EXHIBIT 12
3M COMPANY AND SUBSIDIARIES
CALCULATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Millions)
| | 2007 | | 2006 | | 2005 | | 2004 | | 2003 | |
EARNINGS | | | | | | | | | | | |
Income before income taxes, minority interest, and cumulative effect of accounting change* | | $ | 6,115 | | $ | 5,625 | | $ | 4,828 | | $ | 4,303 | | $ | 3,448 | |
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Add: | | | | | | | | | | | |
| | | | | | | | | | | |
Interest expense | | 229 | | 139 | | 101 | | 88 | | 103 | |
| | | | | | | | | | | |
Interest component of the ESOP benefit expense | | 5 | | 8 | | 10 | | 12 | | 14 | |
| | | | | | | | | | | |
Portion of rent under operating leases representative of the interest component | | 70 | | 70 | | 64 | | 60 | | 53 | |
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Less: | | | | | | | | | | | |
Equity in undistributed income of 20-50% owned companies | | 5 | | 6 | | 4 | | 6 | | 7 | |
| | | | | | | | | | | |
TOTAL EARNINGS AVAILABLE FOR FIXED CHARGES | | $ | 6,414 | | $ | 5,836 | | $ | 4,999 | | $ | 4,457 | | $ | 3,611 | |
| | | | | | | | | | | |
FIXED CHARGES | | | | | | | | | | | |
Interest on debt | | 235 | | 138 | | 94 | | 78 | | 93 | |
| | | | | | | | | | | |
Interest component of the ESOP benefit expense | | 5 | | 8 | | 10 | | 12 | | 14 | |
| | | | | | | | | | | |
Portion of rent under operating leases representative of the interest component | | 70 | | 70 | | 64 | | 60 | | 53 | |
| | | | | | | | | | | |
TOTAL FIXED CHARGES | | $ | 310 | | $ | 216 | | $ | 168 | | $ | 150 | | $ | 160 | |
| | | | | | | | | | | |
RATIO OF EARNINGS TO FIXED CHARGES | | 20.7 | | 27.0 | | 29.8 | | 29.7 | | 22.6 | |
* 2007 results included pre-tax gains of $681 million, with net benefits from gains related to the sale of businesses and a gain on sale of real estate, which were partially offset by increases in environmental liabilities, restructuring actions, and other exit activities. 2006 results included pre-tax gains of $523 million, with net benefits from gains related to the sale of certain portions of 3M’s branded pharmaceuticals business partially offset by restructuring actions, acquired in-process research and development expenses, settlement costs of a previously disclosed antitrust class action, and environmental obligations related to the pharmaceuticals business. 2003 includes a $93 million pre-tax loss related to an adverse ruling associated with a lawsuit filed by LePage’s Inc.
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