Exhibit 12
M.D.C. HOLDINGS, INC.
RATIO OF (LOSS) EARNINGS TO FIXED CHARGES
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
June 30, | | | Six Months Ended
June 30, | | | Year Ended December 31, | |
| (dollars in 000's) | | 2011 | | | 2010 | | | 2011 | | | 2010 | | | 2010 | | | 2009 | | | 2008 | | | 2007 | | | 2006 | |
| | | | | | | | | |
(Loss) Earnings | | $ | (16,022 | ) | | $ | 14,182 | | | $ | (26,856 | ) | | $ | 8,463 | | | $ | (3,916 | ) | | $ | (28,481 | ) | | $ | (299,317 | ) | | $ | (688,767 | ) | | $ | 405,396 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fixed Charges | | $ | 19,077 | | | $ | 18,528 | | | $ | 37,263 | | | $ | 37,485 | | | $ | 76,792 | | | $ | 67,954 | | | $ | 68,570 | | | $ | 70,529 | | | $ | 80,915 | |
| | | | | | | | | |
(Loss) Earnings to Fixed Charges | | $ | (0.84 | ) | | $ | 0.77 | | | $ | (0.72 | ) | | $ | 0.23 | | | $ | (0.05 | ) | | $ | (0.42 | ) | | $ | (4.37 | ) | | $ | (9.77 | ) | | $ | 5.01 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
(Loss) Earnings: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Pretax (Loss) Earnings from Continuing Operations | | $ | (29,803 | ) | | $ | (3,699 | ) | | $ | (53,507 | ) | | $ | (24,941 | ) | | $ | (70,601 | ) | | $ | (107,335 | ) | | $ | (382,135 | ) | | $ | (756,464 | ) | | $ | 333,137 | |
| | | | | | | | | |
Add: Fixed Charges | | | 19,077 | | | | 18,528 | | | | 37,263 | | | | 37,485 | | | | 76,792 | | | | 67,954 | | | | 68,570 | | | | 70,529 | | | | 80,915 | |
Less: Capitalized Interest | | | (10,750 | ) | | | (8,849 | ) | | | (20,269 | ) | | | (15,485 | ) | | | (33,919 | ) | | | (19,810 | ) | | | (39,852 | ) | | | (57,791 | ) | | | (58,141 | ) |
Add: Amortization of Previously Capitalized Interest | | | 5,454 | | | | 8,202 | | | | 9,657 | | | | 11,404 | | | | 23,812 | | | | 30,710 | | | | 54,100 | | | | 54,959 | | | | 49,485 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total (Loss) Earnings | | $ | (16,022 | ) | | $ | 14,182 | | | $ | (26,856 | ) | | $ | 8,463 | | | $ | (3,916 | ) | | $ | (28,481 | ) | | $ | (299,317 | ) | | $ | (688,767 | ) | | $ | 405,396 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
Fixed Charges: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Corporate interest expense | | $ | 7,334 | | | $ | 9,309 | | | $ | 16,001 | | | $ | 19,604 | | | $ | 38,157 | | | $ | 38,131 | | | $ | 17,989 | | | $ | - | | | $ | - | |
Mortgage lending interest expense | | | 63 | | | | 127 | | | | 63 | | | | 206 | | | | 466 | | | | 451 | | | | 329 | | | | 1,581 | | | | 8,816 | |
Interest component of rent expense | | | 695 | | | | 722 | | | | 695 | | | | 1,499 | | | | 2,898 | | | | 3,257 | | | | 4,362 | | | | 7,109 | | | | 9,852 | |
Amortization and expensing of debt expenses | | | 235 | | | | (479 | ) | | | 235 | | | | 691 | | | | 1,352 | | | | 6,305 | | | | 6,038 | | | | 4,048 | | | | 4,106 | |
Capitalized interest | | | 10,750 | | | | 8,849 | | | | 20,269 | | | | 15,485 | | | | 33,919 | | | | 19,810 | | | | 39,852 | | | | 57,791 | | | | 58,141 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total Fixed Charges | | $ | 19,077 | | | $ | 18,528 | | | $ | 37,263 | | | $ | 37,485 | | | $ | 76,792 | | | $ | 67,954 | | | $ | 68,570 | | | $ | 70,529 | | | $ | 80,915 | |
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In computing the ratio of earnings to fixed charges, fixed charges consist of homebuilding and corporate interest expense, mortgage lending interest expense, interest component of rent expense, amortization and expensing of debt expenses and capitalized interest. Earnings are computed by adding fixed charges (except capitalized interest) and amortization of previously capitalized interest during the period to (loss) earnings before income taxes. For the three months ended March 31, 2011 and 2010, the Company generated losses which exceeded fixed charges of $19.2 million and $18.2 million, respectively. For the years ended December 31, 2010, 2009, 2008 and 2007, the Company generated losses which exceeded fixed charges of $76.8 million, $68.0 million, $68.6 million and $70.3 million, respectively.
