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10-Q - OMNICARE INCc59261_10-q.htm
EX-32.2 - OMNICARE INCc59261_ex32-2.htm
EX-31.2 - OMNICARE INCc59261_ex31-2.htm
EX-32.1 - OMNICARE INCc59261_ex32-1.htm
EX-31.1 - OMNICARE INCc59261_ex31-1.htm

EXHIBIT 12

Statement of Computation of Ratio of Earnings to Fixed Charges
Omnicare, Inc. and Subsidiary Companies
(in thousands, except ratios)
Unaudited

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended
September 30,

 

Nine months ended
September 30,

 

 

 

2009

 

2008
as adjusted
(3)(4)

 

2009

 

2008
as adjusted
(3)(4)

 

Income from continuing operations before income taxes

 

$

96,584

(1)

$

85,886

(1)

$

230,837

(1)

$

184,982

(1)

Add fixed charges:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, excluding amortization of disount on convertible notes (Note 6)

 

 

28,261

 

 

34,885

 

 

86,423

 

 

103,786

 

Amortization of discount on convertible notes (Note 6)

 

 

7,059

 

 

6,544

 

 

20,783

 

 

19,265

 

Amortization of debt issuance expense

 

 

1,327

 

 

1,777

 

 

4,227

 

 

5,382

 

Interest portion of rent expense

 

 

5,703

 

 

6,217

 

 

17,366

 

 

18,707

 

Adjusted income

 

$

138,934

 

$

135,309

 

$

359,636

 

$

332,122

 

 

Fixed charges:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, excluding amortization of discount on convertible notes (Note 6)

 

$

28,261

 

$

34,885

 

$

86,423

 

$

103,786

 

Amortization of discount on convertible notes (Note 6)

 

 

7,059

 

 

6,544

 

 

20,783

 

 

19,265

 

Amortization of debt issuance expense

 

 

1,327

 

 

1,777

 

 

4,227

 

 

5,382

 

Interest portion of rent expense

 

 

5,703

 

 

6,217

 

 

17,366

 

 

18,707

 

Fixed charges

 

$

42,350

 

$

49,423

 

$

128,799

 

$

147,140

 

Ratio of earnings to fixed charges(2)

 

 

3.3

x

 

2.7

x

 

2.8

x

 

2.3

x

(1)          Income from continuing operations before income taxes includes certain special items and accounting change impacts (pretax), (which are further discussed in the Management’s Discussion and Analysis at Part I, Item 2 of this Filing):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended
September 30,

 

Nine months ended
September 30,

 

 

 

2009

 

2008

 

2009

 

2008

 

Restructuring and other related charges (a)

 

$

6,295

 

$

7,655

 

$

19,095

 

$

24,887

 

Litigation and other related professional fees (b)

 

 

1,739

 

 

13,479

 

 

71,761

 

 

51,143

 

Heartland repack matters (b)

 

 

2,032

 

 

1,170

 

 

5,221

 

 

4,803

 

Acquisition and other related costs (c)

 

 

(632

)

 

-

 

 

2,218

 

 

-

 

(a) See the “Restructuring and Other Related Charges” note of the Notes to the Consolidated Financial Statements.
(b) See the “Commitments and Contingencies” note of the Notes to the Consolidated Financial Statements.
(c) See the “Acquisitions” note of the Notes to the Consolidated Financial Statements.

(2)          The ratio of earnings to fixed charges has been computed by adding income from continuing operations before income taxes and fixed charges to derive adjusted income, and dividing adjusted income by fixed charges. Fixed charges consist of interest expense on debt (including the amortization of debt issuance expense) and one-third (the proportion deemed representative of the interest portion) of rent expense.

(3)          Effective January 1, 2009, Omnicare adopted the provisions of the authoritative guidance for accounting for convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement). Financial statements for 2008 and prior periods have been restated for this change in accounting.

(4)          As discussed elsewhere herein, during the second quarter of 2009, the Company commenced activities to divest certain non-core businesses within its Pharmacy Services segment. The financial results have been revised to reflect such businesses as discontinued operations.

E-3