Brookfield Q3 2023 Earnings Call Transcript

Quartr
Provided by Quartr
November 9, 2023

There are 9 speakers on the call.

Operator

Hello, and welcome to the Brookfield Corporation Third Quarter 2023 Conference Call and Webcast. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. I would now like to hand the conference call over to our first speaker, Ms. Angela Yulo, Vice President.

Operator

Please go ahead.

Speaker 1

Thank you, operator, and good morning. Welcome to Brookfield Corporation's Q3 2023 conference call. On the call today are Bruce Flatt, our Chief Executive Officer and Nick Goodman, President of Brookfield Corporation. Bruce will start off by giving a business update, followed by Nick, who will discuss our financial and operating results for the quarter. After our formal comments, we'll turn the call over to the operator and take analyst questions.

Speaker 1

In order to accommodate all those who want to take questions, we ask that you refrain from asking more than 2 questions. I would like to remind you that in today's comments, including in responding to questions and in discussing new initiatives and our financial and operating performance, We may make forward looking statements, including forward looking statements within the meaning of applicable Canadian and U. S. Securities laws. These statements reflect predictions of future events and trends and do not relate to historic events.

Speaker 1

They are subject to known and unknown risks and future events and results may differ materially from such statements. For further information on these risks and their potential impacts on our company, Please see our filings with the securities regulators in Canada and the U. S. And the information available on our website. And with that, I'll turn the call over to Bruce.

Speaker 2

Thank you, Angela, and welcome everyone on the call. Results for the Q3 were strong As our business continues to generate growing cash flows and resilient earnings. Distributable earnings Before realizations were $1,100,000,000 in the quarter $4,200,000,000 for the last 12 months, representing an increase of 11% We continue to benefit from our leading position In the fastest growing asset management classes in alternatives today. Across both our asset management business and our scaling insurance solutions business, The franchise is capturing increasing allocations from institutions, pension plans, sovereigns and individuals Towards real assets and private credit. And the increasing allocation alternatives is coinciding with our growing retail and wealth distribution channels, which today are raising approximately $800,000,000 a month and should grow to $1,500,000,000 Our asset management business Had an active quarter overall and has now raised $61,000,000,000 of total capital year to date With further closes expected on our flagship funds through the remainder of the year and early 2024.

Speaker 2

Our successful fundraising efforts include the closing of our largest ever private equity fund in the quarter at 12,000,000,000 And the largest ever private infrastructure debt fund at $6,000,000,000 shortly after quarter end. We expect to put the finishing touches on raising the market's largest ever closed end infrastructure fund and have large closes for next vintages of transition, opportunistic credit and opportunistic real estate in the coming quarters. And we remain on track achieving Our insurance solutions business is also experiencing strong growth And is set to more than double its assets to over $100,000,000,000 increasing annualized earnings to over $1,200,000,000 With the anticipated closings of the previously announced acquisition of Argo Group and American Equity Life. Lastly, our operating businesses continued to deliver stable and growing cash flows supported by resilient earnings and solid fundamentals of the underlying businesses. Turning to markets.

Speaker 2

Central banks have made good headway in lowering headline inflation. While economic activity has been resilient and the labor market has remained tight, particularly in the U. S, we expect rates to remain stable before going lower in the medium term. Stability in interest rates has led to improved liquidity in capital markets And with significant sums of capital sitting on the sideline around the world, we expect that transaction activity will pick up significantly Through the end of 2024. We do, however, recognize that geopolitics as is often the case is a wildcard.

Speaker 2

Despite that, we do not expect that this will impact the long term outlook for the global economy or us specifically. We have found that in all markets, owning businesses and assets that form the backbone of the global economy, Maintaining high levels of liquidity and having a scale perpetual capital base is a safe place to be. With that backdrop, the business has performed well over the past 12 months with strong operating results, dollars 65,000,000,000 of capital deployment and over $35,000,000,000 of monetization. But we expect the next 12 months should even be better. It is worth reemphasizing that underpinning our success is the significant levels of liquidity that we have across our business and our continued Access to capital.

