EXHIBIT 12.1
CHESAPEAKE ENERGY CORPORATION
RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED DIVIDENDS
(DOLLARS IN 000's)
Six Six
Year Months Year Year Year Year Months
Ended Ended Ended Ended Ended Ended Ended
June 30, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31, June 30,
1997 1997 1998 1999 2000 2001 2002
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Income before income taxes and
extraordinary item $(180,330) $ (31,574) $(920,520) $ 35,030 $ 196,162 $ 438,365 $ (4,257)
Interest 18,550 17,448 68,249 81,052 86,256 98,321 51,650
Amortization of capitalized
interest 8,772 4,386 12,240 1,047 1,226 1,784 853
Bond discount amortization (a) -- -- -- -- -- -- --
Loan cost amortization 1,455 794 2,516 3,338 3,669 4,022 2,389
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Earnings $(151,553) $ (8,946) $(837,515) $ 120,467 $ 287,313 $ 542,492 $ 50,635
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Interest expense $ 18,550 $ 17,448 $ 68,249 $ 81,052 $ 86,256 $ 98,321 $ 51,650
Capitalized interest 12,935 5,087 6,470 3,356 2,452 4,719 2,264
Bond discount amortization (a) -- -- -- -- -- -- --
Loan cost amortization 1,455 794 2,516 3,338 3,669 4,022 2,389
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Fixed Charges $ 32,940 $ 23,329 $ 77,235 $ 87,746 $ 92,377 $ 107,062 $ 56,303
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Preferred Stock Dividends
Preferred Dividend Requirements $ -- $ -- $ 12,077 $ 16,711 $ 8,484 $ 2,050 $ 5,062
Ratio of income before provision
for taxes to Net Income (b) -- -- N/A 1.05 N/A 1.66 N/A
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Subtotal - Preferred Dividends $ -- $ -- $ 12,077 $ 17,597 $ 8,484 $ 3,411 $ 5,062
Combined Fixed Charges and
Preferred Dividends $ 32,940 $ 23,329 $ 89,312 $ 105,343 $ 100,861 $ 110,473 $ 61,365
Ratio of Earnings to Fixed Charges -- -- -- 1.4x 3.1x 5.1x --
Insufficient coverage $ 184,493 $ 32,275 $ 914,750 -- -- -- $ 5,668
Ratio of Earnings to Combined Fixed
Charges and Preferred Dividends -- -- -- 1.1x 2.8x 4.9x --
Insufficient coverage $ 184,493 $ 32,275 $ 926,827 -- -- -- $ 10,730
(a) Bond discount excluded since it is included in interest expense.
(b) Represents income (loss) before income taxes and extraordinary item divided
by income (loss) before extraordinary item, which adjusts dividends on
preferred stock to a pre-tax basis.
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