| Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||
| US$ millions (except per unit amounts), unaudited | 2017 | 2016 | 2017 | 2016 | |||||||
| Net income1 | $ | 11 | $ | 78 | $ | 32 | $ | 312 | |||
| – per unit2,3 | $ | (0.04 | ) | $ | 0.16 | $ | (0.13 | ) | $ | 0.73 | |
| FFO4 | $ | 301 | $ | 235 | $ | 857 | $ | 699 | |||
| – per unit5 | $ | 0.81 | $ | 0.68 | $ | 2.32 | $ | 2.02 | |||
Brookfield Infrastructure reported net income for the quarter of
FFO of
“FFO per unit continues to grow as we progress through the second half of the year, up 19% since last year,” said Sam Pollock, Chief Executive Officer of Brookfield Infrastructure. “A strong global economy is fueling the need for ongoing infrastructure capital, and we are well-positioned to participate through our capital backlog and new investment opportunities.”
Segment Performance
The utilities segment generated FFO of
The transport segment posted solid results and delivered FFO of
The energy segment generated FFO of
Our communications infrastructure operations in
| Three Months Ended September 30 | Nine Months Ended September 30 | ||||||||||||||
| US$ millions, unaudited | 2017 | 2016 | 2017 | 2016 | |||||||||||
| FFO by segment | |||||||||||||||
| Utilities | $ | 170 | $ | 102 | $ | 438 | $ | 302 | |||||||
| Transport | 136 | 112 | 393 | 308 | |||||||||||
| Energy | 48 | 40 | 153 | 123 | |||||||||||
| Communications Infrastructure | 19 | 19 | 57 | 57 | |||||||||||
| Corporate and other | (72 | ) | (38 | ) | (184 | ) | (91 | ) | |||||||
| FFO | $ | 301 | $ | 235 | $ | 857 | $ | 699 | |||||||
Update on Strategic Initiatives
- Indian toll road portfolio – In August, we agreed to acquire two high-quality, well-located roads in southern
India for$100 million (BIP’s share). These roads are in the advanced stages of construction and are therefore partially tolling, with full commissioning expected in early 2018. This acquisition is a tuck-in to our existing portfolio of Indian toll roads, bringing BIP’s total road portfolio in this country to over 600 kilometres. - Indian telecom business – Our agreement to acquire the previously announced $200 million investment (BIP’s share) in a portfolio of over 40,000 towers from Reliance Telecom was conditional on, among other standard conditions, the merger of Reliance Communications with Aircel. The merger will not proceed and therefore our transaction as previously announced will not proceed either. However, we continue to monitor the evolving situation to determine if revised terms can be agreed upon.
We remain patient in pursuing this and several other potential opportunities in this sector. In particular, we are evaluating a number of tower portfolios in the hopes of developing a scalable presence inIndia . - Peruvian water utility – Closing the acquisition of a Peruvian water irrigation system for an investment of approximately
$15 million (BIP’s share) remains ongoing following receipt of customary regulatory approvals.
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 communications infrastructure sectors across
Brookfield Infrastructure is the flagship listed infrastructure company of Brookfield Asset Management, a leading global alternative asset manager with approximately
Please note that Brookfield Infrastructure Partner’s previous audited annual and unaudited quarterly reports have been filed on SEDAR and can also be found in the investors 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: Rene Lubianski Senior Vice President, Corporate Development Tel: (416) 956-5196 Email: [email protected] | ||
Conference Call and Quarterly Earnings Details
Investors, analysts and other interested parties can access Brookfield Infrastructure’s Third Quarter 2017 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 November 3, 2017 at 9:00 a.m. Eastern Time at http://services.choruscall.ca/links/bip20171103.html or via teleconference at 1-800-319-4610 toll free in
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
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 and general partnership 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 and nine-month periods ended September 30, 2017 was 262.6 million and 260.6 million, respectively (2016 – 243.4 million and 243.3 million, respectively). |
| 3. Loss per LP unit as allocation of net income is reduced by preferred unit and incentive distributions paid during the period. |
| 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 below. |
| 5. Average number of partnership units outstanding on a fully diluted time weighted average basis, assuming the exchange of redeemable partnership units held by |
