EX-12 69 a15-1108_1ex12.htm EX-12

Exhibit 12

Quad/Graphics, Inc.

Ratio of Earnings to Fixed Charges

(in millions, except ratios)

|  | Nine Months Ended September 30, |  | Year Ended December 31, |
|  | 2014 |  | 2013 |  | 2013 |  | 2012 |  | 2011 |  | 2010 |  | 2009 |
Earnings: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Earnings (loss) from continuing operations before income taxes and equity in earnings (loss) of unconsolidated entities |  | $ | (10.4 | ) | $ | (25.8 | ) | $ | 56.7 |  | $ | 22.5 |  | $ | 14.9 |  | $ | (31.3 | ) | $ | 48.3 |
Add: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Distributed income of unconsolidated entities |  | — |  | 5.0 |  | 5.0 |  | 0.5 |  | 7.5 |  | 4.7 |  | 6.0 |
Fixed charges (see below) |  | 80.2 |  | 74.5 |  | 99.3 |  | 97.0 |  | 122.7 |  | 105.5 |  | 67.1 |
Amortization of capitalized interest |  | 1.0 |  | 1.1 |  | 1.4 |  | 1.6 |  | 1.7 |  | 1.7 |  | 1.8 |
Subtract: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest capitalized |  | (0.2 | ) | (0.5 | ) | (0.5 | ) | (0.2 | ) | (0.4 | ) | (0.2 | ) | (0.3 | )
Total earnings |  | $ | 70.6 |  | $ | 54.3 |  | $ | 161.9 |  | $ | 121.4 |  | $ | 146.4 |  | $ | 80.4 |  | $ | 122.9 |
Fixed charges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest expense |  | $ | 69.5 |  | $ | 64.1 |  | $ | 85.5 |  | $ | 84.0 |  | $ | 108.0 |  | $ | 92.9 |  | $ | 64.1 |
Interest capitalized |  | 0.2 |  | 0.5 |  | 0.5 |  | 0.2 |  | 0.4 |  | 0.2 |  | 0.3 |
Amortization of debt issuance costs and original issue discount |  | 3.2 |  | 3.1 |  | 4.1 |  | 4.5 |  | 8.6 |  | 5.9 |  | — |
Estimate of interest included within rental expense (a) |  | 7.3 |  | 6.8 |  | 9.2 |  | 8.3 |  | 5.7 |  | 6.5 |  | 2.7 |
Total fixed charges |  | $ | 80.2 |  | $ | 74.5 |  | $ | 99.3 |  | $ | 97.0 |  | $ | 122.7 |  | $ | 105.5 |  | $ | 67.1 |
Ratio of earnings to fixed charges (b) |  | 0.9 |  | 0.7 |  | 1.6 |  | 1.3 |  | 1.2 |  | 0.8 |  | 1.8 |

(a) Interest portion of rental expense is estimated to equal 25% of such expense, which is considered a reasonable approximation of the interest factor.

(b) Earnings were insufficient to cover fixed charges for the nine months ended September 30, 2014 and 2013 by $9.6 million and $20.2 million, respectively, and for the year ended December 31, 2010 by $25.1 million. Accordingly, the ratio of earnings to fixed charges was less than 1:1.