Brookfield Infrastructure Partners L.P. (Brookfield Infrastructure,
BIP, or the Partnership) (NYSE: BIP; TSX: BIP.UN) today announced
its results for the third quarter ended September 30, 2023.
“We had strong financial results and delivered
on all of our strategic initiatives to date in 2023,” said Sam
Pollock, Chief Executive Officer of Brookfield Infrastructure
Partners. “We have demonstrated our ability to use our size, scale
and diversification to continue recycling capital at good
valuations, while investing at higher returns on our new
investments.”
| |
For the three monthsended September 30 |
|
For the nine monthsended September 30 |
|
US$ millions (except per unit amounts), unaudited1 |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
Net income2 |
$ |
104 |
|
$ |
113 |
|
$ |
505 |
|
$ |
359 |
|
|
– per unit3 |
$ |
0.03 |
|
$ |
0.05 |
|
$ |
0.34 |
|
$ |
0.17 |
|
| FFO4 |
$ |
560 |
|
$ |
525 |
|
$ |
1,666 |
|
$ |
1,531 |
|
|
– per unit5 |
$ |
0.73 |
|
$ |
0.68 |
|
$ |
2.16 |
|
$ |
1.99 |
|
Brookfield Infrastructure reported net income of
$104 million for the three-month period ended September 30, 2023
compared to $113 million in the prior year. Current year results
benefited from the contribution associated with recently completed
acquisitions and organic growth across our base business. These
positive impacts were partially offset by higher borrowing costs
associated with the financing of growth initiatives and lower gains
on currency and commodity contracts than in the same period last
year.
Funds from operations (FFO) in the quarter was
$560 million, a 7% increase compared with the same period last
year. Results benefited from strong base business performance
reflecting higher tariffs and the commissioning of approximately $1
billion of capital projects in the past 12 months. Our financial
results do not reflect the benefit of new investments this year and
we are conversely impacted by nearly $2 billion of asset sales that
primarily closed in the second quarter of 2023. The fourth quarter
will fully reflect the contributions of our new investments, which
closed right before, or subsequent to, September 30.
Segment Performance
The following table presents FFO by segment:
| |
For the three monthsended September 30 |
|
For the nine monthsended September 30 |
|
US$ millions, unaudited1 |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
FFO by segment |
|
|
|
|
|
|
|
|
Utilities |
$ |
229 |
|
|
$ |
196 |
|
|
$ |
661 |
|
|
$ |
551 |
|
|
Transport |
|
205 |
|
|
|
203 |
|
|
|
596 |
|
|
|
587 |
|
|
Midstream |
|
163 |
|
|
|
172 |
|
|
|
522 |
|
|
|
538 |
|
|
Data |
|
66 |
|
|
|
60 |
|
|
|
208 |
|
|
|
178 |
|
|
Corporate |
|
(103 |
) |
|
|
(106 |
) |
|
|
(321 |
) |
|
|
(323 |
) |
|
FFO4 |
$ |
560 |
|
|
$ |
525 |
|
|
$ |
1,666 |
|
|
$ |
1,531 |
|
The utilities segment generated FFO of $229
million, an increase of 17% from the comparable period last year.
Organic growth for the segment was over 10%, reflecting inflation
indexation and the commissioning of approximately $500 million of
capital into the rate base during the last 12 months. Current
quarter results benefited from the expansion of our residential
decarbonization infrastructure platform in North America and
Europe, following the acquisition of HomeServe in January 2023.
This positive contribution was partially offset by the sale of our
interest in an Australian regulated utility in August of this
year.
The transport segment generated FFO of $205
million for the quarter, with organic growth of 7% compared to the
same period last year. Rates across the portfolio have broadly
increased, with our global toll road tariffs increasing by 8% and
our rail networks passing through rate increases of 7% compared to
the same period last year. Volumes remained consistent, reinforcing
the criticality of our assets despite softness in the broader
global transportation network. Partially offsetting the strong
underlying operational performance were higher borrowing costs at
our U.K. port operations, the normalization of commodity prices at
our U.S. LNG export terminal and the sale of our Indian toll road
portfolio that was completed in June 2023.
FFO from our midstream segment was $163 million,
a 5% decrease compared to the prior period, due to the partial sale
of our interest in a U.S. gas pipeline in June of this year and the
normalization of market sensitive revenues at our Canadian
diversified midstream business. Results were supported by increased
utilization and higher contracted cash flows across the segment
compared to last year, as well as the initial contribution from the
Heartland Petrochemical Complex.
FFO from our data segment was $66 million, an
increase of 10% from the same period last year. The increase is
attributable to the acquisitions of a European telecom tower
operation in February 2023 and a European hyperscale data center
platform that closed in August. The prior period included
contributions from a New Zealand integrated data distribution
business that was sold in June of this year.
Update on Strategic Initiatives
The market backdrop has created a strong
environment for capital deployment, with returns on new investments
expected to be well in excess of our 12-15% target. Our 2023
deployment is expected to provide us with some of the best
risk-adjusted returns we have seen in the last decade.
The take-private of Triton, our global
intermodal logistics operation, closed on September 28. Brookfield
Infrastructure invested approximately $1.2 billion for a 28%
interest, funded primarily using new BIPC shares as transaction
consideration. We expect to generate a base case IRR above our
targets, derived largely from the in-place cash yield. The leading
market position and highly cash generative nature of the business
provides strong operational flexibility to invest in fleet
replacements and growth during favorable markets, or to harvest
cash in less attractive markets.