| 6. Payout ratio is defined as distributions paid (inclusive of GP incentive and preferred unit distributions) divided by FFO. |
| Brookfield Infrastructure Partners L.P. Consolidated Statements of Financial Position | ||||||
| As of | ||||||
US$ millions, unaudited | Sept 30, 2017 | Dec 31, 2016 | ||||
| Assets | ||||||
| Cash and cash equivalents | $ | 492 | $ | 786 | ||
| Financial assets | 221 | 92 | ||||
| Property, plant and equipment | 9,434 | 8,656 | ||||
| Intangible assets | 10,091 | 4,465 | ||||
| Investments in associates | 5,085 | 4,727 | ||||
| Investment properties | 168 | 154 | ||||
| Deferred income taxes and other | 3,275 | 2,376 | ||||
| Assets classified as held for sale | 7 | 19 | ||||
| Total assets | $ | 28,773 | $ | 21,275 | ||
| Liabilities and partnership capital | ||||||
| Corporate borrowings | $ | 1,716 | $ | 1,002 | ||
| Non-recourse borrowings | 7,931 | 7,324 | ||||
| Financial liabilities | 1,404 | 381 | ||||
| Deferred income taxes and other | 4,227 | 2,924 | ||||
| Totalliabilities | 15,278 | 11,631 | ||||
| Partnership capital | ||||||
| Limited partners | 4,926 | 4,611 | ||||
| General partner | 26 | 27 | ||||
| Non-controlling interest attributable to: | ||||||
| Redeemable partnership units held by | 1,995 | 1,860 | ||||
| Interest of others in operating subsidiaries | 5,953 | 2,771 | ||||
| Preferred unitholders | 595 | 375 | ||||
| Total partnership capital | 13,495 | 9,644 | ||||
| Total liabilities and partnership capital | $ | 28,773 | $ | 21,275 | ||
| Brookfield Infrastructure Partners L.P. Consolidated Statements of Operating Results | |||||||||||||||||
| For the three-month period ended Sept 30, | For the nine-month period ended Sept 30, | ||||||||||||||||
| US$ millions (except per unit information), unaudited | 2017 | 2016 | 2017 | 2016 | |||||||||||||
| Revenues | $ | 961 | $ | 522 | $ | 2,551 | $ | 1,438 | |||||||||
| Direct operating costs | (394 | ) | (267 | ) | (1,110 | ) | (667 | ) | |||||||||
| General and administrative expenses | (63 | ) | (45 | ) | (173 | ) | (122 | ) | |||||||||
| Depreciation and amortization expense | (215 | ) | (126 | ) | (541 | ) | (334 | ) | |||||||||
| 289 | 84 | 727 | 315 | ||||||||||||||
| Interest expense | (114 | ) | (98 | ) | (315 | ) | (294 | ) | |||||||||
| Share of earnings from associates | 24 | 32 | 83 | 142 | |||||||||||||
| Revaluation (losses) gains on hedging items | (18 | ) | (39 | ) | (84 | ) | 1 | ||||||||||
| Other income | — | 109 | 19 | 171 | |||||||||||||
| Income before income tax | 181 | 88 | 430 | 335 | |||||||||||||
| Income tax (expense) recovery | |||||||||||||||||
| Current | (17 | ) | (8 | ) | (67 | ) | (20 | ) | |||||||||
| Deferred | (13 | ) | 23 | (31 | ) | 35 | |||||||||||
| Net income | 151 | 103 | 332 | 350 | |||||||||||||
| Non-controlling interest of others in operating subsidiaries | (140 | ) | (25 | ) | (300 | ) | (38 | ) | |||||||||
| Net income attributable to partnership | $ | 11 | $ | 78 | $ | 32 | $ | 312 | |||||||||
| Attributable to: | |||||||||||||||||
| Limited partners | (11 | ) | 40 | (35 | ) | 177 | |||||||||||
| General partner | 28 | 22 | 84 | 62 | |||||||||||||
| Non-controlling interest – redeemable partnership units held by | (6 | ) | 16 | (17 | ) | 73 | |||||||||||
| Basic and diluted (loss) earnings per unit attributable to: | |||||||||||||||||
| Limited partners1 | $ | (0.04 | ) | $ | 0.16 | $ | (0.13 | ) | $ | 0.73 | |||||||
| 1. Average number of limited partnership units outstanding on a time weighted average basis for the three and nine-month periods ended September 30, 2017 were 262.6 million and 260.6 million, respectively (2016 – 243.4 million and 243.3 million, respectively). | |||||||||||||||||
| Brookfield Infrastructure Partners L.P. Consolidated Statements of Cash Flows | |||||||||||||||
| US$ millions, unaudited | For the three-month period ended Sept 30, | For the nine-month period ended Sept 30, | |||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||
| Operating Activities | |||||||||||||||
| Net income | $ | 151 | 103 | $ | 332 | $ | 350 | ||||||||
| Adjusted for the following items: | |||||||||||||||
| Share of earnings from associates, net of distributions | (20 | ) | (20 | ) | (41 | ) | (110 | ) | |||||||
| Depreciation and amortization expense | 215 | 126 | 541 | 334 | |||||||||||
| Market-to-market on hedging items, provisions and other | 27 | 66 | 102 | 34 | |||||||||||
| Deferred tax expense (recovery) | 13 | (23 | ) | 31 | (35 | ) | |||||||||
| Change in non-cash working capital, net | (11 | ) | 91 | 7 | 91 | ||||||||||
| Cash from operating activities | 375 | 343 | 972 | 664 | |||||||||||
