Brookfield Asset Management Inc. (NYSE: BAM, TSX: BAM.A) today
announced financial results for the year ended
December 31, 2019.
Bruce Flatt, CEO of Brookfield, stated, “2019
was a successful year on many fronts. Fundraising was excellent
with more than $30 billion raised during the year and now over $50
billion raised for this round of flagship funds. We invested over
$30 billion into new opportunities during the year but continue to
build liquidity, with approximately $65 billion of capital to
deploy into investments globally.”
Operating Results
UnauditedFor the periods ended December 31(US$ millions, except per
share amounts) |
Three Months Ended |
|
Years Ended |
2019 |
|
2018 |
|
2019 |
|
2018 |
Net income1 |
$ |
1,638 |
|
$ |
3,028 |
|
$ |
5,354 |
|
$ |
7,488 |
Per Brookfield
share2 |
0.74 |
|
1.87 |
|
2.60 |
|
3.40 |
Funds from operations2,3 |
$ |
1,204 |
|
$ |
1,356 |
|
$ |
4,189 |
|
$ |
4,401 |
Per Brookfield share2,3 |
1.13 |
|
1.35 |
|
4.07 |
|
4.35 |
- Consolidated basis – includes amounts attributable to
non-controlling interests.
- Excludes amounts attributable to non-controlling
interests.
- See Basis of Presentation on page 9 and a reconciliation of net
income to FFO on page 6.
Net income and funds from operations (“FFO”)
were $5.4 billion and $4.2 billion, respectively, for the
year, benefiting from a number of acquisitions across the business
as well as strong growth in our asset management franchise. The
strong results were partially offset by lower fair value and
continued disposition gains, compared to the prior year.
Fee-related earnings, before performance fees,
contributed $1.2 billion to FFO in 2019, a 41% increase
from the prior period. This reflects strong fundraising in our
private funds, as well as unit price appreciation across our listed
partnerships and the contribution of one quarter of fee-related
earnings from Oaktree. Fee-related earnings in 2018 included
$278 million of performance fees whereas we recorded no
performance fees in 2019.
Our operating FFO from invested capital
benefited from the strong performance of the underlying businesses
as well as acquisitions, which more than offset the impact of
dispositions made during the year. Total FFO decreased as the
prior year included higher disposition gains primarily within our
real estate and infrastructure businesses.
Three-for-Two Stock Split
The Board of Directors approved a three-for-two
stock split of the company’s outstanding Class A Shares. The split
will be implemented by way of a stock dividend whereby shareholders
will receive one-half of a Brookfield Class A Share for each Class
A and Class B Share held (i.e. one additional share for every two
shares held). The stock dividend will be payable on April 1, 2020
to shareholders of record at the close of business on
February 28, 2020. Fractional shares will be paid in cash
based on the closing price of the Class A Shares on the Toronto
Stock Exchange on the record date.
Brookfield is undertaking the stock split to
ensure its shares remain accessible to individual shareholders and
to improve the liquidity of the shares. Importantly, the stock
split will not dilute shareholders’ equity. The company is
ascribing no monetary value to the stock dividend payable to
shareholders and therefore the stock dividend will not be taxable
in Canada or the United States, although any cash received for
fractional shares will be taxable.
Brookfield’s Class A Shares will trade on a “due
bill” basis from the opening of business on Thursday,
February 27, 2020 (one day before the record date) until
Wednesday, April 1, 2020 (the payment date), inclusively. Class A
Shares trading with due bills will carry the right to receive the
additional shares to be issued in connection with the stock
dividend. Accordingly, ex-dividend (post-split) trading in the
Class A Shares will commence on the Toronto Stock Exchange and New
York Stock Exchange at the opening of business on Thursday, April
2, 2020.
Appointment of Nicholas Goodman as Chief
Financial Officer
The Board of Brookfield Asset Management is
pleased to announce the appointment of Nicholas Goodman as Chief
Financial Officer. Mr. Goodman joined Brookfield in London in 2010
and has since held a number of senior finance roles across the
organization, most recently as Treasurer for Brookfield Asset
Management, directing global corporate finance, treasury operations
and financial risk management. Prior to that, he was Chief
Financial Officer of Brookfield Renewable Partners.
