EXHIBIT 12
CENDANT CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(DOLLARS IN MILLIONS)
YEAR ENDED DECEMBER 31,
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2000 1999 1998 1997 1996
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Earnings before fixed charges:
Income (loss) before income taxes and minority
interest $ 969 $(740) $394 $289 $628
Plus: Fixed Charges 596 617 644 396 321
Less Equity income in unconsolidated affiliates 17 18 14 51 --
Capitalized interest -- -- -- -- 1
Minority interest in mandatorily redeemable
preferred trust securities issued by subsidiary
holding solely senior debentures issued by the
Company 131 96 80 -- --
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Earnings available to cover fixed charges $1,417 $(237) $944 $634 $948
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Fixed charges(a):
Interest, including amortization of deferred
financing costs $ 409 $ 460 $506 $379 $298
Capitalized interest -- -- -- -- 1
Other charges, financing costs -- -- 28 -- --
Minority interest in mandatorily redeemable preferred
securities issued by subsidiaries 131 96 80 -- --
Interest portion of rental payment 56 61 30 17 22
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Total fixed charges $ 596 $ 617 $644 $396 $321
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Ratio of earnings to fixed charges 2.38x(b) (c) 1.47x(b) 1.60x(b) 2.95x
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(a) Fixed charges consist of interest expense on all indebtedness (including
amortization of deferred financing costs) and the portion of operating
lease rental expense that is representative of the interest factor (deemed
to be one-third of operating lease rentals).
(b) For the years ended December 31, 2000, 1998 and 1997, income (loss)
before income taxes and minority interest includes other charges, net,
of $99 million, $810 million (exclusive of financing costs of $28 million)
and $701 million, respectively. Excluding such charges, the ratio of
earnings to fixed charges for the years ended December 31, 2000, 1998 and
1997 is 2.54x, 2.72x and 3.37x, respectively.
(c) Earnings were inadequate to cover fixed charges for the year ended
December 31, 1999 (deficiency of $854 million) as a result of unusual
charges of $2,947 million, partially offset by $967 million net gain on
dispositions of businesses. Excluding such charges and net gain on
dispositions of businesses, the ratio of earnings to fixed charges is
2.82x.