Brookfield Business Partners L.P. (NYSE: BBU) (TSX: BBU.UN)
(“Brookfield Business Partners”) announced today financial results
for the quarter ended June 30, 2020.
“Our business faced challenging conditions
during the second quarter as a result of the global economic
shutdown. We addressed this unprecedented situation by
rapidly reducing costs, maximizing liquidity and implementing
measures to protect employees," said Cyrus Madon, CEO of Brookfield
Business Partners. “Activity levels at virtually all our operations
increased as we entered the third quarter reflecting the essential
nature of products and services that our businesses provide."
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
US$
millions (except per unit amounts), unaudited |
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Net income (loss) attributable to unitholders1 |
|
$ |
(109 |
) |
|
$ |
107 |
|
|
$ |
(235 |
) |
|
$ |
169 |
|
Net income (loss) per limited
partnership unit2 |
|
$ |
(0.73 |
) |
|
$ |
0.82 |
|
|
$ |
(1.57 |
) |
|
$ |
1.30 |
|
|
|
|
|
|
|
|
|
|
Company EBITDA1,3 |
|
$ |
286 |
|
|
$ |
237 |
|
|
$ |
580 |
|
|
$ |
503 |
|
|
|
|
|
|
|
|
|
|
Company FFO1,4 |
|
$ |
173 |
|
|
$ |
435 |
|
|
$ |
367 |
|
|
$ |
640 |
|
Company FFO per unit2 |
|
$ |
1.15 |
|
|
$ |
3.35 |
|
|
$ |
2.44 |
|
|
$ |
4.94 |
|
Company FFO, excluding gain
(loss) on acquisitions/dispositions1,4 |
|
$ |
173 |
|
|
$ |
138 |
|
|
$ |
325 |
|
|
$ |
343 |
|
Company
FFO, excluding gain (loss) on acquisitions/dispositions per
unit2 |
|
$ |
1.15 |
|
|
$ |
1.06 |
|
|
$ |
2.16 |
|
|
$ |
2.65 |
|
Brookfield Business Partners generated Company
EBITDA of $286 million for the three months ended June 30,
2020 compared to $237 million for the three months ended
June 30, 2019 reflecting increased EBITDA in our
Infrastructure Services segment, partially offset by reduced
contribution from our Industrials segment. For the three months
ended June 30, 2020 Company FFO was $173 million ($1.15 per
unit) compared to $435 million ($3.35 per unit) in the prior year
which included the benefit of gains on the sale of operations
within our Business Services segment. Company FFO excluding gains
on dispositions for the three months ended June 30, 2019, was $138
million ($1.06 per unit). The net loss attributable to unitholders
for the three months ended June 30, 2020 was $109
million (loss of $0.73 per unit) compared to net income of
$107 million ($0.82 per unit) in the prior year. The net loss in
the current period includes provisions recorded during the quarter,
partially offset by mark to market gains on financial assets,
including public securities investments.
Operational Update
The following table presents Company EBITDA by
segment:
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
US$
millions, unaudited |
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Business Services |
|
$ |
64 |
|
|
$ |
61 |
|
|
$ |
83 |
|
|
$ |
106 |
|
Infrastructure Services |
|
148 |
|
|
88 |
|
|
304 |
|
|
223 |
|
Industrials |
|
98 |
|
|
108 |
|
|
243 |
|
|
215 |
|
Corporate and Other |
|
(24 |
) |
|
(20 |
) |
|
(50 |
) |
|
(41 |
) |
Company EBITDA1,3 |
|
$ |
286 |
|
|
$ |
237 |
|
|
$ |
580 |
|
|
$ |
503 |
|
Our Business Services segment
generated Company EBITDA of $64 million during the three months
ended June 30, 2020, compared with $61 million in the same
period in 2019. Results benefited from contributions by
Healthscope, Ouro Verde and Genworth Canada, which we acquired
during 2019, partially offset by the impact of the economic
shutdown on our operations. Prior year results included
contributions from our facilities management and executive
relocation businesses which were sold during the second quarter of
2019.
Our Infrastructure
Services segment generated Company EBITDA of $148 million
during the three months ended June 30, 2020, compared to $88
million in the same period in 2019. Results benefited from strong
performance at Westinghouse, our increased ownership in Altera
Infrastructure and contribution from BrandSafway which we acquired
in January 2020, partially offset by the impact of the economic
shutdown on our operations.
