Brookfield Business Partners L.P. (NYSE: BBU) (TSX: BBU.UN)
(“Brookfield Business Partners”) announced today financial results
for the year ended December 31, 2019.
“We delivered strong financial performance in
2019, generated over $1.0 billion from monetizations and
distributions, and deployed over $2.5 billion into new businesses
including Clarios, Genworth Canada and BrandSafway,” said Cyrus
Madon, CEO of Brookfield Business Partners. “Our business today
comprises larger-scale operations with more resilient cash flows.
With our increased scale, a strong financial position and access to
capital we are confident we will continue to find value
opportunities to support our growth in 2020.”
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
US$ millions (except per unit amount), unaudited |
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
Net income (loss) attributable
to unitholders1 |
|
$ |
(105 |
) |
|
$ |
136 |
|
|
$ |
88 |
|
|
$ |
422 |
|
Net income (loss) per limited
partnership unit2,3 |
|
$ |
(0.70 |
) |
|
$ |
1.04 |
|
|
$ |
0.62 |
|
|
$ |
1.11 |
|
|
|
|
|
|
|
|
|
|
Company EBITDA1,4 |
|
$ |
342 |
|
|
$ |
239 |
|
|
$ |
1,213 |
|
|
$ |
843 |
|
|
|
|
|
|
|
|
|
|
Company FFO1,5 |
|
$ |
243 |
|
|
$ |
248 |
|
|
$ |
1,102 |
|
|
$ |
733 |
|
Company
FFO per unit2 |
|
$ |
1.61 |
|
|
$ |
1.92 |
|
|
$ |
7.86 |
|
|
$ |
5.67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brookfield Business Partners generated Company
EBITDA of $1.21 billion for the year ended December 31, 2019
compared to $843 million in 2018 reflecting incremental
contributions from recent acquisitions and improved performance at
our existing businesses. 2019 Company FFO was $1.10 billion ($7.86
per unit) compared to $733 million ($5.67 per unit) in 2018. Net
income attributable to unitholders for the year was $88
million ($0.62 per unit) and included impairment losses
recognized during the year and higher depreciation and amortization
expenses, compared to $422 million ($1.11 per unit) in 2018 which
included the benefit of a non-cash gain.
Operational Update
The following table presents Company EBITDA by
segment:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
US$ millions, unaudited |
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
Business Services |
|
$ |
51 |
|
|
$ |
30 |
|
|
$ |
221 |
|
|
$ |
128 |
|
Infrastructure Services |
|
106 |
|
|
110 |
|
|
468 |
|
|
295 |
|
Industrials |
|
215 |
|
|
120 |
|
|
619 |
|
|
490 |
|
Corporate and Other |
|
(30 |
) |
|
(21 |
) |
|
(95 |
) |
|
(70 |
) |
Company EBITDA1, 4 |
|
$ |
342 |
|
|
$ |
239 |
|
|
$ |
1,213 |
|
|
$ |
843 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Our business services segment
generated Company EBITDA of $221 million in 2019, compared to $128
million in 2018. Results included improved performance for the year
at our road fuels operations and our construction services
business. Results also benefited from contributions by Healthscope,
Ouro Verde and Genworth Canada, which we acquired during the year.
2018 results included a full-year of contributions from our
facilities management and executive relocation businesses which
were sold in the second quarter of 2019.
Our infrastructure services
segment generated Company EBITDA of $468 million in 2019, compared
to $295 million in 2018. Results benefited from the full year
contribution and improved performance of Westinghouse, which we
acquired in August 2018. Contribution from Teekay Offshore
increased primarily as a result of our increased ownership,
partially offset by a one-time settlement payment received in the
prior year.
Our industrials segment
generated Company EBITDA of $619 million in 2019, compared to $490
million in 2018. Results benefited from strong performance at North
American Palladium ("NAP") and the incremental contribution from
Clarios which we acquired in April 2019, partially offset by a
lower contribution from GrafTech primarily due to our decreased
ownership in the business. During the fourth quarter Brookfield
Business Partners realized $135 million from the sale of GrafTech
shares that reduced our ownership interest in the company to 25%.
2018 results included the contribution from our Australian oil and
gas operation which was sold in the fourth quarter of 2018.
