Distributable Earnings Before Realizations Increased 19% to a
Record $1.3 billion or $0.80 Per Share
Advanced Monetizations of $17 billion and New Investments of $20 billion
as Transaction Activity Continues to Increase
BROOKFIELD, NEWS, Nov. 14, 2024 (GLOBE NEWSWIRE) -- Brookfield Corporation (NYSE: BN, TSX: BN) announced record financial results for the quarter ended September 30, 2024.
Nick Goodman, President of Brookfield Corporation, said, "Our financial performance in the third quarter was strong, delivering record cash earnings from our base businesses, and we expect this momentum to continue into 2025. We repurchased approximately $1 billion of shares over the last twelve months and will continue allocating capital opportunistically to share buybacks.”
He added, "With capital markets continuing to improve and transaction activity picking up, we recently executed on several financings and signed or closed a number of monetizations across our business. As the macro tailwinds turn in our favor, we are better positioned than ever to drive strong earnings growth and deliver 15%+ total returns to our shareholders over the long term.”
Operating Results
Distributable earnings ("DE”) before realizations increased by 19% over the prior year quarter.
| Unaudited
For the periods ended September 30 (US$ millions, except per share amounts) | Three Months Ended | Last Twelve Months Ended | |||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||
| Net income of consolidated business1 | $ | 1,518 | $ | 35 | $ | 4,886 | $ | 2,015 | |||
| Net income attributable to Brookfield shareholders2 | 64 | 230 | 908 | 115 | |||||||
| Distributable earnings before realizations2,3,4 | 1,259 | 1,056 | 4,582 | 4,049 | |||||||
| - Per Brookfield share2,3,4 | 0.80 | 0.67 | 2.90 | 2.54 | |||||||
| Distributable earnings2,3 | 1,325 | 1,150 | 5,980 | 4,992 | |||||||
| - Per Brookfield share2,3 | 0.84 | 0.73 | 3.78 | 3.13 | |||||||
Total consolidated net income was $1.5 billion in the quarter and $4.9 billion for the last twelve months ("LTM”). Distributable earnings before realizations were a record $1.3 billion ($0.80/share) for the quarter and $4.6 billion ($2.90/share) for the last twelve months.
Our asset management business delivered 14% growth in fee-related earnings compared to the prior year quarter, due to recent fundraising momentum across our diversified strategies, primarily from our credit funds and insurance inflows.
Wealth solutions earnings doubled compared to the prior year quarter, benefiting from the acquisition of American Equity Life, increased annuity sales and strong investment performance.
Our operating businesses continue to deliver growing cash flows, backed by the resilient earnings of our renewable power and transition, infrastructure and private equity businesses and 4% growth in same-store net operating income ("NOI”) from our core real estate portfolio over the prior year quarter.
During the quarter and over the LTM, earnings from realizations were $66 million and $1.4 billion, with total DE for the quarter and the LTM of $1.3 billion ($0.84/share) and $6.0 billion ($3.78/share), respectively.
Regular Dividend Declaration
The Board declared a quarterly dividend for Brookfield Corporation of $0.08 per share, payable on December 31, 2024 to shareholders of record as at the close of business on December 16, 2024. The Board also declared the regular monthly and quarterly dividends on our preferred shares.
Operating Highlights
Distributable earnings before realizations were a record $1.3 billion ($0.80/share) for the quarter and $4.6 billion ($2.90/share) over the last twelve months, representing an increase of 19% over the prior year quarter. Total distributable earnings were $1.3 billion ($0.84/share) for the quarter and $6.0 billion ($3.78/share) for the last twelve months.
Asset Management:
- DE was $694 million ($0.44/share) in the quarter and $2.6 billion ($1.64/share) over the LTM.
- Fee-related earnings increased by 14% compared to the prior year quarter, driven by a 23% increase in fee-bearing capital over the LTM to $539 billion as at September 30, 2024. Inflows were $21 billion in the quarter and $135 billion for the LTM.
- During the quarter, we closed on the previously announced strategic partnership with Castlelake, a global alternative investment manager specializing in asset-based private credit including aviation and specialty finance. We also completed the acquisition of SVB Capital through Pinegrove Capital Partners, our venture investment platform formed with Sequoia Heritage.
- Distributable operating earnings were $364 million ($0.23/share) in the quarter and $1.2 billion ($0.75/share) over the LTM.
- Our insurance assets increased to over $115 billion, as we generated approximately $4.5 billion of organic inflows in the quarter, primarily driven by retail and institutional annuity sales.
- The average investment portfolio yield on our insurance assets was 5.4%, 1.8% higher than our average cost of capital. As we continue to reposition the investment portfolio, annualized earnings for the business are poised to grow from approximately $1.5 billion today to $2 billion in the near term.