Our
Industrials segment generated
Company EBITDA of $98 million during the three months ended
June 30, 2020 compared to $108 million in the same period in
2019. Results reflect decreased contribution from GrafTech due to
lower sales volumes and price, and the impact of the economic
shutdown on our operations at Cardone. Contribution from Clarios
increased compared to the prior year. Prior year results also
included contribution from our palladium producer which was sold in
2019.
The following table presents Company FFO by
segment:
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
US$
millions (except per unit amounts), unaudited |
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Business Services |
|
$ |
39 |
|
|
$ |
342 |
|
|
$ |
81 |
|
|
$ |
374 |
|
Infrastructure Services |
|
87 |
|
|
54 |
|
|
191 |
|
|
156 |
|
Industrials |
|
62 |
|
|
46 |
|
|
119 |
|
|
127 |
|
Corporate and Other |
|
(15 |
) |
|
(7 |
) |
|
(24 |
) |
|
(17 |
) |
Company FFO1,4 |
|
$ |
173 |
|
|
$ |
435 |
|
|
$ |
367 |
|
|
$ |
640 |
|
Gain
(loss) on acquisitions/dispositions, net |
|
— |
|
|
297 |
|
|
42 |
|
|
297 |
|
Company FFO, excluding gain
(loss) on acquisitions/dispositions1,4 |
|
173 |
|
|
138 |
|
|
325 |
|
|
343 |
|
Company FFO, excluding gain (loss) on acquisitions/dispositions per
unit2 |
|
$ |
1.15 |
|
|
$ |
1.06 |
|
|
$ |
2.16 |
|
|
$ |
2.65 |
|
Company FFO, excluding gain (loss) on
acquisitions/dispositions, for the three months ended June 30,
2020 increased to $173 million from $138 million in the same period
in 2019 primarily due to incremental contributions from recent
acquisitions, partially offset by reduced performance across our
operations as a result of the economic shutdown. Company FFO for
the three months ended June 30, 2019 of $435 million included
after-tax gains of $297 million recognized on businesses sold in
the second quarter of 2019.
Liquidity
We ended the quarter with approximately $1.9
billion of liquidity at the corporate level including $243 million
of cash and liquid securities and $1.7 billion of undrawn credit
facilities. Subsequent to the end of the quarter, we increased our
credit facilities by $500 million to an aggregate capacity of $2.6
billion resulting in total proforma liquidity, including funding
for known transactions, of approximately $2.3 billion. In addition,
our operating companies have approximately $5 billion in additional
liquidity comprised of cash and available credit facilities.
Strategic Initiatives
- IndoStar Capital Finance
("IndoStar")Subsequent to the end of the quarter, together
with institutional partners, we acquired a 57% controlling interest
in IndoStar for approximately $295 million. Brookfield Business
Partners' share of the equity purchase price was approximately $105
million and we own a 20% ownership interest. IndoStar is a
financing company focused on commercial vehicle lending and
affordable home financing in India.
- GrafTech International ("GrafTech")Subsequent
to the end of the quarter, we executed a partial distribution of
GrafTech common shares to our institutional partners that reduced
the size of our control position in the company. The distribution
advances our efforts to monetize our investment in GrafTech and
increases the liquidity of GrafTech's freely tradable common
shares. Brookfield Business Partners continues to own approximately
69 million shares in GrafTech, 17 million of which we now own
directly and can deal with separately from our partners.
- Superior Plus Corp. ("Superior")Together with
institutional partners, we subscribed for $260 million of
convertible preferred shares of Superior. Superior is a leading
propane distributor in North America and our investment will help
accelerate the company's growth objectives. The shares have a
minimum coupon of 7.25% and convert to a 15% common equity stake in
Superior. Brookfield Business Partners' share of the investment is
$45 million.
- Cardone IndustriesDuring the second quarter,
together with institutional partners, we recapitalized Cardone
with $180 million in new equity. Brookfield Business Partners’
share was approximately $95 million for a 52% ownership interest.
As part of the recapitalization Cardone secured concessions from
its senior debtholders including the extension of maturities on its
bank debt. Cardone is a remanufacturer of automotive replacement
parts and the recapitalization strengthens its capital structure to
further progress its operational turnaround.
- Unit Repurchase ProgramFor the three months
ended June 30, 2020 we repurchased 177,571 of BBU units under
our normal course issuer bid (NCIB).
