Distributable Earnings of
Raised a Record
BROOKFIELD, NEWS,
Operating Results
| Unaudited For the periods ended (US$ millions) |
Three Months Ended | Twelve Months Ended | |||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||
| Net Income | $ | 19 | $ | — | $ | 19 | $ | — | |||
Net income for
In order to provide meaningful comparative information, the following discussion relates to full year results on a 100% basis for our asset management business. For clarity,
For the periods ended (US$ millions, except per share amounts) |
Three Months Ended | Twelve Months Ended | |||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||
| Fee-Related Earnings2 | $ | 576 | $ | 534 | $ | 2,108 | $ | 1,827 | |||||||
| Taxes | (35 | ) | (18 | ) | (98 | ) | (58 | ) | |||||||
| Add back: equity-based compensation costs and other | 28 | 23 | 86 | 123 | |||||||||||
| Distributable Earnings2 | $ | 569 | $ | 539 | $ | 2,096 | $ | 1,892 | |||||||
| Fee-related Earnings Per share | $ | 0.35 | $ | 0.33 | $ | 1.29 | $ | 1.12 | |||||||
| Distributable Earnings Per share | 0.35 | 0.33 | 1.28 | 1.16 | |||||||||||
| Net income post-distribution | $ | 84 | $ | — | $ | 84 | $ | — | |||||||
| Net income | 504 | 557 | 1,915 | 1,851 | |||||||||||
1. Reflects full period results unless otherwise noted on a 100% basis for our asset management business, being Brookfield Asset Management ULC and its subsidiaries, including its share of the asset management activities of
2. See Reconciliation of Net Income to Fee-Related Earnings and Distributable Earnings on page 6 and Non-GAAP and Performance Measures section on page 8.
Distributable earnings for our asset management business were
Operating Highlights
We raised a record $93 billion of capital last year. Fee-bearing capital was
During the quarter, we held additional closes for our fifth flagship infrastructure fund and our sixth flagship private equity fund which now stand at approximately
Over the year, we raised
The above increases in fee-bearing capital contributed to a 26% increase in fee-related earnings over the last twelve months, excluding performance fees.
Fee-related earnings were
Fee-related earnings margins before performance fees, at our share were 60% for the quarter and 58% for the year. This represented a 2% increase for both the quarter, and the year, compared to the prior year periods.
The increase in margins over the quarter and the year was driven by the scaling of our flagship funds and benefit of capital deployed across new strategies during the year.
We invested and/or committed
Notable acquisitions include the closing of our infrastructure business’ partnership with Intel to fund half of a
As at
Total investable capital includes approximately
Strategic Initiatives
On
Regular Dividend Declaration & Establishment of Dividend Reinvestment Program
Statements of Financial Position
| Unaudited (US$ millions) |
||||||
| 2022 | 2021 | |||||
| Assets | ||||||
| Cash and cash equivalents | $ | 1 | $ | — | ||
| Investments | 2,377 | — | ||||
| Accounts receivable and other | 782 | — | ||||
| Total Assets | $ | 3,160 | $ | — | ||
| Liabilities and Shareholders’ Equity | ||||||
| Accounts payable and other | $ | 783 | $ | — | ||
| Common Equity | 2,377 | — | ||||
| Non-controlling interest | — | — | ||||
| Total common equity and non-controlling interest | $ | 3,160 | $ | — | ||
Statements of Operating Results
| Unaudited For the periods ended (US$ millions, except per share amounts) |
Three Months Ended | Years Ended | |||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||
| Equity accounted income | $ | 21 | $ | — | $ | 21 | $ | — | |||||
| Other expenses | (2 | ) | — | (2 | ) | — | |||||||
| Net income | $ | 19 | $ | — | $ | 19 | $ | — | |||||
| Net income attributable to: | |||||||||||||
| Common shareholders | $ | 19 | $ | — | $ | 19 | $ | — | |||||
| Non-controlling interests | — | — | — | — | |||||||||
| $ | 19 | $ | — | $ | 19 | $ | — | ||||||
| Net income per share | |||||||||||||
| Diluted | $ | 0.05 | $ | — | $ | 0.05 | $ | — | |||||
| Basic | 0.05 | — | 0.05 | — | |||||||||
Statements of Financial Position
| Unaudited (US$ millions) |
||||||
