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Previous: INTERNATIONAL BUSINESS MACHINES CORP, 10-Q, EX-11, 2000-11-13 |
Next: INTERNATIONAL BUSINESS MACHINES CORP, 10-Q, EX-27, 2000-11-13 |
EXHIBIT 12
COMPUTATION OF RATIO OF NET INCOME TO FIXED CHARGES AND
NET INCOME TO COMBINED FIXED CHARGES AND PREFERRED STOCK
DIVIDENDS
FOR NINE MONTHS ENDED SEPTEMBER 30
(UNAUDITED)
(Dollars in millions)
2000 1999
---- ----
Income before income taxes (1) $ 7,711 $ 8,697
Add: Fixed charges, excluding
capitalized interest 1,379 1,448
------- -------
Income as adjusted before income taxes $ 9,090 $10,145
======= =======
Fixed charges:
Interest expense $ 1,050 $ 1,098
Capitalized interest 23 23
Portion of rental expense representative of
interest 329 350
------- -------
Total fixed charges $ 1,402 $ 1,471
======= =======
Preferred stock dividends (2) 21 23
------- -------
Combined fixed charges and preferred stock
dividends $ 1,423 $ 1,494
======= =======
Ratio of net income to fixed charges 6.48 6.90
Ratio of net income to combined fixed charges
and preferred stock dividends 6.39 6.79
(1) Income before income taxes excludes the company's share in the income and
losses of less-than-fifty percent-owned affiliates.
(2) Included in the ratio computation are preferred stock dividends of $15
million for the first nine months of 2000 and 1999, or $21 million and $23
million, respectively, representing the pre-tax income that would be required to
cover those dividend requirements based on the company's effective tax rate for
the nine months ended September 30, 2000 and 1999.
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<PAGE>
SEGMENT INFORMATION
(UNAUDITED)
<TABLE>
<CAPTION>
Hardware Segments
Personal Enterprise Global
(Dollars in millions) Technology Systems Systems Services
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Quarter Ended September 30, 2000:
External revenue $ 2,632 $ 4,395 $ 2,358 $ 8,230
Internal revenue 675 24 133 654
------- ------- ------- -------
Total revenue $ 3,307 $ 4,419 $ 2,491 $ 8,884
======= ======= ======= =======
Pre-tax income (loss) $ 185 $ 65 $ 293 $ 1,147
======= ======= ======= =======
Revenue year-to-year change (2.8)% 11.9% (6.6)% 3.5%
Pre-tax income year-to-year change (41.6)% 641.7% (1.7)% (2.4)%
Pre-tax income margin 5.6% 1.5% 11.8% 12.9%
Quarter Ended September 30, 1999:
External revenue $ 2,515 $ 3,937 $ 2,536 $ 7,898
Internal revenue 887 12 132 688
------- ------- ------- -------
Total revenue $ 3,402 $ 3,949 $ 2,668 $ 8,586
======= ======= ======= =======
Pre-tax income (loss) $ 317 $ (12) $ 298 $ 1,175
======= ======= ======= =======
Pre-tax income margin 9.3% (0.3)% 11.2% 13.7%
</TABLE>
Reconciliations to IBM as Reported:
<TABLE>
<CAPTION>
Quarter Ended Quarter Ended
(Dollars in millions) September 30, 2000 September 30, 1999
------------------ ------------------
<S> <C> <C>
Revenue:
Total reportable segments $ 23,601 $ 23,160
Eliminations/other (1,820) (2,016)
-------- --------
Total IBM Consolidated $ 21,781 $ 21,144
======== ========
Pretax income:
Total reportable segments $ 2,444 $ 2,516
Sale of the IBM Global Network 0 586
Third quarter actions 0 (385)
Eliminations/other 360 (88)
-------- --------
Total IBM Consolidated $ 2,804 $ 2,629
======== ========
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Global Enterprise Total
(Dollars in million) Software Financing Investments Segments
-----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Quarter Ended September 30, 2000:
External revenue $ 2,918 $ 868 $ 277 $ 21,678
Internal revenue 211 225 1 1,923
--------- -------- -------- --------
