Exhibit 12.1
RATIO OF EARNINGS TO FIXED CHARGES
The following table shows the ratio of earnings to fixed charges for the periods
indicated. We do not show information for periods prior to the year ended March
26, 1996 because information reflecting what our expenses would have been as an
independent company are not available. Prior to the spin-off from Anheuser-Busch
in 1996, Anheuser-Busch provided funds to Earthgrains by intercompany advances,
without interest charges. We have computed these ratios by dividing earnings
available for fixed charges (income before income taxes plus fixed charges) by
fixed charges (interest expense plus that portion of rental expenses deemed to
represent interest).
Computation of The Earthgrains Company Ratio of Earnings to Fixed Charges -
Historical
(Dollars in millions, except ratios)
<TABLE>
<CAPTION>
For the Years Ended
-------------------------------------------------------------------------------
March 26, 1996
March 28, 2000 March 30, 1999 March 31, 1998 March 25, 1997 (pro forma)
-------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Earnings before income taxes 87.9 59.9 62.0 22.7 (39.0)
Capitalized interest (1.0) (1.0) (0.7) (0.8) (1.0)
----- ----- ------ ------ -----
Total 86.9 58.9 61.3 21.9 (40.0)
===== ===== ===== ===== =====
Fixed Charges:
Interest Expense 26.5 19.5 8.2 6.3 7.0
Debt Issuance Expense 0.1 0.0 0.0 0.0 0.5
1/3 of Rent Expense 6.2 5.7 4.3 3.9 4.9
----- ----- ----- ----- -----
Total 32.8 25.2 12.5 10.2 12.4
===== ===== ===== ===== =====
Earnings before income taxes
and Fixed Charges 119.7 84.1 73.8 32.1 (27.6)
===== ===== ===== ===== =====
Ratio of Earnings to Fixed Charges 3.6(1) 3.3(1) 5.9 3.1(1) (1)(2)
===== ===== ===== ===== =====
</TABLE>
(1) These calculations reflect certain non-recurring items. Fiscal 2000 amounts
include a $2.3 million pretax provision for restructuring and a one-time
$5.4 million pretax write-off related to a customer bankruptcy; fiscal 1999
includes a $28.0 million pretax provision for restructuring and a $2.5
million pretax nonoperating gain on the sale of property; fiscal 1997
includes a $12.7 million pretax provision for restructuring; fiscal 1996
includes a $3.0 million pretax provision for restructuring, a $7.8 million
pretax charge for the Spanish work force reduction program and a $7.6
million pretax charge for a legal settlement and other non-recurring
costs. If these non-recurring items were excluded, the ratios would be 3.9x
for the year ended March 28, 2000, 4.3x for the year ended March 30, 1999
and 4.4x for the year ended March 25, 1997, and the deficiency (pro forma)
for the year ended March 26, 1996 would be approximately $21.6 million.
(2) As a result of the historical loss incurred and incremental pro forma
adjustments to represent Earthgrains as an independent company for this
period, earnings were less than fixed charges for the year ended March 26,
1996. The coverage deficiency was approximately $40.0 million.
