EXHIBIT 12-B
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Computation of ratio of earnings to fixed charges and preferred dividends
Exhibit 12-B
Atlantic City Electric Company
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Ratio of Earnings to Fixed Charges and Preferred Dividends
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(Dollars in Thousands)
12 Months Ended December 31,
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1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
Net income $ 30,276 $ 85,747 $ 75,017 $ 98,752 $ 93,174
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Income taxes 18,178 50,442 36,958 48,277 36,130
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Fixed charges:
Interest on long-term debt 63,940 64,501 64,847 62,879 58,460
Other interest 3,435 3,574 4,019 4,364 4,148
Preferred stock dividend
requirements of subsidiaries 6,052 5,775 1,428 - -
-------- -------- -------- -------- --------
Total fixed charges 73,427 73,850 70,294 67,243 62,608
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Earnings before income taxes
and fixed charges $121,881 $210,039 $182,269 $214,272 $191,912
======== ======== ======== ======== ========
Fixed charges 73,427 73,850 70,294 67,243 62,608
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Preferred dividend requirement 5,289 7,506 14,214 20,839 22,212
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$ 78,716 $ 81,356 $ 84,508 $ 88,082 $ 84,820
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Ratio of earnings to fixed
charges & Preferred dividends 1.55 2.58 2.16 2.43 2.26
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For purposes of computing the ratio, earnings are net income plus income taxes
and fixed charges. Fixed charges consist of interest on long- and short-term
debt, amortization of debt discount, premium, and expense, dividends on
preferred securities of a subsidiary trust, and the interest factor associated
with the Company's major leases. Preferred dividend requirements represent
annualized preferred dividend requirements multiplied by the ratio that pre-tax
income bears to net income.