Financial Performance Metrics - The company evaluates its performance using net income attributable to unitholders and Adjusted EFO, with Adjusted EFO being a key measure for assessing performance and resource allocation decisions [21]. - Adjusted EBITDA is defined as net income and equity accounted income at the company's economic ownership interest, excluding various expenses, and is critical for evaluating overall operating performance [23]. - The company emphasizes the importance of reviewing IFRS financial measures alongside non-IFRS measures like Adjusted EBITDA to gain a comprehensive understanding of financial performance [24]. Risks and Uncertainties - Forward-looking statements include expectations regarding operations, financial condition, and market outlook, but are subject to risks and uncertainties that may cause actual results to differ materially [26]. - The company is subject to various risks, including competition for acquisition opportunities and the ability to integrate acquisitions effectively [27]. - The company is subject to significant risks including political instability, changes in government policy, and reliance on third-party service providers [28]. - High inflation and rising interest rates pose risks to economic growth and could negatively impact the company's financial results [43]. - The accuracy of management's assumptions and estimates is critical, as significant deviations could lead to substantial financial impacts [51]. - Future acquisitions may involve risks such as integration difficulties, potential disruption of current operations, and increased legal or regulatory liabilities [46]. Operational Challenges - The cyclical nature of operating businesses and general economic conditions, including interest rates and commodity prices, are significant factors affecting performance [27]. - The company may face challenges related to the cyclical nature of its operations and general economic conditions, which could adversely affect growth and profitability [33]. - The company faces challenges in completing acquisitions due to potential delays in obtaining necessary approvals and financing, which could lead to significant declines in market value [53]. - The total exposure to debt is significant, and increased leverage may heighten the risk of loss and sensitivity to economic downturns [55]. - Rising interest rates could increase financing costs and make it difficult to complete acquisitions, potentially leading to lower profits [56]. Regulatory and Compliance Issues - The company may become regulated as an investment company under the Investment Company Act, which could impose additional operational constraints [29]. - The company is subject to various governmental investigations, audits, and inquiries, which can be costly and may result in criminal liability, fines, or penalties [108]. - The company may incur significant costs and burdens due to compliance with anti-corruption and trade sanctions laws, which could negatively impact its operations [109]. - Compliance with foreign investment laws may limit the company's ability to find suitable investments and could impose additional operational burdens [113]. Market and Economic Conditions - The residential mortgage insurer is heavily influenced by macroeconomic conditions, with key factors including economic growth, interest rates, unemployment, and housing activity impacting premium levels and claims losses [115]. - The healthcare services segment derives the majority of its revenues from private health insurance funds, making it vulnerable to changes in economic conditions and the ability to secure commercial agreements [121]. - The road fuels operation is subject to fluctuations in fuel prices and demand, which could adversely affect revenues and financial condition [126]. - The construction operation is vulnerable to economic cycles, with demand influenced by capital expenditures and economic conditions in key geographic areas, which may affect profitability [134]. Competition and Market Position - The company operates in a highly competitive market for acquisition opportunities, facing competition from larger investment funds and companies [49]. - The dealer software and technology services operation faces intense competition and must adapt quickly to technological developments to maintain market position [128]. - The payment processing services operation is vulnerable to cybersecurity risks and competition from larger firms, which may affect its market position [149]. Environmental and Social Risks - The company faces risks related to environmental damage and compliance costs, particularly in operations involving hazardous substances, which could lead to substantial fines or penalties [80]. - Increasingly stringent environmental legislation may result in higher operational costs that cannot be passed on to customers, adversely affecting growth prospects [82]. - Climate change poses risks to the construction operation, potentially leading to increased interruptions and shifts in client infrastructure priorities [142]. Management and Governance - The company is highly dependent on Brookfield for management and administration services, which may lead to conflicts of interest [184]. - Brookfield has no obligation to source acquisition opportunities for the company, which may limit growth potential [185]. - The Limited Partnership Agreement modifies fiduciary duties, potentially limiting remedies for conflicts of interest [194]. - Conflicts of interest may arise due to the independent operation of Brookfield and Oaktree, potentially impacting investment opportunities and decisions [205]. Financial Structure and Capital Management - Access to capital is crucial for funding acquisitions and capital projects, and misjudgments in capital requirements could lead to negative financial consequences [61]. - The company relies on distributions from the Holding LP and its operating businesses to meet financial obligations, with potential restrictions on these distributions due to local laws and contractual agreements [212]. - The company anticipates that distributions will primarily assist in covering expenses and making distributions to unitholders, rather than generating independent revenue [213].

