EXHIBIT 12
PHILIP MORRIS COMPANIES INC. AND SUBSIDIARIES
Computation of Ratios of Earnings to Fixed Charges
(dollars in millions)
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Years Ended December 31,
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1998 1997 1996 1995 1994
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Earnings before
income taxes and
cumulative effect
of accounting changes $ 9,087 $10,611 $10,683 $ 9,347 $ 8,216
Add (Deduct):
Equity in net earnings of
less than 50% owned
affiliates (195) (207) (227) (246) (184)
Dividends from less than
50% owned affiliates 70 138 160 202 165
Fixed charges 1,386 1,438 1,421 1,495 1,537
Interest capitalized, net
of amortization (5) (16) 13 2 (1)
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Earnings available for
fixed charges $10,343 $11,964 $12,050 $10,800 $ 9,733
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Fixed charges:
Interest incurred:
Consumer products $ 1,166 $ 1,224 $ 1,197 $ 1,281 $ 1,317
Financial services and
real estate 77 67 81 84 78
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$ 1,243 $ 1,291 $ 1,278 $ 1,365 $ 1,395
Portion of rent expense
deemed to represent
interest factor 143 147 143 130 142
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Fixed charges $ 1,386 $ 1,438 $ 1,421 $ 1,495 $ 1,537
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Ratio of earnings to
fixed charges 7.5 8.3 8.5 7.2 6.3
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