“We had a successful 2021, generating strong financial performance and committing
| Three Months Ended |
Twelve Months Ended |
||||||||||
| US$ millions (except per unit amounts), unaudited | 2021 | 2020 | 2021 | 2020 | |||||||
| Net income (loss) attributable to unitholders1 | $ | 41 | $ | 85 | $ | 643 | $ | (169 | ) | ||
| Net income (loss) per limited partnership unit2,3 | $ | (0.25 | ) | $ | 0.56 | $ | 3.28 | $ | (1.13 | ) | |
| Adjusted EBITDA4 | $ | 550 | $ | 423 | $ | 1,761 | $ | 1,384 | |||
Net income attributable to unitholders for the year ended
Adjusted EBITDA for the year ended
Operational Update
The following table presents Adjusted EBITDA by segment:
| Three Months Ended |
Twelve Months Ended |
||||||||||||
| US$ millions, unaudited | 2021 | 2020 | 2021 | 2020 | |||||||||
| Business Services | $ | 149 | $ | 92 | $ | 561 | $ | 271 | |||||
| Infrastructure Services | 212 | 156 | 613 | 602 | |||||||||
| Industrials | 225 | 195 | 713 | 604 | |||||||||
| Corporate and Other | (36 | ) | (20 | ) | (126 | ) | (93 | ) | |||||
| Adjusted EBITDA4 | $ | 550 | $ | 423 | $ | 1,761 | $ | 1,384 | |||||
Our Business Services segment generated Adjusted EBITDA of
Our Infrastructure Services segment generated Adjusted EBITDA of
Our Industrials segment generated Adjusted EBITDA of
The following table presents Adjusted Earnings From Operations5 (“Adjusted EFO”) by segment:
| Three Months Ended |
Twelve Months Ended |
||||||||||||
| US$ millions, unaudited | 2021 | 2020 | 2021 | 2020 | |||||||||
| Business Services | $ | 125 | $ | 86 | $ | 397 | $ | 229 | |||||
| Infrastructure Services | 160 | 95 | 396 | 364 | |||||||||
| Industrials | 141 | 131 | 879 | 336 | |||||||||
| Corporate and Other | (30 | ) | (17 | ) | (99 | ) | (59 | ) | |||||
Our Business Services segment generated Adjusted EFO of
Our Infrastructure Services segment generated Adjusted EFO of
Our Industrials segment generated Adjusted EFO of
Strategic Initiatives
- Modular
Building Leasing Services
InDecember 2021 we completed the acquisition ofModulaire Group (“Modulaire”) for$4.8 billion . Modulaire is a leading provider of modular building leasing services inEurope andAsia-Pacific .Brookfield Business Partners funded approximately$580 million of the$1.6 billion equity investment for a 36% ownership interest, with the balance from institutional partners. A portion of our investment may be syndicated to other institutional partners.
- Roofing Products Manufacturer
InJanuary 2022 we signed an agreement to acquireCupa Group , a leading provider of slate roofing products, for approximately$950 million . The transaction will be funded with approximately$390 million of equity, of which we intend to fund approximately 25% on closing, with the balance funded by institutional partners. We expect to close the transaction in the second quarter of 2022.
- Unit Repurchase Program
For the three months and twelve months endedDecember 31, 2021 we repurchased 759,572 and 1,946,491 ofBrookfield Business Partners L.P. units under our normal course issuer bid (NCIB).
Liquidity
We ended the year with approximately
Subsequent to year end, Brookfield Asset Management agreed to subscribe for up to
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 consolidated financial statements contained herein.
Brookfield Business Partners’ Letter to Unitholders and the Supplemental Information are available on our website https://bbu.brookfield.com under Reports & Filings.
Notes:
- Attributable to limited partnership unitholders, general partnership unitholders, special limited partnership unitholders and redemption-exchange unitholders.
- Average number of partnership units outstanding on a fully diluted time-weighted average basis, assuming the exchange of redemption-exchange units held by Brookfield Asset Management for limited partnership units, for the three and twelve months ended
December 31, 2021 was 147.3 million and 148.0 million, respectively (2020: 149.2 million and 149.9 million, respectively). - Net income (loss) per limited partnership unit is equal to net income (loss) per unitholder less the incentive distribution declared to special limited partnership unitholders during the three and twelve months ended
December 31, 2021 . - Adjusted EBITDA is a non-IFRS measure of operating performance presented as net income and equity accounted income at the Partnership’s economic ownership interest in consolidated subsidiaries and equity accounted investments, respectively, excluding the impact of interest income (expense), net, income taxes, depreciation and amortization, gains (losses) on acquisition/disposition, net, transaction costs, restructuring charges, revaluation gains or losses, impairment expense, and other income (expense), net. The Partnership’s economic ownership interest in consolidated subsidiaries and equity accounted investments excludes amounts attributable to non-controlling interests consistent with how the Partnership determines net income attributable to non-controlling interests in its IFRS consolidated statement of operating results. The Partnership believes that Adjusted EBITDA provides a comprehensive understanding of the ability of its businesses to generate recurring earnings which allows users to better understand and evaluate the underlying financial performance of the Partnership’s operations and excludes items that the Partnership believes do not directly relate to revenue earning activities and are not normal, recurring items necessary for business operations. Please refer to the reconciliation of net income to Adjusted EBITDA included elsewhere in this release.