Financial Data and Key Metrics Changes - The company achieved record full-year adjusted EBITDA of $2.5 billion, reflecting an 11% increase compared to the prior year, with adjusted EBITDA margins improving to 19% [7][19] - Adjusted EFO was reported at $2.9 billion, which included $2 billion of after-tax net gains on sales during the year [19] Business Line Data and Key Metrics Changes - Business Services segment generated full-year EBITDA of $900 million, up from $641 million in 2022, with adjusted EFO increasing to $636 million from $427 million [19] - Infrastructure segment reported adjusted EBITDA of $853 million, with adjusted EFO of $2.1 billion, benefiting from a $1.7 billion net gain on the sale of Nuclear Technology Services [20] - Industrial segment's adjusted EBITDA was $855 million, slightly down from $879 million in 2022, with record results in advanced energy storage offset by reduced contributions from other operations [20] Market Data and Key Metrics Changes - The company noted that the trading price of its units has been materially disconnected from their fundamental value, trading at less than 8.5x EBITDA compared to the S&P 500 at 14x [10] - The company has refinanced over $17 billion of nonrecourse borrowings, extending their duration without increasing the overall cost of debt [9] Company Strategy and Development Direction - The company is focusing on capital recycling initiatives, generating over $2 billion in proceeds, which has reduced corporate borrowings and strengthened its capital position [8] - The company plans to monetize larger investments, with the largest businesses performing exceptionally well, contributing significantly to earnings and cash flow [9][10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged headwinds in the global operating environment but noted that volumes have held up well, and they are monitoring geopolitical tensions affecting freight and commodity prices [13] - The company expects interest rates to have peaked, which should create opportunities for monetization and improve trading performance as rates decline [10][11] Other Important Information - Clarios, a key business unit, achieved record performance in 2023 and is expected to exceed $2 billion in EBITDA in the near term, with significant free cash flow generation [15] - The company ended the year with $2.1 billion of liquidity at the corporate level, providing ample capacity to support operations and growth [21] Q&A Session Summary Question: Clarios debt repayment and future deleveraging - Management indicated that the $850 million of debt repaid in 2023 is a level they can maintain in future years, targeting a leverage ratio of around 3.5 times for a potential IPO [24][28] Question: Market conditions for monetization - Management noted that bid-ask spreads are starting to narrow as interest rates have peaked, which should facilitate monetization opportunities [30] Question: Long-term hold of certain businesses - Management expressed that while they aim to recycle capital, some businesses, like the residential insurance business, may be held longer due to their strong cash flow generation [33] Question: Clarios IPO size and confidence - Management is targeting a smaller IPO size of $750 million to $1 billion, learning from previous attempts, and expressed confidence in the business's improved performance [36][38] Question: Capital allocation priorities - Management emphasized a balanced approach to capital allocation, focusing on deleveraging, liquidity, and selective investments [41] Question: Status of BRK Ambiental efficiency program - Management reported positive progress at BRK Ambiental, with improved margins and free cash flow, but noted that monetization will depend on market conditions [65]

BROOKFIELD, NEWS, Feb. 02, 2024 (GLOBE NEWSWIRE) -- Brookfield Business Partners (NYSE:BBUC, BBU, TSX:BBUC, BBU.UN))) announced today financial results for the year ended December 31, 2023. "We had a successful 2023, achieving strong business performance and generating over $2 billion of proceeds from capital recycling initiatives which further enhances our liquidity position," said Anuj Ranjan, CEO of Brookfield Business Partners. "As we look to the future, the quality of our operations is the best in our ...

