Exhibit 12
W. R. GRACE & CO. AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS (a)
(in millions, except ratios)
(Unaudited)
Three Months Ended
Years Ended December 31,(c) March 31,
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1997(d) 1996(e) 1995(f) 1994(g) 1993(h) 1998 1997(c)
------- ------- ------- ------- ------- ---- -------
Net income/(loss) from continuing operations $ 88.2 $ 112.9 $ (324.8) $ (185.4) $ (106.7) $ 11.8 $ 11.1
Add/(deduct):
Provision for/(benefit from) income taxes 55.2 70.4 (192.4) (120.9) (55.5) 7.6 6.4
Income taxes of 50%-owned companies.... -- -- -- -- .1 -- --
Equity in unremitted (earnings)/losses
of less than 50%-owned companies..... (7.0) (.4) .8 (.6) (.5) (1.9) --
Interest expense and related financing costs,
including amortization of capitalized interest 87.6 160.8 179.8 138.5 122.7 21.4 20.0
Estimated amount of rental expense
deemed to represent the interest factor 6.9 8.4 8.5 10.1 11.3 1.8 1.6
------- ------- -------- -------- -------- ------ -------
Income/(loss) as adjusted................. $ 230.9 $ 352.1 $ (328.1) $ (158.3) $ (28.6) $ 40.7 $ 39.1
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Combined fixed charges and preferred stock
dividends:
Interest expense and related financing costs,
including capitalized interest....... $ 92.4 $ 177.1 $ 195.5 $ 143.2 $ 122.8 $ 21.0 $ 24.5
Estimated amount of rental expense
deemed to represent the interest factor 6.9 8.4 8.5 10.1 11.3 1.8 1.6
------- ------- -------- -------- -------- ------ -------
Fixed charges............................. 99.3 185.5 204.0 153.3 134.1 22.8 26.1
Preferred stock dividend requirements(b).. -- .6 .5 .5 .8 -- --
------- ------- -------- -------- -------- ------ -------
Combined fixed charges and preferred
stock dividends........................ $ 99.3 $ 186.1 $ 204.5 $ 153.8 $ 134.9 $ 22.8 $ 26.1
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Ratio of earnings to fixed charges..... 2.33 1.90 (i) (i) (i) 1.79 1.50
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Ratio of earnings to combined fixed charges
and preferred stock dividends.......... 2.33 1.89 (i) (i) (i) 1.79 1.50
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(a) Grace's preferred stocks were retired in 1996; for additional
information, see Note 1 to the Consolidated Financial Statements in the
1996 10-K.
(b) For each period with an income tax provision, the preferred stock
dividend requirements have been increased to an amount representing
the pretax earnings required to cover such requirements based on
Grace's effective tax rate.
(c) Certain amounts have been restated to conform to the 1998 presentation.
(d) Includes a pretax gain of $103.1 on sales of businesses, offset by a
pretax provision of $47.8 for restructuring costs and asset
impairments.
(e) Includes a pretax gain of $326.4 on sales of businesses, offset by
pretax provisions of $229.1 for asbestos-related liabilities and
insurance coverage and $34.7 for restructuring costs and asset
impairments.
(f) Includes pretax provisions of $275.0 for asbestos-related liabilities
and insurance coverage; $151.3 relating to restructuring costs, asset
impairments and other activities; $77.0 for environmental liabilities
at former manufacturing sites; and $30.0 for corporate governance
activities.
(g) Includes a pretax provision of $316.0 relating to asbestos-related
liabilities and insurance coverage.
(h) Includes a pretax provision of $159.0 relating to asbestos-related
liabilities and insurance coverage.
(i) As a result of the losses incurred for the years ended December 31,
1995, 1994 and 1993, Grace was unable to fully cover the indicated
fixed charges.