Speaker 2

Our liquidity today is significant at nearly $120,000,000,000 and should grow to over a record $150,000,000,000 Around the end of the year and into next year. Our access to capital also remains strong. At a time when many are finding it harder For capital, to find capital, our franchise continues to successfully finance our existing assets and businesses and raise fresh capital for growth. Nick will speak to that in his remarks. Our ability to execute buyouts, partner And lend at scale across a wide range of real assets is differentiating us now more than ever.

Speaker 2

And as the economic picture becomes clearer and our significant liquidity grows even further, we expect 2024 to be another Strong investment year. One of the areas where we're seeing very exciting partnership opportunities surrounds Artificial intelligence or AI. Much of the broader discussion today on AI is about how it's going to change the world and who will win and

Speaker 3

who will lose.

Speaker 2

Less discussed and more important to us is the significant impact that AI is having on the backbone of the global economy and the The substantial amount of capital that is required to launch us into this next AI generation. The digitalization investment, which is all powered by renewables requires tens of 1,000,000,000,000 of dollars. Global scale solutions for green data centers is becoming more critical. And we expect that a few global solution providers Like Brookfield, we'll emerge as winners. By leveraging Brookfield's ecosystem, we are providing turnkey solutions for green data centers on a global basis With a large portfolio today that can provide unique and flexible options for customers.

Speaker 2

Our data center, renewables and real estate businesses are Leaders in their respective sectors. However, we believe that the big opportunity here lies in what we can achieve By having these businesses work together to provide unique integrated solutions to some of the largest global players in AI. We believe that Brookfield is uniquely positioned as a partner of choice to capture the tremendous opportunities ahead and expect AI to be highly additive Before I pass the call to Nick, I want to briefly talk about our infrastructure and renewables businesses. Given the impact that interest rates and broader sector challenges have had on the trading prices of all dividend yield securities of late, I want to reiterate that we expect to continue to earn very attractive returns on the capital we have invested in our renewable security, BEP and our infrastructure security BIP for a very long time. We have for over 20 years And our businesses are better positioned today than they've ever been.

Speaker 2

Today, these businesses are in excellent shape with a strong foundation for growth, Each are well positioned around global secular trends and benefit from being part of the broader Brookfield ecosystem. Providing them with access to scale capital, deep operating investment expertise and global proprietary deal flow makes them different. So while many in the renewables and utility sectors are on the defensive and looking inward, our businesses are well positioned With significant institutional capital along beside them to continue to strengthen their franchises. We expect that the recent volatility in the markets will provide the opportunity to deploy significant amounts of capital for value and to these business to each emerge More dominant than they even are today. Given the current trading prices of Brookfield Renewable Partners and Brookfield Infrastructure Partners, alongside our strong conviction in the intrinsic value of the businesses, We've begun allocating capital to buy further BEP and VIP shares in the open market, similar to what we've been doing with Brookfield Business Partners earlier this year.

Speaker 2

This use of capital will of course be weighed against buying back our own stock where we've invested approximately $750,000,000 over the past 12 months and also investing in some of the great investment opportunities which we are seeing. I will close by noting for you that our significant competitive advantages of Scale Capital, global footprint and deep investment and operating expertise as well as our reputation as a superior partner Continue to differentiate our franchise and are more important today than ever. Thank you for your continued support and interest in Brookfield. With that, I'll turn it over to Nick to continue.

Speaker 3

Thank you, Bruce, and good morning, everyone. Financial results were strong in the 3rd quarter. Distributable earnings or DE before realizations were $1,100,000,000 for the quarter And $4,200,000,000 over the last 12 months. That's an 11% increase per share after adjusting for the distribution of 25 of our manager last December. Total DE was $1,200,000,000 for the quarter, dollars 5,000,000,000 over the last 12 months With net income of $230,000,000 at our share or $35,000,000 in total for the quarter and $2,000,000,000 over the last 12 months.

