EX-12.1 2 dex121.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Computation of Ratio of Earnings to Fixed Charges

Exhibit 12.1

 

 

Telecom Argentina S.A.

Computation of Ratio of Earnings to Fixed Charges/Deficiency

In the Coverage of Fixed Charges by Earnings Before Fixed Charges (in Argentine GAAP)

 

(In millon of Argentine constant pesos, except for the ratio)

 

 

     As of and for fiscal year ended
  
     September
1999
     December
2000
     December
2001
     December
2002
     December
2003
  

A – Earnings

                               

Pretax income (loss)

    1,152     603     218     (5,692 )   363  

Fixed charges

    569     687     708     946     629  

Amortization of capitalized interest

    53     65     56     92     94  

Distributed income from equity investments

    0     0     0     0     0  

Less:

                               

Capitalized interest

    (105 )   (130 )   (104 )   (67 )   (6 )
    
 
 
 
 
     1,669     1,225     878     (4,721 )   1.080  
    
 
 
 
 

B – Fixed charges

                               

Interest expenses

    441     519     564     852     608  

Capitalized interest

    105     130     104     67     6  

Estimate of the interest within rental expense

    23     38     40     27     15  

Preference security dividend

    0     0     0     0     0  
    
 
 
 
 
     569     687     708     946     629  
    
 
 
 
 

Ratio (A/B)

    2.9     1.8     1.2     —  (1)   1.7  

 

(1) Under Argentine GAAP, the ratio related to the year ended December 31, 2002 indicates less than one-to-one coverage. Consequently, earnings for this period are inadequate to cover fixed charges. A total amount of earnings of P$5,667 million is required to attain a ratio of one-to-one determined under Argentine GAAP for the year ended December 31, 2002.

 

Telecom Argentina S.A.

Computation of Ratio of Earnings to Fixed Charges/Deficiency

In the Coverage of Fixed Charges by Earnings Before Fixed Charges (in U.S. GAAP)

 

(In millon of Argentine constant pesos, except for the ratio)

 

 

     As of and for fiscal year ended
  
     September
1999
     December
2000
     December
2001
     December
2002
     December
2003
  

A – Earnings

                               

Pretax income (loss)

    1,250     554     (3,331 )   (2,886 )   535  

Fixed charges

    569     687     708     946     629  

Amortization of capitalized interest

    53     65     56     92     94  

Distributed income from equity investments

    0     0     0     0     0  

Less:

                               

Capitalized interest

    (105 )   (130 )   (104 )   (67 )   (6 )
    
 
 
 
 
     1,767     1,176     (2,671 )   (1,915 )   1,252  
    
 
 
 
 

B – Fixed charges

                               

Interest expenses

    441     519     564     852     608  

Capitalized interest

    105     130     104     67     6  

Estimate of the interest within rental expense

    23     38     40     27     15  

Preference security dividend

    0     0     0     0     0  
    
 
 
 
 
     569     687     708     946     629  
    
 
 
 
 

Ratio (A/B)

    3.1     1.7     —  (1)   —  (1)   2.0  

 

(1) Under U.S. GAAP, the ratios related to the years ended December 31, 2002 and 2001 indicate less than one-to-one coverage. Consequently, earnings for these periods are inadequate to cover fixed charges. A total amount of earnings of P$2,861 million and P$3,379 million is required to attain a ratio of one-to-one determined under US GAAP for the years ended December 31, 2002 and 2001, respectively.