Exhibit 12
NCO Group, Inc.
Ratio of Earnings to Fixed Charges
(in thousands, except for ratios)
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For the Three Months Ended |
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March 31, |
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2010(1)(2) |
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2009(1)(3) |
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Earnings: |
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Add: |
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Loss before income taxes and noncontrolling interest |
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$ |
(11,298 |
) |
$ |
(3,825 |
) |
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Fixed charges |
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29,540 |
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28,688 |
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Amortization of capitalized interest |
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— |
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3 |
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18,242 |
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24,866 |
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Subtract: |
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Distributions to noncontrolling interest holders |
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1,264 |
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2,317 |
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1,264 |
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2,317 |
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Earnings |
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$ |
16,978 |
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$ |
22,549 |
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Fixed Charges: |
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Interest expense |
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$ |
23,601 |
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$ |
23,110 |
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Portion of rentals deemed to be interest |
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5,939 |
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5,578 |
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$ |
29,540 |
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$ |
28,688 |
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Ratio of earnings to fixed charges |
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0.6 |
x |
0.8 |
x |
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(1) |
For the three months ended March 31, 2010 and 2009, the Company’s ratio of earnings to fixed charges indicated a less than one-to-one coverage. The deficiency was a result of earnings that were $12.6 million and $6.1 million, respectively, less than fixed charges. |
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(2) |
Loss before income taxes and noncontrolling interest includes restructuring charges of $1.4 million. |
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(3) |
Loss before income taxes and noncontrolling interest includes restructuring charges of $443,000. |