Speaker 3

Starting with our operating performance, as mentioned, our positioning around the global demand for alternatives continues to be a key driver of our Our Asset Management business delivered strong results with distributable earnings of $634,000,000 in the quarter And $2,600,000,000 over the last 12 months. Strong fundraising momentum has led to inflows of $61,000,000,000 so far this year And $71,000,000,000 over the past 12 months. Fee bearing capital at the end of the quarter was $440,000,000,000 Driving growth in fee related earnings of 13%, excluding performance fees compared to last year. We expect a further acceleration in fundraising through the end of this year and heading into 2024, providing strong momentum for earnings. Our Insurance Solutions business continues to deliver earnings growth, generating distributable operating earnings of $182,000,000 in the quarter $657,000,000 over the last 12 months, representing an increase of 14% compared to the prior year, driven by our growing insurance asset base and strong investment performance.

Speaker 3

During the quarter, our insurance solutions business originated over $2,000,000,000 of annuity premiums and redeployed approximately $1,000,000,000 of assets and an average investment yield in excess of 9%, Expanding the average yield on the investment portfolio by 10 basis points. Today, we earn approximately 5.5% and roughly $50,000,000,000 of assets, which is about 200 basis points higher than the average cost of capital. Annualized earnings for the business are now approximately 7 $75,000,000 and we continue to track towards $800,000,000 by the end of the year. The anticipated acquisitions of the Argo Group And American Equity Life will grow insurance assets to over $100,000,000,000 and will initially take annualized earnings to approximately $1,200,000,000 The run rate of annualized earnings should grow further to approximately $2,000,000,000 annually over time As the investment portfolio is optimized. As Bruce mentioned, we continue to increase our distribution to retail and wealth Through various channels, raising about $800,000,000 a month currently with $300,000,000 of that coming through our wealth solutions platform And $500,000,000 coming from the origination of annuities within our insurance solutions business.

Speaker 3

This should increase to over $1,500,000,000 a month Our operating businesses continue to deliver resilient and high quality earnings, Supporting cash distributions of $366,000,000 in the quarter and $1,500,000,000 over the last 12 months. The cash distributions from our Renewable Power and Transition and Infrastructure businesses were supported by a 14% increase in their operating funds operations over the last 12 months. Our private equity business also contributed resilient earnings with approximately 7% growth in adjusted EBITDA over the prior year. And our real estate business continues to achieve strong performance in its core portfolio, Which has been outperforming the overall market with occupancy levels at 96% and growth in same store net operating income of 9% compared to the prior year quarter. In our core retail portfolio, food traffic increased by 7% versus the comparative period And leasing spreads are 19% higher year to date.

Speaker 3

In our office portfolio, our leasing activity remains robust With 800,000 square feet completed in the quarter and an average net rents 15% higher than those expiring, Which includes 200,000 Square Feet in New York and Toronto, 230,000 Square Feet in Calgary, Over 100,000 square feet across Houston and Washington DC and almost 100,000 square feet across London and Dubai. It's important to know our leasing numbers are not as large as some prior periods because we have very limited space to lease in many buildings and markets. Shifting to monetization activity, our transaction activity remains robust. We have signed and or completed approximately $25,000,000,000 of asset sales year to date, bringing our total monetizations to more than $35,000,000,000 over the last 12 months. And most importantly, Substantially, all of these recent sales were transacted at values higher than our IFRS carrying values.

Speaker 3

And that's an important point to reiterate. A couple of examples include the sale of a manufactured housing portfolio in the U. S. For approximately $390,000,000 And the sale of a partial stake in our technology services business and an implied enterprise value of over $1,000,000,000 representing a 3.5 Over the last 12 months, we have generated $2,200,000,000 of unrealized carried interest, Increasing our total accumulated unrealized carried interest to $9,900,000,000 with $8,700,000,000 of that directly owned by the corporation. And we remain on track to realize well over $500,000,000 of net realized carried interest into income this year.