| Investing Activities | |||||||||||||||
| Investments, net of disposals: | |||||||||||||||
| Operating assets | — | (219 | ) | (4,203 | ) | (412 | ) | ||||||||
| Associates | (33 | ) | (212 | ) | (351 | ) | (716 | ) | |||||||
| Long-lived assets | (164 | ) | (173 | ) | (474 | ) | (465 | ) | |||||||
| Financial assets | (64 | ) | 436 | (88 | ) | 429 | |||||||||
| Net settlements of foreign exchange contracts | (3 | ) | 79 | (43 | ) | 109 | |||||||||
| Cash used by investing activities | (264 | ) | (89 | ) | (5,159 | ) | (1,055 | ) | |||||||
| Financing Activities | |||||||||||||||
| Distributions to limited and general partners | (196 | ) | (160 | ) | (586 | ) | (466 | ) | |||||||
| Net borrowings: | |||||||||||||||
| Corporate | (703 | ) | (713 | ) | 608 | 85 | |||||||||
| Subsidiary | 65 | 109 | 274 | 164 | |||||||||||
| Other | — | — | — | (38 | ) | ||||||||||
| Issuance of preferred units | — | 186 | 220 | 186 | |||||||||||
| Issuance of partnership units, net of repurchases | 977 | 8 | 988 | 13 | |||||||||||
| Capital provided by non-controlling interest, net of distributions | (243 | ) | 383 | 2,372 | 684 | ||||||||||
| Cash (used by) from financing activities | (100 | ) | (187 | ) | 3,876 | 628 | |||||||||
| Cash and cash equivalents | |||||||||||||||
| Change during the period | $ | 11 | $ | 67 | $ | (311 | ) | $ | 237 | ||||||
| Impact of foreign exchange on cash | 13 | (4 | ) | 17 | 5 | ||||||||||
| Balance, beginning of period | 468 | 378 | 786 | 199 | |||||||||||
| Balance, end of period | $ | 492 | $ | 441 | $ | 492 | $ | 441 | |||||||
| Brookfield Infrastructure Partners L.P. Statements of Funds from Operations | |||||||||||||||
| For the three-month period ended Sept 30, | For the nine-month period ended Sept 30, | ||||||||||||||
| US$ millions, unaudited | 2017 | 2016 | 2017 | 2016 | |||||||||||
| Adjusted EBITDA | |||||||||||||||
| Utilities | $ | 200 | $ | 131 | $ | 533 | $ | 399 | |||||||
| Transport | 179 | 162 | 515 | 441 | |||||||||||
| Energy | 62 | 64 | 211 | 202 | |||||||||||
| Communications Infrastructure | 23 | 23 | 68 | 67 | |||||||||||
| Corporate and other | (63 | ) | (45 | ) | (173 | ) | (122 | ) | |||||||
| Total | 401 | 335 | 1,154 | 987 | |||||||||||
| Financing costs | (108 | ) | (116 | ) | (328 | ) | (344 | ) | |||||||
| Other income | 8 | 16 | 31 | 56 | |||||||||||
| Funds from operations (FFO) | 301 | 235 | 857 | 699 | |||||||||||
| Depreciation and amortization | (195 | ) | (158 | ) | (539 | ) | (448 | ) | |||||||
| Deferred taxes and other items | (95 | ) | 1 | (286 | ) | 61 | |||||||||
| Net income attributable to the partnership | $ | 11 | $ | 78 | $ | 32 | $ | 312 | |||||||
| 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 above, 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-month period ended Sept 30, | For the nine-month period ended Sept 30, | |||||||||||||
| US$, unaudited | 2017 | 2016 | 2017 | 2016 | ||||||||||
| (Loss) earnings per limited partnership unit1 | $ | (0.04 | ) | $ | 0.16 | $ | (0.13 | ) | $ | 0.73 | ||||
| Add back or deduct the following: | ||||||||||||||
| Depreciation and amortization | 0.52 | 0.46 | 1.45 | 1.30 | ||||||||||
| Deferred taxes and other items | 0.33 | 0.06 | 1.00 | (0.01 | ) | |||||||||
| FFO per unit2 | $ | 0.81 | $ | 0.68 | $ | 2.32 | $ | 2.02 | ||||||
| 1. Average number of limited partnership units outstanding on a time weighted average basis for the three and nine-month periods ended September 30, 2017 were 262.6 million and 260.6 million, respectively (2016 – 243.4 million and 243.3 million, respectively). | ||||||||||||||
| 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 above, 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 | Sept 30, 2017 | Dec 31, 2016 | |||
| Assets | |||||
| Operating groups | |||||
| Utilities | $ | 3,168 | $ | 1,807 | |
| Transport | 3,841 | 3,549 | |||
| Energy | 1,775 | 1,564 | |||
| Communications Infrastructure | 567 | 541 | |||
| Corporate cash and financial assets | 250 | 549 | |||
| $ | 9,601 | $ | 8,010 | ||
| Liabilities | |||||
| Corporate borrowings | $ | 1,716 | $ | 1,002 | |
| Other liabilities | 938 | 510 | |||
| 2,654 | 1,512 | ||||
| Capitalization | |||||
| Partnership capital | 6,947 | 6,498 | |||
| $ | 9,601 | $ | 8,010 | ||
| 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 Brookfield Infrastructure’s Consolidated Statements of Financial Position above, which is prepared in accordance with IFRS. Readers are encouraged to consider both measures in assessing Brookfield Infrastructure's financial position. | |||||
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