We are also very excited about the opportunities
across our data center platform, which has grown significantly
following the acquisitions of Data4 and Compass that closed in
August and October, respectively. Most recently, we reached an
agreement to acquire a portfolio of data centers out of bankruptcy
from Cyxtera, as well as the associated real estate underlying
several of the sites from third-party landlords. We believe we will
generate strategic value by combining Cyxtera with Evoque to create
a leading retail colocation data center provider, with over 330
megawatts of capacity deployed in high demand areas across North
America. The combined platform will have the scale, assets and
capabilities required to provide critical infrastructure for its
over 2,500 customers to support the exponential increase in demand
from industry tailwinds, including AI and cloud deployments.
The total purchase price for the data centers
and associated real estate underlying the sites is approximately
$1.3 billion, inclusive of transaction costs and net of proceeds
received from concurrently selling non-core Cyxtera sites to a
third-party. Funding has been secured and will be collateralized by
the combined portfolio of Cyxtera’s and Evoque’s data centers and
associated real estate. As part of this transformative transaction,
cash flow for the combined entity will undergo a step-change
improvement from the real estate acquisitions, financial synergies
and lease savings negotiated with Cyxtera’s third-party landlords
during the bankruptcy process. The transaction is expected to close
in Q1 2024 and is subject to customary closing conditions.
Distribution and Dividend Declaration
The Board of Directors of BIP has declared a
quarterly distribution in the amount of $0.3825 per unit, payable
on December 29, 2023 to unitholders of record as at the close of
business on November 30, 2023. This distribution represents a 6%
increase compared to the prior year. The regular quarterly
dividends on the Cumulative Class A Preferred Limited Partnership
Units, Series 1, Series 3, Series 9, Series 11, Series 13 and
Series 14 have also been declared, as well as the capital gains
dividend for BIP Investment Corporation Senior Preferred Shares,
Series 1. In conjunction with the Partnership’s distribution
declaration, the Board of Directors of BIPC has declared an
equivalent quarterly dividend of $0.3825 per share, also payable on
December 29, 2023 to shareholders of record as at the close of
business on November 30, 2023.
Conference Call and Quarterly Earnings
Details
Investors, analysts and other interested parties
can access Brookfield Infrastructure’s Third Quarter 2023 Results,
as well as Letter to Unitholders and Supplemental Information,
under the Investor Relations section at
https://bip.brookfield.com.
To participate in the Conference Call today at
9:00am EST, please pre-register at
https://register.vevent.com/register/BI95ca4eecbc3047b5b1db2c6bf574df34.
Upon registering, you will be emailed a dial-in number, direct
passcode and unique PIN. The Conference Call will also be Webcast
live at https://edge.media-server.com/mmc/p/ozkjpybg.
Additional Information
The Board has reviewed and approved this news
release, including the summarized unaudited financial information
contained herein.
About Brookfield
Infrastructure
Brookfield Infrastructure is a leading global
infrastructure company that owns and operates high-quality,
long-life assets in the utilities, transport, midstream and data
sectors across North and South America, Asia Pacific and Europe. We
are focused on assets that have contracted and regulated revenues
that generate predictable and stable cash flows. Investors can
access its portfolio either through Brookfield Infrastructure
Partners L.P. (NYSE: BIP; TSX: BIP.UN), a Bermuda-based limited
partnership, or Brookfield Infrastructure Corporation (NYSE, TSX:
BIPC), a Canadian corporation. Further information is available at
http://bip.brookfield.com.
Brookfield Infrastructure is the flagship listed
infrastructure company of Brookfield Asset Management, a global
alternative asset manager with over $850 billion of assets under
management. For more information, go to https://brookfield.com.
Contact Information
| Media: |
Investors: |
| Simon Maine |
Stephen Fukuda |
| Managing Director |
Vice President |
| Corporate Communications |
Corporate Development &
Investor Relations |
| Tel: +44 739 890 9278 |
Tel: +1 416 956 5129 |
| Email:
simon.maine@brookfield.com |
Email:
stephen.fukuda@brookfield.com |
| |
|
Cautionary Statement Regarding
Forward-looking Statements
This news release may contain forward-looking
information within the meaning of Canadian provincial securities
laws and “forward-looking statements” within the meaning of
applicable securities laws. The words “will”, “target”, “future”,
“growth”, “expect”, “believe”, “may”, derivatives thereof and other
expressions which are predictions of or indicate future events,
trends or prospects and which do not relate to historical matters,
identify the above mentioned and other forward-looking statements.
