13/02/2025 - Brookfield Corporation: 2024 Fourth Quarter Supplemental Information

[X]

2024 Full Year Highlights

$6B

15%

DISTRIBUTABLE EARNINGS ("DE")

ANNUAL GROWTH IN DE PER SHARE,

BEFORE REALIZATIONS

$160B

RECORD

DEPLOYABLE CAPITAL

PERFORMANCE UPDATE

We generated $1.6 billion ($1.01/share) of Distributable Earnings ("DE") during the quarter and $6.3 billion ($3.96/ share) over the year.

DE before realizations were a record $1.5 billion ($0.94/share) for the quarter and $4.9 billion ($3.07/share) for the year, representing growth of 24% and 15% per share over the prior year periods, respectively.

Asset Management:

  • Distributable earnings were $694 million ($0.44/share) in the quarter and $2.6 billion ($1.67/share) for the year.
  • Fee-relatedearnings increased by 17% compared to the prior year quarter, driven by an 18% increase in fee-bearing capital over the prior year to $539 billion as at December 31, 2024. Total inflows were over $135 billion in 2024.
  • Our latest round of flagship funds have raised approximately $40 billion across our second global transition fund strategy, our fifth opportunistic real estate fund strategy, and our flagship opportunistic credit fund strategy. Heading into 2025, we expect to hold final closes for our latest flagship funds and continue to actively deploy capital, which should contribute to strong earnings growth.
  • Distributions or DE from direct investments were $220 million in the quarter and $909 million for the year.

Wealth Solutions:

  • Distributable operating earnings were $421 million ($0.26/share) in the quarter and $1.4 billion ($0.85/share) for the year.
  • Insurance assets increased to over $120 billion, as we originated approximately $19 billion of retail and institutional annuity sales in 2024. We continue to diversify the business by growing our pension risk transfer capabilities and expanding into new markets. An example of this is the completion of our first reinsurance transaction in the U.K., at $1.3 billion which closed in the fourth quarter.
  • The average investment portfolio yield was 5.4%, 1.8% higher than the average cost of capital. As we continue to rotate the investment portfolio, annualized earnings for the business are well positioned to grow from approximately $1.6 billion today to $2 billion in the near term.
  • We are raising close to $2 billion of retail capital per month through our combined wealth solutions platforms.

Operating Businesses:

  • Distributable earnings were $562 million ($0.35/share) in the quarter and $1.6 billion ($1.03/share) for the year.
  • Operating Funds from Operations in our renewable power, transition and infrastructure businesses increased by 10% over the prior year. Our private equity business continues to contribute resilient, high-quality cash flows. Our core real estate portfolio continues to grow its same-store NOI, delivering a 4% increase over the prior year quarter.
  • In our real estate business, we signed close to 27 million square feet of office and retail leases during the year. Rents on the newly signed leases were approximately 35% higher compared to those leases expiring in the fourth quarter. Also during the fourth quarter, our DE benefited from monetizing a land parcel within our North American residential operations.
  • As real estate markets continue to recover in the coming years, we expect earnings and valuations of the business to strengthen.

Monetization Activity:

  • During the year, we closed nearly $40 billion of asset sales at strong returns, which include a portfolio of U.S. manufactured housing assets and several renewable power and infrastructure assets globally. With the pick-up in transaction activity, we expect this momentum to accelerate into 2025.
  • We realized $1.4 billion ($0.89/share) of gains on dispositions during the year, mainly from the sale of BAM shares to AEL shareholders in the second quarter of 2024.
  • We generated unrealized carried interest of $2.7 billion for the year, taking the total accrued unrealized carried interest balance to $11.5 billion at year end. We recognized approximately $400 million of net realized carried interest into income in 2024, and we expect to realize significant carried interest as we actively monetize assets in the coming years.

Q4 2024 Supplemental Information

Brookfield Corporation 2

2024 Full Year Highlights cont'd

CAPITAL ALLOCATION

  • Over the year, we returned $1.5 billion of capital to our shareholders via regular dividends and share repurchases, with total share buybacks of approximately $1 billion of Class A shares in the open market, adding approximately 80 cents of value to each remaining share. In 2025 so far, we have repurchased over $200 million of shares.
  • The balance of our distributable earnings over the year were invested back into the business-the strategies managed by BAM, our wealth solutions business and our operating businesses.

LIQUIDITY

As at December 31, 2024, we had $6.2 billion of corporate liquidity, including approximately $2.9 billion of cash and financial assets and $3.4 billion of undrawn credit lines.