Speaker 3

Moving on to capital allocation. Since the end of last quarter, we have returned over $400,000,000 to shareholders Through regular dividends and share buybacks with over $300,000,000 of shares repurchased in the open market, Taking the total buybacks over the past year to approximately $750,000,000 The balance of our free cash flow generation was reinvested back into the business. Moving forward, we will continue to opportunistically repurchase our shares and potentially those of BEP, BEP and BBU Wait against the substantial investment and reinvestment opportunities we see ahead. Outside of our financial results, I also want to reiterate how our significant liquidity, strong balance sheet and core financing principles are serving us very well today. Over many decades and through various cycles, we have developed and implemented a simple set of principles to financing our business.

Speaker 3

These principles, which are as follows, still guide us today. First, we always maintain significant and multiple sources of liquidity at the corporation. 2nd, we finance investments using non recourse asset level debt with no cross collateralization. And lastly, we ensure our businesses and assets can be financed on a standalone basis, but we'll support them as needed to create long term value. At the end of the quarter, we had total deployable capital of nearly $120,000,000,000 putting us in a very strong position.

Speaker 3

At the corporation specifically, in addition to having $4,000,000,000 in cash and financial assets, we have approximately $60,000,000,000 of Securities on our balance sheet, soon to be over $100,000,000,000 of insurance assets, most of which is invested in cash and liquid assets. We also have significant headroom in our current credit ratings, enabling us to access the debt market should we choose and we generate approximately $5,000,000,000 Cash flows a year. With this significant level of liquidity, we are in a very strong position to withstand market cycles and will have the ability to focus on growth at a time when we expect to see excellent investment opportunities. They should see us emerge from this cycle in a better place We have maintained a disciplined approach to financing our business, raising debt at the asset or portfolio company level, Sizing the debt to be sustainable through cycles and importantly making sure the debt has no recourse to BN, BAM or our perpetual affiliate balance sheets. We pride ourselves on being a responsible borrower and a strong counterparty to those who lend to us.

Speaker 3

But at the same time, we along with our lenders approach financings on an asset by asset basis. This approach to financing our business Along with our reputation and our relationships, our core strengths, enabling us to have continued access to capital at a time when many others are finding it hard to raise financing. To highlight this, in just the past few months during market uncertainty, We have executed on approximately $25,000,000,000 of financings across the business, increasing duration and in many cases tightening the spreads of the debt, thereby ending up with coupons broadly consistent with the previous financings. A few notable highlights include our renewable power and transition And infrastructure businesses raising approximately $2,500,000,000 in the aggregate to support 2 of their portfolio companies. In our private equity business, we have refinanced close to $15,000,000,000 of debt since the beginning of the year, all done with effectively no increase to the overall cost Within our real estate business, we have successfully refinanced our 2023 maturities across 131 individual loans, Benefiting from our diversity across sectors and geographies with no material impact to liquidity and we expect to refinance our upcoming maturities with similar success.

Speaker 3

In our office portfolio alone, we've closed approximately $9,000,000,000 of financings year to date around our global portfolio. These examples demonstrate our strong access to the capital markets across the business, allowing us to finance existing operations and support growth. Overall, our positioning around the fastest growing segments and alternatives, our vast liquidity and proven access to the capital markets positions us well to continue to deliver strong returns and create significant wealth for our stakeholders over the long term. With that, I am pleased to confirm that our Board of Directors has declared a quarterly dividend of $0.07 per share payable at the end of December To shareholders of record at the close of business on November 30, 2023. Thank you for your time.

Speaker 3

And I'll now hand the call back over to the operator for questions.

Operator

Thank Our first question comes from the line of Mario Saric with Scotiabank, your line is now open.

