| For the three months ended March 31 | |||||||||
| US$ millions (except per unit amounts), unaudited | 2019 | 2018 | |||||||
| Net income1 | $ | 30 | $ | 209 | |||||
| – per unit2,3 | $ | (0.05 | ) | $ | 0.42 | ||||
| FFO4 | $ | 351 | $ | 333 | |||||
| – per unit5 | $ | 0.88 | $ | 0.85 | |||||
Brookfield Infrastructure reported net income for the quarter of
Our business generated FFO of
“Brookfield Infrastructure had a strong start to 2019, delivering 10% organic growth. We also invested $430 million into two previously announced transactions and progressed the integration of recently acquired assets,” said Sam Pollock, Chief Executive Officer of Brookfield Infrastructure. “As we advance a number of asset sales, we will seek to replicate our recent capital recycling success to create further long-term unitholder value.”
Segment Performance
The utilities segment contributed FFO of
FFO from our transport segment was
The energy segment contributed FFO of
FFO for the data infrastructure segment was
The following table presents FFO by segment:
| | For the three months ended March 31 | |||||||||
| US$ millions, unaudited | 2019 | 2018 | ||||||||
| FFO by segment | ||||||||||
| Utilities | $ | 137 | $ | 169 | ||||||
| Transport | 139 | 137 | ||||||||
| Energy | 107 | 66 | ||||||||
| Data Infrastructure | 28 | 19 | ||||||||
| Corporate | (60) | (58) | ||||||||
| FFO | $ | 351 | $ | 333 | ||||||
Update on Strategic Initiatives
We closed or committed to close a number of initiatives that will contribute to our results and liquidity:
- South American Data Centers – In March, we, alongside a strategic partner, completed the acquisition of Ascenty, a leading hyperscale data center operator in
South America . Brookfield Infrastructure invested approximately$200 million , which included our share of growth capital expenditures for 2019.
Since closing the transaction, Ascenty has expanded its data center business intoChile , leasing up to 6MW of capacity over the next 10 years to an investment-grade customer. This anchor contract will facilitate the construction of the facility, which is an accretive initiative that was not contemplated in our original business plan. While it is early days into our investment, the business is performing well, our partnership with Digital Realty Trust is generating the desired synergistic benefits we expected, and we are identifying additional prospective “tuck-in” opportunities that will grow Ascenty’s presence acrossSouth America . - Indian Natural Gas Pipeline – In March, we closed on the previously announced Indian natural gas pipeline acquisition, investing approximately
$230 million . - Western Canadian Midstream – The acquisition of the federally regulated assets in our Western Canadian midstream business is expected to close in the third quarter of 2019, upon completion of a regulatory process.
- European Bulk Port Operations – We have entered into an agreement to sell our European bulk port operations, with a sale expected to be completed in June of this year, subject to regulatory approvals. We expect to receive net after-tax proceeds of
$130 million from the sale, which is approximately equal to the carrying value of the business.
Distribution
The Board of Directors has declared a quarterly distribution in the amount of
Additional Information
The Board has reviewed and approved this news release, including the summarized unaudited financial information contained herein.
Brookfield Infrastructure’s Letter to Unitholders and Supplemental Information are available at www.brookfield.com/infrastructure.
Brookfield Infrastructure Partners is a leading global infrastructure company that owns and operates high quality, long-life assets in the utilities, transport, energy and data infrastructure sectors across
Brookfield Infrastructure is the flagship listed infrastructure company of Brookfield Asset Management, a leading global alternative asset manager with over
Please note that Brookfield Infrastructure Partner’s previous audited annual and unaudited quarterly reports have been filed on SEDAR and Edgar, and can also be found in the shareholders section of its website at www.brookfield.com/infrastructure. Hard copies of the annual and quarterly reports can be obtained free of charge upon request.
