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APPLIED POWER INC. EXHIBIT 12
Computation of Ratio of
Earnings to Fixed Charges
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Nine Months
Ended Year Ended August 31,
May 31, 2000 (1) 1999 (2) 1998 (3) 1997
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<S> <C> <C> <C> <C>
Net earnings from continuing operations $ 34,952 $ 34,580 $ 53 $ 22,632
Add: Income tax expense 19,584 22,830 9,076 10,463
Add: Interest Expense (4) 27,892 41,181 12,535 5,067
Portion of rent deemed interest factor (5) 2,833 3,777 3,639 3,651
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Total earnings available for fixed charges $ 85,261 $ 102,368 $ 25,303 $ 41,813
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Fixed charges:
Interest expense (4) 19,584 22,830 9,076 10,463
Portion of rent deemed interest factor (5) 2,833 3,777 3,639 3,651
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Total fixed charges $ 22,417 $ 26,607 $ 12,715 $ 14,114
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Ratio of earnings to fixed charges $ 3.8 $ 3.8 $ 2.0 $ 3.0
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The ratios reflect the consolidated results of operations and
financial position of the Company, excluding the Electronics business
which is presented as a discontinued operation.
(1)
Earnings from continuing operations for the nine months ended May 31,
2000 include a one-time $1.4 million ($0.9 million after tax) recovery
of costs related to the contract termination recorded in fiscal 1999
and a non-recurring charge of $4.4 million ($2.8 million, net of tax
benefit) for fees and expenses associated with the Distribution and
the incorporation of APW Ltd. Excluding these items and their related
tax effects, the ratio of earnings to fixed charges would have been
approximately 4.2.
(2) Earnings from continuing operations for fiscal 1999 include a one-time
pre-tax contract termination charge of $7.8 million ($4.7 million
after tax). Excluding this charge and the related tax benefit, the
ratio of earnings to fixed charges would have been approximately 4.0.
(3)
Earnings from continuing operations for fiscal 1998 include a $1.7
million gain, with no tax impact, on life insurance proceeds a $2.9
million net gain, after tax, on the sale of a facility and the write-
down of a European subsidiary to its estimated realizable value, and
restructuring and other one-time charges of $50.4 million (37.2
million after tax). Excluding these items and their related tax
effects, the ratio of earnings to fixed charges would have been
approximately 4.6.
(4) Interest expense consists primarily of ??? and amortization of debt
expense.
(5) 33% of rental expense is deemed representative of the interest factor.
