Brookfield Infrastructure Partners (BIP) Q4 2023 earnings summary

Executive summary

• FY2023 FFO was $2.288 billion, up 10% YoY; FFO per unit rose 9% to $2.95, with 8% organic growth and a net positive contribution from asset rotations.

• Q4 FFO was $622 million, or $0.79 per unit, up 10% per unit YoY; organic growth was 7%.

• FY net income attributable to the partnership was $432 million versus $407 million; operating performance and capital recycling gains were partly offset by higher financing costs, transaction fees and lower hedge mark-to-market gains.

• The 2024 outlook was described as stronger, with capital recycling and deployment initiatives underway.

Financial highlights

• FY proportionate revenue was $7.308 billion and Adjusted EBITDA was $3.591 billion; FFO was $2.288 billion versus $2.087 billion in 2022.

• Q4 proportionate revenue was $1.922 billion and Adjusted EBITDA was $986 million, versus $1.571 billion and $811 million in Q4 2022.

• FY revenue was $17.931 billion versus $14.427 billion; AFFO was $1.838 billion versus $1.701 billion, while Adjusted Earnings were $835 million versus $873 million.

• Q4 net loss attributable to the partnership was $73 million versus net income of $48 million; Adjusted Earnings were $287 million versus $319 million.

Outlook and guidance

• Long-term targets: 12–15% annual return on invested capital and 6–9% organic FFO-per-unit growth, driven by indexation, GDP-linked volume and reinvested cash flows.

• Target annual distribution growth of 5–9%; the quarterly distribution rose 6% YoY to $0.405 per unit, payable March 29, 2024.

• Target a 60–70% FFO payout ratio; FY2023 payout was 66%.

• Target $2 billion of capital recycling in 2024; ~$7.6 billion of capital was expected to be commissioned, and FY2024 maintenance capex was estimated at $625–680 million.

• ATC India acquisition, valued at $2 billion, was expected to close in H2 2024 subject to approvals, with ~$150 million of equity consideration.