The following table presents Company FFO by
segment:
|
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
US$
millions, unaudited |
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
Business Services |
|
$ |
27 |
|
|
$ |
22 |
|
|
$ |
432 |
|
|
$ |
131 |
|
Infrastructure Services |
|
63 |
|
|
71 |
|
|
314 |
|
|
195 |
|
Industrials |
|
163 |
|
|
173 |
|
|
393 |
|
|
470 |
|
Corporate and Other |
|
(10 |
) |
|
(18 |
) |
|
(37 |
) |
|
(63 |
) |
Company FFO1,5 |
|
$ |
243 |
|
|
$ |
248 |
|
|
$ |
1,102 |
|
|
$ |
733 |
|
Gain
(loss) on acquisitions/dispositions, net |
|
35 |
|
|
81 |
|
|
338 |
|
|
137 |
|
Company FFO, excluding gain
(loss) on acquisitions/dispositions1,5 |
|
$ |
208 |
|
|
$ |
167 |
|
|
$ |
764 |
|
|
$ |
596 |
|
Company FFO, excluding gain (loss) on acquisitions/dispositions per
unit2 |
|
$ |
1.38 |
|
|
$ |
1.29 |
|
|
$ |
5.45 |
|
|
$ |
4.61 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company FFO for the year ended December 31,
2019 was $1.10 billion compared to $733 million in 2018. The
increase in Company FFO was a result of gains on the sales of
businesses in 2019, incremental contributions from recent
investments and improved performance, offset by businesses sold in
2018.
Strategic Initiatives
- Genworth CanadaIn
December 2019, together with institutional partners, we acquired a
57% controlling interest in Genworth Canada for $1.7 billion.
Brookfield Business Partners' share of the equity purchase price
was approximately $670 million net of syndication to
institutional investors and dividends received after closing.
Genworth Canada is the largest private residential mortgage insurer
in Canada, providing mortgage default insurance to Canadian
residential mortgage lenders, making homeownership more accessible
to first-time homebuyers.
-
BrandSafwaySubsequent to year end, together with
institutional partners, we closed our acquisition of a 48% interest
in BrandSafway for an equity purchase price of $1.3 billion.
Brookfield Business Partners’ share is expected to be $400
million for a 15% ownership interest, subject to syndication to
institutional investors. BrandSafway is a leading provider of
infrastructure services to industrial and commercial
facilities.
- Altera
InfrastructureIn January 2020, together with institutional
partners, we acquired the remaining outstanding publicly held
common units in Teekay Offshore for an aggregate investment of $165
million. Following the transaction 1% of the new private company is
held by former minority unitholders who elected the option to
exchange their publicly traded common units for economically
equivalent units in the private company. Brookfield Business
Partners funded approximately $75 million of the transaction
which increased our ownership interest in Teekay Offshore to 43%.
We have rebranded the company to Altera Infrastructure.
- IndoStar Capital Finance
("IndoStar")In January 2020, together with institutional
partners, we signed an agreement to acquire a 40% interest in
IndoStar for approximately $220 million. IndoStar is a financing
company located in India that primarily services the used
commercial vehicle segment. Brookfield Business Partners' share of
the equity purchase price will be approximately $75 million for an
ownership interest of 15%.
- North American
PalladiumIn December 2019, together with institutional
partners, we sold North American Palladium, a pure-play palladium
producer, for approximately $570 million. Brookfield Business
Partners’ share of net proceeds was approximately $130
million.
- Nova Cold Logistics ("Nova
Cold")In January 2020, together with institutional
partners, we sold Nova Cold, our cold storage service provider,
for $175 million. Brookfield Business Partners’ share of net
proceeds was approximately $45 million.
Distribution
The Board of Directors has declared a quarterly
distribution in the amount of $0.0625 per unit, payable on March
31, 2020 to unitholders of record as at the close of business on
February 28, 2020.
Additional Information
The Board has reviewed and approved this news
release, including the summarized unaudited consolidated financial
statements contained herein.
Brookfield Business Partners’ Letter to
Unitholders and the Supplemental Information are available at
https://bbu.brookfield.com/reports-and-filings.
Notes:
- Attributable to limited partnership
unitholders, general partnership unitholders, special limited
partnership unitholders and redemption-exchange unitholders.
- Average number of partnership units
outstanding on a fully diluted time weighted average basis,
assuming the exchange of redemption exchange units held by
Brookfield Asset Management for limited partnership units, for the
three and twelve months ended December 31, 2019 was 150.6
million and 140.1 million, respectively (2018: 129.3 million).
- Income (loss) attributed to limited
partnership units on a fully diluted basis is reduced by incentive
distributions declared to special limited partnership unitholders
during the period based on the volume-weighted average increase in
unit price of the partnership’s unit over an incentive threshold. A
reconciliation of net income per unit is available on page 12 of
this release.
- Company EBITDA is presented as a
net amount attributable to unitholders and is a non-IFRS measure
and is calculated as Company FFO excluding the impact of realized
disposition gains (losses), interest income (expense), current
income taxes, the impact of realized disposition gains (losses),
current income taxes and interest income (expense) related to
equity accounted investments, and other items. When determining
Company EBITDA, we include our proportionate share of Company
EBITDA of equity accounted investments. A reconciliation of net
income to Company EBITDA is available on pages 8-11 of this
release.
