Bruce Flatt, CEO of
Financial Results
Unaudited Three Months Ended Last Twelve Months Ended
----------------------------------------------------
For the periods ended
June 30
(US$ millions, except
per share amounts) 2016 2015 2016 2015
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Net income(1) $ 584 $ 1,199 $ 3,252 $ 5,445
Per Brookfield
share(2) 0.15 0.62 1.30 3.14
Funds from
operations(2,3) $ 637 $ 520 $ 2,822 $ 2,176
Per Brookfield
share(2,3) 0.62 0.50 2.76 2.12
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1. Consolidated basis - includes amounts attributable to non-controlling
interests
2. Excludes amounts attributable to non-controlling interests
3. See Basis of Presentation on page 3
Net income for the second quarter of 2016 totalled
Funds from operations ("FFO") for the second quarter of 2016, which excludes unrealized valuation gains totalled
Dividend Declaration
The Board declared a quarterly dividend of
Operating Highlights
We achieved record fundraising for our flagship private funds.
We completed fundraising for our most recent series of flagship private funds. Nearly 250 clients committed to these three funds, which represent
Fee bearing capital increased by 15% to
Our annualized run rate of total fees and carry is now more than
We completed the launch of Brookfield Business Partners, our fourth listed partnership, which is now listed on both the
Over the last twelve months we announced or completed acquisitions that will deploy
We continue to deploy capital across our real asset strategies, targetting investments which benefit from our competitive advantages. We invested or committed to invest
In our property business, we acquired a portfolio of 5,600 student housing units in the
Our renewable power business completed the first mandatory tender offer to acquire an additional interest in our 3,000 megawatt Colombian hydroelectric portfolio, increasing our interest in the company to 84%, and also completed the acquisition of a 296 megawatt hydroelectric portfolio in the northern
In our infrastructure group, we acquired a 57% interest in three toll roads in
In our private equity operations, we expanded our global facilities management operations with two tuck-in acquisitions and have built a record backlog in our constructions operations.
Basis of Presentation
This news release and accompanying financial statements are based on International Financial Reporting Standards ("IFRS"), as issued by the International Accounting Standards Board ("IASB"), unless otherwise noted and make reference to Funds From Operations ("FFO").
We define FFO as net income attributable to shareholders prior to fair value changes, depreciation and amortization, and deferred income taxes, and include realized disposition gains that are not recorded in net income as determined under IFRS. FFO also includes the company's share of equity accounted investments' FFO on a fully diluted basis. FFO consists of the following components:
-- FFO from Operating Activities represents the company's share of revenues
less direct costs and interest expenses; excludes realized carried
interest and disposition gains, fair value changes, depreciation and
amortization and deferred income taxes; and includes our proportionate
share of FFO from operating activities recorded by equity accounted
investments on a fully diluted basis. We present this measure as we
believe it assists in describing our results and variances within FFO.
-- Realized Carried Interest represents our contractual share of investment
gains generated within a private fund after considering our clients
minimum return requirements. Realized carried interest is determined on
third party capital that is no longer subject to future investment
performance.
-- Realized Disposition Gains are included in FFO because we consider the
purchase and sale of assets to be a normal part of the company's
business. Realized disposition gains include gains and losses recorded
in net income and equity in the current period, and are adjusted to
include fair value changes and revaluation surplus balances recorded in
prior periods which were not included in prior period FFO.
We use FFO to assess our operating results and the value of
We note that FFO, its components, and its per share equivalent are non-IFRS measures which do not have any standard meaning prescribed by IFRS and therefore may not be comparable to similar measures presented by other companies.
We provide additional information on the determination of FFO and reconciliation between FFO and net income attributable to
Additional Information
The Letter to Shareholders and the company's Supplemental Information for the three months ended June 30, 2016 contain further information on the company's strategy, operations and financial results. Shareholders are encouraged to read these documents, which are available on the company's website.
The attached statements are based primarily on information that has been extracted from our interim financial statements for the three and six months ended June 30, 2016, which have been prepared using IFRS, as issued by the IASB. The amounts have not been audited by
Information on our dividends can be found on our website under Investors/Stock and Dividend Information.
Quarterly Earnings Call Details
Investors, analysts and other interested parties can access Brookfield Asset Management's 2016 Second Quarter Results as well as the Shareholders' Letter and Supplemental Information on
The conference call can be accessed via webcast on August 12, 2016 at 11:00 a.m. Eastern Time at www.brookfield.com or via teleconference at 1-800-319-4610 toll free in
Brookfield Asset Management Inc. is a global alternative asset manager with approximately
Please note that
For more information, please visit our website at www.brookfield.com.