Distribution
The Board of Directors has declared a quarterly
distribution in the amount of $0.0625 per unit, payable on
September 30, 2020 to unitholders of record as at the close of
business on August 31, 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 six months ended
June 30, 2020 was 150.1 million and 150.3 million (2019: 129.9
million and 129.5 million).
- 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
over $525 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: +1 (416) 369-8236Email:
claire.holland@brookfield.com |
Investors:Alan FlemingTel: +1 (416) 645-2736Email:
alan.fleming@brookfield.com |
Conference Call and Quarterly Earnings
Details
Investors, analysts and other interested parties
can access Brookfield Business Partners’ second quarter 2020
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 August 6, 2020 at 12:00 p.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 11:50 a.m. Eastern
Time. The Conference ID is 3838218. A recording of the conference
call will be available until August 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 3838218). 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; including
as a result of the recent novel coronavirus outbreak (“COVID-19”);
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; hurricanes and pandemics/epidemics; 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.
In addition, our future results may be impacted
by the economic shutdown resulting from the COVID-19 pandemic and
the related global reduction in commerce and travel and substantial
volatility in stock markets worldwide, which may negatively impact
our revenues, affect our ability to identify and complete future
transactions, impact our liquidity position and result in a
decrease of cash flows and impairment losses and/or revaluations on
our investments and assets, and therefore we may be unable to
achieve our expected returns. See “Risks Associated with the
COVID-19 Pandemic” in the “Risks and Uncertainties” section
included in our Management’s Discussion and Analysis of Financial
Condition and Results of Operations for the second quarter ended
June 30, 2020 to be made available.
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 second quarter ended
June 30, 2020.
Brookfield Business Partners
L.P. Consolidated Statements of Financial
Position
|
|
As of |
US$
millions, unaudited |
|
June 30, 2020 |
|
|
December 31, 2019 |
|
|
|
|
|
|
Assets |
|
|
|
|
Cash and cash equivalents |
|
$ |
2,138 |
|
|
$ |
1,986 |
|
Financial assets |
|
6,335 |
|
|
6,243 |
|
Accounts and other receivable,
net |
|
4,745 |
|
|
5,631 |
|
Inventory and other
assets |
|
5,188 |
|
|
5,282 |
|
Property, plant and
equipment |
|
13,650 |
|
|
13,892 |
|
Deferred income tax
assets |
|
718 |
|
|
667 |
|
Intangible assets |
|
10,820 |
|
|
11,559 |
|
Equity accounted
investments |
|
1,648 |
|
|
1,273 |
|
Goodwill |
|
5,036 |
|
|
5,218 |
|
|
|
$ |
50,278 |
|
|
$ |
51,751 |
|
|
|
|
|
|
Liabilities and
equity |
|
|
|
|
Liabilities |
|
|
|
|
Corporate borrowings |
|
$ |
253 |
|
|
nil |
|
Accounts payable and
other |
|
16,449 |
|
|
16,496 |
|
Non-recourse borrowings in
subsidiaries of Brookfield Business Partners |