| 2022 | 2021 | |||||
| Assets | ||||||
| Cash and cash equivalents | $ | 3,545 | $ | 2,494 | ||
| Accounts receivable and other | 2,903 | 7,130 | ||||
| Investments | 5,097 | 9,305 | ||||
| Deferred income tax assets | 1,346 | 2,268 | ||||
| Total Assets | $ | 12,891 | $ | 21,197 | ||
| Liabilities and Shareholders’ Equity | ||||||
| Accounts payable and other | $ | 2,702 | $ | 10,239 | ||
| Corporate borrowings | — | 461 | ||||
| Deferred tax liabilities | 681 | 700 | ||||
| Total common equity | 9,508 | 9,797 | ||||
| Total Liabilities and common equity | $ | 12,891 | $ | 21,197 | ||
Note: Reflects balances on a 100% basis for our asset management business, being Brookfield Asset Management ULC and its subsidiaries, as well as its share of the asset management activities of
Statements of Operating Results
| Unaudited For the periods ended (US$ millions, except per share amounts) |
Three Months Ended | Years Ended | |||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||
| Revenues | |||||||||||||||
| Management fee revenues | |||||||||||||||
| Base management and advisory fees | $ | 700 | $ | 523 | $ | 2,500 | $ | 1,951 | |||||||
| Incentive distributions | 84 | 76 | 335 | 315 | |||||||||||
| Performance fees | — | 78 | — | 157 | |||||||||||
| Total management fee revenues | 784 | 677 | 2,835 | 2,423 | |||||||||||
| Carried interest income | 297 | 169 | 490 | 348 | |||||||||||
| Other revenues | 36 | 22 | 302 | 316 | |||||||||||
| Share of income from equity accounted investments and other | (159 | ) | 167 | 132 | 499 | ||||||||||
| Total revenues and other income | 958 | 1,035 | 3,759 | 3,586 | |||||||||||
| Expenses | |||||||||||||||
| Compensation, operating, and general and administrative expenses | (205 | ) | (271 | ) | (1,017 | ) | (1,020 | ) | |||||||
| Carried interest related expenses | (66 | ) | (40 | ) | (200 | ) | (211 | ) | |||||||
| Income before taxes | 687 | 724 | 2,542 | 2,355 | |||||||||||
| Income tax expense | (183 | ) | (167 | ) | (627 | ) | (504 | ) | |||||||
| Net income | $ | 504 | $ | 557 | $ | 1,915 | $ | 1,851 | |||||||
| Net income attributable to Brookfield Asset Management ULC | $ | 504 | $ | 557 | $ | 1,915 | $ | 1,851 | |||||||
| Net income per share | |||||||||||||||
| Diluted | $ | 0.31 | $ | 0.34 | $ | 1.17 | $ | 1.13 | |||||||
| Basic | 0.31 | 0.34 | 1.17 | 1.13 | |||||||||||
Note: Reflects balances on a 100% basis for our asset management business, being Brookfield Asset Management ULC and its affiliates. Presented net of inter-corporate balances for amounts attributable to
SELECT FINANCIAL INFORMATION
RECONCILIATION OF NET INCOME TO FEE-RELATED EARNINGS AND DISTRIBUTABLE EARNINGS
| Unaudited For the periods ended (US$ millions) |
Three Months Ended | Years Ended | |||||||||||||
| 2022 | 2021 | 2022 | 2021 | ||||||||||||
| Net income | $ | 504 | $ | 557 | $ | 1,915 | $ | 1,851 | |||||||
| Add or subtract the following: | |||||||||||||||
| Provision for taxes1 | 183 | 167 | 627 | 504 | |||||||||||
| Depreciation, amortization and other2 | 4 | 5 | 13 | 11 | |||||||||||
| Carried interest allocations and expense3 | (231 | ) | (129 | ) | (290 | ) | (137 | ) | |||||||
| Interest expense paid to related parties4 | 21 | 45 | 154 | 171 | |||||||||||
| Interest and dividend revenue4 | (32 | ) | (11 | ) | (258 | ) | (293 | ) | |||||||
| Share of income (loss) from equity accounted investments5 | 49 | (74 | ) | (146 | ) | (161 | ) | ||||||||
| Fee-Related Earnings of Oaktree at our share5 | 65 | 60 | 252 | 251 | |||||||||||
| Other income and expenses4 | 13 | (86 | ) | (159 | ) | (370 | ) | ||||||||
| Fee-related earnings | 576 | 534 | 2,108 | 1,827 | |||||||||||
| Taxes | (35 | ) | (18 | ) | (98 | ) | (58 | ) | |||||||
| Equity based compensation expense and other6 | 28 | 23 | 86 | 123 | |||||||||||
| Distributable earnings | $ | 569 | $ | 539 | $ | 2,096 | $ | 1,892 | |||||||
-
This adjustment removes the impact of income tax provisions on the basis that we do not believe this item reflects the present value of the actual tax obligations that we expect to incur over the long-term due to the substantial deferred tax assets of our asset management business.
