Computation of Ratios of Earnings to Fixed Charges
Second Quarter | First Six Months | |||||||||
(Dollars in millions) | 2008 | 2007 | 2008 | 2007 | ||||||
Earnings from continuing operations before income taxes (1) | $ | 153 | $ | 151 | $ | 306 | $ | 291 | ||
Add: | ||||||||||
Interest expense | 25 | 25 | 51 | 53 | ||||||
Appropriate portion of rental expense (2) | 4 | 5 | 9 | 10 | ||||||
Amortization of capitalized interest | 2 | (5) | 4 | (3) | ||||||
Earnings as adjusted | $ | 184 | $ | 176 | $ | 370 | $ | 351 | ||
Fixed charges: | ||||||||||
Interest expense | $ | 25 | $ | 25 | $ | 51 | $ | 53 | ||
Appropriate portion of rental expense (2) | 4 | 5 | 9 | 10 | ||||||
Capitalized interest | 4 | 4 | 9 | 8 | ||||||
Total fixed charges | $ | 33 | $ | 34 | $ | 69 | $ | 71 | ||
Ratio of earnings to fixed charges | 5.6x | 5.2x | 5.4x | 4.9x | ||||||
(1) | Because the Company has exited the PET business in the European region, results related to sales of PET products manufactured at the Spain, the Netherlands, and United Kingdom sites are presented as discontinued operations for all periods presented. For additional information, see Note 2, "Discontinued Operations", to the Company's unaudited consolidated financial statements in Part I, Item 1 of this quarterly report on Form 10-Q. |
(2) | For all periods presented, the interest component of rental expense is estimated to equal one-third of such expense. |
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