  • Our balance sheet is robust and remains conservatively capitalized, with a corporate debt to market capitalization ratio of 13%. In addition, our corporate debt at the Corporation has a weighted-average interest rate of 4.7%, a remaining term of 14 years and today we have no maturities through to the end of 2025.
  • We have record deployable capital of approximately $160 billion, which includes $68 billion of cash, financial assets and undrawn credit lines at the Corporation, our affiliates and our wealth solutions business.
  • We had an active year in the capital markets. We executed approximately $135 billion of financings, including issuing $700 million of 30-year subordinated notes and a $1 billion, 7-year non-recourse loan to a large institutional partner of ours, the proceeds of which will mainly be directed towards share repurchases.

CONTENTS

Highlights and Overview

2

Common Share Information

26

Detailed Analysis

Reconciliation of IFRS to non-IFRS Measures

27

Asset Management

12

Endnotes

33

Wealth Solutions

16

Glossary of Terms

37

Operating Businesses

17

3 Brookfield Corporation

Q4 2024 Supplemental Information

Brookfield Corporation

We are a leading global investment firm focused on building long-term wealth for institutions and individuals around the world. We have one of the largest pools of discretionary capital globally, which is deployed across our three core businesses -Asset Management, Wealth Solutions, and our Operating Businesses. Through our core businesses, we invest in real assets that form the backbone of the global economy to deliver strong risk-adjusted returns to our stakeholders. Over the long term, we are focused on delivering 15%+ annualized returns to shareholders.

DE represents the deconsolidated earnings of the Corporation that are available for distribution to shareholders and it is our primary performance metric. DE is comprised of distributions we receive from our Asset Management, Wealth Solutions and Operating Businesses. It also includes disposition gains on our principal investments and our share of realized carried interest that is earned by our Asset Management business. We target growing our DE by 15% or more each year.

We create value for our shareholders in two ways. First, we participate in increases in the earnings and value of our Asset Management, Wealth Solutions and Operating Businesses, which enables us to increase our cash dividends paid to shareholders. Second, we are able to deploy the substantial free cash flows we retain towards supporting the growth of our three businesses, new strategic opportunities and share buybacks.

How value is created

Key Performance Metrics

How value is measured

Asset Management

Brookfield Asset Management

• Increase fee-bearing capital

• Distributable earnings

• Market price of BAM

("BAM") is a leading global alternative

• Maintain cost discipline

• Fee-bearing capital

asset manager, with over $1 trillion of

as we scale

assets under management

• Fee-related earnings

• Achieve strong investment

• Generated unrealized carried

• Multiple of target carried

returns and, in turn, earn

interest

interest, net

carried interest

• Realized carried interest, net

• Accumulated unrealized

carried interest, net

In addition, we invest discretionary

• Increase cash income

• Distributions from direct

• Applicable valuation

capital into and alongside private

through organic levers

investments

methods on our direct

investments

funds managed by BAM and other

• Recycle underlying assets

• Disposition gains on direct

investments

investments

Wealth Solutions

Brookfield Wealth Solutions ("BWS")

• Acquire long duration and

• Cost of insurance liabilities

• Multiple of distributable

is a leading wealth solutions provider

predictable insurance liabilities

• Earnings on investment

operating earnings

focused on securing the financial

• Proactively manage risk of

portfolio

futures of individuals and institutions

underwritten liabilities

through a range of retirement

• Distributable operating

• Earn attractive risk-adjusted

services, wealth protection products

earnings

and tailored capital solutions

returns on our investment

portfolio in excess of the cost

of the insurance liabilities we

manage

Operating Businesses

We are invested in four global operating businesses in Renewable Power and Transition ("BEP"), Infrastructure ("BIP"), Private Equity ("BBU") and Real Estate ("BPG")

• Increase cash income through

• Operating FFO / Net operating

• Market price of public

organic levers

income / Adjusted EBITDA

affiliates (BEP, BIP, BBU)

• Recycle underlying assets

• Distributions from Operating

• Fair value under IFRS

Businesses

(BPG)

Capital Allocation

We allocate the free cash flows we receive to enhance value for our shareholders

• Increase in cash dividends

• Disposition gains on principal

• Share buybacks

investments

• Contribution to growth in DE &

• Support the growth of our

DE per share

three businesses

• New strategic investments

• Special dividends

  • Applicable valuation methods based on how capital is deployed

Q4 2024 Supplemental Information

Brookfield Corporation 4

Performance Highlights

Distributable Earnings

FOR THE YEARS ENDED DEC. 31 (MILLIONS)

$6,282

$6,274

$5,229

$4,806

$4,220

$4,223

$4,871

$3,825

$2,330

$2,993

2020

2021

2022

2023

2024

  • Distributable earnings before realizations, adjusted for special distribution
  • Realized carried interest and disposition gains from principal investments
  • Adjustment for special distribution1