- Company FFO is presented as a net
amount attributable to unitholders and is a non-IFRS measure and is
calculated as net income excluding the impact of depreciation and
amortization, deferred income taxes, breakage and transaction
costs, non-cash gains or losses as appropriate and other items.
When determining Company FFO, we include our proportionate share of
Company FFO of equity accounted investments. A reconciliation of
net income to Company FFO is available on pages 8-11 of this
release.
Brookfield Business Partners is a business
services and industrials company focused on owning and operating
high-quality businesses that benefit from barriers to entry and/or
low production costs.
Brookfield Business Partners is the flagship
listed business services and industrials company of Brookfield
Asset Management, a leading global alternative asset manager with
more than $540 billion of assets under management. More information
is available at www.brookfield.com.
Brookfield Business Partners is listed on the
New York and Toronto stock exchanges. For more information, please
visit our website at https://bbu.brookfield.com
Please note that Brookfield Business Partners'
previous audited annual and unaudited quarterly reports have been
filed on SEDAR and Edgar, and are available at
https://bbu.brookfield.com/reports-and-filings. Hard copies of the
annual and quarterly reports can be obtained free of charge upon
request.
For more information, please contact:
Media:Claire HollandTel: (416) 369-8236Email:
claire.holland@brookfield.com |
Investors:Alan FlemingTel: (416) 645-2736Email:
alan.fleming@brookfield.com |
|
|
Conference Call and 2019 Earnings
Webcast Details
Investors, analysts and other interested parties
can access Brookfield Business Partners’ 2019 fourth quarter
results as well as the Letter to Unitholders and Supplemental
Information on our website under the Reports & Filings section
at https://bbu.brookfield.com
The conference call can be accessed via webcast
on February 6, 2020 at 11:00 a.m. Eastern Time at
https://bbu.brookfield.com or via teleconference at +1 (866)
688-9431 toll free in the U.S. and Canada. For overseas calls
please dial +1 (409) 216-0818, at approximately 10:50 a.m. Eastern
Time. The Conference ID is 5978829. A recording of the conference
call will be available until February 12, 2020 by dialing +1 (855)
859-2056 toll-free in the U.S. and Canada or +1 (404) 537-3406 for
overseas calls (Conference ID 5978829). A replay of the webcast
will be available at https://bbu.brookfield.com.
Cautionary Statement Regarding
Forward-looking Statements and Information
Note: This news release contains
“forward-looking information” within the meaning of Canadian
provincial securities laws and “forward-looking statements” within
the meaning of Section 27A of the 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 Business Partners, 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.”
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
Business Partners 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: the
impact or unanticipated impact of general economic, political and
market factors in the countries in which we do business; the
behavior of financial markets, including fluctuations in interest
and foreign exchange rates; global equity and capital markets and
the availability of equity and debt financing and refinancing
within these markets; strategic actions including dispositions; the
ability to complete and effectively integrate acquisitions into
existing operations and the ability to attain expected benefits;
changes in accounting policies and methods used to report financial
condition (including uncertainties associated with critical
accounting assumptions and estimates); the ability to appropriately
manage human capital; the effect of applying future accounting
changes; business competition; operational and reputational risks;
technological change; changes in government regulation and
legislation within the countries in which we operate; governmental
investigations; litigation; changes in tax laws; ability to collect
amounts owed; catastrophic events, such as earthquakes and
hurricanes; the possible impact of international conflicts and
other developments including terrorist acts and cyber terrorism;
and other risks and factors detailed from time to time in our
documents filed with the securities regulators in Canada and the
United States.
We caution that the foregoing list of important
factors that may affect future results is not exhaustive. When
relying on our forward-looking statements, investors and others
should carefully consider the foregoing factors and other
uncertainties and potential events. Except as required by law,
Brookfield Business Partners 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.
Cautionary Statement Regarding the Use
of Non-IFRS Measures
This news release contains references to
Non-IFRS Measures. When determining Company FFO and Company EBITDA,
we include our unitholders’ proportionate share of Company FFO and
Company EBITDA for equity accounted investments. Company FFO and
Company EBITDA are not generally accepted accounting measures under
IFRS and therefore may differ from definitions used by other
entities. We believe these metrics are useful supplemental measures
that may assist investors in assessing the financial performance of
Brookfield Business Partners and its subsidiaries. However, Company
FFO and Company EBITDA should not be considered in isolation from,
or as substitutes for, analysis of our financial statements
prepared in accordance with IFRS.
References to Brookfield Business Partners are
to Brookfield Business Partners L.P. together with its
subsidiaries, controlled affiliates and operating entities.