Forward-Looking Statements
Note: This news release contains "forward-looking information" within the meaning of Canadian provincial securities laws and "forward-looking statements" within the meaning of Section 27A of the
Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of
Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; the behavior of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; ability to collect amounts owed; catastrophic events, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts and cyber terrorism; and other risks and factors detailed from time to time in our documents filed with the securities regulators in
We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law,
This release does not constitute an offer of any
CONSOLIDATED BALANCE SHEETS
Unaudited June 30 December 31 (US$ millions) 2016 2015 ---------------------------------------------------------------------------- Assets Cash and cash equivalents $ 4,020 $ 2,774 Other financial assets 7,304 6,156 Accounts receivable and other 8,586 7,044 Inventory 5,865 5,281 Assets classified as held for sale 1,685 1,397 Equity accounted investments 23,680 23,216 Investment properties 49,647 47,164 Property, plant and equipment 44,420 37,273 Intangible assets 6,211 5,170 Goodwill 3,594 2,543 Deferred income tax assets 1,531 1,496 ---------------------------------------------------------------------------- Total Assets$ 156,543 $ 139,514 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Liabilities and Equity Accounts payable and other$ 12,237 $ 11,366 Liabilities associated with assets classified as held for sale 430 522 Corporate borrowings 4,469 3,936 Non-recourse borrowings Property-specific mortgages 50,887 46,044 Subsidiary borrowings 10,174 8,303 Deferred income tax liabilities 10,447 8,785 Subsidiary equity obligations 3,360 3,331 Equity Preferred equity 3,734 3,739 Non-controlling interests in net assets 39,172 31,920 Common equity 21,633 21,568 ---------------------------------------------------------------------------- Total Equity 64,539 57,227 ---------------------------------------------------------------------------- Total Liabilities and Equity$ 156,543 $ 139,514 ---------------------------------------------------------------------------- ----------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited Three Months Ended Six Months Ended
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For the periods ended
June 30
(US$ millions, except
per share amounts) 2016 2015 2016 2015
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Revenues $ 5,973 $ 4,923 $ 11,191 $ 9,319
Direct costs (4,330) (3,595) (7,978) (6,601)
Other income and
gains 31 12 66 12
Equity accounted
income 435 603 587 870
Expenses
Interest (815) (725) (1,582) (1,426)
Corporate costs (25) (29) (48) (58)
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1,269 1,189 2,236 2,116
Fair value changes 65 70 417 1,183
Depreciation and
amortization (516) (428) (997) (829)
Income tax (234) 368 (436) 167
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Net income $ 584 $ 1,199 $ 1,220 $ 2,637
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Net income
attributable to:
Brookfield
shareholders $ 185 $ 645 $ 442 $ 1,374
Non-controlling
interests 399 554 778 1,263
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$ 584 $ 1,199 $ 1,220 $ 2,637
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Net income per share
Diluted $ 0.15 $ 0.62 $ 0.38 $ 1.35
Basic 0.16 0.64 0.39 1.39
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SUMMARIZED FINANCIAL RESULTS
The following financial results include non-IFRS measures. See Basis of
Presentation on page 3.
Funds From Operations(1,2)
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Unaudited Three Months Ended Last Twelve Months Ended
----------------------------------------------------
For the periods ended
June 30
(US$ millions, except
per share amounts) 2016 2015 2016 2015
----------------------------------------------------------------------------
FFO from operating
activities $ 514 $ 334 $ 1,963 $ 1,509
Realized carried
interest(3) - 15 15 17
Realized disposition
gains(4) 123 171 844 650
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Funds from
operations(1,2) $ 637 $ 520 $ 2,822 $ 2,176
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Per share $ 0.62 $ 0.50 $ 2.76 $ 2.12
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Unaudited Last Twelve Months
Three Months Ended Ended
------------------------------------------------
For the periods ended June
30
(US$ millions) 2016 2015 2016 2015
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Asset management $ 191 $ 142 $ 675 $ 457
Property 275 324 1,428 1,013
Renewable power 37 66 191 213
Infrastructure 111 61 316 228
Private equity and other 97 12 530 529
Cash and financial assets 27 2 38 90
Interest expense and
operating costs (101) (87) (356) (354)
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Funds from operations(1,2) $ 637 $ 520 $ 2,822 $ 2,176
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Unaudited Three Months Ended Last Twelve Months Ended
----------------------------------------------------
For the periods ended
June 30
(US$ millions, except
per share amounts) 2016 2015 2016 2015
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FFO from operating
activities $ 514 $ 334 $ 1,963 $ 1,509
Realized carried
interest(3) - 15 15 17
Realized disposition
gains(4) (6) (20) 335 (23)
Fair value changes 5 268 304 2,467
Depreciation and
amortization (227) (197) (834) (714)
Income tax (101) 245 (374) (98)
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Net income attributable
to shareholders $ 185 $ 645 $ 1,409 $ 3,158
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Per share $ 0.15 $ 0.62 $ 1.30 $ 3.14
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Notes:
1. Non-IFRS measure - see Basis of Presentation on page 3
2. Excludes amounts attributable to non-controlling interests
3. Excludes carried interest generated that is subject to future investment
performance
4. FFO includes gains recorded in net income, directly in equity as well as
the realization of appraisal gains recorded in prior years
RECONCILIATION OF NET INCOME TO FUNDS FROM OPERATIONS
Unaudited Three Months Ended Last Twelve Months Ended
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For the periods ended
June 30
(US$ millions) 2016 2015 2016 2015
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Net income prior to fair
value changes,
depreciation and
amortization and income
tax (see page 6) $ 1,269 $ 1,189 $ 4,514 $ 4,167
Adjust for:
Equity accounted fair
value changes and
other(1 ) 4 (257) 254 (585)
Current income taxes (72) (37) (165) (112)
Realized disposition
gains(2) 123 191 829 673
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1,324 1,086 5,432 4,143
Non-controlling interest (687) (566) (2,610) (1,967)
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Funds from
operations(3,4) $ 637 $ 520 $ 2,822 $ 2,176
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Notes:
1. Equity accounted other items include depreciation and amortization and
deferred income taxes
2. Includes only the portion of disposition gains in fair value changes and
prior periods
3. Non-IFRS measure - see Basis of Presentation on page 3
4. Excludes amounts attributable to non-controlling interests
Contacts: Suzanne Fleming Communications & Media (212) 417-2421 [email protected] Linda Northwood Investor Relations (416) 359-8647 [email protected]
Source: Brookfield Asset Management Inc.
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