-
This adjustment removes the depreciation and amortization on property, plant and equipment and intangible assets, which are non-cash in nature and therefore excluded from fee-related earnings.
-
This adjustment removes carried interest allocations and the associated compensation expense, which is excluded from Fee-Related Earnings as these items are non-cash in nature.
-
These adjustments remove other income and expenses associated with non-cash fair value changes and remove interest and charges paid or received related to intercompany or related party loans.
-
These adjustments remove our share of Oaktree’s non-cash items, including items 1) to 4) above and include our share of Oaktree’s fee-related earnings.
-
This adjustment adds back equity-based compensation as it is excluded from distributable earnings.
Additional Information
The Letter to Shareholders and the company’s Supplemental Information for the three months and year ended
The statements contained herein are based primarily on information that has been extracted from our financial statements for the quarter and year ended
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 2022 Year End Results as well as the Shareholders’ Letter and Supplemental Information on Brookfield’s website under the Reports & Filings section at www.bam.brookfield.com.
To participate in the Conference Call today at
https://register.vevent.com/register/BIfd03201497c24652b31111cccfdbffbe.
About
For more information, please visit our website at www.bam.brookfield.com or contact:
| Communications & Media: Tel: (212) 618-3469 Email: [email protected] |
Investor Relations: Tel: (416) 369-2547 Email: [email protected] |
Non-GAAP and Performance Measures
This news release and accompanying financial information are based on generally accepted accounting principles in
We make reference to Distributable Earnings (“DE”), which is referring to the sum of its fee-related earnings, realized carried interest, realized principal investments, interest expense, and general and administrative expenses; excluding equity-based compensation costs and depreciation and amortization. The most directly comparable measure disclosed in the primary financial statements of our asset management business for distributable earnings is net income. This provides insight into earnings received by the company that are available for distribution to common shareholders or to be reinvested into the business.
We use FRE and DE to assess our operating results and the value of Brookfield’s business and believe that many shareholders and analysts also find these measures of value to them.
We disclose a number of financial measures in this news release that are calculated and presented using methodologies other than in accordance with US GAAP. These financial measures, which include FRE and DE, should not be considered as the sole measure of our performance and should not be considered in isolation from, or as a substitute for, similar financial measures calculated in accordance with US GAAP. We caution readers that these non-GAAP financial measures or other financial metrics are not standardized under US GAAP and may differ from the financial measures or other financial metrics disclosed by other businesses and, as a result, may not be comparable to similar measures presented by other issuers and entities.
We provide additional information on key terms and non-GAAP measures in our filings available at www.bam.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 Canadian provincial securities laws and “forward-looking statements” within the meaning 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 Brookfield and the Manager 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 including as a result of COVID-19 and the related global economic disruptions; (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, hurricanes and epidemics/pandemics; (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) the existence of information barriers between certain businesses within our asset management operations; (xxiv) risks specific to our business segments including our real estate, renewable power and transition, infrastructure, private equity, credit, and residential development activities; and (xxv) 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 and other factors could also adversely affect its results. 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 company 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.
Source:
| Title | Document |
|---|---|
English |