MCN ENERGY GROUP INC, 10-Q, 1999-08-16

MCN ENERGY GROUP INC
10-Q, 1999-08-16
NATURAL GAS DISTRIBUTION

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EXHIBIT 12-2

MCN INVESTMENT CORPORATION AND SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES


			Twelve Months			Twelve Months			Twelve Months		Twelve Months
			Ended			Ended			Ended		Ended
			June 30, 1999			December 31, 1998			December 31, 1997		December 31, 1996

(Dollars in Thousands)
EARNINGS AS DEFINED(1)(4)(5)




Pre-tax income (2)(6)(7)			$	(68,003	)	$	(302,626	)	$	37,929	$	21,899




Fixed charges(3)				100,207			92,822			65,891		41,628

	Earnings as defined		$	32,204		$	(209,804	)	$	103,820	$	63,527

FIXED CHARGES AS DEFINED(1)(4)(5)




Interest, expensed			$	96,754		$	90,451		$	64,434	$	40,523




Interest, capitalized				9,907			15,239			15,002		8,002




Amortization of debt discounts, premium and expense				2,067			1,915			1,183		982




Interest implicit in rentals				1,386			456			274		123

		Fixed charges as defined	$	110,114		$	108,061		$	80,893	$	49,630

Ratio of Earnings to Fixed Charges										1.28		1.28

Coverage Deficiency (8) (9)			$	77,910		$	317,865

[Additional columns below]

[Continued from above table, first column(s) repeated]

Twelve Months Twelve Months

Ended Ended

December 31, 1995 December 31, 1994

(Dollars in Thousands)

EARNINGS AS DEFINED(1)(4)(5)

Pre-tax income (2)(6)(7) $ 13,163 $ 6,696

Fixed charges(3) 24,748 13,640

Earnings as defined $ 37,911 $ 20,336

FIXED CHARGES AS DEFINED(1)(4)(5)

Interest, expensed $ 24,151 $ 13,365

Interest, capitalized 5,895 2,089

Amortization of debt discounts, premium and expense 520 275

Interest implicit in rentals 77 —

Fixed charges as defined $ 30,643 $ 15,729

Ratio of Earnings to Fixed Charges 1.24 1.29

Coverage Deficiency (8) (9)

(1) Earnings and fixed charges are defined and computed in accordance with Item 503 of Regulation S-K.

(2) This amount represents the aggregate of (a) the pre-tax income from continuing operations of MCN Investment and its majority-owned subsidiaries, (b) MCN Investment’s share of pre-tax income of its 50% owned companies, and (c) any income actually received from less than 50% owned companies.

(3) Fixed charges added to earnings are adjusted to exclude interest capitalized during the period.

(4) In June 1996, MCN completed the sale of The Genix Group, its computer operations subsidiary. For purposes of calculating the Ratio of Earnings to Fixed Charges, it has been classified as a discontinued operation and therefore excluded from the ratio for all periods presented.

(5) The E&P segment has been reclassified from discontinued operations to continuing operations as described in Note 6 to the Consolidated Financial Statements included herein. Therefore, for purposes of calculating the Ratio of Earnings to Fixed Charges, E&P financial information is included in the ratio for all periods presented.

(6) For the twelve-month period ended June 30, 1999, MCN Investment recorded several unusual charges, consisting of property write-downs, investment losses, restructuring charges and losses on sale of properties, totaling $354,081,000 pre-tax ($230,152,000 net of taxes).

(7) For the twelve-month period ended December 31, 1998, MCN Investment recorded several unusual charges, consisting of property write-downs, investment losses and restructuring charges, totaling $564,984,000 pre-tax ($367,239,000 net of taxes).

(8) Earnings for the twelve-month period ended June 30, 1999, were not adequate to cover fixed charges. The amount of the coverage deficiency was $77,910,000. The Ratio of Earnings to Fix Charges excluding unusual charges would have been 3.51.

(9) Earnings for the twelve-month period ended December 31, 1998, were not adequate to cover fixed charges. The amount of the coverage deficiency was $317,865,000. The Ratio of Earnings to Fix Charges excluding unusual charges would have been 3.29.


	(1)	Earnings and fixed charges are defined and computed in accordance with Item 503 of Regulation S-K.
	(2)	This amount represents the aggregate of (a) the pre-tax income from continuing operations of MCN Investment and its majority-owned subsidiaries, (b) MCN Investment’s share of pre-tax income of its 50% owned companies, and (c) any income actually received from less than 50% owned companies.
	(3)	Fixed charges added to earnings are adjusted to exclude interest capitalized during the period.
	(4)	In June 1996, MCN completed the sale of The Genix Group, its computer operations subsidiary. For purposes of calculating the Ratio of Earnings to Fixed Charges, it has been classified as a discontinued operation and therefore excluded from the ratio for all periods presented.
	(5)	The E&P segment has been reclassified from discontinued operations to continuing operations as described in Note 6 to the Consolidated Financial Statements included herein. Therefore, for purposes of calculating the Ratio of Earnings to Fixed Charges, E&P financial information is included in the ratio for all periods presented.
	(6)	For the twelve-month period ended June 30, 1999, MCN Investment recorded several unusual charges, consisting of property write-downs, investment losses, restructuring charges and losses on sale of properties, totaling $354,081,000 pre-tax ($230,152,000 net of taxes).
	(7)	For the twelve-month period ended December 31, 1998, MCN Investment recorded several unusual charges, consisting of property write-downs, investment losses and restructuring charges, totaling $564,984,000 pre-tax ($367,239,000 net of taxes).
	(8)	Earnings for the twelve-month period ended June 30, 1999, were not adequate to cover fixed charges. The amount of the coverage deficiency was $77,910,000. The Ratio of Earnings to Fix Charges excluding unusual charges would have been 3.51.
	(9)	Earnings for the twelve-month period ended December 31, 1998, were not adequate to cover fixed charges. The amount of the coverage deficiency was $317,865,000. The Ratio of Earnings to Fix Charges excluding unusual charges would have been 3.29.