ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY Exhibit 12
Computation of Ratio of Earnings to Fixed Charges
and Preferred Dividends
(In Thousands Except Ratios)
Three Months Ended Twelve Months Ended
March 31, March 31,
1998 1997 1998 1997
------ ------ ------ ------
EARNINGS:
Income before preferred stock
dividends $ 4,645 $ 3,885 $ 21,665 $ 17,046
Federal income taxes 2,456 2,047 11,683 8,981
Interest charges 3,836 4,293 16,165 14,235
------ ------ ------ ------
Earnings available to cover
fixed charges $ 10,937 $ 10,225 $ 49,513 $ 40,262
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FIXED CHARGES AND PREFERRED DIVIDENDS:
Interest on long-term debt $ 3,624 $ 3,253 $ 14,401 $ 13,011
Preferred dividend requirement (1) 310 310 1,251 1,241
Other interest 206 986 1,602 3,218
Amortization of debt discount - net 97 89 384 363
------ ------ ------ ------
Total fixed charges $ 4,237 $ 4,638 $ 17,638 $ 17,833
====== ====== ====== ======
Ratio of Earnings to Fixed Charges
and Preferred Dividends 2.58 2.20 2.81 2.26
====== ====== ====== ======
(1) Preferred Dividend Requirement:
Preferred dividends $ 203 $ 203 $ 813 $ 813
Effective tax rate 34.59% 34.51% 35.03% 34.51%
Preferred dividend requirement $ 310 $ 310 $ 1,251 $ 1,241
Earnings to Fixed Charges and Preferred Dividends represents the sum of
Income Before Preferred Stock Dividends, Federal income taxes and Interest
Charges (which is reduced by Allowance for Debt Funds Used During
Construction), divided by Fixed Charges. Fixed Charges and Preferred
Dividends consist of interest on long and short-term debt (which is not
reduced by Allowance for Debt Funds Used During Construction), dividends
on Preferred Stock on a pre-tax basis and Amortization of debt discount.
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ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY Exhibit 12
Computation of Ratio of Earnings to Fixed Charges
(In Thousands Except Ratios)
Three Months Ended Twelve Months Ended
March 31, March 31,
1997 1996 1997 1996
EARNINGS:
Income before preferred stock
dividends $ 4,645 $ 3,885 $ 21,665 $ 17,046
Federal income taxes 2,456 2,047 11,683 8,981
Interest charges 3,836 4,293 16,165 14,235
------ ------ ------- -------
Earnings available to cover
fixed charges $ 10,937 $ 10,225 $ 49,513 $ 40,262
====== ====== ======= =======
FIXED CHARGES:
Interest on long-term debt $ 3,624 $ 3,253 $ 14,401 $ 13,011
Other interest 206 986 1,602 3,218
Amortization of debt discount - net 97 89 384 363
------ ------ ------- -------
Total fixed charges $ 3,927 $ 4,328 $ 16,387 $ 16,592
====== ====== ======= =======
Ratio of Earnings to Fixed Charges 2.79 2.36 3.02 2.43
====== ====== ======= =======
Earnings to Fixed Charges represents the sum of Income Before Preferred Stock
Dividends, Federal income taxes and Interest Charges (which is reduced by
Allowance for Debt Funds Used During Construction), divided by Fixed Charges.
Fixed Charges consist of interest on long and short-term debt (which is not
reduced by Allowance for Debt Funds Used During Construction), and
Amortization of debt discount.
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