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EXHIBIT 12.01
EASTMAN CHEMICAL COMPANY AND SUBSIDIARIES
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
(DOLLARS IN MILLIONS)
1996 1995 1994 1993(1) 1992(1)
Earnings from continuing
operations before provision
for income taxes $ 607 $ 899 $ 550 $ 439 $ 483
Add:
Interest expense 67 79 87 7 3
Rental expense(2) 22 16 7 11 8
Amortization of
capitalized interest 14 13 15 15 14
--------- --------- --------- --------- ---------
Earnings as adjusted $ 710 $ 1,007 $ 659 $ 472 $ 508
========= ========= ========= ========= =========
Fixed charges:
Interest expense $ 67 $ 79 $ 87 $ 7 $ 3
Rental expense(2) 22 16 7 11 8
Capitalized interest 28 9 11 24 27
--------- --------- --------- --------- ---------
Total fixed charges $ 117 $ 104 $ 105 $ 42 $ 38
========= ========= ========= ========= =========
Ratio of earnings to fixed charges 6.1x 9.7x 6.3x 11.2x 13.4x
========= ========= ========= ========= =========
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(1) The historical amounts for 1992-1993 as presented above, were determined
during periods when the Company was a wholly owned chemical business of
Kodak. If the Company was an independent publicly held entity during these
years, the pro forma ratio of earnings to fixed charges would approximate
4.1x and 3.7x for 1992 and 1993, respectively, reflecting the assumption of
$1,800 million of new borrowings at a 6% annual interest rate, and
adjustments for pension, postretirement and certain other employee benefit
costs. These costs were not allocated to the Company by Kodak during
1992-1993 and therefore, are not included in the historical amounts
presented above.
(2) For all periods presented, the interest component of rental expense is
estimated to equal one-third of such expense.
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