EXHIBIT 12 STONE CONTAINER CORPORATION COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES YEAR ENDED DECEMBER 31, ----------------------------------------------------------------- (DOLLARS IN THOUSANDS) 1989 1990 1991 1992 1993 - ------------------------------------------------------------ ----------- ----------- ----------- ------------ ------------ Income (loss) before cumulative effects of accounting changes.................................................... $ 285,828 $ 95,420 $ (49,149) $ (169,910) $ (319,185) Income tax provision (credit)............................... 195,201 92,786 31,106 (59,424) (147,700) Minority interest in consolidated subsidiaries.............. 821 5,863 5,799 5,319 3,572 Preferred stock dividend requirements of majority owned subsidiary................................................. (2,810) (3,852) (5,826) (4,713) (5,629) Undistributed (earnings) loss of non-consolidated subsidiaries............................................... (226) (611) 5,360 6,009 13,260 Capitalized interest........................................ (56,820) (64,815) (81,926) (47,395) (10,779) ----------- ----------- ----------- ------------ ------------ 421,994 124,791 (94,636) (270,114) (466,461) ----------- ----------- ----------- ------------ ------------ ----------- ----------- ----------- ------------ ------------ Fixed charges: Interest charges (expensed and capitalized), amortization of debt discount and debt fees on all indebtedness...... 408,576 487,631 479,732 433,518 437,466 Interest cost portion of rental expenses (33 1/3%)........ 20,666 25,379 26,890 27,822 27,463 Preferred stock dividend requirements of majority owned subsidiary.............................................. 2,810 3,852 5,826 4,713 5,629 ----------- ----------- ----------- ------------ ------------ Total fixed charges................................... 432,052 516,862 512,448 466,053 470,558 ----------- ----------- ----------- ------------ ------------ ----------- ----------- ----------- ------------ ------------ Earnings before income taxes, undistributed (earnings) loss of non-consolidated subsidiaries, minority interest and fixed charges (excluding capitalized interest)............. $ 854,046 $ 641,653 $ 417,812 $ 195,939 $ 4,097 ----------- ----------- ----------- ------------ ------------ Ratio of earnings to fixed charges.......................... 2.0 1.2 (C) (B) (A) ----------- ----------- ----------- ------------ ------------ ----------- ----------- ----------- ------------ ------------ <FN> - --------- (A) The Company's earnings for the year ended December 31, 1993 were insufficient to cover fixed charges by $466.5 million. Earnings for 1993 included a non-recurring pretax gain of $35.4 million from the sale of the Company's 49 percent equity interest in Empaques de Carton Titan, S.A. ("Titan"). If such a non-recurring event had not occurred, earnings would have been insufficient to cover fixed charges by $501.9 million. (B) The Company's earnings for the year ended December 31, 1992 were insufficient to cover fixed charges by $270.1 million. (C) The Company's earnings for the year ended December 31, 1991 were insufficient to cover fixed charges by $94.6 million. Earnings for 1991 included a non-recurring pretax gain of $41.8 million associated with the settlement and termination of a Canadian supply contract and a non-recurring pretax gain of $17.5 million relating to an involuntary conversion at the Company's Missoula, Montana mill. If such nonrecurring events had not occurred, earnings would have been insufficient to cover the fixed charges by $153.9 million. 72