Forward-looking statements in this news release include statements
regarding the three-for-two split of BIP and BIPC’s respective
units and shares, and may include statements regarding expansion of
Brookfield Infrastructure’s business, the likelihood and timing of
successfully completing the transactions referred to in this news
release, statements with respect to our assets tending to
appreciate in value over time, the future performance of acquired
businesses and growth initiatives, the commissioning of our capital
backlog, the pursuit of projects in our pipeline, the level of
distribution growth over the next several years and our
expectations regarding returns to our unitholders as a result of
such growth. Although Brookfield Infrastructure believes that these
forward-looking statements and information are based upon
reasonable assumptions and expectations, the reader should not
place undue reliance on them, or any other forward-looking
statements or information in this news release. The future
performance and prospects of Brookfield Infrastructure are subject
to a number of known and unknown risks and uncertainties. Factors
that could cause actual results of Brookfield Infrastructure to
differ materially from those contemplated or implied by the
statements in this news release include general economic conditions
in the jurisdictions in which we operate and elsewhere which may
impact the markets for our products and services, the ability to
achieve growth within Brookfield Infrastructure’s businesses and in
particular completion on time and on budget of various large
capital projects, which themselves depend on access to capital and
continuing favorable commodity prices, and our ability to achieve
the milestones necessary to deliver the targeted returns to our
unitholders, the impact of market conditions on our businesses, the
fact that success of Brookfield Infrastructure is dependent on
market demand for an infrastructure company, which is unknown, the
availability of equity and debt financing for Brookfield
Infrastructure, the impact of health pandemics on our business and
operations, the ability to effectively complete transactions in the
competitive infrastructure space (including the ability to complete
announced and potential transactions that may be subject to
conditions precedent, and the inability to reach final agreement
with counterparties to transactions referred to in this press
release as being currently pursued, given that there can be no
assurance that any such transaction will be agreed to or completed)
and to integrate acquisitions into existing operations, the future
performance of these acquisitions, changes in technology which have
the potential to disrupt the business and industries in which we
invest, the market conditions of key commodities, the price, supply
or demand for which can have a significant impact upon the
financial and operating performance of our business and other risks
and factors described in the documents filed by Brookfield
Infrastructure with the securities regulators in Canada and the
United States including under “Risk Factors” in Brookfield
Infrastructure’s most recent Annual Report on Form 20-F and other
risks and factors that are described therein. Except as required by
law, Brookfield Infrastructure undertakes no obligation to publicly
update or revise any forward-looking statements or information,
whether as a result of new information, future events or otherwise.
References to Brookfield Infrastructure are to the Partnership
together with its subsidiaries and operating entities. Brookfield
Infrastructure’s results include limited partnership units held by
public unitholders, redeemable partnership units, general
partnership units, Exchange LP units, BIPC exchangeable LP units
and BIPC exchangeable shares.
Any statements contained herein with respect to
tax consequences are of a general nature only and are not intended
to be, nor should they be construed to be, legal or tax advice to
any person, and no representation with respect to tax consequences
is made. Unitholders and shareholders are urged to consult their
tax advisors with respect to their particular circumstances.
References to Brookfield Infrastructure are to
the Partnership together with its subsidiaries and operating
entities. Brookfield Infrastructure’s results include limited
partnership units held by public unitholders, redeemable
partnership units, general partnership units, Exchange LP units,
BIPC exchangeable LP units and BIPC exchangeable shares.
References to the Partnership are to Brookfield
Infrastructure Partners L.P.
- Please
refer to page 11 for results of Brookfield Infrastructure
Corporation.
-
Includes net income attributable to limited partners, the general
partner, and non-controlling interests ‒ Redeemable Partnership
Units held by Brookfield, Exchange LP units, BIPC exchangeable LP
units and BIPC exchangeable shares.
-
Average number of limited partnership units outstanding on a time
weighted average basis for the three and nine-month periods ended
September 30, 2023 was 458.8 million and
458.6 million (2022: 458.2 million and
458.0 million).
-
We define FFO as net income excluding the impact of depreciation
and amortization, deferred income taxes, mark-to-market gains
(losses) and other income (expenses) that are not related to the
revenue earning activities and are not normal, recurring cash
operating expenses necessary for business operations. FFO includes
balances attributable to the Partnership generated by investments
in associates and joint ventures accounted for using the equity
method and excludes amounts attributable to non-controlling
interests based on the economic interests held by non-controlling
interests in consolidated subsidiaries. We believe that FFO, when
viewed in conjunction with our IFRS results, provides a more
complete understanding of factors and trends affecting our
underlying operations. FFO is a measure of operating performance
that is not calculated in accordance with, and does not have any
standardized meaning prescribed by IFRS as issued by the
International Accounting Standards Board. FFO is therefore unlikely
to be comparable to similar measures presented by other issuers. A
reconciliation of net income to FFO is available on page 9 of this
release. Readers are encouraged to consider both measures in
assessing our company’s results.
-
Average number of partnership units outstanding on a fully diluted
time weighted average basis for the three and nine-month periods
ended September 30, 2023 were 772.1 million and
771.7 million (2022: 771.3 million and
771.2 million).
| |
|
Brookfield Infrastructure Partners
L.P.Consolidated Statements of Financial
Position |
| |
| |
As of |
|
US$ millions, unaudited |
|
Sept. 30,2023 |
|
|
|
Dec. 31,2022 |
|
|
|
|
|
|
| Assets |
|
|
|
| Cash and cash equivalents |
$ |
1,307 |
|
|
$ |
1,279 |
|
| Financial assets |
|
878 |
|
|
|
785 |
|
| Property, plant and equipment
and investment properties |
|
50,953 |
|
|
|
37,991 |
|
| Intangible assets and
goodwill |
|
29,753 |
|
|
|
20,611 |
|
| Investments in associates and
joint ventures |
|
5,046 |
|
|
|
5,325 |
|
|
Deferred income taxes and other |
|
9,801 |
|
|
|
6,978 |
|
|
Total assets |
$ |
97,738 |
|
|
$ |
72,969 |
|
|
|
|
|
|
| Liabilities and
partnership capital |
|
|
|
| Corporate borrowings |
$ |
5,272 |
|
|
$ |
3,666 |
|
| Non-recourse borrowings |
|
38,846 |
|
|
|
26,567 |
|
| Financial liabilities |
|
2,579 |
|
|
|
2,067 |
|
| Deferred income taxes and
other |
|
17,055 |
|
|
|
15,115 |
|
| |
|
|
|
| Partnership
capital |
|
|
|
| Limited partners |
|
5,394 |
|
|
|
5,372 |
|
| General partner |
|
28 |
|
|
|
27 |
|
| Non-controlling interest
attributable to: |
|
|
|
|
Redeemable partnership units held by Brookfield |
|
2,216 |
|
|
|
2,263 |
|
|
Exchangeable units/shares1 |
|
1,617 |
|
|
|
1,361 |
|
|
Perpetual subordinated notes |
|
293 |
|
|
|
293 |
|
|
Interest of others in operating subsidiaries |
|
23,520 |
|
|
|
15,320 |
|
|
Preferred unitholders |
|
918 |
|
|
|
918 |
|
|
Total partnership capital |
|
33,986 |
|
|
|
25,554 |
|
|
Total liabilities and partnership capital |
$ |
97,738 |
|
|
$ |
72,969 |
|
- Includes
non-controlling interest attributable to BIPC exchangeable shares,
BIPC exchangeable LP units and Exchange LP units.
