Exhibit 12
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES AND Sprint Corporation
EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED
STOCK DIVIDENDS (Unaudited)
Quarters Ended Year-to-Date
September 30, September 30,
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2001 2000 2001 2000
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(millions)
Earnings
Income (Loss) from
continuing operations
before income taxes $ (79) $ 35 $ (57) $ (130)
Capitalized interest (48) (47) (136) (130)
Equity in net losses
of less than 50%
owned entities 55 121 144 197
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Subtotal (72) 109 (49) (63)
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Fixed charges
Interest charges 338 280 1,043 847
Interest factor of
operating rents 115 83 292 242
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Total fixed charges 453 363 1,335 1,089
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Earnings, as adjusted $ 381 $ 472 $ 1,286 $ 1,026
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Ratio of earnings
to fixed charges -(1) 1.30 -(2) -(3)
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Total fixed charges $ 453 $ 363 $ 1,335 $ 1,089
Pre-tax cost of preferred
stock dividends 2 5 8 9
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Total fixed charges
and preferred stock
dividends $ 455 $ 368 $ 1,343 $ 1,098
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Ratio of earnings to
combined fixed
charges and preferred stock
dividends -(1) 1.28 -(2) -(3)
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<FN>
(1) Earnings, as adjusted, were inadequate to cover fixed
charges by $72 million and combined fixed charges and
preferred stock dividends by $74 million in the quarter ended
September 30, 2001. Earnings, as adjusted, includes a
nonrecurring write-down of an investment of $157 million, a
loss on the sale of an investment of $25 million and a gain
from the amendment of certain retirement plan benefits of $120
million. Excluding these items, earnings, as adjusted, would
have been inadequate to cover fixed charges by $10 million and
inadequate to cover combined fixed charges and preferred stock
dividends by $12 million.
</FN>
<FN>
(2) Earnings, as adjusted, were inadequate to cover fixed
charges by $49 million and combined fixed charges and
preferred stock dividends by $57 million in the year-to-date
period ended September 30, 2001. Earnings, as adjusted,
includes nonrecurring gains in the first quarter of 2001 of
$14 million from investment activities. Earnings, as adjusted,
includes nonrecurring items in the third quarter of 2001 of a
write-down of an investment of $157 million, a loss on the
sale of an investment of $25 million and a gain from the
amendment of certain retirement plan benefits of $120 million.
Excluding these items, earnings, as adjusted would have been
inadequate to cover fixed charges by $1 million and inadequate
to cover combined fixed charges and preferred stock dividends
by $9 million.
</FN>
<FN>
(3) Earnings, as adjusted, were inadequate to cover fixed
charges by $63 million and combined fixed charges and
preferred stock dividends by $72 million in the year-to-date
period ended September 30, 2000. Earnings, as adjusted,
includes nonrecurring items in the first quarter of 2000 of a
net gain from investment activities of $26 million and a
nonrecurring gain of $28 million on the sale of network
infrastructure and the right to manage customers to a PCS
affiliate. Earnings, as adjusted, includes nonrecurring items
in the second quarter of 2000 of $187 million for costs
associated with the proposed WorldCom merger, which was
terminated, and a gain on the sale of an independent directory
publishing operation of $45 million. Excluding these items,
the ratio of earnings to fixed charges would have been 1.02
and the ratio of earnings to combined fixed charges and
preferred stock dividends would have been 1.01.
</FN>
Note: The ratios of earnings to fixed charges were computed by
dividing fixed charges into the sum of earnings (after
certain adjustments) and fixed charges. Earnings include
income from continuing operations before taxes, plus equity
in the net losses of less-than-50% owned entities, less
capitalized interest. Fixed charges include interest on all
debt of continuing operations, including amortization of debt
issuance costs, and the interest component of operating
rents. The ratios of earnings to fixed charges and preferred
stock dividends were computed by dividing the sum of fixed
charges and the pre-tax costs of preferred stock dividends
into the sum of earnings (after certain adjustments) and
fixed charges.