|
22,202 |
|
|
22,399 |
|
Deferred income tax liabilities |
|
1,617 |
|
|
1,803 |
|
|
|
$ |
40,521 |
|
|
$ |
40,698 |
|
Equity |
|
|
|
|
Limited partners |
|
1,731 |
|
|
2,116 |
|
Non-Controlling interests
attributable to: |
|
|
|
|
Redemption-Exchange Units, Preferred Shares and Special Limited
Partnership Units held by Brookfield Asset Management Inc. |
|
1,354 |
|
|
1,676 |
|
Interest of others in operating subsidiaries |
|
6,672 |
|
|
7,261 |
|
|
|
9,757 |
|
|
11,053 |
|
|
|
$ |
50,278 |
|
|
$ |
51,751 |
|
Brookfield Business Partners
L.P.Consolidated Statements of Operating
Results
US$
millions, unaudited |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
7,370 |
|
|
$ |
10,717 |
|
|
$ |
17,516 |
|
|
$ |
19,918 |
|
Direct operating costs |
|
(6,285 |
) |
|
(9,776 |
) |
|
(15,186 |
) |
|
(17,969 |
) |
General and administrative
expenses |
|
(228 |
) |
|
(211 |
) |
|
(472 |
) |
|
(389 |
) |
Depreciation and amortization
expense |
|
(533 |
) |
|
(441 |
) |
|
(1,071 |
) |
|
(752 |
) |
Interest income (expense),
net |
|
(353 |
) |
|
(313 |
) |
|
(717 |
) |
|
(497 |
) |
Equity accounted income
(loss), net |
|
18 |
|
|
23 |
|
|
9 |
|
|
30 |
|
Impairment expense, net |
|
(29 |
) |
|
(324 |
) |
|
(142 |
) |
|
(324 |
) |
Gain (loss) on
acquisitions/dispositions, net |
|
(4 |
) |
|
522 |
|
|
179 |
|
|
520 |
|
Other
income (expense), net |
|
149 |
|
|
(181 |
) |
|
(68 |
) |
|
(271 |
) |
Income (loss) before income
tax |
|
105 |
|
|
16 |
|
|
48 |
|
|
266 |
|
Income tax (expense)
recovery |
|
|
|
|
|
|
|
|
Current |
|
(23 |
) |
|
(93 |
) |
|
(98 |
) |
|
(123 |
) |
Deferred |
|
67 |
|
|
41 |
|
|
165 |
|
|
22 |
|
Net
income (loss) |
|
$ |
149 |
|
|
$ |
(36 |
) |
|
$ |
115 |
|
|
$ |
165 |
|
Attributable
to: |
|
|
|
|
|
|
|
|
Limited partners |
|
$ |
(59 |
) |
|
$ |
55 |
|
|
$ |
(126 |
) |
|
$ |
87 |
|
Non-controlling interests attributable to: |
|
|
|
|
|
|
|
|
Redemption-Exchange Units held by Brookfield Asset Management
Inc. |
|
(50 |
) |
|
52 |
|
|
(109 |
) |
|
82 |
|
Special Limited Partners |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Interest of others in operating subsidiaries |
|
$ |
258 |
|
|
$ |
(143 |
) |
|
$ |
350 |
|
|
$ |
(4 |
) |
Brookfield Business Partners
L.P.Statements of Company Funds from
Operations
For the
three months ended June 30, 2020 US$ millions, unaudited |
Business Services |
|
|
Infrastructure Services |
|
|
Industrials |
|
|
Corporate and Other |
|
|
Total |
|
Revenues |
$ |
4,053 |
|
|
$ |
1,120 |
|
|
$ |
2,197 |
|
|
$ |
— |
|
|
$ |
7,370 |
|
Direct operating costs |
(3,763 |
) |
|
(791 |
) |
|
(1,728 |
) |
|
(3 |
) |
|
(6,285 |
) |
General and administrative
expenses |
(80 |
) |
|
(53 |
) |
|
(74 |
) |
|
(21 |
) |
|
(228 |
) |
Equity accounted Company
EBITDA |
4 |
|
|
42 |
|
|
17 |
|
|
— |
|
|
63 |
|
Company
EBITDA attributable to others |
(150 |
) |
|
(170 |
) |
|
(314 |
) |
|
— |
|
|
(634 |
) |
Company
EBITDA1,2,4 |
64 |
|
|
148 |
|
|
98 |
|
|
(24 |
) |
|
286 |
|
Realized disposition gain,
net |
— |
|
|
— |
|
|
(4 |
) |
|
— |
|
|
(4 |
) |
Other income (expense),
net |
3 |
|
|
(23 |
) |
|
1 |
|
|
— |
|
|
(19 |
) |
Interest income (expense),
net |
(52 |
) |
|
(76 |
) |
|
(224 |