| |
|
Brookfield Infrastructure Partners
L.P.Consolidated Statements of Operating
Results |
| |
| |
For the three monthsended September 30 |
|
For the nine monthsended September 30 |
|
US$ millions, except per unit information, unaudited |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
| Revenues |
$ |
4,487 |
|
|
$ |
3,627 |
|
|
$ |
12,961 |
|
|
$ |
10,719 |
|
| Direct operating costs |
|
(3,384 |
) |
|
|
(2,590 |
) |
|
|
(9,893 |
) |
|
|
(7,808 |
) |
| General
and administrative expense |
|
(100 |
) |
|
|
(109 |
) |
|
|
(312 |
) |
|
|
(338 |
) |
|
|
|
1,003 |
|
|
|
928 |
|
|
|
2,756 |
|
|
|
2,573 |
|
| Interest expense |
|
(640 |
) |
|
|
(480 |
) |
|
|
(1,775 |
) |
|
|
(1,358 |
) |
| Share of earnings from
associates and joint ventures |
|
96 |
|
|
|
5 |
|
|
|
472 |
|
|
|
25 |
|
| Mark-to-market gains |
|
34 |
|
|
|
95 |
|
|
|
27 |
|
|
|
228 |
|
| Other
(expense) income |
|
(99 |
) |
|
|
(54 |
) |
|
|
101 |
|
|
|
37 |
|
|
Income before income tax |
|
394 |
|
|
|
494 |
|
|
|
1,581 |
|
|
|
1,505 |
|
| Income tax (expense)
recovery |
|
|
|
|
|
|
|
|
Current |
|
(142 |
) |
|
|
(70 |
) |
|
|
(418 |
) |
|
|
(370 |
) |
|
Deferred |
|
4 |
|
|
|
(63 |
) |
|
|
9 |
|
|
|
(55 |
) |
|
Net income |
|
256 |
|
|
|
361 |
|
|
|
1,172 |
|
|
|
1,080 |
|
|
Non-controlling interest of others in operating subsidiaries |
|
(152 |
) |
|
|
(248 |
) |
|
|
(667 |
) |
|
|
(721 |
) |
|
Net income attributable to partnership |
$ |
104 |
|
|
$ |
113 |
|
|
$ |
505 |
|
|
$ |
359 |
|
|
|
|
|
|
|
|
|
|
| Attributable to: |
|
|
|
|
|
|
|
|
Limited partners |
$ |
23 |
|
|
$ |
32 |
|
|
$ |
184 |
|
|
$ |
108 |
|
|
General partner |
|
66 |
|
|
|
60 |
|
|
|
198 |
|
|
|
180 |
|
|
Non-controlling interest |
|
|
|
|
|
|
|
|
Redeemable partnership units held by Brookfield |
|
10 |
|
|
|
13 |
|
|
|
76 |
|
|
|
45 |
|
|
Exchangeable units/shares1 |
|
5 |
|
|
|
8 |
|
|
|
47 |
|
|
|
26 |
|
|
Basic and diluted losses per unit attributable to: |
|
|
|
|
|
|
|
|
Limited partners2 |
$ |
0.03 |
|
|
$ |
0.05 |
|
|
$ |
0.34 |
|
|
$ |
0.17 |
|
- Includes
non-controlling interest attributable to BIPC exchangeable shares,
BIPC exchangeable LP units and Exchange LP units.
-
Average number of limited partnership units outstanding on a time
weighted average basis for the three and nine-month periods ended
September 30, 2023 was 458.8 million and 458.6 million (2022:
458.2 million and 458.0 million).
