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QWEST COMMUNICATIONS INTERNATIONAL INC.
RATIO OF EARNINGS TO FIXED CHARGES(1)
(Dollars in millions)
| Year Ended December 31, | Nine Months Ended September 30, | |||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 1996 | 1997 | 1998 | 1999 | 2000 | 2000 | 2001(2) | ||||||||||||||||
Income before income taxes, extraordinary item and cumulative effect of change in accounting principle | $ | 2,377 | $ | 2,429 | $ | 2,419 | $ | 1,902 | $ | 126 | $ | 196 | $ | (3,090 | ) | ||||||||
Interest expense (net of amounts capitalized) | 448 | 405 | 543 | 736 | 1,041 | 732 | 1,061 | ||||||||||||||||
Interest factor on rentals (1/3) | 79 | 91 | 70 | 92 | 137 | 110 | 102 | ||||||||||||||||
Subtotal earnings | 2,904 | 2,925 | 3,032 | 2,730 | 1,304 | 1,038 | (1,927 | ) | |||||||||||||||
Add: Losses from equity method affiliates | — | — | — | — | 41 | 16 | 3,116 | ||||||||||||||||
Total earnings | $ | 2,904 | $ | 2,925 | $ | 3,032 | $ | 2,730 | $ | 1,345 | $ | 1,054 | $ | 1,189 | |||||||||
Gross interest expense | $ | 479 | $ | 425 | $ | 568 | $ | 763 | $ | 1,145 | $ | 800 | $ | 1,210 | |||||||||
Interest factor on rentals (1/3) | 79 | 91 | 70 | 92 | 137 | 110 | 102 | ||||||||||||||||
Fixed charges | $ | 558 | $ | 516 | $ | 638 | $ | 855 | $ | 1,282 | $ | 910 | $ | 1,312 | |||||||||
Ratio of earnings to fixed charges or (coverage deficiency) | 5.20 | 5.67 | 4.75 | 3.19 | 1.05 | 1.16 | $ | (123 | ) | ||||||||||||||
Note (1):
"Earnings" is computed by adding income before income taxes, extraordinary items and cumulative effect of change in accounting principle and fixed charges. Also included in earnings is the add-back of Qwest's share of losses in its equity method affiliates. "Fixed charges" consist of interest on indebtedness and the portion of rentals representative of the interest factor.
Note (2):
For the nine months ended September 30, 2001, the ratio of earnings to fixed charges was calculated as a negative ratio. As a result, disclosed above is the calculation of the coverage deficiency. For the purposes of this calculation we have included the impact of the $3.048 billion write-down of the investment on KPNQwest that occurred during the second quarter of 2001, as an add-back of Qwest's share of losses in its equity method affiliates.
QWEST COMMUNICATIONS INTERNATIONAL INC. RATIO OF EARNINGS TO FIXED CHARGES(1) (Dollars in millions)