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, | |||||||||||||||||||||||||||
TITLE | 2007 | 2008 | 2009 | 2010 | 2011 | 2011 | 2012 | |||||||||||||||||||||
A) Earnings (loss) from continuing operations before income taxes and equity earnings | $ | 1,654.0 | $ | (1,153.0 | )(1) | $ | 1,199.0 | (1) | $ | 822.0 | (1) | $ | 1,458.0 | (1) | $ | 368.0 | (1) | $ | 213.0 | (1) | ||||||||
B) Noncontrolling interests, net of taxes | (24.0 | ) | (3.0 | ) | (18.0 | ) | (21.0 | ) | (14.0 | ) | (5.0 | ) | (4.0 | ) | ||||||||||||||
C) Fixed charges excluding capitalized interest | 552.8 | 648.2 | 780.6 | 718.8 | 680.7 | 171.8 | 207.6 | |||||||||||||||||||||
D) Amortization of previously capitalized interest | 27.2 | 30.0 | 31.3 | 30.4 | 29.2 | 7.3 | 6.0 | |||||||||||||||||||||
E) Equity in undistributed earnings of affiliates | (10.7 | ) | 0 | (1) | 0 | (1) | 0 | (1) | 0 | (1) | 0 | (1) | 0 | (1) | ||||||||||||||
F) Distributed income of equity investees | 0 | 73.0 | 51.0 | 33.0 | 85.6 | 41.9 | 0 | |||||||||||||||||||||
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G) Earnings (loss) from continuing operations before income taxes and fixed charges | $ | 2,199.3 | $ | (404.8 | ) | $ | 2,043.9 | $ | 1,583.2 | $ | 2,239.5 | $ | 584.0 | $ | 422.6 | |||||||||||||
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Fixed Charges | ||||||||||||||||||||||||||||
H) Interest and amortization of debt expense | $ | 487.0 | $ | 572.5 | $ | 702.3 | $ | 643.4 | $ | 602.0 | $ | 150.1 | $ | 183.4 | ||||||||||||||
I) Interest factor attributable to rentals | 55.4 | 65.8 | 72.0 | 69.9 | 73.3 | 20.4 | 22.7 | |||||||||||||||||||||
J) Preferred dividends of subsidiaries | 10.4 | 9.9 | 6.3 | 5.5 | 5.4 | 1.3 | 1.5 | |||||||||||||||||||||
K) Capitalized interest | 29.9 | 27.5 | 12.1 | 14.0 | 21.6 | 3.6 | 6.1 | |||||||||||||||||||||
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L) Total fixed charges | $ | 582.7 | $ | 675.7 | $ | 792.7 | $ | 732.8 | $ | 702.3 | $ | 175.4 | $ | 213.7 | ||||||||||||||
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M) Ratio of earnings to fixed charges | 3.77 | 2.58 | 2.16 | 3.19 | 3.33 | 1.98 | ||||||||||||||||||||||
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N) Deficiency in earnings necessary to cover fixed charges | $ | (1,080.5 | ) | |||||||||||||||||||||||||
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(1) | Beginning in 2008, earnings from continuing operations are reported before equity earnings. Therefore, equity earnings are no longer adjusted out of the total in Line E. |
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.