| |
|
Brookfield Infrastructure Partners L.P. Consolidated
Statements of Cash Flows |
| |
| |
For the three monthsended September 30 |
|
For the nine monthsended September 30 |
|
US$ millions, unaudited |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
| Operating
Activities |
|
|
|
|
|
|
|
| Net income |
$ |
256 |
|
|
$ |
361 |
|
|
$ |
1,172 |
|
|
$ |
1,080 |
|
| Adjusted for the following
items: |
|
|
|
|
|
|
|
|
Earnings from investments in associates and joint ventures, net of
distributions received |
|
30 |
|
|
|
64 |
|
|
|
191 |
|
|
|
210 |
|
|
Depreciation and amortization expense |
|
669 |
|
|
|
520 |
|
|
|
1,946 |
|
|
|
1,616 |
|
|
Mark-to-market, provisions and other |
|
156 |
|
|
|
(64 |
) |
|
|
48 |
|
|
|
(243 |
) |
|
Deferred income tax (recovery) expense |
|
(4 |
) |
|
|
63 |
|
|
|
(9 |
) |
|
|
55 |
|
| Change
in non-cash working capital, net |
|
(117 |
) |
|
|
(268 |
) |
|
|
(871 |
) |
|
|
(573 |
) |
|
Cash from operating activities |
|
990 |
|
|
|
676 |
|
|
|
2,477 |
|
|
|
2,145 |
|
|
|
|
|
|
|
|
|
|
| Investing
Activities |
|
|
|
|
|
|
|
| Net (investments in) proceeds
from: |
|
|
|
|
|
|
|
|
Operating assets |
|
(5,970 |
) |
|
|
(271 |
) |
|
|
(10,145 |
) |
|
|
(313 |
) |
|
Associates |
|
435 |
|
|
|
(193 |
) |
|
|
405 |
|
|
|
(589 |
) |
|
Long-lived assets |
|
(616 |
) |
|
|
(761 |
) |
|
|
(1,612 |
) |
|
|
(2,074 |
) |
|
Financial assets |
|
69 |
|
|
|
8 |
|
|
|
245 |
|
|
|
27 |
|
|
Net settlements of foreign exchange contracts |
|
2 |
|
|
|
89 |
|
|
|
2 |
|
|
|
113 |
|
| Other
investing activities |
|
(10 |
) |
|
|
— |
|
|
|
(678 |
) |
|
|
— |
|
|
Cash used by investing activities |
|
(6,090 |
) |
|
|
(1,128 |
) |
|
|
(11,783 |
) |
|
|
(2,836 |
) |
|
|
|
|
|
|
|
|
|
| Financing
Activities |
|
|
|
|
|
|
|
| Distributions to limited and
general partners |
|
(377 |
) |
|
|
(354 |
) |
|
|
(1,130 |
) |
|
|
(1,065 |
) |
| Net borrowings: |
|
|
|
|
|
|
|
|
Corporate |
|
652 |
|
|
|
493 |
|
|
|
1,610 |
|
|
|
1,311 |
|
|
Subsidiary |
|
777 |
|
|
|
217 |
|
|
|
3,323 |
|
|
|
1,610 |
|
| Net preferred units
redeemed |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(243 |
) |
| Partnership units issued |
|
2 |
|
|
|
3 |
|
|
|
10 |
|
|
|
11 |
|
| Settlement of deferred
consideration |
|
— |
|
|
|
(118 |
) |
|
|
— |
|
|
|
(1,155 |
) |
| Net capital provided by (to)
non-controlling interest |
|
4,514 |
|
|
|
(201 |
) |
|
|
6,758 |
|
|
|
(232 |
) |
| Lease
liability repaid and other |
|
(479 |
) |
|
|
323 |
|
|
|
(1,260 |
) |
|
|
233 |
|
|
Cash from financing activities |
|
5,089 |
|
|
|
363 |
|
|
|
9,311 |
|
|
|
470 |
|
|
|
|
|
|
|
|
|
|
| Cash and cash
equivalents |
|
|
|
|
|
|
|
|
Change during the period |
$ |
(11 |
) |
|
$ |
(89 |
) |
|
$ |
5 |
|
|
$ |
(221 |
) |
|
Cash reclassified as held for sale |
|
— |
|
|
|
(101 |
) |
|
|
(6 |
) |
|
|
(131 |
) |
|
Impact of foreign exchange on cash |
|
(62 |
) |
|
|
(58 |
) |
|
|
29 |
|
|
|
(1 |
) |
|
Balance, beginning of period |
|
1,380 |
|
|
|
1,301 |
|
|
|
1,279 |
|
|
|
1,406 |
|
|
Balance, end of period |
$ |
1,307 |
|
|
$ |
1,053 |
|
|
$ |
1,307 |
|
|
$ |
1,053 |
|
| |
|
Brookfield Infrastructure Partners L.P.
Reconciliation of Net Income to Funds from
Operations |
| |
| |
For the three monthsended September 30 |
|
For the nine monthsended September 30 |
|
US$ millions, unaudited |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
| Net income |
$ |
256 |
|
|
$ |
361 |
|
|
$ |
1,172 |
|
|
$ |
1,080 |
|
|
Add back or deduct the following: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
669 |
|
|
|
520 |
|
|
|
1,946 |
|
|
|
1,616 |
|
|
Share of earnings from investments in associates and joint
ventures |
|
(96 |
) |
|
|
(5 |
) |
|
|
(472 |
) |
|
|
(25 |
) |
|
FFO contribution from investments in associates and joint
ventures1 |
|
225 |
|
|
|
227 |
|
|
|
709 |
|
|
|
648 |
|
|
Deferred tax (recovery) expense |
|
(4 |
) |
|
|
63 |
|
|
|
(9 |
) |
|
|
55 |
|
|
Mark-to-market gains |
|
(34 |
) |
|
|
(95 |
) |
|
|
(27 |
) |
|
|
(228 |
) |
|
Other expense2 |
|
194 |
|
|
|
122 |
|
|
|
142 |
|
|
|
137 |
|
|
Consolidated Funds from Operations |
$ |
1,210 |
|
|
$ |
1,193 |
|
|
$ |
3,461 |
|
|
$ |
3,283 |
|
|
FFO Attributable to non-controlling interests3 |
|
(650 |
) |
|
|
(668 |
) |
|
|
(1,795 |
) |
|
|
(1,752 |
) |
|
FFO |
$ |
560 |
|
|
$ |
525 |
|
|
$ |
1,666 |
|
|
$ |
1,531 |
|
- FFO
contribution from investments in associates and joint ventures
correspond to the FFO attributable to the partnership that are
generated by its investments in associates and joint ventures
accounted for using the equity method.