For more information, please contact:
Media: Claire Holland Vice President, Communications Tel: (416) 369-8236 Email: [email protected] | Investors: Melissa Low Vice President, Investor Relations Tel: (416) 956-5239 Email: [email protected] |
Conference Call and Quarterly Earnings Details
Investors, analysts and other interested parties can access Brookfield Infrastructure’s First Quarter 2019 Results as well as the Letter to Unitholders and Supplemental Information on Brookfield Infrastructure’s website under the Investor Relations section at www.brookfield.com/infrastructure.
The conference call can be accessed via webcast on May 3, 2019 at 9:00 a.m. Eastern Time at https://edge.media-server.com/m6/p/gek7ckx7 or via teleconference at 1-866-688-9459 toll free in
Note: This news release may contain forward-looking information within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of Section 27A of the
References to Brookfield Infrastructure are to the Partnership together with its subsidiaries and operating entities. Brookfield Infrastructure’s results include limited partnership units held by public unitholders, redeemable partnership units, general partnership units and exchange LP units.
References to the Partnership are to Brookfield Infrastructure Partners L.P.
1. Includes net income attributable to non-controlling interests ‒ Redeemable Partnership Units held by
2. Average number of limited partnership units outstanding on a time weighted average basis for the three months ended March 31, 2019 were 278.1 million (2018 – 276.6 million).
3. Results in a loss on a per unit basis for the three months ended March 31, 2019 as allocation of net income is reduced by preferred unit and incentive distributions.
4. FFO is defined as net income excluding the impact of depreciation and amortization, deferred income taxes, breakage and transaction costs, and non-cash valuation gains or losses. A reconciliation of net income to FFO is available on page 9 of this release.
5. Average number of partnership units outstanding on a fully diluted time weighted average basis, assuming the exchange of redeemable partnership units held by
Brookfield Infrastructure Partners L.P.
Consolidated Statements of Financial Position
| As of | |||||
US$ millions, unaudited | Mar 31, 2019 | Dec 31, 2018 | |||
| Assets | |||||
| Cash and cash equivalents | $ | 720 | $ | 540 | |
| Financial assets | 445 | 224 | |||
| Property, plant and equipment | 16,277 | 12,814 | |||
| Intangible assets | 11,889 | 11,635 | |||
| Investments in associates and joint ventures | 4,586 | 4,591 | |||
| Investment properties | 398 | 190 | |||
| Deferred income taxes and other | 7,310 | 6,586 | |||
| Total assets | $ | 41,625 | $ | 36,580 | |
| Liabilities and partnership capital | |||||
| Corporate borrowings | $ | 2,481 | $ | 1,993 | |
| Non-recourse borrowings | 14,323 | 13,113 | |||
| Financial liabilities | 1,282 | 1,280 | |||
| Deferred income taxes and other | 7,264 | 5,526 | |||
| Totalliabilities | 25,350 | 21,912 | |||
| Partnership capital | |||||
| Limited partners | 4,633 | 4,513 | |||
| General partner | 22 | 22 | |||
| Non-controlling interest attributable to: | |||||
| Redeemable partnership units held by | 1,863 | 1,823 | |||
| Exchange LP units | 23 | 71 | |||
| Interest of others in operating subsidiaries | 8,799 | 7,303 | |||
| Preferred unitholders | 935 | 936 | |||
| Total partnership capital | 16,275 | 14,668 | |||
| Total liabilities and partnership capital | $ | 41,625 | $ | 36,580 | |
Brookfield Infrastructure Partners L.P.