Speaker 4

Hi. Good morning and thank you for taking my questions. So the first one is more of a general one in terms of kind of the internal view on the broader U. S. Economy.

Speaker 4

There continues to be a lot of discussion about hard versus soft landing in the U. S. So I'm just curious about how the internal view has evolved relating to the probability of each And how that may shape capital allocation in terms of asset classes or geographies heading into 2024, if at all?

Speaker 3

Hey Mario, it's Nick. When I think when we look at the broad economic situation as we've outlined, I think one of the hindrances to capital deployment more recently has been people forming a view or certainty over the outlook for rates. And I think if that stabilizes, we think people will gain more confidence in pricing risk and deploying capital. And as more liquidity returns to the Capital markets, again, that should support transaction activity. And I think from our perspective, we try less to form a view on short term economic Activity, we tend more to focus on looking for very high quality businesses with good cash flow.

Speaker 3

They'll be resilient through cycles. And if there's opportunities to acquire them for value, Then we will look to deploy capital. So I would say that we have lots of capital. We're being selective and patient, but we expect to see significant investment opportunities in the coming year.

Speaker 4

Okay. And then just maybe an associated question coming back to the peak rate cycle and Expected transaction activity acceleration, I just want to focus specifically on real estate for this. You've been fairly vocal in noting there's a significant that exists between Class A and Class B C Properties. Based on your experience, whether it's coming out of the GFC or the early 90s, How would you characterize the acceleration in expected activity between the trophy assets that you own and presumably kind of the more discounted value add assets? I guess the question is, when do you expect transaction activity to pick up for the types of trophy assets that you own, which would perhaps provide the market with more confidence in the underlying

Speaker 3

Yes. I mean, Mario, it's very hard to predict the future, but as you know, when transaction activity returns, The focus tends to be on the highest quality assets. And so yes, it's fair to assume that when trans activity does pick up and it's Hard to predict that will be, but maybe into the start of next year with stronger capital markets, more support from liquidity, you'll see transaction activity return. And As you state, we own very high quality assets with very attractive cash flows that will offer very attractive long term returns. So we should expect to see that start Hard to say, but hopefully into the start of next year.

Speaker 4

Okay, great. Thanks, Nick.

Operator

Our next question comes from the line of Ken Worthington with JPMorgan. Your line is now open.

Speaker 5

Hi, good morning. Thanks for taking the question. In Investor Day, you reiterated plans To sell down a significant portion of the transition and development real estate portfolio over the next 5 years with focus sort of redirected towards insurance. What portion of the transition and development portfolio is ready for sale today If market conditions were accommodative and if geopolitical actions don't derail market conditions, Would you expect to have more meaningful dispositions next year? Thank you.

Speaker 3

Hi, Ken. It's Nick. The first comment I would make is that and we've reiterated it in the past. The assets that we own on our balance sheet are Backed by perpetual capital. So we are going to we can be patient.

Speaker 3

We're long term in our view of these In our hold of these assets and desire to create value, we're not looking or needing to sell in the short term. So we will wait for the right market conditions to transact. With these assets, they're all at various stages of their business plans. So it's hard to put an exact percentage, but there is a number of assets that when market conditions return that we can look to sell Around the world, so diversified by markets. So we're not specifically exposed to any one market and when conditions improve, we can look to transact.

Speaker 3

If marketing does show strong next year, then we look to execute. But as I said, we can be patient.

Speaker 5

Okay. Thank you. And then Brookfield is on track to generate $500,000,000 of carry this year. It was a more challenging environment this year and you still You know, generated quite a bit. As we look to 2024, I know you said you can't predict the future.

Speaker 5

Would you expect realized carry to grow? And in which businesses seem sort of best positioned to realize carry this Given the sort of seasoning of the various portfolios?