Mr. Goodman succeeds Brian Lawson as Chief
Financial Officer. Mr. Lawson will continue to serve as a director
of Brookfield and will provide guidance and advice on the company’s
finance and risk management activities as a Vice Chair.
Appointment of Howard Marks to Board of
Brookfield Asset Management
The Board of Brookfield Asset Management
approved the appointment of Howard Marks, co-Chairman of Oaktree
Capital Group, to the Board. Mr. Marks, who founded Oaktree in
1995, has been a leader in the alternative asset management
industry for decades. To facilitate Mr. Marks’ appointment to the
Board, Robert Harding, who has been with Brookfield for over
35 years, and served as a director of Brookfield Asset Management
for more than 20 years, retired from the Board. The
Corporation and the Board extend their sincerest appreciation to
Mr. Harding for his long-standing commitment and contribution to
Brookfield and the Board, and on behalf of all investors welcome
Mr. Marks to the Board.
Dividend Declaration
The Board declared a quarterly dividend of
US$0.18 per share (representing US$0.72 per annum), payable on
March 31, 2020 to shareholders of record as at the close of
business on February 28, 2020. This represents an increase of
approximately 12% over the current quarterly dividend rate and
equates to a quarterly dividend of US$0.12 per share on a
post-split basis. The first dividend payable post-split will occur
on June 30, 2020, subject to Board approval. The Board also
declared the regular monthly and quarterly dividends on its
preferred shares.
Operating Highlights
Assets under management and fee-bearing capital
grew during the year to $545 billion and $290 billion,
respectively, as at December 31, 2019.
AUM and fee-bearing capital growth includes the
acquisition of a 61.2% interest in Oaktree Capital Management in
September 2019. In addition, the capitalization of our listed
partnerships grew by 34%, reflecting unit price growth from strong
performance across each of the businesses. Fee-bearing capital from
our existing private fund strategies grew by 33% as we raised
significant capital across our strategies and enhanced our
distribution capabilities through new channels.
Subsequent to year end, we held the final close
of our fourth flagship infrastructure fund, which reached a total
fund size of $20 billion.
Based on strong investor demand, the fund
attracted total capital commitments exceeding the original
fundraising target. Over the last 24 months, we have raised
approximately $50 billion across our flagship private fund
strategies, including the close of our flagship real estate fund,
Brookfield Strategic Real Estate Partners III at $15 billion,
and our flagship private equity fund, Brookfield Capital Partners V
at $9 billion, as well as additional co-investment capital relating
to each fund. As at December 31, 2019, our latest flagship real
estate, infrastructure and private equity funds were already
approximately 45% invested or committed in aggregate, and we
continue to see opportunity to deploy this capital globally.
Annualized fee revenues and target carried
interest now stand at a run-rate of $5.8 billion.
Annualized fee revenues and annualized
fee-related earnings are now $3.0 billion and $1.4 billion,
respectively. Fee-related earnings, before performance fees, for
2019 increased by 41% over 2018, attributable to private fund
capital raised and the increased capitalization of our listed
partnerships, as well as one quarter of fee-related earnings
related to Oaktree, at our share.
We remain focused on recycling capital across
the business and returning capital to our investors. During 2019,
we successfully realized $13 billion through asset sales across the
portfolio. Asset monetizations within our private funds,
predominantly in our first flagship real estate fund and fourth
flagship private equity fund, led to the recognition of
$600 million of realized carried interest into income in 2019,
compared to $254 million in the prior year. Together with Oaktree,
annualized target carried interest stands at $2.8 billion, or $1.6
billion net of costs.
We invested $32 billion of capital during the
year across our businesses.
We invested approximately $5 billion for a 61.2%
interest in Oaktree. In addition, our real estate operations made
many investments globally, including an investment in the
hospitality sector in India, and one in the retail sector in Dubai.