Consolidated Statements of Operating Results
| US$ millions, except per unit information, unaudited | For the three months ended March 31, | ||||||||||
| 2019 | 2018 | ||||||||||
| Revenues | $ | 1,593 | $ | 1,013 | |||||||
| Direct operating costs | (798 | ) | (409 | ) | |||||||
| General and administrative expense | (61 | ) | (58 | ) | |||||||
| Depreciation and amortization expense | (292 | ) | (193 | ) | |||||||
| 442 | 353 | ||||||||||
| Interest expense | (212 | ) | (114 | ) | |||||||
| Share of earnings (losses) from associates and joint ventures | 18 | (5 | ) | ||||||||
| Mark-to-market on hedging items | (18 | ) | (36 | ) | |||||||
| Gain on sale of associate | – | 338 | |||||||||
| Other income (expense) | 10 | (24 | ) | ||||||||
| Income before income tax | 240 | 512 | |||||||||
| Income tax expense | |||||||||||
| Current | (63 | ) | (170 | ) | |||||||
| Deferred | (12 | ) | (15 | ) | |||||||
| Net income | 165 | 327 | |||||||||
| Non-controlling interest of others in operating subsidiaries | (135 | ) | (118 | ) | |||||||
| Net income attributable to partnership | $ | 30 | $ | 209 | |||||||
| Attributable to: | |||||||||||
| Limited partners | (6 | ) | 122 | ||||||||
| General partner | 38 | 35 | |||||||||
| Non-controlling interest – redeemable partnership units held by | (2 | ) | 52 | ||||||||
| Basic and diluted (loss) earnings per unit attributable to: | |||||||||||
| Limited partners1 | $ | (0.05 | ) | $ | 0.42 | ||||||
1. Average number of limited partnership units outstanding on a time weighted average basis for the three months ended March 31, 2019 was 278.1 million (2018 – 276.6 million).
Brookfield Infrastructure Partners L.P.
Consolidated Statements of Cash Flows
| US$ millions, unaudited | For the three months ended March 31, | ||||||||||
| 2019 | 2018 | ||||||||||
| Operating Activities | |||||||||||
| Net income | $ | 165 | $ | 327 | |||||||
| Adjusted for the following items: | |||||||||||
| Earnings from investments in associates and joint ventures, net of distributions received | 13 | 9 | |||||||||
| Depreciation and amortization expense | 292 | 193 | |||||||||
| Mark-to-market on hedging items, provisions and other | 54 | 69 | |||||||||
| Gain on sale of associate | – | (338) | |||||||||
| Deferred income tax expense | 12 | 15 | |||||||||
| Change in non-cash working capital, net | 25 | 191 | |||||||||
| Cash from operating activities | 561 | 466 | |||||||||
| Investing Activities | |||||||||||
| Net (investments in) proceeds from: | |||||||||||
| Operating assets | (1,985) | – | |||||||||
| Associates | (188) | 1,274 | |||||||||
| Long-lived assets | (237) | (175) | |||||||||
| Financial assets | – | (25) | |||||||||
| Acquisition funded on behalf of parent | (581) | – | |||||||||
| Net settlement of foreign exchange contracts | (1) | (54) | |||||||||
| Cash (used by) from investing activities | (2,992) | 1,020 | |||||||||
| Financing Activities | |||||||||||
| Distributions to limited and general partners | (250) | (228) | |||||||||
| Net borrowings (repayments): | |||||||||||
| Corporate | 455 | (789) | |||||||||
| Subsidiary | 1,122 | 60 | |||||||||
| Deposit received from parent | 367 | – | |||||||||
| Net preferred units and preferred shares issued | 72 | 157 | |||||||||
| Net partnership units (repurchased) issued | (26) | 4 | |||||||||
| Capital provided by non-controlling interest, net of distributions, and other | 868 | (175) | |||||||||
| Cash from (used by) financing activities | 2,608 | (971) | |||||||||
| Cash and cash equivalents | |||||||||||
| Change during the period | $ | 177 | $ | 515 | |||||||
| Impact of foreign exchange on cash | 3 | 1 | |||||||||
| Balance, beginning of period | 540 | 374 | |||||||||
| Balance, end of period | $ | 720 | $ | 890 | |||||||
Brookfield Infrastructure Partners L.P.