) |
|
(1 |
) |
|
(353 |
) |
Equity accounted current taxes
and interest |
(2 |
) |
|
(16 |
) |
|
(4 |
) |
|
— |
|
|
(22 |
) |
Current income taxes |
(33 |
) |
|
(4 |
) |
|
4 |
|
|
10 |
|
|
(23 |
) |
Company
FFO attributable to others (net of Company EBITDA attributable to
others) |
59 |
|
|
58 |
|
|
191 |
|
|
— |
|
|
308 |
|
Company
FFO1,3,4 |
39 |
|
|
87 |
|
|
62 |
|
|
(15 |
) |
|
173 |
|
Depreciation and amortization
expense |
|
|
|
|
|
|
|
|
(533 |
) |
Impairment expense, net |
|
|
|
|
|
|
|
|
(29 |
) |
Other income (expense),
net |
|
|
|
|
|
|
|
|
168 |
|
Deferred income taxes |
|
|
|
|
|
|
|
|
67 |
|
Non-cash items attributable to
equity accounted investments |
|
|
|
|
|
|
|
|
(23 |
) |
Non-cash items attributable to others |
|
|
|
|
|
|
|
|
68 |
|
Net income (loss) attributable to
unitholders4 |
|
|
|
|
|
|
|
|
$ |
(109 |
) |
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
six months ended June 30, 2020 US$ millions, unaudited |
Business Services |
|
|
Infrastructure Services |
|
|
Industrials |
|
|
Corporate and Other |
|
|
Total |
|
Revenues |
$ |
10,582 |
|
|
$ |
2,290 |
|
|
$ |
4,644 |
|
|
$ |
— |
|
|
$ |
17,516 |
|
Direct operating costs |
(10,021 |
) |
|
(1,599 |
) |
|
(3,561 |
) |
|
(5 |
) |
|
(15,186 |
) |
General and administrative
expenses |
(171 |
) |
|
(91 |
) |
|
(165 |
) |
|
(45 |
) |
|
(472 |
) |
Equity accounted Company
EBITDA |
15 |
|
|
77 |
|
|
43 |
|
|
— |
|
|
135 |
|
Company
EBITDA attributable to others |
(322 |
) |
|
(373 |
) |
|
(718 |
) |
|
— |
|
|
(1,413 |
) |
Company
EBITDA1,2,4 |
83 |
|
|
304 |
|
|
243 |
|
|
(50 |
) |
|
580 |
|
Realized disposition gain,
net |
186 |
|
|
— |
|
|
(7 |
) |
|
— |
|
|
179 |
|
Other income (expense),
net |
9 |
|
|
(29 |
) |
|
1 |
|
|
— |
|
|
(19 |
) |
Interest income (expense),
net |
(110 |
) |
|
(165 |
) |
|
(447 |
) |
|
5 |
|
|
(717 |
) |
Equity accounted current taxes
and interest |
(4 |
) |
|
(24 |
) |
|
(8 |
) |
|
— |
|
|
(36 |
) |
Current income taxes |
(52 |
) |
|
(6 |
) |
|
(61 |
) |
|
21 |
|
|
(98 |
) |
Company
FFO attributable to others (net of Company EBITDA attributable to
others) |
(31 |
) |
|
111 |
|
|
398 |
|
|
— |
|
|
478 |
|
Company
FFO1,3,4 |
81 |
|
|
191 |
|
|
119 |
|
|
(24 |
) |
|
367 |
|
Depreciation and amortization
expense |
|
|
|
|
|
|
|
|
(1,071 |
) |
Impairment expense, net |
|
|
|
|
|
|
|
|
(142 |
) |
Other income (expense),
net |
|
|
|
|
|
|
|
|
(49 |
) |
Deferred income taxes |
|
|
|
|
|
|
|
|
165 |
|
Non-cash items attributable to
equity accounted investments |
|
|
|
|
|
|
|
|
(90 |
) |
Non-cash items attributable to others |
|
|
|
|
|
|
|
|
585 |
|
Net income (loss) attributable to
unitholders4 |
|
|
|
|
|
|
|
|
$ |
(235 |
) |
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 June 30, 2019US$ millions, unaudited |
Business Services |
|
|
Infrastructure Services |
|
|
Industrials |
|
|
Corporate and Other |
|
|
Total |
|
Revenues |
$ |
7,345 |
|
|
$ |
1,105 |
|
|
$ |
2,267 |
|
|
$ |
— |
|
|
$ |
10,717 |
|
Direct operating costs |
(7,169 |
) |
|
(838 |
) |
|
(1,767 |
) |
|
(2 |
) |
|
(9,776 |
) |
General and administrative
expenses |
(67 |
) |
|
(41 |
) |
|
(85 |
) |
|
(18 |
) |
|
(211 |
) |
Equity accounted Company
EBITDA |
