EXHIBIT 12
TIME WARNER INC.
RATIO OF EARNINGS TO FIXED CHARGES
NINE MONTHS
ENDED SEPTEMBER 30,
------------------------
PRO
FORMA HISTORICAL
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1997(a) 1997 1996
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(IN MILLIONS, EXCEPT
RATIOS)
Earnings:
Net income (loss) before
income taxes and
extraordinary items..... $ 373 $ 360 $ (172)
Interest expense.......... 742 792 688
Amortization of
capitalized interest.... 17 17 1
Portion of rents
representative of an
interest factor......... 63 63 43
Preferred stock dividend
requirements of
majority-owned
subsidiaries............ 54 54 54
Adjustment for partially
owned subsidiaries and
50% owned companies..... 719 682 594
Undistributed losses of
less than 50% owned
companies............... 16 16 24
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Total earnings........ $1,984 $ 1,984 $ 1,232
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Fixed charges:
Interest expense.......... $ 742 $ 792 $ 688
Capitalized interest...... 17 17 1
Portion of rents
representative of an
interest factor......... 63 63 43
Preferred stock dividend
requirements of
majority-owned
subsidiaries............ 54 54 54
Adjustment for partially
owned subsidiaries and
50% owned companies..... 504 457 446
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Total fixed charges... $1,380 $ 1,383 $ 1,232
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Ratio of earnings to fixed
charges..................... 1.4 x 1.4x 1.0x
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YEAR ENDED DECEMBER 31,
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PRO
FORMA HISTORICAL
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1996(a) 1996 1995 1994 1993 1992
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Earnings:
Net income (loss) before
income taxes and
extraordinary items.....$ (117 ) $ 4 $ 2 $ 89 $ 81 $ 320
Interest expense.......... 1,011 968 877 769 698 729
Amortization of
capitalized interest.... 19 6 2 2 -- 19
Portion of rents
representative of an
interest factor......... 86 63 57 52 54 85
Preferred stock dividend
requirements of
majority-owned
subsidiaries............ 72 72 11 -- -- --
Adjustment for partially
owned subsidiaries and
50% owned companies..... 844 801 691 665 663 97
Undistributed losses of
less than 50% owned
companies............... 46 52 117 82 47 56
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Total earnings........$1,961 $ 1,966 $ 1,757 $ 1,659 $ 1,543 $ 1,306
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Fixed charges:
Interest expense..........$1,011 $ 968 $ 877 $ 769 $ 698 $ 729
Capitalized interest...... 23 7 4 2 -- 15
Portion of rents
representative of an
interest factor......... 86 63 57 52 54 85
Preferred stock dividend
requirements of
majority-owned
subsidiaries............ 72 72 11 -- -- --
Adjustment for partially
owned subsidiaries and
50% owned companies..... 668 607 697 668 664 81
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Total fixed charges...$1,860 $ 1,717 $ 1,646 $ 1,491 $ 1,416 $ 910
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Ratio of earnings to fixed
charges..................... 1.1 x 1.1x 1.1x 1.1x 1.1x 1.4x
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(a) The pro forma ratio of earnings to fixed charges for the Issuer for the
nine months ended September 30, 1997 and the year ended December 31, 1996
gives effect to (i) the TWE-A/N Transfers and (ii) with respect to 1996
only, the TBS Transaction, the Preferred Stock Refinancing and certain
other debt refinancings as if such transactions had occurred at the
beginning of such periods. The pro forma information presented above should
be read in conjunction with the pro forma consolidated condensed financial
statements contained in the Issuer's Current Report on Form 8-K dated
November 13, 1997 and incorporated herein by reference.