We also acquired a business in the senior housing and assisted
living sector in Australia. Our renewable power operations
partnered to acquire a 50% interest in one of the world’s largest
solar developers and we also doubled the size of our Asian
operations, as well as our distributed generation businesses, and
also made a sizable investment in a western Canadian based utility
company. Our infrastructure business completed the acquisition of
gas pipelines in North America and India, and data infrastructure
businesses in South America and New Zealand, and at the end of
December closed on the acquisition of one of the largest short-haul
rail operators in North America, as well as a portfolio of pipeline
assets. Our private equity operations acquired a leading global
supplier of advanced automotive batteries and the second largest
private healthcare provider in Australia. We also acquired a
controlling interest in a residential mortgage insurer in Canada
and announced an investment in a leading provider of work access
solutions to industrial and commercial facilities.
We have approximately $65 billion of available
liquidity to deploy into new investments.
At the end of the year, we had $51 billion of
uncalled fund commitments available for transactions yet to close
and new investments. We also had $13 billion of liquidity in the
form of cash and financial assets, as well as long-dated, committed
undrawn credit facilities, across our listed entities. Our
liquidity is increasingly supplemented by the cash available for
distribution and/or reinvestment.
CONSOLIDATED BALANCE SHEETS
|
|
|
Unaudited (US$ millions) |
December 31 |
|
December 31 |
|
2019 |
|
2018 |
|
Assets |
|
|
Cash and cash equivalents |
$ |
6,778 |
|
$ |
8,390 |
|
Other financial assets |
12,468 |
|
6,227 |
|
Accounts receivable and
other |
18,469 |
|
16,931 |
|
Inventory |
10,272 |
|
6,989 |
|
Assets classified as held for
sale |
3,502 |
|
2,185 |
|
Equity accounted
investments |
40,698 |
|
33,647 |
|
Investment properties |
96,686 |
|
84,309 |
|
Property, plant and
equipment |
89,264 |
|
67,294 |
|
Intangible assets |
27,710 |
|
18,762 |
|
Goodwill |
14,550 |
|
8,815 |
|
Deferred income tax
assets |
3,572 |
|
2,732 |
|
Total Assets |
$ |
323,969 |
|
$ |
256,281 |
|
|
|
|
Liabilities and
Equity |
|
|
Corporate borrowings |
$ |
7,083 |
|
$ |
6,409 |
|
|
|
|
Accounts payable and
other |
43,077 |
|
23,989 |
|
Liabilities associated with
assets classified as held for sale |
1,690 |
|
812 |
|
Non-recourse borrowings in
entities that we manage |
136,292 |
|
111,809 |
|
Deferred income tax
liabilities |
14,849 |
|
12,236 |
|
Subsidiary equity
obligations |
4,132 |
|
3,876 |
|
Equity |
|
|
Preferred equity |
4,145 |
|
4,168 |
|
Non-controlling interests in net assets |
81,833 |
|
67,335 |
|
Common equity |
30,868 |
|
25,647 |
|
Total
Equity |
116,846 |
|
97,150 |
|
Total Liabilities and Equity |
$ |
323,969 |
|
$ |
256,281 |
|
CONSOLIDATED STATEMENTS OF
OPERATIONS
|
|
|
|
UnauditedFor the periods ended December 31(US$ millions, except per
share amounts) |
Three Months Ended |
|
Years Ended |
