Brookfield Business Partners L.P.(US:BBU)2023-11-06 16:00Financial 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].