EX-12 2 ex12.htm EXHIBIT 12

Exhibit 12

RATIO OF EARNINGS TO FIXED CHARGES

|  | Fiscal Year Ended |
(Dollars In thousands) |  | October 31, 2013 |  |  | October 31, 2012 |  |  | October 31, 2011 |  |  | October 31, 2010 |  |  | October 31, 2009 |
Net (loss) income |  | $ | 31,295 |  |  | $ | (66,197 | ) |  | $ | (286,087 | ) |  | $ | 2,588 |  |  | $ | (716,712 | )
Add: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Federal and state (benefit) income tax provision |  |  | (9,360 | ) |  |  | (35,051 | ) |  |  | (5,501 | ) |  |  | (297,870 | ) |  |  | 44,693 |
Interest expensed |  |  | 143,574 |  |  |  | 152,433 |  |  |  | 171,845 |  |  |  | 182,359 |  |  |  | 200,469 |
Interest expensed mortgage and financing subsidiaries |  |  | 3,008 |  |  |  | 2,514 |  |  |  | 1,889 |  |  |  | 1,848 |  |  |  | 1,728 |
Interest included in rent expense |  |  | 5,199 |  |  |  | 5,663 |  |  |  | 6,612 |  |  |  | 7,914 |  |  |  | 12,206 |
Distributions of earnings of unconsolidated joint ventures, net of (loss) income from unconsolidated joint ventures |  |  | (9,700 | ) |  |  | (3,611 | ) |  |  | 10,541 |  |  |  | 1,295 |  |  |  | 50,134 |
Amortization of bond prepaid expenses |  |  | 6,045 |  |  |  | 3,713 |  |  |  | 3,978 |  |  |  | 3,310 |  |  |  | 14,300 |
Amortization of bond discounts |  |  | 1,798 |  |  |  | 3,149 |  |  |  | 2,069 |  |  |  | 1,741 |  |  |  | 1,179 |
Total income (loss) earnings |  | $ | 171,859 |  |  | $ | 62,613 |  |  | $ | (94,654 | ) |  | $ | (96,815 | ) |  | $ | (392,003 | )
Fixed Charges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest incurred |  | $ | 132,611 |  |  | $ | 147,048 |  |  | $ | 156,998 |  |  | $ | 154,307 |  |  | $ | 194,702 |
Interest incurred mortgage and financing subsidiaries |  |  | 3,008 |  |  |  | 2,434 |  |  |  | 1,959 |  |  |  | 1,848 |  |  |  | 1,728 |
Amortization of bond prepaid expenses |  |  | 6,045 |  |  |  | 3,713 |  |  |  | 3,978 |  |  |  | 3,310 |  |  |  | 14,300 |
Amortization of bond discounts |  |  | 1,798 |  |  |  | 3,149 |  |  |  | 2,069 |  |  |  | 1,741 |  |  |  | 1,179 |
Interest included in rent expense (a) |  |  | 5,199 |  |  |  | 5,663 |  |  |  | 6,612 |  |  |  | 7,914 |  |  |  | 12,206 |
Total fixed charges |  | $ | 148,661 |  |  | $ | 162,007 |  |  | $ | 171,616 |  |  | $ | 169,120 |  |  | $ | 224,115 |
Ratio of earnings to fixed charges |  |  | 1.2 |  |  | (b) |  |  | (b) |  |  | (b) |  |  | (b) |

RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS

|  | Fiscal Year Ended |
(Dollars In thousands) |  | October 31, 2013 |  |  | October 31, 2012 |  |  | October 31, 2011 |  |  | October 31, 2010 |  |  | October 31, 2009 |
Total income (loss) earnings – above |  | $ | 171,859 |  |  | $ | 62,613 |  |  | $ | (94,654 | ) |  | $ | (96,815 | ) |  | $ | (392,003 | )
Total fixed charges – above |  | $ | 148,661 |  |  | $ | 162,007 |  |  | $ | 171,616 |  |  | $ | 169,120 |  |  | $ | 224,115 |
Preferred stock dividends (adjusted to pretax dollars) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Combined fixed charges and preferred stock dividends |  | $ | 148,661 |  |  | $ | 162,007 |  |  | $ | 171,616 |  |  | $ | 169,120 |  |  | $ | 224,115 |
Ratio of earnings to combined fixed charges and preferred stock dividends |  |  | 1.2 |  |  | (c) |  |  | (c) |  |  | (c) |  |  | (c) |

(a) | Management has determined the interest component of rent expense to be 33%.
(b) | Earnings for the year ended October 31, 2012, 2011, 2010, 2009 and 2008 were insufficient to cover fixed charges for such period by $105.1 million, $272.9 million, $273.8 million, $628.3 million and $1,153.5 million, respectively.
(c) | Earnings for the year ended October 31, 2012, 2011, 2010, 2009 and 2008 were insufficient to cover fixed charges and preferred stock dividends for such period by $105.1 million, $272.9 million, $273.8 million, $628.3 million and $1,153.5 million, respectively. Due to restrictions in our indentures on our senior and senior secured notes, we are currently prohibited from paying dividends on our preferred stock and did not make any dividend payments in fiscal 2012, 2011, 2010, 2009 and 2008.