Pep Boys 2005 Annual Report Download - page 88

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THE PEP BOYS - MANNY, MOE & JACK AND SUBSIDIARIES Exhibit 12 - Statement Regarding Computation
of Ratios of Earnings to Fixed Charges
(in thousands, except ratios)
January 28, January 29, January 31, February 1, February 2,
Fiscal year 2006 2005 2004 2003 2002
Interest $ 49,040 $ 35,965 $ 38,255 $ 47,237 $ 53,709
Interest factor in rental expense 22,534 20,314 21,269 20,424 21,063
Capitalized interest 867 659 - 44 1
(a) Fixed charges, as defined $ 72,441 $ 56,938 $ 59,524 $ 67,705 $ 74,773
(Loss) Earnings from continuing operations
before income taxes and cumulative
effect of change in accounting principle $ (56,326) $ 40,645 $ (24,337) $ 61,267 $ 46,321
Fixed charges 72,441 56,938 59,524 67,705 74,773
Capitalized interest (867) (659) - (44) (1)
(b) Earnings, as defined $ 15,248 $ 96,924 $ 35,187 $ 128,928 $ 121,093
(c) Ratio of earnings to fixed charges (b÷a) - 1.7x - 1.9x 1.6x
The ratio of earnings to fixed charges is completed by dividing earnings by fixed charges. “Earnings” consist of earnings
before income taxes plus fixed charges (exclusive of capitalized interest costs) plus one-third of rental expense (which
amount is considered representative of the interest factor in rental expense). Earnings, as defined, were not sufficient to
cover fixed charges by approximately $57.2 and $24.2 million for fiscal years ended January 28, 2006 and January 31, 2004,
respectively.