Brookfield Asset Management Ltd. announced financial results that surpassed expectations and increased its quarterly dividend, driven by robust fundraising and effective capital deployment.
In the fourth quarter, the Toronto-based firm announced Management distributable earnings of US$586 million, or 36 cents U.S. per share, as stated on February 7th. This result exceeded the average estimate of 34 cents U.S. per share, which was predicted by analysts surveyed by Bloomberg.
At the end of the year, the organisation’s fee-bearing assets reached US$457 billion, reflecting a four percent growth since September. Presently, the firm oversees a total of US$916 billion. Its ambition is to attain US$1 trillion in fee-bearing assets by 2028.
The stock registered a 0.9 percent decrease during premarket trading in New York
Brookfield Asset Management emerged as an independent entity from its parent company, Brookfield Corp., in late 2022. The purpose of this spin-off was to oversee its fee-bearing assets, catering to shareholders who were interested in investing solely in its asset management business rather than its real estate and other tangible assets. With ambitious aspirations, the newly formed company established high targets for assets under management and expanded its range of products.
However, this strategic move coincided with the challenges posed by increasing interest rates and the aftermath of the pandemic, particularly impacting its real estate business, which constituted its second-largest segment. Despite these obstacles, Brookfield perceives the current turbulence in the property market as an opportunity and is actively seeking to raise a new real estate fund amounting to US$15 billion. On Wednesday, the firm announced the completion of the initial phase, securing US$8 billion for its fifth flagship real estate fund.
In the statement, President Connor Teskey expressed satisfaction with our company’s robust performance during our inaugural year after going public. He highlighted that we successfully secured a significant amount of capital, totaling US$143 billion. This impressive figure includes the US$93 billion raised and an additional anticipated US$50 billion from the closure of the American Equity Investment Life insurance account.
Brookfield had established a goal of achieving a total of US$150 billion in funds raised. The company successfully secured an impressive amount of US$10 billion during the initial closing of its second global transition fund. Furthermore, in December, Brookfield concluded a remarkable US$30 billion infrastructure fund.
During the previous two years, alternative asset managers have faced challenges in fundraising and executing deals due to the impact of higher interest rates. However, in a letter addressed to shareholders, Teskey and Brookfield’s CEO, Bruce Flatt, expressed a positive outlook regarding interest rates for the upcoming two years.
The executives conveyed their confidence in the central banks’ successful handling of inflation, which is expected to result in a global decline in interest rates during 2024 and 2025. They anticipate that this will lead to a flourishing capital market and resilient stock markets. Additionally, due to improved liquidity and significant reserves, they foresee a period of heightened transaction activity in the upcoming years. Consequently, valuations for real assets are predicted to respond accordingly. The executives also disclosed their intention to introduce several products to foster growth in different areas of their business.
Brookfield is a globally diversified company that focuses on investing in long-term, high-quality assets and businesses that are essential to the global economy. With our extensive experience of over a century as an owner and operator, we actively invest our own capital in various transactions, ensuring alignment of interests with our partners and investors. Our operational expertise, global reach, and substantial capital enable us to make a significant impact in all our endeavors.
With over $850 billion in assets under management, we have a strong presence in renewable power and transition, infrastructure, real estate, private equity, and credit sectors. We invite you to explore our website, www.brookfield.com, to learn more about our global businesses and the value we create.
However, we would like to caution you about the misuse of the Brookfield name and brand by fraudulent individuals and groups. They may create fake websites and engage in phishing scams to deceive potential job candidates and obtain personal or confidential information. It has come to our attention that fake Brookfield job offers are being posted on LinkedIn and other career sites. We urge you to exercise caution and verify the authenticity of any communication or job offer claiming to be from Brookfield.