Speaker 3

Yes, that's a good question. Listen, we do expect carry to grow for sure, Because we're now working our way into larger funds and larger investments and they've all performed really well. So we should expect to see a grow. We're now working our way into the 2nd vintage of the infrastructure fund getting close to realize and carry, same with the 2nd vintage of the real estate fund and private equity to common. And as we've said in the past, What's unique about these assets is that they tend to be investment grade rated with portable debt, which makes them very transactable.

Speaker 3

They've proven to be very resilient in their cash flow And so we expect them to be very attractive when they bring them to market and we should continue to see carry growth.

Speaker 5

Okay, great. Thank you.

Operator

Our next question comes from the line of Cherilyn Radbourne with TD Cowen. Your line is now open. Thank

Speaker 6

you very much and good morning. Just starting with the fundraising inflows from the retail wealth channel, I I was hoping you could talk about how you're managing those inflows in the context of strong consumer demand versus what you think you can deploy manageably On a quarterly or annual basis?

Speaker 3

Hi, Cherilyn. Yes, so the flows are Fairly, they're diversified across products. They're not flowing into one single product. They're flowing predominantly right now through credit and into infrastructure. And I think we will be careful to moderate inflows to make sure we can match that against investments that match the return criteria and yields of those products.

Speaker 3

But so far, And we see a tremendous investment opportunity and we can match those inflows with deployment opportunities.

Speaker 6

Great. And then separately, as it relates to the core real estate portfolio and its potential to nicely match the duration of your Will the AEL acquisition give you sufficient scale to contemplate a partial transfer to the insurance business?

Speaker 3

Yes. I think having more scale in the portfolio, a larger asset base will allow us to look to execute transfers at the right price of Core assets over to the insurance portfolio.

Speaker 6

That's my 2. Thank you.

Speaker 3

Thanks.

Operator

Thank you. Our next question comes from the line of Saurabh Movahedi with BMO Capital Markets. Your line is now open.

Speaker 7

Okay. Thank you very much. I think that's a good where you left it off, I think, is a good spot for me to pick up. You In the supplemental, you talk about insurance solutions business acquiring economic interest of circa $2,000,000,000 of real estate. Can you give us a little bit of indication as to the mix of that real estate, I guess, between office and Retail and the like, maybe core versus transition and I suppose How the value was established for that transfer?

Speaker 3

Yes, sure, Saurabh. So, I think prior to this quarter, we transferred $700,000,000 of equity value of interest in core assets, predominantly core office, I think one retail, But those were done at fair value with independent valuations, which obviously were all approved by the regulators before we transacted. What we actually transferred in this quarter was interest in BN's interest in opportunistic real estate ownerships of BSREP. They were moved across as a more efficient way to own those assets for long term and added capital base to the insurance business and those were transacted at fair value And assets that are quarterly valued and reviewed by auditors.

Speaker 7

Nick, is it fair to say that it wasn't I'd kind of observe market prices because obviously there isn't much transacting over there would be consistent with your IFRS valuations of those. Is that fair to put it? Yes.

Speaker 3

But independently verified valuations.

Speaker 7

Okay. And then so you did about $700,000,000 I guess you said Quarter in some portfolios, you did a couple of $1,000,000,000 I guess in real estate this quarter. Like, is there some sort of a quarterly transition rate That I can that we could think about over here or is this just going to be a bit more opportunistic?

Speaker 3

The latter, Saurabh, as the business grows and the assets make sense, then we'll look to execute.

Speaker 5

Thank you.

Operator

Thank you. Our next question comes from the line of Mike Brown with KBW. Your line is now open.

Speaker 8

Okay, great. So you increased your share repurchases here in the Q3 and that's continued into the Q4. So I guess my question here is about the balance sheet here. It looks like you're focusing on the cash levels here in your liquidity profile. It declined, I think about $1,000,000,000 quarter over quarter.