Statements of Funds from Operations
| For the three months ended March 31, | ||||||||||||
| US$ millions, unaudited | 2019 | 2018 | ||||||||||
| Adjusted EBITDA | ||||||||||||
| Utilities | $ | 181 | $ | 203 | ||||||||
| Transport | 189 | 178 | ||||||||||
| Energy | 127 | 79 | ||||||||||
| Data Infrastructure | 36 | 23 | ||||||||||
| Corporate | (61) | (58) | ||||||||||
| Total | 472 | 425 | ||||||||||
| Financing costs | (140) | (112) | ||||||||||
| Other income | 19 | 20 | ||||||||||
| Funds from operations (FFO) | 351 | 333 | ||||||||||
| Depreciation and amortization | (220) | (210) | ||||||||||
| Deferred taxes and other items | (101) | 86 | ||||||||||
| Net income attributable to the partnership | $ | 30 | $ | 209 | ||||||||
Notes:
Funds from operations in this statement is on a segmented basis and represents the operations of Brookfield Infrastructure net of charges associated with related liabilities and non-controlling interests. Adjusted EBITDA is defined as FFO excluding the impact of interest expense and other income or expenses. Net income attributable to the partnership includes net income attributable to non-controlling interests – redeemable partnership units held by
The Statements of Funds from Operations above are prepared on a basis that is consistent with the Partnership’s Supplemental Information and differs from net income as presented in Brookfield Infrastructure’s Consolidated Statements of Operating Results on page 7 of this release, which is prepared in accordance with IFRS. Management uses funds from operations (FFO) as a key measure to evaluate operating performance. Readers are encouraged to consider both measures in assessing Brookfield Infrastructure’s results.
Brookfield Infrastructure Partners L.P.
Statements of Funds from Operations per Unit
| For the three months ended March 31, | ||||||||||||
| US$, unaudited | 2019 | 2018 | ||||||||||
| Earnings (loss) per limited partnership unit1 | $ | (0.05 | ) | $ | 0.42 | |||||||
| Add back or deduct the following: | ||||||||||||
| Depreciation and amortization | 0.55 | 0.53 | ||||||||||
| Deferred taxes and other items | 0.38 | (0.10 | ) | |||||||||
| FFO per unit2 | $ | 0.88 | $ | 0.85 | ||||||||
1. Average number of limited partnership units outstanding on a time weighted average basis for the three months ended March 31, 2019 was 278.1 million (2018 – 276.6 million).
2. Average number of partnership units outstanding on a fully diluted time weighted average basis, assuming the exchange of redeemable partnership units held by
Notes:
The Statements of Funds from Operations per unit above are prepared on a basis that is consistent with the Partnership’s Supplemental Information and differs from net income per limited partnership unit as presented in Brookfield Infrastructure’s Consolidated Statements of Operating Results on page 7 of this release, which is prepared in accordance with IFRS. Management uses funds from operations per unit (FFO per unit) as a key measure to evaluate operating performance. Readers are encouraged to consider both measures in assessing Brookfield Infrastructure’s results.
Brookfield Infrastructure Partners L.P.
Statements of Partnership Capital
| As of | ||||
US$ millions, unaudited | Mar 31, 2019 | Dec 31, 2018 | ||
| Assets | ||||
| Operating groups | ||||
| Utilities | $ | 1,806 | $ | 1,787 |
| Transport | 3,602 | 3,627 | ||
| Energy | 3,083 | 2,817 | ||
| Data Infrastructure | 1,691 | 882 | ||
| Cash and cash equivalents | 482 | 238 | ||
| $ | 10,664 | $ | 9,351 | |
| Liabilities | ||||
| Corporate borrowings | $ | 2,481 | $ | 1,993 |
| Other liabilities | 1,642 | 929 | ||
| 4,123 | 2,922 | |||
| Capitalization | ||||
| Partnership capital | 6,541 | 6,429 | ||
| $ | 10,664 | $ | 9,351 | |
Notes:
Partnership capital in these statements represents Brookfield Infrastructure’s investments in its operations on a segmented basis, net of underlying liabilities and non-controlling interests, and includes partnership capital attributable to non-controlling interests – redeemable partnership units held by
The Statements of Partnership Capital above are prepared on a basis that is consistent with the Partnership’s Supplemental Information and differs from the Brookfield Infrastructure’s Consolidated Statements of Financial Position on page 6 of this release, which is prepared in accordance with IFRS. Readers are encouraged to consider both bases of presentation in assessing Brookfield Infrastructure's financial position.
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