Brookfield Business Partners’ results include publicly held limited
partnership units, redemption-exchange units, general partnership
units and special limited partnership units. More detailed
information on certain references made in this news release will be
available in our Management’s Discussion and Analysis of Financial
Condition and Results of Operations for the year ended December 31,
2019.
|
Brookfield Business Partners L.P. Consolidated
Statements of Financial Position |
|
As of |
US$
millions, unaudited |
December 31,2019 |
|
December 31,2018 |
|
|
|
|
|
|
Assets |
|
|
|
|
|
Cash and cash equivalents |
$ |
1,986 |
|
$ |
1,949 |
Financial assets |
|
6,243 |
|
|
1,369 |
Accounts and other receivable,
net |
|
5,631 |
|
|
5,160 |
Inventory and other
assets |
|
5,282 |
|
|
3,138 |
Property, plant and
equipment |
|
13,892 |
|
|
6,947 |
Deferred income tax
assets |
|
667 |
|
|
280 |
Intangible assets |
|
11,559 |
|
|
5,523 |
Equity accounted
investments |
|
1,273 |
|
|
541 |
Goodwill |
|
5,218 |
|
|
2,411 |
|
$ |
51,751 |
|
$ |
27,318 |
|
|
|
|
|
|
Liabilities and
equity |
|
|
|
|
|
Liabilities |
|
|
|
|
|
Corporate borrowings |
|
nil |
|
|
nil |
Accounts payable and
other |
|
16,496 |
|
|
9,091 |
Non-recourse borrowings in
subsidiaries of Brookfield Business Partners |
|
22,399 |
|
|
10,866 |
Deferred income tax liabilities |
|
1,803 |
|
|
867 |
|
$ |
40,698 |
|
$ |
20,824 |
Equity |
|
|
|
|
|
Limited partners |
|
2,116 |
|
|
1,548 |
Non-Controlling interests
attributable to: |
|
|
|
|
|
Redemption-Exchange Units, Preferred Shares and Special Limited
Partnership Units held by Brookfield Asset Management Inc. |
|
1,676 |
|
|
1,415 |
Interest of others in operating subsidiaries |
|
7,261 |
|
|
3,531 |
|
|
11,053 |
|
|
6,494 |
|
$ |
51,751 |
|
$ |
27,318 |
|
|
|
|
|
|
|
Brookfield Business Partners
L.P.Consolidated Statements of Operating
Results |
|
US$
millions, unaudited |
|
Three Months Ended December 31, |
|
Twelve Months Ended December 31, |
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
11,320 |
|
|
$ |
10,209 |
|
|
$ |
43,032 |
|
|
$ |
37,168 |
|
Direct operating costs |
|
(9,969 |
) |
|
(9,205 |
) |
|
(38,327 |
) |
|
(34,134 |
) |
General and administrative
expenses |
|
(228 |
) |
|
(209 |
) |
|
(832 |
) |
|
(643 |
) |
Depreciation and amortization
expense |
|
(518 |
) |
|
(286 |
) |
|
(1,804 |
) |
|
(748 |
) |
Interest income (expense),
net |
|
(388 |
) |
|
(181 |
) |
|
(1,274 |
) |
|
(498 |
) |
Equity accounted income
(loss), net |
|
52 |
|
|
9 |
|
|
114 |
|
|
10 |
|
Impairment expense, net |
|
(285 |
) |
|
(38 |
) |
|
(609 |
) |
|
(218 |
) |
Gain (loss) on
acquisitions/dispositions, net |
|
190 |
|
|
147 |
|
|
726 |
|
|
500 |
|
Other
income (expense), net |
|
(46 |
) |
|
(73 |
) |
|
(400 |
) |
|
(136 |
) |
Income (loss) before income
tax |
|
128 |
|
|
373 |
|
|
626 |
|
|
1,301 |
|
Income tax (expense)
recovery |
|
|
|
|
|
|
|
|
Current |
|
(93 |
) |
|
(63 |
) |
|
(324 |
) |
|
(186 |
) |
Deferred |
|
52 |
|
|
84 |
|
|
132 |
|
|
88 |
|
Net
income (loss) |
|
$ |
87 |
|
|
$ |
394 |
|
|
$ |
434 |
|
|
$ |
1,203 |
|
Attributable
to: |
|
|
|
|
|
|
|
|
Limited partners |
|
$ |
(57 |
) |
|
$ |
70 |
|
|
$ |
43 |
|
|
$ |
74 |
|
Non-controlling interests attributable to: |
|
|
|
|
|
|
|
|
Redemption-Exchange Units held by Brookfield Asset Management
Inc. |
|
(48 |
) |
|
66 |
|
|
45 |
|
|
70 |
|
Special Limited Partners |
|
— |
|
|
— |
|
|
— |
|
|
278 |
|
Interest of others in operating subsidiaries |
|
$ |
192 |
|
|
$ |
258 |
|
|
$ |
346 |
|
|
$ |
781 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brookfield
Business Partners L.P.Statements of Company Funds from
Operations |
|
For the three months ended December 31, 2019 US$ millions,
