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Borders Group Inc – ‘S-3ASR’ on 4/3/07 – EX-12.1

On:  Tuesday, 4/3/07, at 5:22pm ET   ·   Effective:  4/3/07   ·   Accession #:  950124-7-2009   ·   File #:  333-141863

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  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 4/03/07  Borders Group Inc                 S-3ASR      4/03/07    6:991K                                   Bowne - Bde

Automatic Shelf Registration Statement for Securities of a Well-Known Seasoned Issuer   —   Form S-3
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: S-3ASR      Automatic Shelf Registration                        HTML    184K 
 2: EX-4.1      Form of Senior Indenture                            HTML    348K 
 3: EX-4.2      Form of Subordinated Indenture                      HTML    391K 
 4: EX-5.1      Opinion of Baker & McKenzie LLP                     HTML     27K 
 5: EX-12.1     Statement Re: Ratio of Earnings to Fixed Charges    HTML     18K 
 6: EX-23.1     Consent of Ernst & Young LLP                        HTML      7K

EX-12.1   —   Statement Re: Ratio of Earnings to Fixed Charges

This exhibit is an HTML Document rendered as filed.  [ Alternative Formats ]

  exv12w1  
 

Exhibit 12.1
RATIO OF EARNINGS TO FIXED CHARGES
Our consolidated ratio of earnings to for each of the last five fiscal years is set forth below. For the purpose of computing these ratios, “earnings” consists of income from continuing operations before provision for taxes on income, minority interest and cumulative effect of a change in accounting principle less minority interest adjusted for fixed charges, excluding capitalized interest. “Fixed charges” consists of interest expense (which includes amortization of debt expenses), capitalized interest and an estimate of the interest factor in our leases. It is not practicable to calculate the interest factor in a material portion of our leases. The ratio was calculated by dividing the sum of the fixed charges into the sum of the earnings from continuing operations before taxes and fixed charges.
Computation of Earnings to Fixed Charges Ratio
(in millions)
                                         
    Fiscal
    2006   2005   2004   2003   2002
Fixed Charges:
                                    
Interest Expense(1)
   $ 32.4     $ 14.3     $ 9.1     $ 8.7     $ 12.6  
Interest Capitalized
     1.0       1.0       0.2       0.4       0.6  
Interest from Rental Expense(2)
     205.6       191.5       194.8       193.9       175.7  
 
    
Total Fixed Charges
   $ 239.0     $ 206.8     $ 204.1     $ 203.0     $ 188.9  
 
    
Earnings:
                                    
Pre-tax Income (loss)
   $ (169.2 )   $ 159.1     $ 207.6     $ 189.4     $ 175.0  
Fixed Charges
   239.0     206.8     204.1     203.0     188.9  
Amortization of Capitalized Interest
     0.4       0.4       0.4       0.4       0.4  
 
    
 
     70.2       366.3       412.1       392.8       364.3  
 
    
Less:
                                        
Interest Capitalized
   $ 1.0     $ 1.0     $ 0.2     $ 0.4     $ 0.6  
Minority Interest
     0.5       —       —       —       —  
 
    
 
     1.5       1.0       0.2       0.4       0.6  
 
    
     
 
    
Total Earnings
   $ 68.7     $ 365.3     $ 411.9     $ 392.4     $ 363.7  
 
    
     
 
    
Earnings to Fixed Charges Ratio
     0.3:1.0     1.8:1.0       2.0:1.0       1.9:1.0       1.9:1.0  
 
    
Dollar amount of Deficiency(3)
   $ 170.3                                  
 
(1)   Interest expense includes the amortization of debt issuance costs.
(2)   Amount represents an estimate of interest expense included in rental expense.
(3)   Earnings were inadequate to cover fixed charges for fiscal 2006. The amount of the coverage deficiency was $170.3 million.

 

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