EXHIBIT 12
FOREST CITY ENTERPRISES, INC.
STATEMENT OF RATIO OF EARNINGS TO FIXED CHARGES
(IN THOUSANDS)
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Fiscal Year Ended January 31,
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Pro-Rata
Full Consolidation(a) Consolidation(a)
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2002 2001 2000 1999 1998(b)
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Earnings:
Earnings from continuing operations before income
taxes and extraordinary gain (excluding equity in earnings $107,623 $ 86,359 $ 59,851 $ 32,435 $ 3,386
of unconsolidated entities)
Adjustments to earnings:
Interest incurred, net of capitalized interest 178,580 182,544 139,865 124,601 136,322
Amortization of loan procurement costs 6,837 10,850 4,982 10,324 5,118
Previously capitalized interest amortized into earnings 5,364 4,925 4,791 4,291 3,939
Cash distributions from unconsolidated entities 69,213 82,100 66,679 47,228 354
Portion of rents representative of interest factor 3,927 4,951 3,609 3,336 2,771
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Earnings, as adjusted $371,544 $371,729 $279,777 $222,214 $151,890
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Fixed charges:
Interest expensed $178,580 $182,544 $139,865 $124,601 $136,322
Interest capitalized 26,623 21,433 27,440 22,458 17,884
Amortization of loan procurement costs 6,837 10,850 4,982 10,324 5,118
Portion of rents representative of interest factor 3,927 4,951 3,609 3,336 2,771
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Total fixed charges $215,967 $219,778 $175,896 $160,719 $162,095
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Ratio of earnings to fixed charges (c) 1.72 1.69 1.59 1.38 --
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(a) Effective January 31, 2001, the Company implemented a change in the
presentation of its financial results. Prior to January 31, 2001, the
Company used the pro-rata method of consolidation to report its
partnership investments proportionate to its share of ownership for
each line item of its consolidated financial statements. In accordance
with the FASB's Emerging Issues Task Force Issue No. 00-1, "Investor
Balance Sheet and Income Statement Display under the Equity Method for
Investments in Certain Partnerships and Other Ventures," the Company
can no longer use the pro-rata consolidation method for partnerships.
Accordingly, partnership investments that were previously reported on
the pro-rata method are not reported as consolidated at 100% if deemed
under the Company's control, or otherwise on the equity method of
accounting.
(b) Total fixed charges exceeded the Company's adjusted earnings by $10
million for January 31, 1998. Earnings, as adjusted, includes income of
$15 million from a lawsuit settlement related to Toscana, a California
apartment project, and a $39 million loss related to the sale of
Toscana ($36 million) and a partnership interest ($3 million), but does
not include an extraordinary gain of $18 million related to the sale of
Toscana.
(c) The Company has other earnings from operations, principally from
depreciation and amortization, that are available to cover fixed
charges.