EX-12 3 a2018q310qex12.htm EXHIBIT 12
Exhibit 12
ZOETIS INC. AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES(a)

|  | Nine Months Ended |  |  |  |  |  |  |  |  |  |
|  | September 30, |  |  | Year Ended December 31,
(IN MILLIONS, EXCEPT RATIOS) |  | 2018 |  |  | 2017 |  |  | 2016 |  |  | 2015 |  |  | 2014 |  | 2013 |
Determination of earnings: |  |  |  |  |  |  |  |  |  |  |
Income before provision for taxes on income |  |  |  |  |  |  |  |  |  |  |
and noncontrolling interests |  | $ | 1,272 |  |  | $ | 1,525 |  |  | $ | 1,228 |  |  | $ | 545 |  |  | $ | 820 |  | $ | 690 |
Less: Net income/(loss) attributable to noncontrolling interests |  | (4 | ) |  | (2 | ) |  | (2 | ) |  | — |  |  | 4 |  | (1 | )
Income attributable to Zoetis Inc. |  | 1,276 |  |  | 1,527 |  |  | 1,230 |  |  | 545 |  |  | 816 |  | 691 |
Add: fixed charges |  | 160 |  |  | 188 |  |  | 177 |  |  | 137 |  |  | 131 |  | 127 |
Total earnings as defined |  | $ | 1,436 |  |  | $ | 1,715 |  |  | $ | 1,407 |  |  | $ | 682 |  |  | $ | 947 |  | $ | 818 |
Fixed charges: |  |  |  |  |  |  |  |  |  |  |
Interest expense, net of capitalized interest(a) |  | $ | 147 |  |  | $ | 175 |  |  | $ | 166 |  |  | $ | 124 |  |  | $ | 117 |  | $ | 113 |
Capitalized interest |  | 6 |  |  | 4 |  |  | 3 |  |  | 4 |  |  | 4 |  | 3 |
Interest portion of rent expense(b) |  | 7 |  |  | 9 |  |  | 8 |  |  | 9 |  |  | 10 |  | 11 |
Fixed charges |  | $ | 160 |  |  | $ | 188 |  |  | $ | 177 |  |  | $ | 137 |  |  | $ | 131 |  | $ | 127 |
Ratio of earnings to fixed charges |  | 9.0 |  |  | 9.1 |  |  | 7.9 |  |  | 5.0 |  |  | 7.2 |  | 6.4 |

(a) | Interest expense includes amortization of debt discount and fees. Interest expense does not include interest related to uncertain tax positions.

(b) | One-third of all rental expense is deemed to be interest, which we believe to be a conservative estimate of an interest factor in our leases.