Financial Performance - As of September 30, 2023, total assets amounted to $88.3 billion, with revenues of $41.7 billion for the nine months ended September 30, 2023[223]. - Revenues for Q3 2023 decreased by $312 million to $14,399 million, primarily due to a $440 million decrease in business services segment revenues[278]. - For the nine months ended September 30, 2023, revenues decreased by $1,082 million to $41,663 million, mainly due to a $3,782 million decrease in road fuels operations[279]. - Net income for Q3 2023 was $49 million, compared to a net loss of $65 million in Q3 2022[276]. - Net income for the nine months ended September 30, 2023, was $205 million, compared to a loss of $117 million in the same period of 2022[357]. - Adjusted EBITDA for the three months ended September 30, 2023, was $655 million, compared to $611 million for the same period in 2022[350]. - Adjusted EBITDA for the nine months ended September 30, 2023, was $1,627 million, an increase from $2,381 million in the same period of 2022[357]. Segment Performance - The business services segment generated revenues of $24.3 billion, while the infrastructure services segment contributed $6.0 billion, and the industrials segment accounted for $11.3 billion[223]. - Adjusted EFO for the business services segment was $123 million for the three months ended September 30, 2023, compared to $136 million for the same period in 2022[318]. - Adjusted EBITDA for the infrastructure services segment for the three months ended September 30, 2023 was $228 million, an increase of $23 million compared to $205 million for the same period in 2022[331]. - Adjusted EBITDA for the industrials segment for the three months ended September 30, 2023 was $218 million, a decrease of $10 million from $228 million for the same period in 2022[338]. - The residential mortgage insurer contributed $64 million to Adjusted EBITDA for the three months ended September 30, 2023, up from $53 million for the same period in 2022[326]. Assets and Liabilities - Financial assets decreased by $99 million to $12,809 million as of September 30, 2023, compared to $12,908 million as of December 31, 2022[296]. - Total liabilities increased to $2,336 million as of September 30, 2023, compared to $2,279 million as of December 31, 2022[343]. - Non-recourse borrowings in subsidiaries decreased to $43,893 million as of September 30, 2023, from $44,593 million as of December 31, 2022[369]. - The partnership's net debt as of September 30, 2023 was $42,950 million, with a net debt-to-capitalization ratio of 70%[377]. Cash Flow and Liquidity - Total cash flow provided by operating activities for the nine months ended September 30, 2023 was $1,704 million, compared to $951 million for the same period in 2022, reflecting a significant increase[382]. - Total cash flow used in financing activities was $695 million for the nine months ended September 30, 2023, a decrease from $16,377 million in the same period of 2022[383]. - Total cash flow used in investing activities was $883 million for the nine months ended September 30, 2023, compared to $16,711 million for the same period in 2022[384]. - The partnership declared a quarterly distribution of $0.0625 per unit, payable on December 29, 2023, with an anticipated annualized distribution of approximately $0.25 per unit[377]. Strategic Initiatives - The partnership aims to enhance cash flows through an operations-oriented acquisition strategy and capital recycling into new investments[220]. - The partnership's strategy includes pursuing acquisitions through consortium arrangements with institutional partners, enhancing growth opportunities[367]. - The partnership has a revolving acquisition credit facility with Brookfield allowing borrowings of up to $1 billion, which remains undrawn as of September 30, 2023[374]. Tax and Regulatory Changes - Current income tax expense for Q3 2023 increased by $79 million to $211 million compared to $132 million in Q3 2022, primarily due to increased profitability in advanced energy storage and dealer software operations[288]. - Deferred income tax recovery for Q3 2023 increased by $126 million to $294 million compared to $168 million in Q3 2022, partly due to the transition to IFRS 17[288]. - The partnership adopted IFRS 17 effective January 1, 2023, impacting the reported results of its residential mortgage insurer[396]. - Amendments to IAS 12 regarding International Tax Reform - Pillar Two model rules were adopted, with no material impact on the financial statements[398]. Operational Highlights - The healthcare services operations manage 38 hospitals, primarily generating revenue from private health insurance and government agreements[231]. - The advanced energy storage operations manufacture and distribute over 150 million batteries per year, powering one in three cars globally[253]. - The water and wastewater operations in Brazil provide services to over 16 million people across more than 100 municipalities[258]. - The offshore oil services operations emerged from Chapter 11 restructuring with a deleveraged balance sheet, holding approximately 53% economic interest post-restructuring[247].