- Other expense
corresponds to amounts that are not related to the revenue earning
activities and are not normal, recurring cash operating expenses
necessary for business operations. Other income/expenses excluded
from FFO primarily includes gains on dispositions of subsidiaries,
associates and joint ventures, gains or losses relating to foreign
currency translation reclassified from accumulated comprehensive
income to other expense, acquisition costs, gains/losses on
remeasurement of borrowings, amortization of deferred financing
costs, fair value remeasurement gains/losses, accretion expenses on
deferred consideration or asset retirement obligations, and gains
or losses on debt extinguishment.
- Amounts
attributable to non-controlling interests are calculated based on
the economic ownership interests held by non-controlling interests
in consolidated subsidiaries. By adjusting FFO attributable to
non-controlling interests, our partnership is able to remove the
portion of FFO earned at non-wholly owned subsidiaries that are not
attributable to our partnership.
| |
|
Brookfield Infrastructure Partners
L.P.Statements of Funds from Operations per
Unit |
| |
| |
For the three monthsended September 30 |
|
For the nine monthsended September 30 |
|
US$, unaudited |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
| Earnings per limited
partnership unit1 |
$ |
0.03 |
|
$ |
0.05 |
|
$ |
0.34 |
|
$ |
0.17 |
|
| Add back or deduct the
following: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
0.46 |
|
|
0.40 |
|
|
1.36 |
|
|
1.25 |
|
|
Deferred taxes and other items |
|
0.24 |
|
|
0.23 |
|
|
0.46 |
|
|
0.57 |
|
|
FFO per unit2 |
$ |
0.73 |
|
$ |
0.68 |
|
$ |
2.16 |
|
$ |
1.99 |
|
- Average
number of limited partnership units outstanding on a time weighted
average basis for the three and nine-month periods ended
September 30, 2023 was 458.8 million and 458.6 million (2022:
458.2 million and 458.0 million).
- Average
number of partnership units outstanding on a fully diluted time
weighted average basis for the three and nine-month periods ended
September 30, 2023 was 772.1 million and 771.7 million
(2022: 771.3 million and 771.2 million).
Notes:
The Statements of Funds from Operations per unit
above are prepared on a basis that is consistent with the
Partnership’s Supplemental Information and differs from net income
per limited partnership unit as presented in Brookfield
Infrastructure’s Consolidated Statements of Operating Results on
page 7 of this release, which is prepared in accordance with IFRS.
Management uses funds from operations per unit (FFO per unit) as a
key measure to evaluate operating performance. Readers are
encouraged to consider both measures in assessing Brookfield
Infrastructure’s results.
Brookfield Infrastructure Corporation
Reports Third Quarter 2023 Results
The Board of Directors of Brookfield
Infrastructure Corporation (“BIPC” or our “company”) (NYSE, TSX:
BIPC) today has declared a quarterly dividend in the amount of
$0.3825 per class A exchangeable subordinate voting share of BIPC
(a “Share”), payable on December 29, 2023 to shareholders of record
as at the close of business on November 30, 2023. This
dividend is identical in amount per Share and has identical record
and payment dates to the quarterly distribution announced today by
Brookfield Infrastructure Partners L.P. (“BIP” or the
“Partnership”) on its units.
The Shares of BIPC are structured with the
intention of being economically equivalent to the non-voting
limited partnership units of Brookfield Infrastructure Partnership
L.P. (“BIP” or the “Partnership”) (NYSE: BIP; TSX: BIP.UN). We
believe economic equivalence is achieved through identical
dividends and distributions on the Shares and BIP’s units and each
Share being exchangeable at the option of the holder for one BIP
unit at any time. Given the economic equivalence, we expect that
the market price of the Shares will be significantly impacted by
the market price of BIP’s units and the combined business
performance of our company and BIP as a whole. In addition to
carefully considering the disclosure made in this news release in
its entirety, shareholders are strongly encouraged to carefully
review BIP’s letter to unitholders, supplemental information and
its other continuous disclosure filings. BIP’s letter to
unitholders and supplemental information are available at
https://bip.brookfield.com. Copies of the Partnership’s continuous
disclosure filings are available electronically on EDGAR on the
SEC’s website at https://sec.gov or on SEDAR+ at
https://sedarplus.ca.
Results
The net income of BIPC is captured in the
Partnership’s financial statements and results.
BIPC reported net income of $1,009 million
for the three-month period ended September 30, 2023, compared
to $331 million in the prior year. After removing the impact
of the revaluation on our own Shares that are classified as
liabilities under IFRS, underlying earnings were consistent with
the prior year. Current period results benefited from inflation
indexation across our business and capital commissioned into rate
base at our U.K. regulated distribution business. These benefits
were offset by transaction costs associated with the acquisition of
our global intermodal logistics operation that closed in September
and higher financing costs at our U.K. regulated distribution
business as a result of incremental borrowings.
