries | 128.9 | 115.0 | 67.1 | 15.5 | 10.0 | 7.3 | 9.6 | ||||||||||||||||||||||
J) | Capitalized interest | 13.0 | 11.9 | 8.0 | 9.7 | 13.7 | 8.3 | 12.9 | ||||||||||||||||||||||
K) | Total fixed charges | $ | 1,184.1 | $ | 1,019.3 | $ | 957.6 | $ | 875.3 | $ | 772.4 | $ | 571.5 | $ | 570.2 | |||||||||||||||
L) | Ratio of earnings to fixed charges | 1.26 | 1.16 | 1.75 | 1.71 | 2.28 | ||||||||||||||||||||||||
M) | Deficiency in earnings necessary to cover fixed charges | $ | (1,370.2 | ) | $ | (720.8 | ) | |||||||||||||||||||||||
Note: Dividends on International Paper’s preferred stock are insignificant. As a result, for all periods presented, the ratios of earnings to fixed charges and preferred stock dividends are the same as the ratios of earnings to fixed charges.