Exhibit 12
UNITED STATES CELLULAR CORPORATION
RATIO OF EARNINGS TO FIXED CHARGES
For the Year Ended December 31,
(Dollars in Thousands)
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| 2005 |
| 2004 |
| 2003 |
| 2002 |
| 2001 |
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| (As |
| (As |
| (As |
| (As |
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EARNINGS: |
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Income (loss) before income taxes and minority interest |
| $ | 261,347 |
| $ | 159,469 |
| $ | 44,831 |
| $ | (31,577 | ) | $ | 330,941 |
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Add (deduct): |
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Equity in earnings of unconsolidated entities |
| (66,719 | ) | (64,161 | ) | (50,425 | ) | (42,192 | ) | (42,586 | ) | |||||
Distributions from unconsolidated entities |
| 52,112 |
| 46,385 |
| 44,940 |
| 28,881 |
| 14,813 |
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Minority interest in pre-tax income of subsidiaries that do not have fixed charges |
| (12,478 | ) | (12,625 | ) | (13,859 | ) | (16,649 | ) | (10,388 | ) | |||||
|
| 234,262 |
| 129,068 |
| 25,487 |
| (61,537 | ) | 292,780 |
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Add fixed charges: |
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Consolidated interest expense |
| 84,867 |
| 86,241 |
| 64,607 |
| 47,878 |
| 35,164 |
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Interest portion (1/3) of consolidated rent expense |
| 30,142 |
| 26,938 |
| 21,051 |
| 16,582 |
| 13,824 |
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|
| $ | 349,271 |
| $ | 242,247 |
| $ | 111,145 |
| $ | 2,923 |
| $ | 341,768 |
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FIXED CHARGES: |
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Consolidated interest expense |
| $ | 84,867 |
| $ | 86,241 |
| $ | 64,607 |
| $ | 47,878 |
| $ | 35,164 |
|
Interest portion (1/3) of consolidated rent expense |
| 30,142 |
| 26,938 |
| 21,051 |
| 16,582 |
| 13,824 |
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|
| $ | 115,009 |
| $ | 113,179 |
| $ | 85,658 |
| $ | 64,460 |
| $ | 48,988 |
|
RATIO OF EARNINGS TO FIXED CHARGES |
| 3.04 |
| 2.14 |
| 1.30 |
| — | (a) | 6.98 |
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Tax-effected preferred dividends |
| $ | — |
| $ | — |
| $ | 25 |
| $ | 70 |
| $ | 124 |
|
Fixed charges |
| 115,009 |
| 113,179 |
| 85,658 |
| 64,460 |
| 48,988 |
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Fixed charges and preferred dividends |
| $ | 115,009 |
| $ | 113,179 |
| $ | 85,683 |
| $ | 64,530 |
| $ | 49,112 |
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RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDENDS |
| 3.04 |
| 2.14 |
| 1.30 |
| — | (a) | 6.96 |
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(a) Earnings for the year ended December 31, 2002 were insufficient to cover fixed charges by $61.5 million and fixed charges and preferred dividends by $61.6 million. In the year ended December 31, 2002, U.S. Cellular recognized a pre-tax loss on marketable securities and other investments of $295.5 million as a result of management’s determination that unrealized losses with respect to the investments were other than temporary and the write-down of other assets. U.S. Cellular also recognized a pre-tax fair value adjustment related to derivative instruments of $13.2 million in the restatement for the year ended December 31, 2002.