Distributable Earnings per share2

FOR THE YEARS ENDED DEC. 31

$3.96

$3.96

$3.25

$3.03

$2.74

$2.66

$3.07

$2.38

$1.89

$1.51

2020

2021

2022

2023

2024

  • Distributable earnings before realizations, adjusted for special distribution
  • Realized carried interest and disposition gains from principal investments
  • Adjustment for special distribution1

Capital Returned to Common Shareholders

FOR THE YEARS ENDED DEC. 31 (MILLIONS)

$14,665

$13,099

$1,645

$1,496

$1,145

$538

$687

$1,082

$1,001

$419

$307

$646

$800

$879

$726

$436

$495

2020

2021

2022

2023

20243

  • Common distributions
  • Share repurchases
  • Special distributions4

Capital Returned per share

FOR THE YEARS ENDED DEC. 31

$8.99

$8.00

$1.07

$0.95

$0.36

$0.75

$0.43

$0.63

$0.69

$0.27

$0.19

$0.41

$0.48

$0.52

$0.56

$0.28

$0.32

20202

2021

2022

2023

20243

  • Common distributions
  • Share repurchases
  • Special distributions4

See endnotes.

5 Brookfield Corporation

Q4 2024 Supplemental Information

Distributable Earnings ("DE")

DE before realizations were a record $1.5 billion for the quarter and $4.9 billion for the year, an increase of 24% and 15% per share over the prior year periods, respectively

FOR THE PERIODS ENDED DEC. 31

Three Months

Full Year

Annualized1

2024

2023

2024

2023

Page Ref.

(MILLIONS, EXCEPT PER SHARE AMOUNTS)

BAM2,3

$

474

$

435

$

1,736

$

1,678

$

1,736

page 12

Direct investments

220

214

909

876

813

page 15

Asset Management

694

649

2,645

2,554

2,549

Wealth Solutions

421

253

1,350

740

1,559

page 16

BEP

107

102

428

417

428

page 17

BIP

84

79

336

319

336

page 18

BBU

8

9

35

36

22

page 19

BPG

351

218

855

733

730

page 20

Other

12

(8)

(28)

(43)

(28)

page 17

Operating Businesses

562

400

1,626

1,462

1,488

Corporate costs and other4,5,6

(179)

(93)

(750)

(533)

(899)

page 23

Distributable earnings before realizations7

1,498

1,209

4,871

4,223

$

4,697

Realized carried interest, net

108

100

403

570

page 13

Disposition gains from principal investments

-

3

1,000

13

page 24

Distributable earnings7

$

1,606

$

1,312

$

6,274

$

4,806

Per share8

Distributable earnings before realizations

$

0.94

$

0.76

$

3.07

$

2.66

Distributable earnings

1.01

0.83

3.96

3.03

3. BAM annualized DE includes $70 million of borrowing costs related to a $1 billion non-recourse loan issued to a large institutional partner in December 2024.

Asset Management

  • Generated DE of $694 million for the quarter and $2.6 billion for the year, mainly driven by a 17% increase in fee-related earnings ("FRE") compared to the prior year quarter due to strong fundraising momentum, with inflows of over $135 billion in 2024, and capital deployment across our private fund strategies. This includes distributions from direct investments of $220 million for the quarter and $909 million for the year.

Wealth Solutions

  • DE was $421 million for the quarter and $1.4 billion for the year, benefitting from contributions from the acquisition of AEL, organic growth and the strength of our investment performance.

Operating Businesses

  • Generated DE of $562 million for the quarter and $1.6 billion for the year, with cash distributions supported by the resilient earnings across our underlying businesses.

In the year, we recognized $403 million of net carried interest from realizations in private funds managed by BAM and generated $1.0 billion of disposition gains from principal investments, primarily related to a gain on the sale of a portion of our BAM shares to AEL shareholders.

See endnotes.

Q4 2024 Supplemental Information

Brookfield Corporation 6

Capital

We create value for our shareholders by increasing the cash flows generated by our investments and appreciation of capital over time as we execute operational improvements and disciplined recycling of underlying assets.

Our capital was approximately $175 billion on a blended basis as at December 31, 2024, on which we earn $5.6 billion of diversified, long-term, stable cash flows via dividends. Most of our earnings are retained for reinvestment. Over the year, we generated unrealized carried interest, net of costs, of $1.9 billion, which is not included in the annualized cash flow presented in the below table and instead is presented on page 13.

