Exhibit 12
Dominion Resources Inc. and Subsidiaries
Computation of Ratio of Earnings to Fixed Charges
(millions of dollars)
| | | Years Ended
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| | | 2002
| | 2001 (a)
| | 2000 (b)
| | 1999
| | 1998
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Earnings, as defined: | | | | | | | | | | | | | | | |
Earnings before income taxes and minority interests in consolidated subsidiaries | | $ | 2,043.2 | | $ | 914.0 | | $ | 600.0 | | $ | 829.0 | | $ | 887.0 |
Distributed income from unconsolidated investees, less equity in earnings | | | 23.6 | | | 33.0 | | | 6.3 | | | | | | |
Fixed charges included in the determination of net income | | | 975.2 | | | 1,025.8 | | | 1,041.7 | | | 583.0 | | | 656.1 |
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Total earnings, as defined | | $ | 3,042.0 | | $ | 1,972.8 | | $ | 1,648.0 | | $ | 1,412.0 | | $ | 1,543.1 |
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Fixed charges, as defined: | | | | | | | | | | | | | | | |
Interest charges | | $ | 1,051.2 | | $ | 1,063.6 | | $ | 1,039.3 | | $ | 591.8 | | $ | 669.5 |
Rental interest factor | | | 26.7 | | | 18.8 | | | 18.2 | | | 8.0 | | | 6.0 |
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Total fixed charges, as defined | | $ | 1,077.9 | | $ | 1,082.4 | | $ | 1,057.5 | | $ | 599.8 | | $ | 675.5 |
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Ratio of Earnings to Fixed Charges | | | 2.82 | | | 1.82 | | | 1.56 | | | 2.35 | | | 2.28 |
(a) Earnings for the twelve months ended December 31, 2001 includes a one-time $220 million charge related to the buyout of power purchase contracts and non-utility generating plants previously serving the company under long-term contracts, a one-time $40 million charge associated with the divestiture of Saxon Capital, Inc., a $281 million charge from a write-down of Dominion Capital assets, a $151 million charge associated with Dominion’s estimated Enron exposure, and $105 million in restructuring charges associated with a senior management restructuring initiative announced in November and other restructuring costs. Excluding these items from the calculation above results in a ratio of earnings to fixed charges for the twelve months ended December 31, 2001 of 2.56x.
(b) Earnings for the twelve months ended December 31, 2000 includes $579 million in restructuring and other acquisition-related costs resulting from the CNG acquisition and a write-down at Dominion Capital, Inc. Dominion is required to divest its financial services business as a result of the acquisition of CNG. Excluding these items from the calculation above results in a ratio of earnings to fixed charges for the twelve months ended December 31, 2000 of 2.10x.