- Today, a subsidiary of Brookfield Wealth Solutions announced an agreement to reinsure $1.4 billion of U.K. pension liabilities. This is our first transaction outside of North America, as we continue to look to diversify and expand our wealth solutions business.
- Through our combined wealth solutions platforms, we are raising close to $2 billion of retail capital per month.
- DE was $356 million ($0.23/share) in the quarter and $1.5 billion ($0.93/share) over the LTM.
- Cash distributions from our operating businesses are supported by their resilient earnings and strong underlying performance. Our core real estate portfolio continues to deliver growth, with same-store NOI increasing by 4% over the prior year quarter.
- In our real estate business, we signed close to 6 million square feet of office and retail leases during the quarter. Rents on the newly signed leases were approximately 10% higher compared to those leases expiring.
- In the past few months, we have seen increased levels of transaction activity. We closed or advanced over $17 billion of asset sales across the business, which include retail parks in the U.K., a luxury resort in the U.S., multiple renewable power assets globally, and an office asset in Australia. All of these are expected to generate attractive returns.
- Total accumulated unrealized carried interest was $11.5 billion at quarter end, representing an increase of 17% over the LTM, net of carried interest realized into income. We recognized $295 million of net realized carried interest into income so far this year.
- During the quarter, we returned $203 million to shareholders through regular dividends and share repurchases. Over the last twelve months, we repurchased approximately $1 billion of shares, and we plan to keep allocating capital to share repurchases.
- We have over $150 billion of deployable capital, which includes $66 billion of cash, financial assets and undrawn credit lines at the Corporation, our affiliates and our wealth solutions business.
- Our balance sheet remains conservatively capitalized. Our corporate debt at the Corporation has a weighted-average term of 13 years and modest maturities through to the end of 2025.
- Our strong access to capital throughout our franchise enabled us to execute on over $30 billion of financings in the past few months. This includes an $850 million loan on a high-quality mall in Las Vegas and an approximately $600 million financing for the acquisition of an industrial portfolio, demonstrating the very active CMBS market.
| Unaudited
(US$ millions) | September 30
2024 | December 31 2023 | |||||||||
| Assets | |||||||||||
| Cash and cash equivalents | $ | 11,824 | $ | 11,222 | |||||||
| Other financial assets | 30,096 | 28,324 | |||||||||
| Accounts receivable and other | 35,956 | 31,001 | |||||||||
| Inventory | 11,031 | 11,412 | |||||||||
| Equity accounted investments | 65,101 | 59,124 | |||||||||
| Investment properties | 129,586 | 124,152 | |||||||||
| Property, plant and equipment | 148,305 | 147,617 | |||||||||
| Intangible assets | 37,420 | 38,994 | |||||||||
| Goodwill | 34,812 | 34,911 | |||||||||
| Deferred income tax assets | 4,013 | 3,338 | |||||||||
| Total Assets | $ | 508,144 | $ | 490,095 | |||||||
| Liabilities and Equity | |||||||||||
| Corporate borrowings | $ | 14,898 | $ | 12,160 | |||||||
| Accounts payable and other | 61,074 | 59,011 | |||||||||
| Non-recourse borrowings | 232,195 | 221,550 | |||||||||
| Subsidiary equity obligations | 5,212 | 4,145 | |||||||||
| Deferred income tax liabilities | 24,866 | 24,987 | |||||||||
| Equity | |||||||||||
| Non-controlling interests in net assets | $ | 123,428 | $ | 122,465 | |||||||
| Preferred equity | 4,103 | 4,103 | |||||||||
| Common equity | 42,368 | 169,899 | 41,674 | 168,242 | |||||||
| Total Equity | 169,899 | 168,242 | |||||||||
| Total Liabilities and Equity | $ | 508,144 | $ | 490,095 | |||||||
CONSOLIDATED STATEMENTS OF OPERATIONS
| Unaudited For the periods ended September 30 (US$ millions, except per share amounts) | Three Months Ended | Nine Months Ended | |||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Revenues | $ | 20,623 | $ | 24,441 | $ | 66,580 | $ | 71,406 | |||||||
| Direct costs1 | (12,934 | ) | (18,842 | ) | (46,222 | ) | (54,166 | ) | |||||||
| Other income and gains | 711 | 381 | 1,195 | 2,245 | |||||||||||
| Equity accounted income | 184 | 809 | 1,695 | 1,639 | |||||||||||
| Interest expense | |||||||||||||||
| - Corporate borrowings | (190 | ) | (164 | ) | (544 | ) | (454 | ) | |||||||
| - Non-recourse borrowings | |||||||||||||||
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