Expand Energy (EXE) 10-Q 2015 Q3 Quarterly report

10-Q Document

EXHIBIT 12

CHESAPEAKE ENERGY CORPORATION AND SUBSIDIARIES

RATIOS OF EARNINGS TO FIXED CHARGES AND COMBINED FIXED CHARGES

AND PREFERRED DIVIDENDS

	Years Ended December 31,													Nine Months Ended September 30,
	2010			2011			2012			2013		2014		2015
EARNINGS:
Income (loss) before income taxes and cumulative effect of accounting change	$	2,884		$	2,880		$	(974	)	$	1,442	$	3,200	$	(16,264	)
Interest expense(a)	122			94			142			207		172		219
(Gain)/loss on investment in equity investees in excess of distributed earnings	(232		)	(154		)	108			219		75		57
Amortization of capitalized interest	212			297			402			440		438		387
Loan cost amortization	25			28			43			37		32		24
Earnings	$	3,011		$	3,145		$	(279	)	$	2,345	$	3,917	$	(15,577	)
FIXED CHARGES:
Interest Expense	$	122		$	94		$	142		$	207	$	172	$	219
Capitalized interest	711			727			976			815		604		326
Loan cost amortization	25			28			43			37		32		24
Fixed Charges	$	858		$	849		$	1,161		$	1,059	$	808	$	569
PREFERRED STOCK DIVIDENDS:
Preferred dividend requirements	$	111		$	172		$	171		$	171	$	171	$	128
Ratio of income (loss) before provision for taxes to net income (loss)(b)	1.63			1.65			1.64			1.61		1.56		1.31
Preferred Dividends	$	181		$	284		$	280		$	275	$	266	$	167
COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS	$	1,039		$	1,131		$	1,441		$	1,334	$	1,074	$	736
RATIO OF EARNINGS TO FIXED CHARGES	3.5			3.7			(0.2		)	2.2		4.8		(27.4		)
INSUFFICIENT COVERAGE	$	—		$	—		$	1,440		$	—	$	—	$	16,146
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS	2.9			2.8			(0.2		)	1.8		3.6		(21.2		)
INSUFFICIENT COVERAGE	$	—		$	—		$	1,720		$	—	$	—	$	16,313

(a) Excludes the effect of unrealized gains or losses on interest rate derivatives and includes amortization of bond discount.

(b) Amounts of income (loss) before provision for taxes and of net income (loss) exclude the cumulative effect of accounting change.