Mr. Connor Teskey reports
BROOKFIELD ASSET MANAGEMENT ANNOUNCES STRONG FOURTH QUARTER RESULTS
Brookfield Asset Management Ltd. has released financial results for the quarter ended Dec. 31, 2022.
Connor Teskey, president, stated: "We are pleased to announce our first quarterly results as a public company. Our asset management business delivered strong performance in the fourth quarter, finishing the year with record capital raised of $93-billion, driving $2.1-billion of annual distributable earnings. As we head into 2023, we expect strong growth in fee-related earnings, benefiting from a full-year contribution from our latest flagship funds, along with two of our follow-on flagship funds expected to be in the market soon. Our complementary strategies continue to attract significant capital, and we are confident we will see attractive investment opportunities this year across the risk-and-return spectrum."
Net income for Brookfield Asset Management Ltd. totalled $19-million for the quarter and $19-million for the year. Net income for Brookfield Asset Management Ltd. reflects results for 25 per cent of the asset management business from the period Dec. 9, 2022, when Brookfield Asset Management Ltd. acquired its share of the asset management business, until Dec. 31, 2022.
In order to provide meaningful comparative information, the following discussion relates to full-year results on a 100-per-cent basis for the company's asset management business. For clarity, Brookfield Asset Management Ltd. owns 25 per cent of this business and 75 per cent is owned by Brookfield Corp.
Distributable earnings for the company's asset management business were $569-million for the quarter and $2.1-billion for the year. Fee-related earnings made up approximately 100 per cent of distributable earnings for both the quarter and the year. Record fundraising levels and strong capital deployment activities drove fee-related earnings of $2.1-billion, representing an increase of 26 per cent compared with the prior-year quarter, excluding performance fees.
The company raised a record $93-billion of capital last year. Fee-bearing capital was $418-billion at the end of the year, an increase of approximately $11-billion during the quarter and $54-billion, or 15 per cent, over the past year.
During the quarter, the company held additional closes for its fifth flagship infrastructure fund and its sixth flagship private equity fund, which now stand at approximately $22-billion and $9-billion, respectively. The company expects final closes for both funds in the coming months. In November, the company launched fundraising for its 12th opportunistic credit flagship fund and expects a first close very soon. In February, 2023, the company launched fundraising for its fifth real estate flagship fund and should have a first close in the coming months. The company's transition fund continues to find a significant amount of investment opportunities and is already over 50 per cent invested or committed.
Over the year, the company raised $12-billion of capital across a variety of perpetual funds, including its supercore perpetual infrastructure fund and its perpetual real estate funds. The company also held a subsequent close for its third infrastructure debt fund, which now stands at nearly $4-billion. In addition, the company raised $6-billion of co-investment capital across its long-term private funds, giving the company's investors the flexibility to receive additional exposure to certain investments alongside the company's private funds.
These increases in fee-bearing capital contributed to a 26-per-cent increase in fee-related earnings over the last 12 months, excluding performance fees.
Fee-related earnings were $576-million for the quarter and $2.1-billion for the year. The company has approximately $40-billion of additional committed but uninvested capital across its strategies that will earn approximately $400-million of fees annually once deployed.
Fee-related earnings margins before performance fees, at the company's share, were 60 per cent for the quarter and 58 per cent for the year. This represented a 2-per-cent increase for both the quarter and the year, compared with the prior-year periods.
The increase in margins over the quarter and the year was driven by the scaling of the company's flagship funds and benefit of capital deployed across new strategies during the year.
The company invested and/or committed
capital to new investments during the year.
Notable acquisitions include the closing of the company's infrastructure business's partnership with Intel to finance half of a $30-billion investment in a semiconductor facility being built in Arizona; the company's private equity business closed the acquisition of Nielsen, a leading audience measurement business, for $16-billion this quarter; and the company's renewable power and transition business entered into an $8-billion partnership agreement with Cameco to own Westinghouse. The company continues to find opportunities to invest at large scale for value, resulting in swift deployment of the company's capital within its current funds, accelerating the company's plans to launch new vintages.
As at Dec. 31, 2022, the company had $91-billion
of capital available to deploy into new investments.
Total investable capital includes approximately $3.2-billion of cash, financial assets and undrawn lines of credit as well as $87-billion of uncalled fund commitments. The company has zero debt and $300-million on undrawn credit facilities. The company established its normal course issuer bid in January, allowing the company to repurchase shares opportunistically as necessary.
On Dec. 12, 2022, the company successfully completed the listing of 25 per cent of its asset management business and began trading on the New York Stock Exchange and Toronto Stock Exchange under the ticker symbol BAM, giving investors access to one of the world's largest and most diversified, pure play alternative asset managers.
Regular dividend declaration and establishment of dividend reinvestment program
The board of Brookfield Asset Management Ltd. declared a quarterly dividend of 32 U.S. cents per share, payable on March 31, 2023, to shareholders of record as at the close of business on Feb. 28, 2023. This dividend rate was announced on Dec. 6, 2022.
Brookfield Asset Management Ltd. recently established a dividend reinvestment program, allowing investors to elect to automatically reinvest their dividends into shares.
Quarterly earnings call details
Investors, analysts and other interested parties can access Brookfield Asset Management's 2022 year-end results as well as the shareholder letter and supplemental information on Brookfield's website under the reports and filings section.
To participate in the conference call today at 10 a.m. EST, please preregister on-line. Upon registering, you will be e-mailed a dial-in number and a unique PIN (personal identification number). The conference call will also be webcast live. For those unable to participate in the conference call, the telephone replay will be archived and available until May 9, 2023.
About Brookfield Asset Management
Brookfield Asset Management is a leading global alternative asset manager with approximately $800-billion of assets under management across real estate, infrastructure, renewable power and transition, private equity, and credit. The company invests client capital for the long term with a focus on real assets and essential service businesses that form the backbone of the global economy. The company offers a range of alternative investment products to investors around the world -- including public and private pension plans, endowments and foundations, sovereign wealth funds, financial institutions, insurance companies, and private wealth investors. The company draws on Brookfield's heritage as an owner and operator to invest for value and generate strong returns for its clients across economic cycles.
We seek Safe Harbor.
© 2023 Canjex Publishing Ltd. All rights reserved.