Brookfield Corporation Q2 FY2025 earnings call

• Bruce Flatt noted strong second quarter results with distributable earnings before realizations increasing 13% YOY to $1.3 billion. Announced acquisition of Just Group, a U.K. leader in pension risk transfer solutions. - Macro environment is constructive with global equities at all-time highs, credit spreads tightened. Completed $55 billion of asset sales year-to-date. - Launched AI infrastructure strategy with development of AI factories. Focus on insurance operations, using balance sheet to back growing insurance. - Wealth Solutions business grew asset base, originated annuities, deployed capital. Operating businesses had strong cash flows and robust real estate performance with leasing activity and strong rents. - Monetization saw $55 billion of asset sales, including real estate, infrastructure, and energy sales with notable highlights like student housing exit and IPOs.

Asset Management: Distributable earnings were $650 million or $0.41 per share in the quarter and $2.7 billion or $1.72 per share over the last 12 months. Fee-bearing capital grew to $563 billion, resulting in fee-related earnings of $676 million, an increase of 10% and 16% respectively over the prior year quarter. Wealth Solutions: Distributable operating earnings were $391 million or $0.25 per share in the quarter and $1.6 billion or $1.02 per share over the last 12 months. Originated over $4 billion of retail and institutional annuities, total insurance assets reached $135 billion. Deployed $3.5 billion into Brookfield managed strategies at an average net yield of 8%. Operating Businesses: Distributable earnings were $350 million or $0.22 per share in the quarter and $1.7 billion or $1.07 per share over the last 12 months, supported by strong underlying fundamentals and resilient operating earnings.

• Asset Management expects fundraising momentum to continue into the second half of 2025 supporting further earnings growth. - Acquisition of Just Group expected to deliver return on equity in line with long-term target of 15% plus. - Board declared quarterly dividend of $0.09 per share, payable end of September. - Approved 3-for-2 stock split of Class A limited voting shares, payable October 9.

Q: Bart Dziarski asked about growth in P&C and how to get to $30 billion to $50 billion of equity.

A: Nicholas Goodman said focus is on organic growth initially in P&C, leveraging risk tolerance and Brookfield's operating experience.

Q: Kenneth Worthington inquired about carry and real estate dispositions.

A: Nicholas Goodman stated carry timing is broadly in line with plan, real estate transaction activity picking up with strong operating fundamentals and constructive capital markets.

Q: Mario Saric asked about evolution of balance sheet for insurance operations.

A: Nicholas Goodman said insurance business is more integrated into Brookfield, with focus on being a growth engine for BAM and efficient capital structure.

Q: Cherilyn Radbourne asked about AI infrastructure strategy and carried interest.

A: Nicholas Goodman said working on cornerstone investors for AI infrastructure, carried interest contributors include certain funds like Oaktree and initial infrastructure/real estate funds.

Q: Jaeme Gloyn asked about Wealth Solutions spread and real estate cash distributions.

A: Nicholas Goodman said spread is broadly consistent, real estate cash distribution reduction driven by residential land and housing business.

Q: Jaeme Gloyn followed up on real estate FFO.

A: Nicholas Goodman said residential impact and deleveraging, better capital markets, and core NOI growth will drive FFO growth in real estate.