unaudited |
|
BusinessServices |
|
|
|
InfrastructureServices |
|
|
|
Industrials |
|
|
|
Corporate and Other |
|
|
|
Total |
|
Revenues |
$ |
7,115 |
|
|
$ |
1,032 |
|
|
$ |
3,173 |
|
|
$ |
— |
|
|
$ |
11,320 |
|
Direct operating costs |
|
(6,898 |
) |
|
|
(742 |
) |
|
|
(2,326 |
) |
|
|
(3 |
) |
|
|
(9,969 |
) |
General and administrative
expenses |
|
(87 |
) |
|
|
(29 |
) |
|
|
(85 |
) |
|
|
(27 |
) |
|
|
(228 |
) |
Equity accounted Company
EBITDA |
|
10 |
|
|
|
32 |
|
|
|
42 |
|
|
|
— |
|
|
|
84 |
|
Company
EBITDA attributable to others |
|
(89 |
) |
|
|
(187 |
) |
|
|
(589 |
) |
|
|
— |
|
|
|
(865 |
) |
Company
EBITDA1,2,4 |
|
51 |
|
|
|
106 |
|
|
|
215 |
|
|
|
(30 |
) |
|
|
342 |
|
Realized disposition gains
(loss), net |
|
6 |
|
|
|
(1 |
) |
|
|
185 |
|
|
|
— |
|
|
|
190 |
|
Other income (expense),
net |
|
2 |
|
|
|
(10 |
) |
|
|
— |
|
|
|
— |
|
|
|
(8 |
) |
Interest income (expense),
net |
|
(66 |
) |
|
|
(90 |
) |
|
|
(246 |
) |
|
|
14 |
|
|
|
(388 |
) |
Realized disposition gain,
current income taxes and interest expense related to equity
accounted investment |
|
(2 |
) |
|
|
(2 |
) |
|
|
(9 |
) |
|
|
— |
|
|
|
(13 |
) |
Current income taxes |
|
(15 |
) |
|
|
(9 |
) |
|
|
(75 |
) |
|
|
6 |
|
|
|
(93 |
) |
Company
FFO attributable to others (net of Company EBITDA attributable to
others) |
|
51 |
|
|
|
69 |
|
|
|
93 |
|
|
|
— |
|
|
|
213 |
|
Company
FFO1,3,4 |
|
27 |
|
|
|
63 |
|
|
|
163 |
|
|
|
(10 |
) |
|
|
243 |
|
Depreciation and amortization
expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(518 |
) |
Impairment expense, net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(285 |
) |
Gain on acquisition and
disposition |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
Other income (expenses),
net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(38 |
) |
Deferred income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
52 |
|
Non-cash items attributable to
equity accounted investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(19 |
) |
Non-cash items attributable to others |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
460 |
|
Net income (loss) attributable to
unitholders4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
(105 |
) |
Notes:
- The Statements of Company Funds
from Operations above are prepared on a basis that is consistent
with Brookfield Business Partners’ Supplemental Information and
differs from net income as presented in Brookfield Business
Partners’ Consolidated Statements of Operating Results on page 7 of
this release, which is prepared in accordance with IFRS. Management
uses Company FFO and Company EBITDA as key measures to evaluate
operating performance. Readers are encouraged to consider all
measures in assessing Brookfield Business Partners’ results.
- Company EBITDA is presented as a
net amount attributable to unitholders and is a non-IFRS measure
and is calculated as Company FFO excluding the impact of realized
disposition gains (losses), interest income (expense), current
income taxes, the impact of realized disposition gains (losses),
current income taxes and interest income (expense) related to
equity accounted investments, and other items. When determining
Company EBITDA, we include our proportionate share of Company
EBITDA of equity accounted investments.
- Company FFO is presented as a net
amount attributable to unitholders and is a non-IFRS measure and is
calculated as net income excluding the impact of depreciation and
amortization, deferred income taxes, breakage and transaction
costs, non-cash gains or losses as appropriate and other items.
When determining Company FFO, we include our proportionate share of
Company FFO of equity accounted investments.