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Revenues |
$ |
17,819 |
|
|
$ |
16,006 |
|
|
$ |
67,826 |
|
|
$ |
56,771 |
|
Direct costs |
(13,848 |
) |
|
(12,680 |
) |
|
(52,728 |
) |
|
(45,519 |
) |
Other income and gains |
313 |
|
|
585 |
|
|
1,285 |
|
|
1,166 |
|
Equity accounted income |
737 |
|
|
408 |
|
|
2,498 |
|
|
1,088 |
|
Expenses |
|
|
|
|
|
|
|
Interest |
(1,852 |
) |
|
(1,477 |
) |
|
(7,227 |
) |
|
(4,854 |
) |
Corporate costs |
(26 |
) |
|
(28 |
) |
|
(98 |
) |
|
(104 |
) |
Fair value changes |
4 |
|
|
257 |
|
|
(831 |
) |
|
1,794 |
|
Depreciation and
amortization |
(1,309 |
) |
|
(927 |
) |
|
(4,876 |
) |
|
(3,102 |
) |
Income tax |
(200 |
) |
|
884 |
|
|
(495 |
) |
|
248 |
|
Net Income |
$ |
1,638 |
|
|
$ |
3,028 |
|
|
$ |
5,354 |
|
|
$ |
7,488 |
|
|
|
|
|
|
|
|
|
Net income attributable
to: |
|
|
|
|
|
|
|
Brookfield shareholders |
$ |
846 |
|
|
$ |
1,884 |
|
|
$ |
2,807 |
|
|
$ |
3,584 |
|
Non-controlling interests |
792 |
|
|
1,144 |
|
|
2,547 |
|
|
3,904 |
|
|
$ |
1,638 |
|
|
$ |
3,028 |
|
|
$ |
5,354 |
|
|
$ |
7,488 |
|
|
|
|
|
|
|
|
|
Net income per share |
|
|
|
|
|
|
|
Diluted |
$ |
0.74 |
|
|
$ |
1.87 |
|
|
$ |
2.60 |
|
|
$ |
3.40 |
|
Basic |
0.76 |
|
|
1.91 |
|
|
2.66 |
|
|
3.47 |
|
SUMMARIZED FINANCIAL
RESULTS
RECONCILIATION OF NET INCOME TO FUNDS
FROM OPERATIONS
|
|
|
|
Unaudited For the periods ended December 31 (US$ millions) |
Three Months Ended |
|
Years Ended |
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Net income |
$ |
1,638 |
|
|
$ |
3,028 |
|
|
$ |
5,354 |
|
|
$ |
7,488 |
|
Realized disposition gains in
fair value changes or prior periods |
192 |
|
|
543 |
|
|
621 |
|
|
1,445 |
|
Non-controlling interests |
(1,955 |
) |
|
(1,844 |
) |
|
(7,161 |
) |
|
(6,015 |
) |
Financial statement components
not included in FFO |
|
|
|
|
|
|
|
Equity accounted fair value changes and other non-FFO items |
91 |
|
|
222 |
|
|
143 |
|
|
1,284 |
|
Fair value changes |
(4 |
) |
|
(257 |
) |
|
831 |
|
|
(1,794 |
) |
Depreciation and amortization |
1,309 |
|
|
927 |
|
|
4,876 |
|
|
3,102 |
|
Deferred income taxes |
(67 |
) |
|
(1,263 |
) |
|
(475 |
) |
|
(1,109 |
) |
Funds from operations1,2 |
$ |
1,204 |
|
|
$ |
1,356 |
|
|
$ |
4,189 |
|
|
$ |
4,401 |
|
SEGMENT FUNDS FROM
OPERATIONS
|
|
|
|
UnauditedFor the periods ended December 31(US$ millions, except per
share amounts) |
Three Months Ended |
|
Years Ended |
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Asset management |
$ |
529 |
|
|
$ |
393 |
|
|
$ |
1,597 |
|
|
$ |
1,317 |
|
Real estate |
348 |
|
|
677 |
|
|
1,185 |
|
|
1,786 |
|
Renewable power |
66 |
|
|
114 |
|
|
333 |
|
|
328 |
|
Infrastructure |
105 |
|
|
95 |
|
|
464 |
|
|
602 |
|
Private equity |
189 |
|
|
212 |
|
|
844 |
|
|
795 |
|
Residential |
87 |
|
|
52 |
|
|
125 |
|
|
49 |
|
Corporate |
(120 |
) |
|
(187 |
) |
|
(359 |
) |
|
(476 |
) |
Funds from operations1,2 |
$ |
1,204 |
|
|
$ |
1,356 |
|
|
$ |
4,189 |
|
|
$ |
4,401 |
|
|
|
|
|
|
|
|
|
Per
share3 |
$ |
1.13 |
|
|
$ |
1.35 |
|
|
$ |
4.07 |
|
|
$ |
4.35 |
|
- Non-IFRS measure – see Basis of Presentation on page 9.
- Excludes amounts attributable to non-controlling
interests.