- Adjusted EFO was formerly referred to as Adjusted FFO and the methodology of calculating Adjusted EFO is unchanged from how Adjusted FFO was previously calculated. Adjusted EFO is the Partnership’s segment measure of profit or loss and is presented as net income and equity accounted income at the Partnership’s economic ownership interest in consolidated subsidiaries and equity accounted investments, respectively, excluding the impact of depreciation and amortization, deferred income taxes, transaction costs, restructuring charges, revaluation gains or losses, impairment expense, and other income or expense items. The Partnership’s economic ownership interest in consolidated subsidiaries and equity accounted investments excludes amounts attributable to non-controlling interests consistent with how the Partnership determines net income attributable to non-controlling interests in its IFRS consolidated statement of operating results. In order to provide additional insight regarding the Partnership’s operating performance over the lifecycle of an investment, Adjusted EFO includes realized disposition gains or losses, recorded in net income, other comprehensive income, or directly in equity, such as ownership changes. Adjusted EFO allows the Partnership to evaluate its segments on the basis of return on invested capital generated by its operations and allows the Partnership to evaluate the performance of its segments on a levered basis.
Please note that Brookfield Business Partners’ previous audited annual and unaudited quarterly reports have been filed on SEDAR and Edgar, and are available at https://bbu.brookfield.com under Reports & Filings. Hard copies of the annual and quarterly reports can be obtained free of charge upon request.
For more information, please contact:
| Media: Tel: +1 (416) 943-7937 Email: [email protected] |
Investors: Tel: +1 (416) 645-2736 Email: [email protected] |
Conference Call and 2021 Earnings Webcast Details
Investors, analysts and other interested parties can access Brookfield Business Partners’ 2021 results as well as the Letter to Unitholders and Supplemental Information on our website https://bbu.brookfield.com under Reports & Filings.
The conference call can be accessed via webcast on
Cautionary Statement Regarding Forward-looking Statements and Information
Note: This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of applicable Canadian and
Although we believe that our anticipated future results, performance or achievements expressed or implied 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 because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of
Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; including as a result of the ongoing novel coronavirus (SARS-CoV-2) pandemic, including any SARS-CoV-2 variants (collectively, “COVID-19”); the behavior of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; ability to collect amounts owed; catastrophic events, such as earthquakes; hurricanes and pandemics/epidemics; the possible impact of international conflicts and other developments including terrorist acts and cyber terrorism; and other risks and factors detailed from time to time in our documents filed with the securities regulators in
In addition, our future results may be impacted by various government mandated economic restrictions resulting from the ongoing COVID-19 pandemic and the related global reduction in commerce and travel and substantial volatility in stock markets worldwide, which may negatively impact our revenues, affect our ability to identify and complete future transactions, impact our liquidity position and result in a decrease of cash flows and impairment losses and/or revaluations on our investments and assets, and therefore we may be unable to achieve our expected returns. See “Risks Associated with the COVID-19 Pandemic” in the “Risks Factors” section included in our Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 20-F for the year ended
We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law,
Cautionary Statement Regarding the Use of Non-IFRS Measures
This news release contains references to Non-IFRS Measures. Adjusted EBITDA is not a generally accepted accounting measure under IFRS and therefore may differ from definitions used by other entities. We believe this measure is a useful supplemental measure that may assist investors in assessing the financial performance of
References to
Consolidated Statements of Financial Position
| As at | |||||||||
| US$ millions, unaudited | |||||||||
| Assets | |||||||||
| Cash and cash equivalents | $ | 2,588 | $ | 2,743 | |||||
| Financial assets | 8,550 | 8,796 | |||||||
