Exhibit 12
MASCO CORPORATION
Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends
(Dollars in Millions) | ||||||||||||||||||||
Year Ended December 31, | ||||||||||||||||||||
2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||
Earnings Before Income Taxes, Preferred Stock Dividends and Fixed Charges: | ||||||||||||||||||||
Income (loss) from continuing operations before income taxes | $ | 73 | $ | (392 | ) | $ | (745 | ) | $ | (151 | ) | $ | (145 | ) | ||||||
Deduct equity in undistributed (earnings) of fifty-percent-or-less-owned companies | — | — | — | — | (1 | ) | ||||||||||||||
Add interest on indebtedness, net | 249 | 250 | 249 | 224 | 228 | |||||||||||||||
Add amortization of debt expense | 7 | 7 | 7 | 5 | 4 | |||||||||||||||
Add estimated interest factor for rentals | 31 | 33 | 36 | 44 | 51 | |||||||||||||||
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Earnings (loss) before income taxes, noncontrolling interest, fixed charges and preferred stock dividends | $ | 360 | $ | (102 | ) | $ | (453 | ) | $ | 122 | $ | 137 | ||||||||
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Fixed Charges: | ||||||||||||||||||||
Interest on indebtedness | $ | 248 | $ | 249 | $ | 246 | $ | 221 | $ | 228 | ||||||||||
Amortization of debt expense | 7 | 7 | 7 | 5 | 4 | |||||||||||||||
Estimated interest factor for rentals | 31 | 33 | 36 | 44 | 51 | |||||||||||||||
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Total fixed charges | $ | 286 | $ | 289 | $ | 289 | $ | 270 | $ | 283 | ||||||||||
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Preferred stock dividends (a) | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||
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Combined fixed charges and preferred stock dividends | $ | 286 | $ | 289 | $ | 289 | $ | 270 | $ | 283 | ||||||||||
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Ratio of earnings to fixed charges | 1.3 | (0.4 | ) | (1.6 | ) | 0.5 | 0.5 | |||||||||||||
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Ratio of earnings to combined fixed charges and preferred stock dividends | 1.3 | (0.4 | ) | (1.6 | ) | 0.5 | 0.5 | |||||||||||||
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Ratio of earnings to combined fixed charges and preferred stock dividends excluding certain items(b) | 1.7 | 1.2 | 1.0 | 1.5 | 2.2 | |||||||||||||||
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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 2012 non-cash, pre-tax impairment charge for other intangible assets of $42 million and litigation expense of $77 million; the 2011 non-cash, pre-tax impairment charge for goodwill and other intangible assets of $450 million and litigation expense of $9 million; the 2010 non-cash, pre-tax impairment charge for goodwill and other intangible assets of $698 million and non-cash, pre-tax impairment charge for financial investments of $34 million; the 2009 non-cash, pre-tax impairment charge for goodwill of $262 million; non-cash, pre-tax impairment charge for financial investments of $10 million and litigation expense of $7 million; and the 2008 non-cash, pre-tax impairment charge for goodwill and other intangible assets of $415 million, financial investments of $58 million and litigation expense of $9 million. |