- Attributable to limited partnership
unitholders, general partnership unitholders, special limited
partnership unitholders and redemption-exchange unitholders.
|
Brookfield Business Partners
L.P.Statements of Company Funds from
Operations |
|
For the twelve months ended December 31, 2019US$ millions,
unaudited |
|
BusinessServices |
|
|
|
InfrastructureServices |
|
|
|
Industrials |
|
|
|
Corporate and Other |
|
|
|
Total |
|
Revenues |
$ |
28,822 |
|
|
$ |
4,559 |
|
|
$ |
9,651 |
|
|
$ |
— |
|
|
$ |
43,032 |
|
Direct operating costs |
|
(27,995 |
) |
|
|
(3,231 |
) |
|
|
(7,092 |
) |
|
|
(9 |
) |
|
|
(38,327 |
) |
General and administrative
expenses |
|
(314 |
) |
|
|
(133 |
) |
|
|
(299 |
) |
|
|
(86 |
) |
|
|
(832 |
) |
Equity accounted Company
EBITDA |
|
38 |
|
|
|
109 |
|
|
|
94 |
|
|
|
— |
|
|
|
241 |
|
Company
EBITDA attributable to others |
|
(330 |
) |
|
|
(836 |
) |
|
|
(1,735 |
) |
|
|
— |
|
|
|
(2,901 |
) |
Company
EBITDA1,2,4 |
|
221 |
|
|
|
468 |
|
|
|
619 |
|
|
|
(95 |
) |
|
|
1,213 |
|
Realized disposition gains
(loss), net |
|
528 |
|
|
|
(1 |
) |
|
|
200 |
|
|
|
(1 |
) |
|
|
726 |
|
Other income (expense),
net |
|
— |
|
|
|
(27 |
) |
|
|
2 |
|
|
|
— |
|
|
|
(25 |
) |
Interest income (expense),
net |
|
(189 |
) |
|
|
(381 |
) |
|
|
(741 |
) |
|
|
37 |
|
|
|
(1,274 |
) |
Realized disposition gain,
current income taxes and interest expense related to equity
accounted investment |
|
(7 |
) |
|
|
(15 |
) |
|
|
(20 |
) |
|
|
— |
|
|
|
(42 |
) |
Current income taxes |
|
(91 |
) |
|
|
(4 |
) |
|
|
(251 |
) |
|
|
22 |
|
|
|
(324 |
) |
Company
FFO attributable to others (net of Company EBITDA attributable to
others) |
|
(30 |
) |
|
|
274 |
|
|
|
584 |
|
|
|
— |
|
|
|
828 |
|
Company
FFO1,3,4 |
|
432 |
|
|
|
314 |
|
|
|
393 |
|
|
|
(37 |
) |
|
|
1,102 |
|
Depreciation and amortization
expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,804 |
) |
Impairment expense, net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(609 |
) |
Gain on acquisition and
disposition |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
Deferred income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(375 |
) |
Other income (expense),
net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
132 |
|
Non-cash items attributable to
equity accounted investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(85 |
) |
Non-cash items attributable to others |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,727 |
|
Net income (loss) attributable to
unitholders4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
88 |
|
Notes:
- The Statements of Company Funds
from Operations above are prepared on a basis that is consistent
with Brookfield Business Partners’ Supplemental Information and
differs from net income as presented in Brookfield Business
Partners’ Consolidated Statements of Operating Results on page 7 of
this release, which is prepared in accordance with IFRS. Management
uses Company FFO and Company EBITDA as key measures to evaluate
operating performance. Readers are encouraged to consider all
measures in assessing Brookfield Business Partners’ results.
- Company EBITDA is presented as a
net amount attributable to unitholders and is a non-IFRS measure
and is calculated as Company FFO excluding the impact of realized
disposition gains (losses), interest income (expense), current
income taxes, the impact of realized disposition gains (losses),
current income taxes and interest income (expense) related to
equity accounted investments, and other items. When determining
Company EBITDA, we include our proportionate share of Company
EBITDA of equity accounted investments.
- Company FFO is presented as a net
amount attributable to unitholders and is a non-IFRS measure and is
calculated as net income excluding the impact of depreciation and
amortization, deferred income taxes, breakage and transaction
costs, non-cash gains or losses as appropriate and other items.
When determining Company FFO, we include our proportionate share of
Company FFO of equity accounted investments.