The following table provides a breakdown of our capital as at December 31, 2024 and 2023. We provide three methods for you to review: quoted prices, our IFRS values, and blended values. We recommend that you focus on the blended values as these include quoted market values and, since we have control over these assets, we believe we could liquidate for at least these values. Nonetheless, we provide this information so you can choose how to assess value.

AS AT DEC. 31

(MILLIONS, EXCEPT PER SHARE AMOUNTS)

Quoted1

IFRS

Blended2

No. of

2024

2023

2024

2023

2024

Annualized

Units

2023 Cash Flow3

BAM4

1,194

$ 63,704

$ 49,268

$

6,025

$

7,126

$

63,704

$

49,268

$

1,736

Target carried interest, net

N/A

N/A

N/A

N/A

N/A

27,260

25,980

-

Accumulated unrealized carried interest, net5

N/A

N/A

N/A

N/A

N/A

7,023

6,158

-

Direct investments

N/A

N/A

N/A

11,313

12,358

11,313

12,358

813

Asset Management

17,338

19,484

109,300

93,764

2,549

Wealth Solutions6,7,8

10,872

6,144

23,385

14,100

1,559

BEP

302

6,965

8,034

3,821

4,302

6,965

8,034

428

BIP

207

6,677

6,571

2,202

2,537

6,677

6,571

336

BBU8,9

89

2,120

3,058

1,879

3,291

2,120

3,058

22

BPG

Core

N/A

N/A

N/A

14,841

14,092

14,841

14,092

480

Transitional and Development10

N/A

N/A

N/A

8,244

8,321

9,849

9,783

250

Other

N/A

N/A

N/A

664

585

664

585

(28)

Operating Businesses

31,651

33,128

41,116

42,123

1,488

Total investments

59,861

58,756

173,801

149,987

5,596

Corporate and other

578

(589)

578

(589)

N/A 

Capital

60,439

58,167

174,379

149,398

$

5,596

Debt and preferred capital11

(18,565)

(16,493)

(18,565)

(16,493)

Capital, net

$41,874

$41,674

$

155,814

$

132,905

Per Share

$

26.13

$

25.80

$

97.24

$

82.29

4. BAM quoted, IFRS, and blended values are presented net of a $1 billion non-recourse loan issued to a large institutional partner in December 2024.

8. In the fourth quarter of 2024, our wealth solutions business acquired a $1 billion economic interest in BBU from the Corporation. On a combined basis with our wealth solutions business, we hold a 66% ownership interest in BBU.

Capital

Annualized Cash Flow

AS AT DEC. 31 (BILLIONS)

$174.4

AS AT DEC. 31 (BILLIONS)

$149.4

$128.2

$5.6

$4.8

$5.1

$58.3

$68.0

$2.8

$1.8

2020

2021

2022

2023

2024

2020

2021

2022

2023

2024

See endnotes.

7 Brookfield Corporation

Q4 2024 Supplemental Information

Capital Allocation

We allocate the free cash flows we receive from our businesses to enhance value for our shareholders

FOR THE PERIODS ENDED DEC. 31

Three Months

Full Year

2024

2023

2024

2023

(MILLIONS)

Sources

Distributable earnings, before realizations1,2

$

1,498

$

1,209

$

4,871

$

4,223

Realized carried interest, net

108

100

403

570

Disposition gains from principal investments

-

3

1,000

13

1,606

1,312

6,274

4,806

Return of capital

Dividends paid to common shareholders

(123)

(107)

(495)

(436)

Share repurchases3

(136)

(98)

(1,001)

(646)

Reinvestment in businesses

Capital allocated to Asset Management business4

(383)

(306)

(2,360)

(4,109)

Capital allocated to Wealth Solutions business

(421)

(253)

(2,304)

(740)

Capital allocated to Operating Businesses, net

-

123

(1,054)

306

(1,063)

(641)

(7,214)

(5,625)

Net financing activities

468

(905)

2,556

731

Other (uses) sources5

(516)

729

(766)

(793)

In-period change

$

495

$

495

$

850

$

(881)

We target paying a modest dividend so that we are able to deploy the majority of the substantial free cash flow we receive towards supporting the growth of our businesses, new strategic investments and share repurchases.

Over the year we allocated $7.2 billion of capital, primarily as follows:

  • $495 million of dividends paid to common shareholders;
  • Approximately $1 billion to repurchase 23.6 million BN common shares, at prices well below our view of intrinsic value;
  • $2.4 billion to invest into various strategies managed by BAM;
  • $2.3 billion investment in wealth solutions business to support continued growth; and
  • $1.1 billion primarily to opportunistically repay debt within our operating businesses.