Financial Data and Key Metrics Changes - Adjusted EBITDA for Q3 2023 increased to a record $655 million, with an adjusted EBITDA margin improving to 19%, up more than 100 basis points year-over-year [4][20] - Adjusted EFO for Q3 was $288 million, with an adjusted EFO of $218 million excluding gains [20] Business Line Data and Key Metrics Changes - Infrastructure Services generated adjusted EBITDA of $228 million, up from $205 million last year, benefiting from improved performance in work access services and modular building leasing [20] - Industrials segment adjusted EBITDA was $218 million, down from $228 million last year, with strong performance in advanced energy storage offset by lower contributions from graphite electrode operations [21] - Business Services segment adjusted EBITDA increased to $238 million from $213 million, driven by strong results in residential mortgage insurance and dealer software services [21] Market Data and Key Metrics Changes - Global container rates have normalized to pre-COVID levels, improving international shipping options [11] - Raw material prices have decreased, with some prices down close to 25% from peak levels earlier this year [11] Company Strategy and Development Direction - The company is focused on capital recycling, with the $8 billion sale of Westinghouse expected to close soon, generating about $1.5 billion in proceeds [6] - The company is committed to enhancing value through share buybacks, trading at less than 8 times annual EBITDA compared to the broader S&P 500 at 13 times [9] Management's Comments on Operating Environment and Future Outlook - Management noted that while certain regions face challenges, the overall operating environment is improving, with costs for raw materials and logistics stabilizing [11][12] - The company is optimistic about Clarios, expecting it to perform better next year than this year, driven by strong management and operational improvements [50] Other Important Information - The company has refinanced nearly a third of its non-recourse borrowings this year without increasing overall debt costs [6] - Clarios is generating over $500 million in free cash flow annually, with a focus on deleveraging [8] Q&A Session Summary Question: Any capital allocation considerations post-Westinghouse transaction? - Management confirmed ongoing share buybacks as part of their normal course issuer bid, with no additional considerations at this time [27][28] Question: Will corporate debt continue to decrease? - The long-term goal remains to eliminate permanent corporate debt, with proceeds from sales being used to pay down debt [30] Question: Impact of UAW strike on Clarios? - A short strike at the Toledo plant had minimal impact, allowing the company to catch up on inventory levels [32] Question: Clarios EBITDA contribution details? - The strong EBITDA growth was primarily due to organic growth, with no significant one-time factors [38] Question: Rationale for partial sale of Everise? - The decision to sell a portion of Everise was based on achieving a strong return while retaining upside potential [40] Question: Future asset sales? - The company plans to continue selling smaller businesses to generate capital and focus on larger operations [52]

THREE MONTHS ENDED SEPTEMBER 30, 2023 Primary FontColour Print Important Cautionary Notes R34 G34 B35 On-screen R17 G17 B17 All amounts in this Supplemental Information are in U.S. dollars unless otherwise specified. Unless otherwise indicated, the statistical and financial data in this document is presented as at September 30, 2023. CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION Logo & Divider Slide Font Note: This Supplemental Information contains “forward-looking information” w ...

