Exhibit 12.1
LSB Industries, Inc.
Unaudited Computation of Ratios of Earnings to Fixed Charges and Combined Fixed Charges and Preferred Stock Dividends
(Dollars in Thousands)
|
| 2013 |
|
| 2014 |
|
| 2015 (7) |
|
| 2016 |
|
| 2017 |
| |||||
Income (loss) from continuing operations before provisions (benefit) for income taxes and equity in earnings of affiliate |
| $ | 59,119 |
|
| $ | 9,259 |
|
| $ | (78,666 | ) |
| $ | (130,089 | ) |
| $ | (71,052 | ) |
Add: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed charges |
|
| 19,027 |
|
|
| 37,166 |
|
|
| 40,319 |
|
|
| 48,297 |
|
|
| 39,635 |
|
Amortization of capitalized interest |
|
| 26 |
|
|
| 79 |
|
|
| 372 |
|
|
| 2,030 |
|
|
| 2,272 |
|
Share of distributed income of 50% owned affiliate |
|
| 1,719 |
|
|
| 590 |
|
|
| — |
|
|
| — |
|
|
| — |
|
Less: (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest capitalized (2) |
|
| (3,959 | ) |
|
| (14,104 | ) |
|
| (30,625 | ) |
|
| (15,015 | ) |
|
| (255 | ) |
Fixed charges relating to Discontinued Operations |
|
| (852 | ) |
|
| (141 | ) |
|
| (148 | ) |
|
| (79 | ) |
|
| — |
|
Adjusted earnings |
| $ | 75,080 |
|
| $ | 32,849 |
|
| $ | (68,748 | ) |
| $ | (94,856 | ) |
| $ | (29,400 | ) |
Fixed charges: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing Operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net (3) |
| $ | 13,268 |
|
| $ | 21,528 |
|
| $ | 7,324 |
|
| $ | 30,945 |
|
| $ | 37,267 |
|
Interest capitalized |
|
| 3,959 |
|
|
| 14,104 |
|
|
| 30,625 |
|
|
| 15,015 |
|
|
| 255 |
|
Estimate of interest in rental expense |
|
| 948 |
|
|
| 1,393 |
|
|
| 2,222 |
|
|
| 2,258 |
|
|
| 2,113 |
|
Fixed charges relating to Continuing Operations |
|
| 18,175 |
|
|
| 37,025 |
|
|
| 40,171 |
|
|
| 48,218 |
|
|
| 39,635 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinuing Operations: (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net (3) |
|
| 685 |
|
|
| — |
|
|
| 10 |
|
|
| — |
|
|
| — |
|
Interest capitalized |
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Estimate of interest in rental expense |
|
| 167 |
|
|
| 141 |
|
|
| 138 |
|
|
| 79 |
|
|
| — |
|
Fixed charges relating to Discontinued Operations |
|
| 852 |
|
|
| 141 |
|
|
| 148 |
|
|
| 79 |
|
|
| — |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total fixed charges |
|
| 19,027 |
|
|
| 37,166 |
|
|
| 40,319 |
|
|
| 48,297 |
|
|
| 39,635 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock dividends (5) |
|
| 502 |
|
|
| 551 |
|
|
| 3,273 |
|
|
| 46,317 |
|
|
| 30,230 |
|
Combined fixed charges and preferred stock dividends |
| $ | 19,529 |
|
| $ | 37,717 |
|
| $ | 43,592 |
|
| $ | 94,614 |
|
| $ | 69,865 |
|
Ratio of earnings to fixed charges |
|
| 3.9 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Insufficient coverage (6) |
| $ | — |
|
| $ | 4,317 |
|
| $ | 109,067 |
|
| $ | 143,153 |
|
| $ | 69,035 |
|
Ratio of earnings to combined fixed charges and preferred stock dividends |
|
| 3.8 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| — |
|
Insufficient coverage (6) |
| $ | — |
|
| $ | 4,868 |
|
| $ | 112,340 |
|
| $ | 189,470 |
|
| $ | 99,265 |
|
(1) | Only fixed charges that were deducted from income from continuing operations before income taxes should be added back in the earnings computation. |
(2) | Interest capitalized during the period is deducted because fixed charges include all interest, whether capitalized or expensed. |
(3) | Interest expense includes amortization of deferred debt issuance costs and excludes realized and unrealized gains or losses on interest rate financial instruments that are reported as interest expense. |
(4) | On July 1, 2016, we sold our Climate Control Business and its operations have been classified as discontinued operations for all periods presented. |
(5) | Preferred stock dividends include the accretion of the carrying value of preferred stock, when applicable. |
(6) | For 2014, 2015, 2016 and 2017 earnings were inadequate to cover fixed charges and combined fixed charges and preferred stock dividends. |
(7) | The amount of amortization of capitalized interest for 2015 has been adjusted by $220,000 relating to amortization previously incorrectly excluded from the computation. |