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 Nine Months Ended Twelve Months Ended
September 30, September 30, September 30,
1998 1997 1998 1997 1998 1997
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EARNINGS:
Income before preferred stock dividends $8,689 $7,982 $19,021 $16,729 $23,197 $ 20,614
Federal income taxes 4,633 4,253 10,106 8,873 12,507 10,900
Interest charges 3,797 4,003 11,511 12,518 15,615 16,469
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Earnings available to cover fixed charges 17,119 16,238 40,638 38,120 51,319 47,983
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FIXED CHARGES AND PREFERRED DIVIDENDS:
Interest on long-term debt 3,651 3,671 10,988 10,318 14,700 13,570
Preferred dividend requirement (1) 311 311 933 932 1,251 1,243
Other interest 229 293 627 2,060 949 2,986
Amortization of debt discount - net 98 89 293 267 402 365
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Total fixed charges 4,289 4,364 12,841 13,577 17,302 18,164
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Ratio of Earnings to Fixed Charges
and Preferred Dividends 3.99 3.72 3.16 2.81 2.97 2.64
========================================================
(1) Preferred Dividend Requirement:
Preferred dividends 203 203 609 609 813 813
Effective tax rate 34.78% 34.76% 34.70% 34.66% 35.03% 34.59%
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Preferred dividend requirement $ 311 $ 311 $ 933 $ 932 $ 1,251 $ $1,243
========================================================
<FN>
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.
</FN>
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ELIZABETHTOWN WATER COMPANY AND SUBSIDIARIES Exhibit 12
Computation of Ratio of Earnings to Fixed Charges
(In Thousands Except Ratios)
Three Months Ended Nine Months Ended Twelve Months Ended
September 30, September 30, September 30,
1998 1997 1998 1997 1998 1997
-----------------------------------------------------------
EARNINGS:
Income before preferred stock dividends $ 8,689 $ 7,982 $19,021 $16,729 $23,197 $ 20,614
Federal income taxes 4,633 4,253 10,106 8,873 12,507 10,900
Interest charges 3,797 4,003 11,511 12,518 15,615 16,469
--------------------------------------------------------
Earnings available to cover fixed charges 17,119 16,238 40,638 38,120 51,319 47,983
--------------------------------------------------------
FIXED CHARGES:
Interest on long-term debt 3,651 3,671 10,988 10,318 14,700 13,570
Other interest 229 293 627 2,060 949 2,986
Amortization of debt discount - net 98 89 293 267 402 365
--------------------------------------------------------
Total fixed charges 3,978 4,053 11,908 12,645 16,051 16,921
--------------------------------------------------------
Ratio of Earnings to Fixed Charges 4.30 4.01 3.41 3.01 3.20 2.84
========================================================
<FN>
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.
</FN>
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