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MASCO CORPORATION
Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends
| (Dollars in Millions) | |||||||||||||||
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| Year Ended December 31, | | ||||||||||||||
| 2015 | 2014 | 2013 | 2012 | 2011 | |||||||||||
Earnings Before Income Taxes, Preferred Stock Dividends and Fixed Charges: | ||||||||||||||||
Income (loss) from continuing operations before income taxes | $ | 689 | $ | 507 | $ | 386 | $ | 155 | $ | (322 | ) | |||||
Deduct equity in undistributed (earnings) loss of fifty-percent-or-less-owned companies | (2 | ) | 2 | (16 | ) | — | (9 | ) | ||||||||
Add interest on indebtedness, net | 222 | 221 | 230 | 249 | 250 | |||||||||||
Add amortization of debt expense | 5 | 5 | 6 | 7 | 7 | |||||||||||
Add estimated interest factor for rentals | 19 | 33 | 31 | 31 | 33 | |||||||||||
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Earnings (loss) before income taxes, noncontrolling interest, fixed charges and preferred stock dividends | $ | 933 | $ | 768 | $ | 637 | $ | 442 | $ | (41 | ) | |||||
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Fixed Charges: | ||||||||||||||||
Interest on indebtedness | $ | 223 | $ | 221 | $ | 229 | $ | 248 | $ | 249 | ||||||
Amortization of debt expense | 5 | 5 | 6 | 7 | 7 | |||||||||||
Estimated interest factor for rentals | 19 | 33 | 31 | 31 | 33 | |||||||||||
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Total fixed charges | $ | 247 | $ | 259 | $ | 266 | $ | 286 | $ | 289 | ||||||
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Preferred stock dividends (a) | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||
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Combined fixed charges and preferred stock dividends | $ | 247 | $ | 259 | $ | 266 | $ | 286 | $ | 289 | ||||||
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Ratio of earnings to fixed charges | 3.8 | 3.0 | 2.4 | 1.5 | (0.1 | ) | ||||||||||
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Ratio of earnings to combined fixed charges and preferred stock dividends | 3.8 | 3.0 | 2.4 | 1.5 | (0.1 | ) | ||||||||||
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Ratio of earnings to combined fixed charges and preferred stock dividends excluding certain items(b) | 3.8 | 2.9 | 2.4 | 1.7 | 1.4 | |||||||||||
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- (a)
- Represents amount of income before provision for income taxes required to meet the preferred stock dividend requirements of the Company.
- (b)
- Excludes the 2014 litigation settlement income of $9 million; the 2012 non-cash, pre-tax impairment charge for other intangible assets of $42 million and litigation expense of $1 million; the 2011 non-cash, pre-tax impairment charge for goodwill and other intangible assets of $450 million and litigation expense of $9 million.
MASCO CORPORATION Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends