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, | Three Months Ended March 31, | |||||||||||||||||||||||||||||
2002 | 2003 | 2004 | 2005 | 2006 | 2006 | 2007 | ||||||||||||||||||||||||
TITLE | ||||||||||||||||||||||||||||||
A) | Earnings (loss) from continuing operations before income taxes and minority interest | $ | 174.0 | $ | 89.0 | $ | 376.0 | $ | 286.0 | $ | 3,188.0 | $ | (1,223.0 | ) | $ | 606.0 | ||||||||||||||
B) | Minority interest expense, net of taxes | (44.0 | ) | (79.0 | ) | (24.0 | ) | (9.0 | ) | (17.0 | ) | (4.8 | ) | (5.7 | ) | |||||||||||||||
C) | Fixed charges excluding capitalized interest | 987.7 | 943.8 | 859.7 | 752.0 | 724.5 | 190.7 | 127.9 | ||||||||||||||||||||||
D) | Amortization of previously capitalized interest | 42.6 | 40.8 | 40.3 | 39.2 | 34.8 | 9.8 | 7.5 | ||||||||||||||||||||||
E) | Equity in undistributed earnings of affiliates | 20.5 | 3.1 | (13.4 | ) | 9.7 | (5.8 | ) | (3.5 | ) | 6.6 | |||||||||||||||||||
F) | Earnings (loss) from continuing operations before income taxes and fixed charges | $ | 1,180.8 | $ | 997.7 | $ | 1,238.6 | $ | 1,077.9 | $ | 3,924.5 | $ | (1,030.8 | ) | $ | 742.3 | ||||||||||||||
Fixed Charges | ||||||||||||||||||||||||||||||
G) | Interest and amortization of debt expense | $ | 795.9 | $ | 801.8 | $ | 780.3 | $ | 680.8 | $ | 651.4 | $ | 171.1 | $ | 114.0 | |||||||||||||||
H) | Interest factor attributable to rentals | 76.8 | 74.9 | 63.9 | 61.2 | 60.2 | 16.6 | 14.1 | ||||||||||||||||||||||
I) | Preferred dividends of subsidiaries | 115.0 | 67.1 | 15.5 | 10.0 | 12.9 | 3.0 | (0.2 | ) | |||||||||||||||||||||
J) | Capitalized interest | 11.9 | 8.0 | 9.7 | 13.7 | 20.7 | 3.4 | 11.2 | ||||||||||||||||||||||
K) | Total fixed charges | $ | 999.6 | $ | 951.8 | $ | 869.4 | $ | 765.7 | $ | 745.2 | $ | 194.1 | $ | 139.1 | |||||||||||||||
L) | Ratio of earnings to fixed charges | 1.18 | 1.05 | 1.42 | 1.41 | 5.27 | 5.34 | |||||||||||||||||||||||
M) | Deficiency in earnings necessary to cover fixed charges | $ | (1,224.9 | ) | ||||||||||||||||||||||||||
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.