Exhibit 12
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CONRAIL INC.
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COMPUTATION OF THE RATIO OF EARNINGS TO FIXED CHARGES
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($ In Millions)
Quarters Ended Quarters Ended Quarters Ended Quarters Ended Years Ended
March 31, June 30, September 30, December 31, December 31,
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1995 1994(1) 1995 1994 1995 1994 1995(2) 1994 1995 1994 1993
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Earnings
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Pre-tax income (loss) $ 91 $(53) $165 $166 $188 $ 174 $(52) $245 $392 $532 $440
Add:
Interest expense 48 47 50 48 49 48 47 49 194 192 185
Rental expense
interest factor 14 9 16 9 12 7 11 17 53 42 29
Less equity in
undistributed
earnings of 20-50%
owned companies (5) (3) (5) (4) (4) (3) (6) (7) (20) (17) (14)
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Earnings available for
fixed charges $148 $ - $226 $219 $245 $226 $ - $304 $619 $749 $640
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Fixed Charges
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Interest expense 48 47 50 48 49 48 47 49 194 192 185
Rental expense interest
factor 14 9 16 9 12 7 11 17 53 42 29
Capitalized interest 1 1 1
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Fixed charges $ 62 $ 56 $ 66 $ 57 $ 61 $ 56 $ 58 $ 66 $247 $235 $215
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Ratio of earnings to
fixed charges 2.39x - 3.42x 3.84x 4.02x 4.04x - 4.61x 2.51X 3.19x 2.98x
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<FN>
Note: For the purpose of computing the ratio of earnings to fixed charges, earnings represent income
before income taxes plus fixed charges, less equity in undistributed earnings of 20% to 50% owned
companies. Fixed charges represent interest expense together with interest capitalized and a
portion of rent under long-term operating leases representative of an interest factor.
(1) During the first quarter of 1994, the Company recorded a charge of $51 million (after tax
benefits of $33 million) for a non-union employee voluntary retirement program and related
costs. After this one-time charge, earnings were insufficient by $56 million to cover
fixed charges for the quarter.
(2) In the fourth quarter of 1995, the Company recorded an asset disposition charge of $176
million (after tax benefits of $109 million). After this charge, earnings were insufficient
by $58 million to cover fixed charges for the quarter.
</FN>