11 |
|
|
35 |
|
|
17 |
|
|
— |
|
|
63 |
|
Company
EBITDA attributable to others |
(59 |
) |
|
(173 |
) |
|
(324 |
) |
|
— |
|
|
(556 |
) |
Company
EBITDA1,2,4 |
61 |
|
|
88 |
|
|
108 |
|
|
(20 |
) |
|
237 |
|
Realized disposition gain,
net |
522 |
|
|
— |
|
|
— |
|
|
— |
|
|
522 |
|
Other income (expense),
net |
— |
|
|
4 |
|
|
— |
|
|
— |
|
|
4 |
|
Interest income (expense),
net |
(38 |
) |
|
(97 |
) |
|
(186 |
) |
|
8 |
|
|
(313 |
) |
Equity accounted current taxes
and interest |
(2 |
) |
|
(5 |
) |
|
(3 |
) |
|
— |
|
|
(10 |
) |
Current income taxes |
(47 |
) |
|
— |
|
|
(51 |
) |
|
5 |
|
|
(93 |
) |
Company
FFO attributable to others (net of Company EBITDA attributable to
others) |
(154 |
) |
|
64 |
|
|
178 |
|
|
— |
|
|
88 |
|
Company
FFO1,3,4 |
342 |
|
|
54 |
|
|
46 |
|
|
(7 |
) |
|
435 |
|
Depreciation and amortization
expense |
|
|
|
|
|
|
|
|
(441 |
) |
Impairment expense, net |
|
|
|
|
|
|
|
|
(324 |
) |
Other income (expense),
net |
|
|
|
|
|
|
|
|
(185 |
) |
Deferred income taxes |
|
|
|
|
|
|
|
|
41 |
|
Non-cash items attributable to
equity accounted investments |
|
|
|
|
|
|
|
|
(30 |
) |
Non-cash items attributable to
others |
|
|
|
|
|
|
|
|
611 |
|
Net income (loss) attributable to
unitholders4 |
|
|
|
|
|
|
|
|
$ |
107 |
|
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
six months ended June 30, 2019US$ millions, unaudited |
Business Services |
|
|
Infrastructure Services |
|
|
Industrials |
|
|
Corporate and Other |
|
|
Total |
|
Revenues |
$ |
14,280 |
|
|
$ |
2,394 |
|
|
$ |
3,244 |
|
|
$ |
— |
|
|
$ |
19,918 |
|
Direct operating costs |
(13,947 |
) |
|
(1,730 |
) |
|
(2,288 |
) |
|
(4 |
) |
|
(17,969 |
) |
General and administrative
expenses |
(134 |
) |
|
(75 |
) |
|
(143 |
) |
|
(37 |
) |
|
(389 |
) |
Equity accounted Company
EBITDA |
19 |
|
|
56 |
|
|
21 |
|
|
— |
|
|
96 |
|
Company
EBITDA attributable to others |
(112 |
) |
|
(422 |
) |
|
(619 |
) |
|
— |
|
|
(1,153 |
) |
Company
EBITDA1,2,4 |
106 |
|
|
223 |
|
|
215 |
|
|
(41 |
) |
|
503 |
|
Realized disposition gain,
net |
522 |
|
|
— |
|
|
(2 |
) |
|
— |
|
|
520 |
|
Other income (expense),
net |
— |
|
|
— |
|
|
2 |
|
|
— |
|
|
2 |
|
Interest income (expense),
net |
(58 |
) |
|
(198 |
) |
|
(255 |
) |
|
14 |
|
|
(497 |
) |
Equity accounted current taxes
and interest |
(3 |
) |
|
(8 |
) |
|
(4 |
) |
|
— |
|
|
(15 |
) |
Current income taxes |
(57 |
) |
|
9 |
|
|
(85 |
) |
|
10 |
|
|
(123 |
) |
Company
FFO attributable to others (net of Company EBITDA attributable to
others) |
(136 |
) |
|
130 |
|
|
256 |
|
|
— |
|
|
250 |
|
Company
FFO1,3,4 |
374 |
|
|
156 |
|
|
127 |
|
|
(17 |
) |
|
640 |
|
Depreciation and amortization
expense |
|
|
|
|
|
|
|
|
(752 |
) |
Impairment expense, net |
|
|
|
|
|
|
|
|
(324 |
) |
Other income (expense),
net |
|
|
|
|
|
|
|
|
(273 |
) |
Deferred income taxes |
|
|
|
|
|
|
|
|
22 |
|
Non-cash items attributable to
equity accounted investments |
|
|
|
|
|
|
|
|
(51 |
) |
Non-cash items attributable to
others |
|
|
|
|
|
|
|
|
907 |
|
Net income (loss) attributable to
unitholders4 |
|
|
|
|
|
|
|
|
$ |
169 |
|
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.
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