- Per share amounts are inclusive of
dilutive effect of mandatorily redeemable preferred shares held in
a consolidated subsidiary.
EARNINGS PER SHARE
|
|
|
|
Unaudited For the periods ended December 31(US$ millions, except
per share amounts) |
Three Months Ended |
|
Years Ended |
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Net income |
$ |
1,638 |
|
|
$ |
3,028 |
|
|
$ |
5,354 |
|
|
$ |
7,488 |
|
Non-controlling interests |
(792 |
) |
|
(1,144 |
) |
|
(2,547 |
) |
|
(3,904 |
) |
Net income attributable to
shareholders |
846 |
|
|
1,884 |
|
|
2,807 |
|
|
3,584 |
|
Preferred share dividends |
(39 |
) |
|
(37 |
) |
|
(152 |
) |
|
(151 |
) |
Dilutive effect of conversion of subsidiary preferred shares |
(39 |
) |
|
(18 |
) |
|
(74 |
) |
|
(105 |
) |
Net
income available to common shareholders |
$ |
768 |
|
|
$ |
1,829 |
|
|
$ |
2,581 |
|
|
$ |
3,328 |
|
|
|
|
|
|
|
|
|
Weighted average shares |
1,007.1 |
|
|
957.6 |
|
|
968.6 |
|
|
957.6 |
|
Dilutive effect of the
conversion of options and escrowed shares using treasury stock
method1 |
26.7 |
|
|
18.2 |
|
|
23.7 |
|
|
19.8 |
|
Shares and share equivalents |
1,033.8 |
|
|
975.8 |
|
|
992.3 |
|
|
977.4 |
|
|
|
|
|
|
|
|
|
Diluted
earnings per share2 |
$ |
0.74 |
|
|
$ |
1.87 |
|
|
$ |
2.60 |
|
|
$ |
3.40 |
|
- Includes management share option plan and escrowed stock
plan.
- Per share amounts are inclusive of
dilutive effect of mandatorily redeemable preferred shares held in
a consolidated subsidiary.
CASH AVAILABLE FOR DISTRIBUTION AND/OR
REINVESTMENT
|
|
|
|
Unaudited For the periods ended December 31(US$ millions) |
Three Months Ended |
|
Years Ended |
2019 |
|
|
2018 |
|
|
2019 |
|
|
2018 |
|
Fee-related earnings3, excluding performance fees |
$ |
362 |
|
|
$ |
227 |
|
|
$ |
1,169 |
|
|
$ |
851 |
|
Our share of Oaktree’s
distributable earnings |
42 |
|
|
— |
|
|
42 |
|
|
— |
|
Distributions from
investments |
404 |
|
|
440 |
|
|
1,598 |
|
|
1,698 |
|
Other invested capital
earnings |
|
|
|
|
|
|
|
Corporate interest
expense |
(88 |
) |
|
(82 |
) |
|
(348 |
) |
|
(323 |
) |
Corporate costs and
taxes |
(53 |
) |
|
(57 |
) |
|
(135 |
) |
|
(163 |
) |
Other wholly owned
investments |
32 |
|
|
54 |
|
|
(36 |
) |
|
41 |
|
|
(109 |
) |
|
(85 |
) |
|
(519 |
) |
|
(445 |
) |
Preferred share dividends |
(39 |
) |
|
(37 |
) |
|
(152 |
) |
|
(151 |
) |
Add
back: equity-based compensation |
24 |
|
|
21 |
|
|
87 |
|
|
84 |
|
Cash available for
distribution and/or reinvestment before carried interest and
performance fees |
684 |
|
|
566 |
|
|
2,225 |
|
|
2,037 |
|
Realized carried interest,
net3,4 |
125 |
|
|
166 |
|
|
386 |
|
|
188 |
|
Performance fees |
— |
|
|
— |
|
|
— |
|
|
278 |
|
Cash
available for distribution and/or reinvestment |
$ |
809 |
|
|
$ |
732 |
|
|
$ |
2,611 |
|
|
$ |
2,503 |
|
3. Excludes our share of
Oaktree’s fee-related earnings and carried interest.