Total revenue $ 3,129 $ 1,093 $ 278 $ 23,601
========= ======== ======== ========
Pre-tax income (loss) $ 515 $ 294 $ (55) $ 2,444
========= ======== ======== ========
Revenue year-to-year change (1.5)% 11.5% (30.0)% 1.9%
Pre-tax income year-to-year change (23.0)% 10.1% 72.2% (2.9)%
Pre-tax income margin 16.5% 26.9% (19.8)% 10.4%
Quarter Ended September 30, 1999:
External revenue $ 3,010 $ 786 $ 393 $ 21,075
Internal revenue 168 194 4 2,085
--------- -------- -------- --------
Total revenue $ 3,178 $ 980 $ 397 $ 23,160
========= ======== ======== ========
Pre-tax income (loss) $ 669 $ 267 $ (198) $ 2,516
========= ======== ======== ========
Pre-tax income margin 21.1% 27.2% (49.9)% 10.9%
</TABLE>
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<PAGE>
SEGMENT INFORMATION
(UNAUDITED)
<TABLE>
<CAPTION>
Hardware Segments
Personal Enterprise Global
(Dollars in millions) Technology Systems Systems Services
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Nine Months Ended September 30, 2000:
External revenue $ 7,028 $ 11,570 $ 7,548 $ 23,966
Internal revenue 2,178 55 458 1,849
-------- -------- -------- --------
Total revenue $ 9,206 $ 11,625 $ 8,006 $ 25,815
======== ======== ======== ========
Pre-tax income (loss) $ 431 $ (182) $ 1,180 $ 3,214
======== ======== ======== ========
Revenue year-to-year change (6.4)% (1.7)% (8.6)% 1.5%
Pre-tax income year-to-year change 6.4% (9.0)% (18.1)% (0.7)%
Pre-tax income margin 4.7% (1.6)% 14.7% 12.5%
Nine Months Ended September 30, 1999:
External revenue $ 7,072 $ 11,799 $ 8,343 $ 23,436
Internal revenue 2,767 26 417 1,985
-------- -------- -------- --------
Total revenue $ 9,839 $ 11,825 $ 8,760 $ 25,421
======== ======== ======== ========
Pre-tax income (loss) $ 405 $ (167) $ 1,440 $ 3,236
======== ======== ======== ========
Pre-tax income margin 4.1% (1.4)% 16.4% 12.7%
</TABLE>
Reconciliations to IBM as Reported:
<TABLE>
<CAPTION>
Nine Months Ended Nine Months Ended
(Dollars in millions) September 30, 2000 September 30, 1999
------------------ ------------------
<S> <C> <C>
Revenue:
Total reportable segments $ 68,436 $ 69,546
Eliminations/other (5,656) (6,180)
-------- --------
Total IBM Consolidated $ 62,780 $ 63,366
======== ========
Pretax income:
Total reportable segments $ 7,153 $ 7,278
Sale of the IBM Global Network 0 4,016
Second and third quarter actions 0 (2,205)
Eliminations/other 594 (317)
-------- --------
Total IBM Consolidated $ 7,747 $ 8,772
======== ========
</TABLE>
- 27 -
<PAGE>
<TABLE>
<CAPTION>
Global Enterprise Total
(Dollars in millions) Software Financing Investments Segments
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Nine Months Ended September 30, 2000:
External revenue $ 9,027 $ 2,525 $ 939 $ 62,603
Internal revenue 595 695 3 5,833
--------- -------- -------- --------
Total revenue $ 9,622 $ 3,220 $ 942 $ 68,436
========= ======== ======== ========
Pre-tax income (loss) $ 1,832 $ 888 $ (210) $ 7,153
========= ======== ======== ========
Revenue year-to-year change 0.1% 12.1% (22.2)% (1.6)%
Pre-tax income year-to-year change (14.0)% 15.5% 60.8% (1.7)%
Pre-tax income margin 19.0% 27.6% (22.3)% 10.5%
Nine Months Ended September 30, 1999:
External revenue $ 9,056 $ 2,274 $ 1,193 $ 63,173
Internal revenue 561 599 18 6,373
--------- -------- -------- --------
Total revenue $ 9,617 $ 2,873 $ 1,211 $ 69,546
========= ======== ======== ========
Pre-tax income (loss) $ 2,131 $ 769 $ (536) $ 7,278
========= ======== ======== ========
Pre-tax income margin 22.2% 26.8% (44.3)% 10.5%
</TABLE>
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