Exhibit 12(b)
ELIZABETHTOWN WATER COMPANY AND SUBSIDIARY
Computation of Ratio of Earnings to Fixed Charges
and Preferred Dividends
(In Thousands Except Ratios)
Three Months Ended Six Months Ended
June 30, June 30,
1999 1998 1999 1998
EARNINGS:
Net income $ 6,343 $ 5,687 $ 10,626 $10,332
Federal income taxes 3,369 3,017 5,630 5,473
Interest charges 4,163 3,878 8,028 7,714
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Earnings available to cover fixed charges 13,875 12,582 24,284 23,519
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FIXED CHARGES AND PREFERRED DIVIDENDS:
Interest on long-term debt 3,862 3,713 7,619 7,337
Preferred dividend requirement (1) 311 311 621 621
Other interest 315 192 378 398
Amortization of debt discount - net 98 98 196 195
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Total fixed charges $ 4,586 4,314 8,814 8,551
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Ratio of Earnings to Fixed Charges
and Preferred Dividends 3.03 2.92 2.76 2.75
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(1) Preferred Dividend Requirement:
Preferred dividends 203 203 406 406
Effective tax rate 34.69% 34.66% 34.63% 34.63%
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Preferred dividend requirement $ 311 $ 311 $ 621 $ 621
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Earnings to Fixed Charges and Preferred Dividends represents the sum of
Net Income, 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.