Cautionary Statement Regarding
Forward-looking Statements
This news release may contain forward-looking
information within the meaning of Canadian provincial securities
laws and “forward-looking statements” within the meaning of Section
27A of the U.S. Securities Act of 1933, as amended, Section 21E of
the U.S. Securities Exchange Act of 1934, as amended, “safe harbor”
provisions of the United States Private Securities Litigation
Reform Act of 1995 and in any applicable Canadian securities
regulations. The words “believe”, “expect”, “will” derivatives
thereof and other expressions which are predictions of or indicate
future events, trends or prospects and which do not relate to
historical matters, identify the above mentioned and other
forward-looking statements. Forward-looking statements in this news
release include statements regarding the three-for-two split of
BIP’s and BIPC’s respective units and Shares, the impact of the
market price of BIP’s units and the combined business performance
of our company and BIP as a whole on the market price of the
Shares. Although Brookfield Infrastructure believes that these
forward-looking statements and information are based upon
reasonable assumptions and expectations, the reader should not
place undue reliance on them, or any other forward-looking
statements or information in this news release. The future
performance and prospects of Brookfield Infrastructure are subject
to a number of known and unknown risks and uncertainties. Factors
that could cause actual results of Brookfield Infrastructure to
differ materially from those contemplated or implied by the
statements in this news release include general economic conditions
in the jurisdictions in which we operate and elsewhere which may
impact the markets for our products and services, the ability to
achieve growth within Brookfield Infrastructure’s businesses and in
particular completion on time and on budget of various large
capital projects, which themselves depend on access to capital and
continuing favorable commodity prices, and our ability to achieve
the milestones necessary to deliver the targeted returns to our
unitholders, the impact of market conditions on our businesses, the
fact that success of Brookfield Infrastructure is dependent on
market demand for an infrastructure company, which is unknown, the
availability of equity and debt financing for Brookfield
Infrastructure, the impact of health pandemics on our business and
operations, the ability to effectively complete transactions in the
competitive infrastructure space (including the ability to complete
announced and potential transactions that may be subject to
conditions precedent, and the inability to reach final agreement
with counterparties to transactions being currently pursued, given
that there can be no assurance that any such transaction will be
agreed to or completed) and to integrate acquisitions into existing
operations, the future performance of these acquisitions, changes
in technology which have the potential to disrupt the business and
industries in which we invest, the market conditions of key
commodities, the price, supply or demand for which can have a
significant impact upon the financial and operating performance of
our business and other risks and factors described in the documents
filed by BIPC with the securities regulators in Canada and the
United States including “Risk Factors” in BIPC’s most recent Annual
Report on Form 20-F and other risks and factors that are described
therein. Except as required by law, Brookfield Infrastructure
Corporation undertakes no obligation to publicly update or revise
any forward-looking statements or information, whether as a result
of new information, future events or otherwise.
| |
|
Brookfield Infrastructure
CorporationConsolidated Statements of Financial
Position |
| |
| |
As of |
|
US$ millions, unaudited |
|
Sept. 30,2023 |
|
|
|
Dec. 31,2022 |
|
|
|
|
|
|
| Assets |
|
|
|
| Cash and cash equivalents |
$ |
241 |
|
|
$ |
445 |
|
| Due from Brookfield
Infrastructure |
|
1,292 |
|
|
|
566 |
|
| Property, plant and
equipment |
|
13,780 |
|
|
|
4,718 |
|
| Intangible assets |
|
3,658 |
|
|
|
2,847 |
|
| Investments in associates |
|
— |
|
|
|
428 |
|
| Goodwill |
|
1,737 |
|
|
|
518 |
|
|
Deferred tax asset and other |
|
2,906 |
|
|
|
656 |
|
|
Total assets |
$ |
23,614 |
|
|
$ |
10,178 |
|
|
|
|
|
|
| Liabilities and
Equity |
|
|
|
| Accounts payable and
other |
$ |
1,303 |
|
|
$ |
781 |
|
| Loans payable to Brookfield
Infrastructure |
|
26 |
|
|
|
26 |
|
| Exchangeable and class B