4. Non-IFRS measure – see Basis of Presentation on page
9.
Additional Information
The Letter to Shareholders and the company’s
Supplemental Information for the three months ended
December 31, 2019, 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 statements contained herein are based
primarily on information that has been extracted from our financial
statements for the year ended December 31, 2019, which have been
prepared using IFRS, as issued by the IASB. The amounts have not
been audited by Brookfield’s external auditor.
Brookfield’s Board of Directors have reviewed
and approved this document, including the summarized unaudited
consolidated financial statements prior to its release.
Information on our dividends can be found on our
website under Stock & Distributions/Distribution History.
Quarterly Earnings Call
Details
Investors, analysts and other interested parties
can access Brookfield Asset Management’s 2019 Year End Results as
well as the Shareholders’ Letter and Supplemental Information on
Brookfield’s website under the Reports & Filings section at
www.brookfield.com.
To participate in the Conference Call, please
dial 1-866-688-9425 toll free in North America, or for overseas
calls please dial 1-409-216-0815 (Conference ID: 8681089) at
approximately 10:50 a.m. EST. The Conference Call will also be
Webcast live at www.brookfield.com under Brookfield Asset
Management/Events and Presentations. For those unable to
participate in the Conference Call, the telephone replay will be
archived and available until midnight February 20, 2020. To access
this rebroadcast, please call 1-855-859-2056 or 1-404-537-3406
(Conference ID: 8681089.
Brookfield Asset Management
Inc. is a leading global alternative asset manager with
over $540 billion of assets under management across real
estate, infrastructure, renewable power, private equity and
credit. Brookfield owns and operates long-life assets and
businesses, many of which form the backbone of the global economy.
Utilizing its global reach, access to large-scale capital and
operational expertise, Brookfield offers a range of alternative
investment products to investors around the world—including public
and private pension plans, endowments and foundations, sovereign
wealth funds, financial institutions, insurance companies and
private wealth investors. Brookfield Asset Management is listed on
the New York and Toronto stock exchanges under the symbol BAM and
BAM.A respectively. For more information, please visit our website
at www.brookfield.com.
Please note that Brookfield’s previous audited
annual and unaudited quarterly reports have been filed on EDGAR and
SEDAR and can also be found in the investor section of its website
at www.brookfield.com. Hard copies of the annual and quarterly
reports can be obtained free of charge upon request.
For more information, please visit our website at
www.brookfield.com or contact:
Communications &
Media:Claire HollandVice President, Branding &
CommunicationsTel: (416) 369-8236Email:
claire.holland@brookfield.com |
Investor
RelationsLinda Northwood Director, Investor
Relations Tel: (416) 359-8647 Email:
linda.northwood@brookfield.com |
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.
We 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 Brookfield’s business and believe that many
shareholders and analysts also find this measure of value to
them.
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 issuers and
entities.
We make reference to Invested Capital. Invested
Capital is defined as the amount of common equity in our segments
and underlying businesses within the segments.
We make reference to Cash available for
distribution and/or reinvestment, which is referring to the sum of
our Asset Management segment FFO and distributions received from
our ownership of investments, net of Corporate activities FFO,
equity-based compensation and preferred share dividends. This
provides insight into earnings received by the corporation that are
available for distribution to common shareholders or to be
reinvested into the business.
We provide additional information on key terms
and non-IFRS measures in our filings available at
www.brookfield.com.
Notice to Readers
Brookfield is not making any offer or invitation
of any kind by communication of this news release and under no
circumstance is it to be construed as a prospectus or an
advertisement.
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 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. Forward-looking statements include statements that are
predictive in nature, depend upon or refer to future events or
conditions, include statements regarding the operations, business,
financial condition, expected financial results, performance,
prospects, opportunities, priorities, targets, goals, ongoing
objectives, strategies and outlook of Brookfield and its
subsidiaries, as well as the outlook for North American and
international economies for the current fiscal year and subsequent
periods, and include words such as “expects,” “anticipates,”
“plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,”
“projects,” “forecasts” or negative versions thereof and other
similar expressions, or future or conditional verbs such as “may,”
“will,” “should,” “would” and “could.”