- Attributable to limited partnership
unitholders, general partnership unitholders, special limited
partnership unitholders and redemption-exchange unitholders.
|
Brookfield Business Partners
L.P.Statements of Company Funds from
Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the
three months ended December 31, 2018US$ millions,
unaudited |
|
BusinessServices |
|
|
|
InfrastructureServices |
|
|
|
Industrials |
|
|
|
Corporateand Other |
|
|
|
Total |
|
Revenues |
$ |
7,718 |
|
|
$ |
1,364 |
|
|
$ |
1,127 |
|
|
$ |
— |
|
|
$ |
10,209 |
|
Direct operating costs |
|
(7,622 |
) |
|
|
(977 |
) |
|
|
(604 |
) |
|
|
(2 |
) |
|
|
(9,205 |
) |
General and administrative
expenses |
|
(75 |
) |
|
|
(43 |
) |
|
|
(72 |
) |
|
|
(19 |
) |
|
|
(209 |
) |
Equity accounted Company
EBITDA |
|
11 |
|
|
|
24 |
|
|
|
5 |
|
|
|
— |
|
|
|
40 |
|
Company
EBITDA attributable to others |
|
(2 |
) |
|
|
(258 |
) |
|
|
(336 |
) |
|
|
— |
|
|
|
(596 |
) |
Company
EBITDA1,2,4 |
|
30 |
|
|
|
110 |
|
|
|
120 |
|
|
|
(21 |
) |
|
|
239 |
|
Realized disposition gains
(loss), net |
|
— |
|
|
|
— |
|
|
|
147 |
|
|
|
— |
|
|
|
147 |
|
Other income (expense),
net |
|
— |
|
|
|
(4 |
) |
|
|
(3 |
) |
|
|
— |
|
|
|
(7 |
) |
Interest income (expense),
net |
|
(16 |
) |
|
|
(100 |
) |
|
|
(68 |
) |
|
|
3 |
|
|
|
(181 |
) |
Realized disposition gain,
current income taxes and interest expense related to equity
accounted investment |
|
(1 |
) |
|
|
(5 |
) |
|
|
(1 |
) |
|
|
— |
|
|
|
(7 |
) |
Current income taxes |
|
(6 |
) |
|
|
(4 |
) |
|
|
(53 |
) |
|
|
— |
|
|
|
(63 |
) |
Company
FFO attributable to others (net of Company EBITDA attributable to
others) |
|
15 |
|
|
|
74 |
|
|
|
31 |
|
|
|
— |
|
|
|
120 |
|
Company
FFO1,3,4 |
|
22 |
|
|
|
71 |
|
|
|
173 |
|
|
|
(18 |
) |
|
|
248 |
|
Depreciation and amortization
expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(286 |
) |
Impairment expense, net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(38 |
) |
Gain on acquisition and
disposition |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
Deferred income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(66 |
) |
Other income (expense),
net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
84 |
|
Non-cash items attributable to
equity accounted investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(24 |
) |
Non-cash items attributable to
others |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
218 |
|
Net income (loss) attributable to
unitholders4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
136 |
|
Notes:
- The Statements of Company Funds
from Operations above are prepared on a basis that is consistent
with Brookfield Business Partners’ Supplemental Information and
differs from net income as presented in Brookfield Business
Partners’ Consolidated Statements of Operating Results on page 7 of
this release, which is prepared in accordance with IFRS. Management
uses Company FFO and Company EBITDA as key measures to evaluate
operating performance. Readers are encouraged to consider all
measures in assessing Brookfield Business Partners’ results.
- Company EBITDA is presented as a
net amount attributable to unitholders and is a non-IFRS measure
and is calculated as Company FFO excluding the impact of realized
disposition gains (losses), interest income (expense), current
income taxes, the impact of realized disposition gains (losses),
current income taxes and interest income (expense) related to
equity accounted investments, and other items. When determining
Company EBITDA, we include our proportionate share of Company
EBITDA of equity accounted investments.
- Company FFO is presented as a net
amount attributable to unitholders and is a non-IFRS measure and is
calculated as net income excluding the impact of depreciation and
amortization, deferred income taxes, breakage and transaction
costs, non-cash gains or losses as appropriate and other items.
When determining Company FFO, we include our proportionate share of
Company FFO of equity accounted investments.
