EXHIBIT 12
STATEMENT RE COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES(a) Sunoco, Inc.
and Subsidiaries
(Millions of Dollars)
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For the Nine
Months Ended
September 30, 2002
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(UNAUDITED)
Fixed Charges:
Consolidated interest cost and debt expense $ 83
Proportionate share of interest cost and debt
expense of 50 percent owned but not controlled
investees (b) 3
Interest allocable to rental expense(c) 33
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Total $ 119
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Earnings:
Consolidated loss before income tax benefit $(163)
Minority interest in net income of subsidiaries
having fixed charges 9
Proportionate share of income tax expense of
50 percent owned but not controlled investees 3
Equity in income of less than 50 percent owned
investees (13)
Dividends received from less than 50 percent
owned investees 12
Fixed charges 119
Interest capitalized (2)
Amortization of previously capitalized interest --
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Total $ (35)
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Ratio of Earnings to Fixed Charges N/A (d)
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(a) The consolidated financial statements of Sunoco, Inc. and subsidiaries
contain the accounts of all investees that are controlled (generally more
than 50 percent owned). Corporate joint ventures and other investees over
which the Company has the ability to exercise significant influence but
that are not controlled (generally 20 to 50 percent owned) are accounted
for by the equity method.
(b) Consists of Sunoco's share of interest cost and debt expense of the Epsilon
Products Company, LLC ("Epsilon") polypropylene joint venture in which the
Company is a partner. Sunoco guarantees Epsilon's $120 million term loan
due in 2006 and borrowings under Epsilon's $40 million revolving credit
agreement, which amounted to $35 million at September 30, 2002. Epsilon's
interest and debt expense totalled $4 million for the nine months ended
September 30, 2002.
(c) Represents one-third of total operating lease rental expense which is that
portion deemed to be interest.
(d) Earnings are inadequate to cover fixed charges by $154 million.