| Accounts and other receivable, net | 5,638 | 4,989 | |||||||
| Inventory and other assets | 6,359 | 5,280 | |||||||
| Property, plant and equipment | 15,325 | 13,982 | |||||||
| Deferred income tax assets | 888 | 761 | |||||||
| Intangible assets | 14,806 | 11,261 | |||||||
| Equity accounted investments | 1,480 | 1,690 | |||||||
| 8,585 | 5,244 | ||||||||
| Total Assets | $ | 64,219 | $ | 54,746 | |||||
| Liabilities and Equity | |||||||||
| Liabilities | |||||||||
| Corporate borrowings | $ | 1,619 | $ | 610 | |||||
| Accounts payable and other | 19,636 | 17,932 | |||||||
| Non-recourse borrowings in subsidiaries of |
27,457 | 23,166 | |||||||
| Deferred income tax liabilities | 2,507 | 1,701 | |||||||
| $ | 51,219 | $ | 43,409 | ||||||
| Equity | |||||||||
| Limited partners | $ | 2,252 | $ | 1,928 | |||||
| Non-Controlling interests attributable to: | |||||||||
| Redemption-Exchange Units, Preferred Shares and Special Limited Partnership Units held by Brookfield Asset Management Inc. | 2,026 | 1,564 | |||||||
| Interest of others in operating subsidiaries | 8,722 | 7,845 | |||||||
| 13,000 | 11,337 | ||||||||
| Total Liabilities and Equity | $ | 64,219 | $ | 54,746 | |||||
Consolidated Statements of Operating Results
| US$ millions, unaudited | Three Months Ended |
Twelve Months Ended |
|||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||
| Revenues | $ | 13,480 | $ | 10,049 | $ | 46,587 | $ | 37,635 | |||||
| Direct operating costs | (12,469 | ) | (9,104 | ) | (43,151 | ) | (34,630 | ) | |||||
| General and administrative expenses | (261 | ) | (260 | ) | (1,012 | ) | (968 | ) | |||||
| Interest income (expense), net | (411 | ) | (394 | ) | (1,468 | ) | (1,482 | ) | |||||
| Equity accounted income (loss), net | (48 | ) | 31 | 13 | 57 | ||||||||
| Impairment expense, net | (239 | ) | (114 | ) | (440 | ) | (263 | ) | |||||
| Gain (loss) on acquisitions/dispositions, net | — | 95 | 1,823 | 274 | |||||||||
| Other income (expense), net | 44 | 188 | (34 | ) | 111 | ||||||||
| Income (loss) before income tax | 96 | 491 | 2,318 | 734 | |||||||||
| Income tax (expense) recovery | |||||||||||||
| Current | (106 | ) | (84 | ) | (536 | ) | (284 | ) | |||||
| Deferred | 125 | (27 | ) | 371 | 130 | ||||||||
| Net income (loss) | $ | 115 | $ | 380 | $ | 2,153 | $ | 580 | |||||
| Attributable to: | |||||||||||||
| Limited partners | $ | (19 | ) | $ | 45 | $ | 258 | $ | (91 | ) | |||
| Non-controlling interests attributable to: | |||||||||||||
| Redemption-Exchange Units held by Brookfield Asset Management Inc. | (18 | ) | 40 | 228 | (78 | ) | |||||||
| 78 | — | 157 | — | ||||||||||
| Interest of others in operating subsidiaries | 74 | 295 | 1,510 | 749 | |||||||||
Reconciliation of Non-IFRS Measures
| US$ millions, unaudited | Three Months Ended |
|||||||||||||||||||
| Business Services |
Infrastructure Services | Industrials | Corporate and Other |
Total | ||||||||||||||||
| Net income (loss) | $ | 204 | $ | (244 | ) | $ | 172 | $ | (17 | ) | $ | 115 | ||||||||
| Add or subtract the following: | ||||||||||||||||||||
| Depreciation and amortization expense | 121 | 186 | 325 | — | 632 | |||||||||||||||
| Impairment expense, net | — | 279 | (40 | ) | — | 239 | ||||||||||||||
| Other income (expense), net1 | (82 | ) | 24 | 13 | 1 | (44 | ) | |||||||||||||
| Income tax (expense) recovery | 26 | (28 | ) | 12 | (29 | ) | (19 | ) | ||||||||||||
| Equity accounted income (loss), net | (7 | ) | 85 | (30 | ) | — | 48 | |||||||||||||
| Interest income (expense), net | 63 | 110 | 229 | 9 | 411 | |||||||||||||||
| Equity accounted Adjusted EBITDA2 | 11 | 35 | 25 | — | 71 | |||||||||||||||
| Amounts attributable to non-controlling interests3 | (187 | ) | (235 | ) | (481 | ) | — | (903 | ) | |||||||||||
| Adjusted EBITDA | $ | 149 | $ | 212 | $ | 225 | $ | (36 | ) | $ | 550 | |||||||||
Notes:
- Other income (expense), net corresponds to amounts that are not directly related to revenue earning activities and are not normal, recurring income or expenses necessary for business operations. The components of other income (expense), net include
$26 million of net revaluation gains,$35 million of net gains on the disposition of property, plant and equipment,$39 million of restructuring charges,$39 million in transaction costs,$46 million of income related to the release of a non-recurring provision accrued for a contract dispute at one of the Partnership’s operations, and$15 million of other income. - Equity accounted Adjusted EBITDA corresponds to the Adjusted EBITDA attributable to the Partnership that is generated by its investments in associates and joint ventures accounted for using the equity method.