Speaker 8

And so if I exclude the proportion of BAM's cash from that level, it would actually be negative. I guess why take your cash down this quarter? And if you do keep the buybacks high, which it certainly seems like you've done so far in the Q4, If I think through the various sources and uses of cash, is it possible for the cash to start to kind of grow back here in the Q4 or should it actually can actually

Speaker 3

Hey, Mike. I think some of that is just timing. But remember, we've got $2,600,000,000 of undrawn lines. We got Significant liquidity at the corporate level. This was a very good use of cash and we have a lot of other sources of cash beyond, as we said, dollars 5,000,000,000 of coming in the year carried interest monetization is in the pipeline.

Speaker 3

So yes, you can see cash build up, but we're in a very strong liquidity position And buybacks is an attractive use of capital at this point in time.

Speaker 8

Okay. And then On BEP and BIP, we've seen those share prices start to come back. And I know there were some read across from Some other assets in the market that weighed on this group this quarter and maybe the rate backdrop also Kind of played out, kind of impacting the shares this quarter. I guess first, When you think about what kind of dragged those stocks or kind of impacted those stocks this quarter, If some element of that valuation hit, I guess the question here is, Is there some element that will be kind of harder to get back just given the challenge the kind of tough macro backdrop? And are you You're kind of confident the buyback activity will help reverse some of that discount?

Speaker 8

And then 2, Would you ever consider changing the way that the management fees are calculated on the BAM side? There's clearly some kind of mark to market noise here. So would you ever shift You keep doing a fee rate calculation on a NAV based calculation versus like a market cap calculation. And if so, what would that Transition process kind of look like in practice?

Speaker 3

Maybe taking the second one first. I think the answer is no. We have a well established Fee structure for these businesses, they've been public for a long time, well disclosed, well understood by the market. So not contemplating any changes. I think on the discount with Beth and Beth, of course, the higher rate environment has impacted people's views of yield stocks in the short term.

Speaker 3

But I think what's different about both BIP and BEP and what they've proven over a long period of time is they're not just owners of They own very, very high quality assets, but they're real operating businesses and they buy assets and they really can grow and drive cash flow growth, which outperforms The broader market in terms of returns that they have proven over a long period of time to be able to deliver in their assets. And whilst the macro of higher rates has impacted the sector, I think we fully expect that Bip and Bet will continue to differentiate themselves in their earnings growth and then the value they generate in their investments and that will translate into Share price performance over time. Now our buybacks in the short term are not necessarily intended to enhance their price. It's us seeing a good opportunity to deploy capital for value And we'll continue to look to do that if it persists.

Speaker 8

Okay. Thank you for taking my questions.

Operator

Thank you. I would now like to turn the call back over to Ms. Angela Yulo for closing remarks.

Speaker 1

Thank you everybody for joining us today. And with that, we'll end the call.

Operator

This concludes today's conference call. Thank you for participating and you may now disconnect.

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Key Takeaways

  • Brookfield reported distributable earnings before realizations of $1.1 billion in Q3 and $4.2 billion over the last 12 months, a per-share increase of 11% driven by resilient cash flows across its businesses.
  • The asset management platform raised $61 billion of capital year-to-date, including record closes of a $12 billion private equity fund and a $6 billion infrastructure debt fund, while retail and wealth channels are raising ~$800 million per month, targeting $1.5 billion.
  • Its insurance solutions business is set to more than double assets to >$100 billion with the Argo Group and American Equity Life acquisitions, boosting annualized earnings to over $1.2 billion and ultimately to ~$2 billion as the portfolio is optimized.
  • Brookfield maintains nearly $120 billion of deployable capital (rising to ~$150 billion year-end), has returned ~$750 million to shareholders in share buybacks over the past 12 months, and continues to execute $25 billion of financings and $35 billion of monetizations at premiums to book.
  • The firm is leveraging its renewable power, data center and real estate franchises to provide turnkey green AI data center solutions, positioning itself as a global partner of choice for the next wave of digitalization.
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Earnings Conference Call
Brookfield Q3 2023
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