Exhibit 12
PFIZER INC. AND SUBSIDIARY COMPANIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
Year Ended December 31, | |||||||||||||||
(in millions, except ratios) | 2008 | 2007 | 2006 | 2005 | 2004 | ||||||||||
Determination of earnings: | |||||||||||||||
Income from continuing operations before provision for taxes on income, minority interests and cumulative effect of a change in accounting principles | $ | 9,694 | $ | 9,278 | $ | 13,028 | $ | 10,800 | $ | 13,403 | |||||
Less: | |||||||||||||||
Minority interests | 23 | 42 | 12 | 12 | 7 | ||||||||||
Income adjusted for minority interests | 9,671 | 9,236 | 13,016 | 10,788 | 13,396 | ||||||||||
Add: | |||||||||||||||
Fixed charges | 647 | 541 | 642 | 622 | 505 | ||||||||||
Total earnings as defined | $ | 10,318 | $ | 9,777 | $ | 13,658 | $ | 11,410 | $ | 13,901 | |||||
Fixed charges: | |||||||||||||||
Interest expense(a) | $ | 516 | $ | 397 | $ | 488 | $ | 471 | $ | 347 | |||||
Preferred stock dividends(b) | 8 | 11 | 14 | 14 | 12 | ||||||||||
Rents(c) | 123 | 133 | 140 | 137 | 146 | ||||||||||
Fixed charges | 647 | 541 | 642 | 622 | 505 | ||||||||||
Capitalized interest | 46 | 43 | 29 | 17 | 12 | ||||||||||
Total fixed charges | $ | 693 | $ | 584 | $ | 671 | $ | 639 | $ | 517 | |||||
Ratio of earnings to fixed charges | 14.9 | 16.7 | 20.4 | 17.9 | 26.9 | ||||||||||
All financial information reflects the following as discontinued operations for 2006, 2005 and 2004: the Consumer Healthcare business; certain European generics businesses; and for 2004: our in-vitro allergy and autoimmune diagnostics testing, and surgical ophthalmics.
(a) | Interest expense includes amortization of debt premium, discount and expenses. Interest expense does not include interest related to uncertain tax positions of $333 million for 2008; $331 million for 2007; $200 million for 2006; $203 million for 2005; and $201 million for 2004. |
(b) | Preferred stock dividends are from our Series A convertible perpetual preferred stock held by an Employee Stock Ownership Plan assumed in connection with our acquisition of Pharmacia in 2003. |
(c) | Rents included in the computation consist of one-third of rental expense, which we believe to be a conservative estimate of an interest factor in our leases, which are not material. |