- Adjusted EBITDA that is attributable to non-controlling interests in consolidated subsidiaries.
Reconciliation of Non-IFRS Measures
| US$ millions, unaudited | Twelve Months Ended |
|||||||||||||||||||
| Business Services |
Infrastructure Services | Industrials | Corporate and Other |
Total | ||||||||||||||||
| Net income (loss) | $ | 619 | $ | (329 | ) | $ | 1,953 | $ | (90 | ) | $ | 2,153 | ||||||||
| Add or subtract the following: | ||||||||||||||||||||
| Depreciation and amortization expense | 465 | 705 | 1,113 | — | 2,283 | |||||||||||||||
| Impairment expense, net | (13 | ) | 279 | 174 | — | 440 | ||||||||||||||
| Gain (loss) on acquisitions/dispositions, net | — | — | (1,823 | ) | — | (1,823 | ) | |||||||||||||
| Other income (expense), net1 | (39 | ) | 51 | 17 | 5 | 34 | ||||||||||||||
| Income tax (expense) recovery | 184 | (10 | ) | 52 | (61 | ) | 165 | |||||||||||||
| Equity accounted income (loss), net | (11 | ) | 79 | (81 | ) | — | (13 | ) | ||||||||||||
| Interest income (expense), net | 239 | 360 | 849 | 20 | 1,468 | |||||||||||||||
| Equity accounted Adjusted EBITDA2 | 30 | 123 | 85 | — | 238 | |||||||||||||||
| Amounts attributable to non-controlling interests3 | (913 | ) | (645 | ) | (1,626 | ) | — | (3,184 | ) | |||||||||||
| Adjusted EBITDA | $ | 561 | $ | 613 | $ | 713 | $ | (126 | ) | $ | 1,761 | |||||||||
Notes:
- Other income (expense), net corresponds to amounts that are not directly related to revenue earning activities and are not normal, recurring income or expenses necessary for business operations. The components of other income (expense), net include
$242 million of net revaluation gains,$168 million of business separation expenses, stand-up costs and restructuring charges,$60 million in transaction costs,$40 million of net losses on debt extinguishment/modification, and$8 million of other expenses. - Equity accounted Adjusted EBITDA corresponds to the Adjusted EBITDA attributable to the Partnership that is generated by its investments in associates and joint ventures accounted for using the equity method.
- Adjusted EBITDA that is attributable to non-controlling interests in consolidated subsidiaries.
Reconciliation of Non-IFRS Measures
| US$ millions, unaudited | Three Months Ended |
|||||||||||||||||||
| Business Services |
Infrastructure Services | Industrials | Corporate and Other |
Total | ||||||||||||||||
| Net income (loss) | $ | 114 | $ | (93 | ) | $ | 376 | $ | (17 | ) | $ | 380 | ||||||||
| Add or subtract the following: | ||||||||||||||||||||
| Depreciation and amortization expense | 113 | 167 | 267 | — | 547 | |||||||||||||||
| Impairment expense, net | 13 | 101 | — | — | 114 | |||||||||||||||
| Gain (loss) on acquisitions/dispositions, net | (55 | ) | — | (40 | ) | — | (95 | ) | ||||||||||||
| Other income (expense), net1 | (2 | ) | 16 | (202 | ) | — | (188 | ) | ||||||||||||
| Income tax (expense) recovery | 29 | 5 | 87 | (10 | ) | 111 | ||||||||||||||
| Equity accounted income (loss), net | — | (15 | ) | (16 | ) | — | (31 | ) | ||||||||||||
| Interest income (expense), net | 57 | 103 | 227 | 7 | 394 | |||||||||||||||
| Equity accounted Adjusted EBITDA2 | 3 | 33 | 11 | — | 47 | |||||||||||||||
| Amounts attributable to non-controlling interests3 | (180 | ) | (161 | ) | (515 | ) | — | (856 | ) | |||||||||||
| Adjusted EBITDA | $ | 92 | $ | 156 | $ | 195 | $ | (20 | ) | $ | 423 | |||||||||
Notes:
- Other income (expense), net corresponds to amounts that are not directly related to revenue earning activities and are not normal, recurring income or expenses necessary for business operations. The components of other income (expense), net include
$298 million of net revaluation gains,$55 million of restructuring charges,$26 million of provisions for potential productivity impacts and damages related to business interruption and work stoppages which are not considered normal or recurring, and$29 million of other expenses. - Equity accounted Adjusted EBITDA corresponds to the Adjusted EBITDA attributable to the Partnership that is generated by its investments in associates and joint ventures accounted for using the equity method.
