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 Nine Months Ended
September 30, September 30,
1999 1998 1999 1998
EARNINGS:
Net income $ 7,880 $ 8,689 $18,506 $19,021
Federal income taxes 4,201 4,633 9,831 10,106
Interest charges 4,021 3,797 11,882 11,511
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Earnings available to cover fixed charges 16,102 17,119 40,219 40,638
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FIXED CHARGES AND PREFERRED DIVIDENDS:
Interest on long-term debt 3,507 3,651 10,959 10,988
Preferred dividend requirement (1) 311 311 933 933
Other interest 490 229 868 627
Amortization of debt discount - net 99 98 295 293
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Total fixed charges $ 4,407 $ 4,289 $13,055 $12,841
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Ratio of Earnings to Fixed Charges
and Preferred Dividends 3.65 3.99 3.08 3.16
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(1) Preferred Dividend Requirement:
Preferred dividends 203 203 609 609
Effective tax rate 34.78% 34.78% 34.69% 34.70%
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Preferred dividend requirement $ 311 311 933 933
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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 pretax basis and Amortization of debt discount.