Net financing activities of $2.6 billion relate to our senior bond issuances over the year, the issuance of a $700 million 30-year subordinated debt in December 2024, net of the repayment of maturing term notes and revolving facilities, as well as a $1 billion non-recourse loan issued to a large institutional partner in December 2024.

See endnotes.

Q4 2024 Supplemental Information

Brookfield Corporation 8

Liquidity Profile and Capital Structure

We manage our liquidity and capital resources on a group-wide basis and organize it into three principal tiers:

  1. The Corporation1, inclusive of our proportionate share of the liquidity of our asset management business;
  2. Our perpetual affiliates (BEP, BIP, BBU and BPG); and
  3. Managed funds or investments, either held directly or within perpetual affiliates.

LIQUIDITY

The Corporation has very few non-discretionary capital requirements. We maintain significant liquidity ($6.2 billion in the form of corporate cash and financial assets and undrawn credit facilities) at the corporate level to further enable the growth of the broader business. This does not include our ability to issue debt or monetize investments to replenish our liquidity.

On a group basis, as at December 31, 2024, we had record deployable capital of approximately $160 billion, which included corporate liquidity, perpetual affiliate liquidity, and uncalled private fund commitments. Uncalled fund commitments include third-party commitments available for drawdown in our private funds.

AS AT DEC. 31

Corporate Liquidity

Deployable Capital

2024

2023

2024

2023

(MILLIONS)

Cash and financial assets, net2

$

2,863

$

2,013

$

56,815

$

29,161

Undrawn committed credit facilities

3,361

2,533

10,989

9,009

Core liquidity

6,224

4,546

67,804

38,170

Third-party uncalled private fund commitments

-

-

91,463

85,658

Total liquidity

$

6,224

$

4,546

$

159,267

$

123,828

CAPITAL STRUCTURE

Virtually all of the debt within our business is issued by entities or assets within the funds, or other investing entities, that we manage and generally has no recourse to the Corporation. Only 6% of our consolidated debt is issued by, or has recourse to, the Corporation.

Our corporate capitalization was $65 billion as at December 31, 2024, with a debt to capitalization level of approximately 21% at the corporate level based on book values, which excludes virtually all of the value of our asset management business (see page 25 for details). Based on our market capitalization, the corporate debt to capitalization level was 13%.

  • Corporate borrowings excluding commercial paper totaled $13.0 billion, with a weighted-average term of 14 years, and a weighted-average interest rate of 4.7%.
  • Our corporate borrowings are supplemented by $4.3 billion of perpetual preferred shares with a weighted-average cost of 4.9%.

AS AT DEC. 31, 2024 (MILLIONS)

Corporate borrowing Term debt4

Perpetual preferred shares5

Average

Total3

Maturity

Term

Rate

2025

2026

2027

2028

2029

2030+

14

4.7 %

$ 12,965

$

-

$

1,091

$

348

$

1,050

$

1,000

$

9,476

perp.

4.9 %

4,333

-

-

-

-

-

n/a

$ 17,298

$

-

$

1,091

$

348

$

1,050

$

1,000

$

9,476

See endnotes.

9 Brookfield Corporation

Q4 2024 Supplemental Information

Distributable Earnings and Net Income

FOR THE PERIODS ENDED DEC. 31

Three Months

Full Year

2024

2023

2024

2023

(MILLIONS, EXCEPT PER SHARE AMOUNTS)

Operating activities

Asset Management

$

694

$

649

$

2,645

$

2,554

Wealth Solutions

421

253

1,350

740

Operating Businesses

562

400

1,626

1,462

Corporate activities and other

(179)

(93)

(750)

(533)

Distributable earnings before realizations

1,498

1,209

4,871

4,223

Realized carried interest, net

108

100

403

570

Disposition gains from principal investments1,2

-

3

1,000

13

Distributable earnings

1,606

1,312

6,274

4,806

Add: disposition gains in net income

405

1,227

484

1,536

Less: realized disposition gains

-

(3)

(1,000)

(13)

Fair value changes and other2

(494)

(1,450)

(2,221)

(2,684)

Depreciation and amortization2

(582)

(541)

(2,413)

(2,236)

Deferred income taxes2

(411)

160

15

398

Working capital, net

(92)

(6)

(498)

(677)

Net income attributable to shareholders3

$

432

$

699

$

641

$

1,130

Per share4,5

Distributable earnings before realizations

$

0.94

$

0.76

$

3.07

$

2.66

Distributable earnings

1.01

0.83

3.96

3.03

Net income6

0.25

0.42

0.31

0.61

See endnotes.

Q4 2024 Supplemental Information

Brookfield Corporation 10

Disclaimer

Brookfield Corporation published this content on February 13, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on February 13, 2025 at 12:10:11.571.

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