Where this news release refers to “target
carried interest” it is based on an assumption that existing funds
meet their target gross returns. Target gross returns are
typically ~20% for opportunistic funds; 10% to 15% for value add,
credit and core funds. Fee terms vary by investment strategy
and may change over time.
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 Brookfield
to differ materially from anticipated future results, performance
or achievement expressed or implied by such forward-looking
statements and information.
Factors that could cause actual results to
differ materially from those contemplated or implied by
forward-looking statements include, but are not limited to:
(i) investment returns that are lower than target;
(ii) the impact or unanticipated impact of general economic,
political and market factors in the countries in which we do
business; (iii) the behavior of financial markets, including
fluctuations in interest and foreign exchange rates;
(iv) global equity and capital markets and the availability of
equity and debt financing and refinancing within these markets;
(v) strategic actions including dispositions; the ability to
complete and effectively integrate acquisitions into existing
operations and the ability to attain expected benefits;
(vi) changes in accounting policies and methods used to report
financial condition (including uncertainties associated with
critical accounting assumptions and estimates); (vii) the
ability to appropriately manage human capital; (viii) the
effect of applying future accounting changes; (ix) business
competition; (x) operational and reputational risks;
(xi) technological change; (xii) changes in government
regulation and legislation within the countries in which we
operate; (xiii) governmental investigations;
(xiv) litigation; (xv) changes in tax laws;
(xvi) ability to collect amounts owed;
(xvii) catastrophic events, such as earthquakes and
hurricanes; (xviii) the possible impact of international
conflicts and other developments including terrorist acts and
cyberterrorism; (xix) the introduction, withdrawal, success
and timing of business initiatives and strategies; (xx) the
failure of effective disclosure controls and procedures and
internal controls over financial reporting and other risks;
(xxi) health, safety and environmental risks; (xxii) the
maintenance of adequate insurance coverage; (xxiii) risks
specific to our business segments including our real estate,
renewable power, infrastructure, private equity, and residential
development activities; and (xxiv) factors detailed from time
to time in our documents filed with the securities regulators in
Canada and the United States.
We caution that the foregoing list of important
factors that may affect future results is not exhaustive and other
factors could also adversely affect its results. Investors and
other readers are urged to consider the foregoing risks, as well as
other uncertainties, factors and assumptions carefully in
evaluating the forward-looking information and are cautioned not to
place undue reliance on such forward-looking information. Except as
required by law, the corporation undertakes no obligation to
publicly update or revise any forward-looking statements or
information, whether written or oral, that may be as a result of
new information, future events or otherwise.
Past performance is not indicative nor a
guarantee of future results. There can be no assurance that
comparable results will be achieved in the future, that future
investments will be similar to the historic investments discussed
herein (because of economic conditions, the availability of
investment opportunities or otherwise), that targeted returns,
diversification or asset allocations will be met or that an
investment strategy or investment objectives will be achieved.
Target returns set forth in this news release
are for illustrative and informational purposes only and have been
presented based on various assumptions made by Brookfield in
relation to the investment strategies being pursued by the funds,
any of which may prove to be incorrect. There can be no assurance
that targeted returns will be achieved. Due to various risks,
uncertainties and changes (including changes in economic,
operational, political or other circumstances) beyond Brookfield’s
control, the actual performance of the funds and the business could
differ materially from the target returns set forth herein. In
addition, industry experts may disagree with the assumptions used
in presenting the target returns. No assurance, representation or
warranty is made by any person that the target returns will be
achieved, and undue reliance should not be put on them. Prior
performance is not indicative of future results and there can be no
guarantee that the funds will achieve the target returns or be able
to avoid losses.
Certain of the information contained herein is
based on or derived from information provided by independent
third-party sources. While Brookfield believes that such
information is accurate as of the date it was produced and that the
sources from which such information has been obtained are reliable,
Brookfield makes no representation or warranty, express or implied,
with respect to the accuracy, reasonableness or completeness of any
of the information or the assumptions on which such information is
based, contained herein, including but not limited to, information
obtained from third parties.
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