shares |
|
3,875 |
|
|
|
3,426 |
|
| Non-recourse borrowings |
|
12,021 |
|
|
|
4,577 |
|
| Financial liabilities |
|
84 |
|
|
|
72 |
|
| Deferred tax liabilities and
other |
|
2,335 |
|
|
|
1,657 |
|
| |
|
|
|
| Equity |
|
|
|
| Equity in net assets
attributable to the Partnership |
|
(315 |
) |
|
|
(1,119 |
) |
|
Non-controlling interest |
|
4,285 |
|
|
|
758 |
|
|
Total equity |
|
3,970 |
|
|
|
(361 |
) |
|
Total liabilities and equity |
$ |
23,614 |
|
|
$ |
10,178 |
|
| |
|
Brookfield Infrastructure
CorporationConsolidated Statements of Operating
Results |
| |
| |
For the three monthsended September 30 |
|
For the nine monthsended September 30 |
|
US$ millions, unaudited |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
| Revenues |
$ |
551 |
|
|
$ |
454 |
|
|
$ |
1,586 |
|
|
$ |
1,394 |
|
| Direct operating costs |
|
(146 |
) |
|
|
(121 |
) |
|
|
(442 |
) |
|
|
(386 |
) |
| General
and administrative expenses |
|
(16 |
) |
|
|
(17 |
) |
|
|
(49 |
) |
|
|
(54 |
) |
|
|
|
389 |
|
|
|
316 |
|
|
|
1,095 |
|
|
|
954 |
|
| |
|
|
|
|
|
|
|
| Interest expense |
|
(162 |
) |
|
|
(147 |
) |
|
|
(476 |
) |
|
|
(392 |
) |
| Share of (losses) earnings
from investments in associates |
|
(24 |
) |
|
|
8 |
|
|
|
(20 |
) |
|
|
4 |
|
| Remeasurement of exchangeable
and class B shares |
|
917 |
|
|
|
257 |
|
|
|
309 |
|
|
|
516 |
|
|
Mark-to-market and other |
|
(16 |
) |
|
|
(32 |
) |
|
|
22 |
|
|
|
64 |
|
|
Income before income tax |
|
1,104 |
|
|
|
402 |
|
|
|
930 |
|
|
|
1,146 |
|
| Income tax (expense)
recovery |
|
|
|
|
|
|
|
|
Current |
|
(93 |
) |
|
|
(53 |
) |
|
|
(262 |
) |
|
|
(253 |
) |
|
Deferred |
|
(2 |
) |
|
|
(18 |
) |
|
|
(8 |
) |
|
|
64 |
|
|
Net income |
$ |
1,009 |
|
|
$ |
331 |
|
|
$ |
660 |
|
|
$ |
957 |
|
|
|
|
|
|
|
|
|
|
| Attributable to: |
|
|
|
|
|
|
|
|
Partnership |
$ |
913 |
|
|
$ |
229 |
|
|
$ |
338 |
|
|
$ |
529 |
|
|
Non-controlling interest |
|
96 |
|
|
|
102 |
|
|
|
322 |
|
|
|
428 |
|
| |
|
Brookfield Infrastructure
CorporationConsolidated Statements of Cash
Flows |
| |
| |
For the three monthsended September 30 |
|
For the nine monthsended September 30 |
|
US$ millions, unaudited |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
| Operating
Activities |
|
|
|
|
|
|
|
| Net income |
$ |
1,009 |
|
|
$ |
331 |
|
|
$ |
660 |
|
|
$ |
957 |
|
| Adjusted for the following
items: |
|
|
|
|
|
|
|
|
Earnings from investments in associates, net of distributions
received |
|
24 |
|
|
|
1 |
|
|
|
23 |
|
|
|
22 |
|
|
Depreciation and amortization expense |
|
59 |
|
|
|
51 |
|
|
|
171 |
|
|
|
159 |
|
|
Mark-to-market and other |
|
37 |
|
|
|
51 |
|
|
|
32 |
|
|
|
(3 |
) |
|
Remeasurement of exchangeable and class B shares |
|
(917 |
) |
|
|
(257 |
) |
|
|
(309 |
) |
|
|
(516 |
) |
|
Deferred income tax expense (recovery) |
|
2 |
|
|
|
18 |
|
|
|
8 |
|
|
|
(64 |
) |
| Change
in non-cash working capital, net |
|
(57 |
) |
|
|
19 |
|
|
|
(173 |
) |
|
|
14 |
|
|
Cash from operating activities |
|
157 |
|
|
|
214 |
|
|
|
412 |
|
|
|
569 |
|
|
|
|
|
|
|
|
|
|
| Investing
Activities |
|
|
|
|
|
|
|
| Disposal of (investments in)
associates |
|
435 |
|
|
|
— |
|
|
|
435 |
|
|
|
(455 |
) |
| Purchase of long-lived assets,
net of disposals |
|
(122 |
) |
|
|
(122 |
) |
|
|
(381 |
) |
|
|
(375 |
) |
| Purchase of financial assets
and other |
|
(53 |
) |
|
|
— |
|
|
|
(57 |
) |
|
|
(71 |
) |
|
Acquisition of subsidiaries |
|
(3,086 |
) |
|
|
— |
|
|
|
(3,086 |
) |
|
|
— |
|
|
Cash used by investing activities |
|
(2,826 |
) |
|
|
(122 |
) |
|
|
(3,089 |
) |
|
|
(901 |
) |
|
|
|
|
|
|
|
|
|
| Financing
Activities |
|
|
|
|
|
|
|
| Net capital provided by (to)
non-controlling interest |
|
2,629 |
|
|
|
(276 |
) |
|
|
2,466 |
|
|
|
(412 |
) |
| Net (repayments)
borrowings |
|
(65 |
) |
|
|
(50 |
) |
|
|
(7 |
) |
|
|
1,520 |
|
|
Settlement of deferred consideration |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,037 |
) |
|
Cash from (used by) financing activities |
|
2,564 |
|
|
|
(326 |
) |
|
|
2,459 |
|
|
|
71 |
|
|
|
|
|
|
|
|
|
|
| Cash and cash
equivalents |
|
|
|
|
|
|
|
|
Change during the period |
$ |
(105 |
) |
|
$ |
(234 |
) |
|
$ |
(218 |
) |
|
$ |
(261 |
) |
|
Impact of foreign exchange on cash |
|
(10 |
) |
|
|
(13 |
) |
|
|
14 |
|
|
|
57 |
|
|
Balance, beginning of period |
|
356 |
|
|
|
512 |
|
|
|
445 |
|
|
|
469 |
|
|
Balance, end of period |
$ |
241 |
|
|
$ |
265 |
|
|
$ |
241 |
|
|
$ |
265 |
|
Brookfield Infrastructure (NYSE:BIPC)
Historical Stock Chart
From Nov 2024 to Dec 2024
Brookfield Infrastructure (NYSE:BIPC)
Historical Stock Chart
From Dec 2023 to Dec 2024