- Adjusted EBITDA that is attributable to non-controlling interests in consolidated subsidiaries.
Reconciliation of Non-IFRS Measures
| US$ millions, unaudited | Twelve Months Ended |
|||||||||||||||||||
| Business Services |
Infrastructure Services | Industrials | Corporate and Other |
Total | ||||||||||||||||
| Net income (loss) | $ | 330 | $ | (318 | ) | $ | 638 | $ | (70 | ) | $ | 580 | ||||||||
| Add or subtract the following: | ||||||||||||||||||||
| Depreciation and amortization expense | 435 | 665 | 1,065 | — | 2,165 | |||||||||||||||
| Impairment expense, net | (18 | ) | 245 | 36 | — | 263 | ||||||||||||||
| Gain (loss) on acquisitions/dispositions, net | (241 | ) | — | (33 | ) | — | (274 | ) | ||||||||||||
| Other income (expense), net1 | 158 | 175 | (455 | ) | 11 | (111 | ) | |||||||||||||
| Income tax (expense) recovery | 69 | 23 | 102 | (40 | ) | 154 | ||||||||||||||
| Equity accounted income (loss), net | (4 | ) | (9 | ) | (44 | ) | — | (57 | ) | |||||||||||
| Interest income (expense), net | 225 | 356 | 895 | 6 | 1,482 | |||||||||||||||
| Equity accounted Adjusted EBITDA2 | 16 | 117 | 33 | — | 166 | |||||||||||||||
| Amounts attributable to non-controlling interests3 | (699 | ) | (652 | ) | (1,633 | ) | — | (2,984 | ) | |||||||||||
| Adjusted EBITDA | $ | 271 | $ | 602 | $ | 604 | $ | (93 | ) | $ | 1,384 | |||||||||
Notes:
- Other income (expense), net corresponds to amounts that are not directly related to revenue earning activities and are not normal, recurring income or expenses necessary for business operations. The components of other income (expense), net include
$390 million of net revaluation gains,$258 million of net gains on debt extinguishment/modification,$134 million of provisions for potential productivity impacts and damages related to business interruption and work stoppages which are not considered normal or recurring,$128 million of non-recurring, one-time provisions including product line exits, contract write-offs, and production relocation costs, as a result of the recapitalization of one of the Partnership’s operations,$186 million of business separation expenses, stand-up costs and restructuring charges,$52 million in transaction costs, and$37 million of other expenses. - Equity accounted Adjusted EBITDA corresponds to the Adjusted EBITDA attributable to the Partnership that is generated by its investments in associates and joint ventures accounted for using the equity method.
- Adjusted EBITDA that is attributable to non-controlling interests in consolidated subsidiaries.
Reconciliation of Net Income per Unit
| US$, unaudited |
Three Months Ended |
Twelve Months Ended |
||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Net income (loss) per unitholder1,2 | $ | 0.28 | $ | 0.56 | $ | 4.34 | $ | (1.13 | ) | |||
| Less: incentive distribution to special limited partners2 | (0.53 | ) | — | (1.06 | ) | — | ||||||
| Net income (loss) per limited partnership unit2,3 | $ | (0.25 | ) | $ | 0.56 | $ | 3.28 | $ | (1.13 | ) | ||
Notes:
- Attributable to limited partnership unitholders, general partnership unitholders, special limited partnership unitholders and redemption-exchange unitholders.
- Average number of partnership units outstanding on a fully diluted time-weighted average basis, assuming the exchange of redemption-exchange units held by Brookfield Asset Management for limited partnership units, for the three and twelve months ended
December 31, 2021 was 147.3 million and 148.0 million, respectively (2020: 149.2 million and 149.9 million, respectively). - Net income (loss) per limited partnership unit is equal to net income (loss) per unitholder less the incentive distribution declared to special limited partnership unitholders during the three and twelve months ended
December 31, 2021 .
Source:
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