- Attributable to limited partnership
unitholders, general partnership unitholders, special limited
partnership unitholders and redemption-exchange unitholders.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brookfield Business Partners
L.P.Statements of Company Funds from
Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the
twelve months ended December 31, 2018US$ millions,
unaudited |
|
BusinessServices |
|
|
|
InfrastructureServices |
|
|
|
Industrials |
|
|
|
Corporateand Other |
|
|
|
Total |
|
Revenues |
$ |
30,847 |
|
|
$ |
2,418 |
|
|
$ |
3,896 |
|
|
$ |
7 |
|
|
$ |
37,168 |
|
Direct operating costs |
|
(30,351 |
) |
|
|
(1,715 |
) |
|
|
(2,060 |
) |
|
|
(8 |
) |
|
|
(34,134 |
) |
General and administrative
expenses |
|
(278 |
) |
|
|
(65 |
) |
|
|
(231 |
) |
|
|
(69 |
) |
|
|
(643 |
) |
Equity accounted Company
EBITDA |
|
34 |
|
|
|
120 |
|
|
|
42 |
|
|
|
— |
|
|
|
196 |
|
Company
EBITDA attributable to others |
|
(124 |
) |
|
|
(463 |
) |
|
|
(1,157 |
) |
|
|
— |
|
|
|
(1,744 |
) |
Company
EBITDA1,2,4 |
|
128 |
|
|
|
295 |
|
|
|
490 |
|
|
|
(70 |
) |
|
|
843 |
|
Realized disposition gains
(loss), net |
|
55 |
|
|
|
— |
|
|
|
195 |
|
|
|
— |
|
|
|
250 |
|
Other income (expense),
net |
|
— |
|
|
|
(15 |
) |
|
|
(3 |
) |
|
|
— |
|
|
|
(18 |
) |
Interest income (expense),
net |
|
(66 |
) |
|
|
(176 |
) |
|
|
(263 |
) |
|
|
7 |
|
|
|
(498 |
) |
Realized disposition gain,
current income taxes and interest expense related to equity
accounted investment |
|
(3 |
) |
|
|
(41 |
) |
|
|
(10 |
) |
|
|
— |
|
|
|
(54 |
) |
Current income taxes |
|
(44 |
) |
|
|
(10 |
) |
|
|
(132 |
) |
|
|
— |
|
|
|
(186 |
) |
Company
FFO attributable to others (net of Company EBITDA attributable to
others) |
|
61 |
|
|
|
142 |
|
|
|
193 |
|
|
|
— |
|
|
|
396 |
|
Company
FFO1,3,4 |
|
131 |
|
|
|
195 |
|
|
|
470 |
|
|
|
(63 |
) |
|
|
733 |
|
Depreciation and amortization
expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(748 |
) |
Impairment expense, net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(218 |
) |
Gain on acquisition and
disposition |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
250 |
|
Deferred income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(118 |
) |
Other income (expense),
net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
88 |
|
Non-cash items attributable to
equity accounted investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(132 |
) |
Non-cash items attributable to
others |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
567 |
|
Net income (loss) attributable to
unitholders4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
422 |
|
Notes:
- The Statements of Company Funds
from Operations above are prepared on a basis that is consistent
with Brookfield Business Partners’ Supplemental Information and
differs from net income as presented in Brookfield Business
Partners’ Consolidated Statements of Operating Results on page 7 of
this release, which is prepared in accordance with IFRS. Management
uses Company FFO and Company EBITDA as key measures to evaluate
operating performance. Readers are encouraged to consider all
measures in assessing Brookfield Business Partners’ results.
- Company EBITDA is presented as a
net amount attributable to unitholders and is a non-IFRS measure
and is calculated as Company FFO excluding the impact of realized
disposition gains (losses), interest income (expense), current
income taxes, the impact of realized disposition gains (losses),
current income taxes and interest income (expense) related to
equity accounted investments, and other items. When determining
Company EBITDA, we include our proportionate share of Company
EBITDA for equity accounted investments.
- Company FFO is presented as a net
amount attributable to unitholders and is a non-IFRS measure and is
calculated as net income excluding the impact of depreciation and
amortization, deferred income taxes, breakage and transaction
costs, non-cash gains or losses as appropriate and other items.
When determining Company FFO, we include our proportionate share of
Company FFO for equity accounted investments.
- Attributable to limited partnership
unitholders, general partnership unitholders, special limited
partnership unitholders and redemption-exchange unitholders.
|
|
|
|
|
|
|
|
|
|
|
|
|
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Brookfield Business Partners
L.P.Reconciliation of Net Income per
Unit |
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Three Months Ended December 31, |
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Year EndedDecember 31, |
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US$, unaudited |
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2019 |
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2018 |
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2019 |
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2018 |
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Net income (loss) per
unitholder, excluding incentive distribution1 |
$ |
(0.70 |
) |
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$ |
1.04 |
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$ |
0.62 |
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$ |
3.26 |
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Incentive distribution per unit2 |
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— |
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— |
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— |
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(2.15 |
) |
Net
income (loss) attributable to limited partnership unit1, 2 |
$ |
(0.70 |
) |
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$ |
1.04 |
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$ |
0.62 |
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$ |
1.11 |
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Notes:
- Average number of partnership units
outstanding on a fully diluted time weighted average basis,
assuming the exchange of redemption exchange units held by
Brookfield Asset Management for limited partnership units, for the
three and twelve months ended December 31, 2019 was 150.6
million and 140.1 million, respectively (2018: 129.3 million).
- Income (loss) attributed to limited
partnership unit on a fully diluted basis is reduced by incentive
distributions paid to special limited partnership unitholders
during the period based on the volume-weighted average increase in
unit price of the partnership’s unit over an incentive
threshold.
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