EX-12.2 10 exhibit122930201610-q.htm EXHIBIT 12.2
EXHIBIT 12.2
EPR PROPERTIES
COMPUTATION OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
(Dollars in thousands)

|  | Nine Months Ended September 30, |  | Year Ended December 31,
|  | 2016 |  | 2015 |  | 2014 |  | 2013 |  | 2012 |  | 2011
Earnings: |  |  |  |  |  |  |  |  |  |  |  |
Income before equity in income from joint ventures and other items (1) |  | $ | 163,092 |  |  | $ | 170,017 |  |  | $ | 177,278 |  |  | $ | 152,193 |  |  | $ | 140,881 |  |  | $ | 127,241 |
Fixed charges before preferred dividends |  | 78,438 |  |  | 98,672 |  |  | 88,996 |  |  | 83,988 |  |  | 77,738 |  |  | 71,980 |
Distributions from equity investments |  | 511 |  |  | 540 |  |  | 810 |  |  | 985 |  |  | 1,046 |  |  | 2,848 |
Capitalized interest |  | (7,982 | ) |  | (18,547 | ) |  | (7,525 | ) |  | (2,763 | ) |  | (859 | ) |  | (498 | )
Adjusted Earnings |  | $ | 234,059 |  |  | $ | 250,682 |  |  | $ | 259,559 |  |  | $ | 234,403 |  |  | $ | 218,806 |  |  | $ | 201,571 |
Fixed Charges: |  |  |  |  |  |  |  |  |  |  |  |
Interest expense, net (including amortization of deferred financing fees) |  | $ | 70,310 |  |  | $ | 79,915 |  |  | $ | 81,270 |  |  | $ | 81,056 |  |  | $ | 76,656 |  |  | $ | 71,295 |
Interest within rental expense (2) |  | 146 |  |  | 185 |  |  | 174 |  |  | 145 |  |  | 156 |  |  | 154 |
Interest income |  | — |  |  | 25 |  |  | 27 |  |  | 24 |  |  | 67 |  |  | 33 |
Capitalized interest |  | 7,982 |  |  | 18,547 |  |  | 7,525 |  |  | 2,763 |  |  | 859 |  |  | 498 |
Preferred dividends |  | 17,855 |  |  | 23,806 |  |  | 23,807 |  |  | 23,806 |  |  | 24,508 |  |  | 28,140 |
Combined Fixed Charges and Preferred Dividends |  | $ | 96,293 |  |  | $ | 122,478 |  |  | $ | 112,803 |  |  | $ | 107,794 |  |  | $ | 102,246 |  |  | $ | 100,120 |
Ratio of Earnings to Combined Fixed Charges and Preferred Dividends |  | 2.4 | x |  | 2.0 | x |  | 2.3 | x |  | 2.2 | x |  | 2.1 | x |  | 2.0 | x

(1) | Earnings before equity in income in joint ventures and other items for the nine months ended September 30, 2016 includes $0.9 million in costs associated with loan refinancing or payoff. Earnings before equity in income in joint ventures and other items for the year ended December 31, 2015 includes $18.6 million of retirement severance expense and $0.3 million in costs associated with loan refinancing or payoff. Earnings before equity in income from joint ventures and other items for the year ended December 31, 2014 includes $3.8 million in provision for loan losses and $0.3 million in costs associated with loan refinancing or payoff. Earnings before equity in income from joint ventures and other items for the year ended December 31, 2013 includes $6.2 million in costs associated with loan refinancing or payoff and a $4.5 million gain on early extinguishment of debt. Earnings before equity in income from joint ventures and other items for the year ended December 31, 2012 includes $3.1 million in impairment charges for properties held and used and $0.6 million in costs associated with loan refinancing or payoff. Earnings before equity in income from joint ventures and other items for the year ended December 31, 2011 includes $2.5 million in impairment charges for properties held and used and $1.9 million in costs associated with loan refinancing or payoff.
(2) | Interest within rental expense represents one-third of rental expense (the approximate portion of rental expense representing interest).