Financial Performance - Total assets as of June 30, 2023, amounted to $90.3 billion, with revenues of $27.3 billion for the six months ended June 30, 2023[230]. - For Q2 2023, the company reported revenues of $13,506 million, a decrease of $1,101 million (7.5%) compared to $14,607 million in Q2 2022[285]. - Net income for Q2 2023 was $41 million, down from $280 million in Q2 2022, resulting in a loss of $0.22 per limited partner unit compared to a gain of $0.62 per unit in the prior year[283]. - Net income for the six months ended June 30, 2023, was $270 million, compared to a loss of $72 million in the same period of 2022[366]. - Other income for Q2 2023 increased to $138 million, compared to a net expense of $218 million in Q2 2022, driven by net gains on debt modifications and extinguishments[293]. - The net income for the three months ended June 30, 2023, was $41 million, while the net income for the six months ended June 30, 2023, was $244 million[358][361]. Revenue Segmentation - The business services segment generated revenues of $15.8 billion, while the infrastructure services segment contributed $4.0 billion, and the industrials segment accounted for $7.4 billion[230]. - Revenues from nuclear technology services operations were $1,006 million and $2,062 million for the three and six months ended June 30, 2023, with direct operating costs of $898 million and $1,833 million respectively[250]. - Adjusted EFO for the business services segment was $119 million for the three months ended June 30, 2023, compared to $138 million for the same period in 2022[328]. - Adjusted EFO in the infrastructure services segment for the three months ended June 30, 2023 was $88 million, a decrease of $36 million (29.0%) from $124 million in the same period of 2022[341]. - Adjusted EFO in the industrials segment for the three months ended June 30, 2023 was $63 million, a decrease of $38 million (37.6%) from $101 million in the same period of 2022[348]. Operational Highlights - The partnership's residential mortgage insurer is the largest private sector residential mortgage insurer in Canada, significantly increasing access to homeownership for Canadian residents[233]. - The dealer software and technology services operations closed the sale of a non-core division for approximately $490 million, resulting in a gain of $87 million[236]. - The healthcare services operations operate 38 hospitals, primarily generating revenues from private health insurance funds and government-related bodies[237]. - The construction operations focus on high-quality construction, primarily on large-scale and complex landmark buildings and social infrastructure[238]. - The offshore oil services operations emerged from Chapter 11 restructuring with a deleveraged balance sheet, maintaining approximately 53% economic interest[253]. Cash Flow and Liquidity - Cash flow from operating activities for the six months ended June 30, 2023, was $560 million, an increase from $224 million for the same period in 2022[394]. - Total cash flow used in financing activities was $102 million for the six months ended June 30, 2023, compared to $8,859 million provided in the same period in 2022[395]. - Cash flow provided by investing activities was $337 million for the six months ended June 30, 2023, a significant improvement from $9,215 million used in the same period in 2022[397]. - The partnership's consolidated net debt was $43,876 million, with a net debt-to-capitalization ratio of 70%[390]. - Liquidity is managed through cash flows from operations, credit facilities, and monetizing mature operations, with a strong liquidity profile to pursue acquisition opportunities[376]. Capital Expenditures and Assets - Capital expenditures for the six months ended June 30, 2023, included $301 million in maintenance capital and $1,045 million in growth capital, compared to $328 million and $581 million, respectively, for the same period in 2022[310]. - Financial assets increased by $521 million to $13,429 million as of June 30, 2023, compared to $12,908 million as of December 31, 2022[303]. - Inventory and other assets increased by $725 million to $8,284 million as of June 30, 2023, compared to $7,559 million as of December 31, 2022[307]. - Property, plant & equipment (PP&E) increased by $403 million to $16,296 million as of June 30, 2023, compared to $15,893 million as of December 31, 2022, driven by $1,650 million in additions and impacted by foreign exchange movements of $175 million[308]. Debt and Financing - The partnership's financing arrangements totaled $44,908 million as of June 30, 2023, reflecting an increase primarily due to new borrowings for acquisitions[381]. - The weighted average interest rate on debt outstanding was 7.9% as of June 30, 2023, with approximately 50% of non-recourse borrowings being fixed or hedged[382]. - The partnership has a total capacity of $2.3 billion in bilateral credit facilities, with $310 million available as of June 30, 2023[384]. - The revolving acquisition credit facility with Brookfield allows borrowings of up to $1 billion, maturing on April 27, 2028, and will decrease to $500 million on April 27, 2024[385]. Regulatory and Accounting Changes - The partnership adopted IFRS 17 effective January 1, 2023, impacting the reported results of its residential mortgage insurer[409]. - The transition impact of IFRS 17 resulted in a $17 million increase to opening equity on January 1, 2022[409]. - The adoption of IFRS 17 does not materially impact cash flows generated by the partnership[410]. - Amendments to IAS 12 were adopted on January 1, 2023, with no material impact on the partnership's financial statements[411].

Brookfield Business Partners L.P. (NYSE:BBU) Q2 2023 Earnings Conference Call August 4, 2023 9:30 AM ET Company Participants Alan Fleming - Head-Investor Relations Cyrus Madon - Chief Executive Officer Anuj Ranjan - President Jaspreet Dehl - Chief Financial Officer Patrick McHugh - Chief Executive of Scientific Games Conference Call Participants Gary Ho - Desjardins Capital Markets Andrew Kuske - Credit Suisse Jaeme Gloyn - National Bank Devin Dodge - BMO Capital Markets Nik Priebe - CIBC Capital Markets Op ...

UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF BROOKFIELD BUSINESS PARTNERS L.P. As at March 31, 2023 and December 31, 2022 and for the three months ended March 31, 2023 and 2022 1 INDEX TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF BROOKFIELD BUSINESS PARTNERS L.P. Unaudited Interim Condensed Consolidated Statements of Financial Position 3 Unaudited Interim Condensed Consolidated Statements of Operating Results 4 Unaudited Interim Condensed Consolidated Statement ...

Brookfield Business Partners L.P. (NYSE:BBU) Q1 2023 Earnings Conference Call May 5, 2023 10:30 AM ET Company Participants Alan Fleming – Head-Investor Relations Cyrus Madon – Chief Executive Officer Jaspreet Dehl – Chief Financial Officer Mark Wallace – Chief Executive Officer-Clarios Denis Turcotte – Managing Partner-Private Equity Conference Call Participants Geoff Kwan – RBC Capital Markets Andrew Kuske – Credit Suisse Gary Ho – Desjardins Capital Markets Devin Dodge – BMO Capital Markets Jaeme Gloyn – ...