Kodak 2006 Annual Report Download - page 146

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
n
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
Year Ended December 31
(in millions, except for ratios) 2006 2005 2004 2003 2002
(Loss) earnings from continuing
operations before provision for income taxes $ (346) $ (799) $ (113) $ 62 $ 890
Adjustments:
Minority interest in income of
subsidiaries with fixed charges 7 4 2 24 17
Undistributed (earnings)/loss of equity
method investees (7) (12) (30) 41 107
Interest expense 262 211 168 147 173
Interest component of rental expense (1) 57 50 54 53 53
Amortization of capitalized interest 43 22 25 27 28
Earnings as adjusted $ 16 $ (524) $ 106 $ 354 $ 1 ,268
Fixed charges:
Interest expense $ 262 $ 211 $ 168 $ 147 $ 173
Interest component of rental expense (1) 57 50 54 53 53
Capitalized interest 3 3 2 2 3
Total fixed charges $ 322 $ 264 $ 224 $ 202 $ 229
Ratio of earnings to fixed charges * ** *** 1.8x 5.5x
(1) Interest component of rental expense is estimated to equal 1/3 of such expense, which is considered a reasonable approximation of the interest factor.
* Earnings for the year ended December 31, 2006 were inadequate to cover fixed charges. The coverage deficiency was $306 million.
** Earnings for the year ended December 31, 2005 were inadequate to cover fixed charges. The coverage deficiency was $788 million.
*** Earnings for the year ended December 31, 2004 were inadequate to cover fixed charges. The coverage deficiency was $118 million.