TORONTO, August 8, 2008 – Brookfield Asset Management Inc. (TSX/NYSE: BAM; EURONEXT: BAMA) today announced its results for the second quarter ended June 30, 2008.
Cash Flow From Operations
Cash flow from operations for the second quarter totalled $378 million ($0.62 per share). Operating cash flow in the same quarter in 2007 was $340 million ($0.55 per share) on a comparable basis, which excludes a security disposition gain of $100 million, or $440 million ($0.72 per share) including the gain. On a comparable basis, operating cash flow per share increased by 13% quarter-over-quarter due to improved water levels and pricing in the company’s renewable power business and stable growth within our commercial office business.
|
US$ millions
(except per share amounts) |
Three months
ended June 30 |
|
Six months
ended June 30 |
| |
2008 |
2007 |
|
2008 |
2007 |
|
|
|
|
| Cash flow from operations |
|
|
|
|
|
|
|
|
|
| |
Comparable basis (excluding security disposition gain) |
$ |
378 |
$ |
340 |
|
$ |
821 |
$ |
746 |
|
– per share (1) |
|
0.62 |
|
0.55 |
|
|
1.34 |
|
1.22 |
| |
|
|
|
|
|
|
|
|
|
| |
Total basis (including security disposition gain) |
$ |
378 |
$ |
440 |
|
$ |
821 |
$ |
1,011 |
|
– per share (1) |
|
0.62 |
|
0.72 |
|
|
1.34 |
|
1.65 |
| (1) Adjusted
to reflect three-for-two stock split
on June 1, 2007 |
|
|
|
|
|
|
|
|
“Our operating performance reflects the sustainable cash flows which are generated by our high quality assets and operating platforms,” commented Bruce Flatt, Senior Managing Partner of Brookfield Asset Management. “We remain focused on building our operations over the longer term."
Net Income
Net income was $110 million in the second quarter of 2008 compared with $153 million on the same basis last year. Increases in operating cash flows were offset by a higher level of non-cash charges, including depreciation on assets purchased since the second quarter of 2007. In the company’s view, these assets should generate increasing cash flows over an extended period of time due to their high quality, long life and value appreciation potential. The company believes that the depreciation and amortization being recorded is far greater than the expenditures required to maintain the assets.
|
US$ millions
(except
per share amounts) |
Three
months ended
June 30 |
Six
months ended
June 30 |
|
2008 |
2007 |
2008 |
2007 |
 |
| Net income |
|
|
|
|
|
|
|
|
|
– total |
$ |
110 |
$ |
153 |
$ |
307 |
$ |
348 |
|
– per share (1) |
$ |
0.17 |
$ |
0.24 |
$ |
0.48 |
$ |
0.55 |
| (1) Adjusted
to reflect three-for-two stock split
on June 1, 2007 |
|
|
|
|
|
|
This news release and accompanying financial statements make reference to cash flow from operations on a total and per share basis. Cash flow from operations is defined as net income excluding depreciation and amortization, interests of non-controlling shareholders, future income taxes and other items as described as such in the consolidated statements of income, and including dividends and disposition gains that are not otherwise included in net income. Brookfield uses cash flow from operations to assess its operating results and the value of its business and believes that many of its shareholders and analysts also find this measure of value to them. The company provides the components of cash flow from operations and a full reconciliation between cash flow from operations and net income with the financial information accompanying this news release. Cash flow from operations is a non-GAAP measure which does not have any standard meaning prescribed by GAAP and therefore may not be comparable to similar measures presented by other companies.
Dividend Declaration
The Board of Directors declared a dividend of US$0.13 per Class A Common Share, payable on November 30, 2008, to shareholders of record as at the close of business on November 1, 2008. The Board also declared all of the regular monthly and quarterly dividends on its preferred shares.
Information on Brookfield Asset Management’s declared share dividends can be found on the company’s web site under Investor Centre/Stock and Dividend Information.
Additional Information
The Letter to Shareholders and the company’s Supplemental Financial Information for the six months ended June 30, 2008 contain further information on the company’s strategy, operations and financial results. Shareholders are encouraged to read these documents, which are available on the company’s web site.
* * * * *
Brookfield Asset Management Inc., focused on property, power and infrastructure assets, has approximately $95 billion of assets under management and is co-listed on the New York and Toronto Stock Exchanges under the symbol BAM and on NYSE Euronext under the symbol BAMA. For more information, please visit our web site at www.brookfield.com.
Please note that Brookfield’s audited annual and unaudited quarterly reports have been filed on Edgar and Sedar and can also be found in the investor section of our web site at www.brookfield.com. Hard copies of the annual report and quarterly disclosures can be obtained free of charge upon request.
For more information, please visit our web site at www.brookfield.com or contact:
Contact:
Denis Couture
SVP, Investor Relations and Corporate
and International Affairs
Brookfield Asset Management
Tel.: (416) 956-5189
Fax.: (416) 363-2856
dcouture@brookfield.com
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Note: This news release contains forward-looking information withinthe meaning of Canadian provincial securities laws and other “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. The words, “sustainable,” “should,” “believe,” derivations thereof, and other expressions which are predictions of or indicate future events, trends or prospects and which do not relate to historical matters identify forward-looking statements. Forward-looking statements in this news release include statements in regards to sustainability of the company’s cash flows, the company’s ability to increase cash flows over an extended period of time and the expenditures required to maintain assets purchased since the second quarter of 2007. Although Brookfield Asset Management believes that its anticipated future results, performance or achievements expressed or implied of such assets 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 as such statements and information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company 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: economic and financial conditions in the countries in which we do business; the behaviour of financial markets, including fluctuations in interest and exchange rates; market demand for an infrastructure company, which is unknown; ability to compete for new acquisitions in the competitive infrastructure space; availability of equity and debt financing; strategic actions including dispositions; the ability to effectively integrate acquisitions into existing operations and the ability to attain expected benefits; the company’s continued ability to attract institutional partners to its Specialty Investment Funds; adverse hydrology conditions; regulatory and political factors within the countries in which the company operates; acts of God, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts; and other risks and factors detailed from time to time in the company’s form 40-F filed with the Securities and Exchange Commission as well as other documents filed by the company with the securities regulators in Canada and the United States including the company’s most recent Annual Information Form under the heading “Business Environment and Risks.”
We caution that the foregoing factors that may affect future results is not exhaustive. When relying on our forward-looking statements to make decisions with respect to Brookfield Asset Management, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, the company undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, as a result of new information, future events or otherwise.
