Brookfield Infrastructure Partners (NYSE: BIP), a Toronto, Ontario-based diversified infrastructure investor group, reported funds from operations (FFO) for the third quarter were $525 million, up 24 percent from $422 million in 3Q21. Organic growth for the quarter was 10 percent, reflecting the benefits of higher inflation levels that are impacting tariffs. FFO also gained from the commissioning of roughly $1.2 billion of capital projects in the last 12 months and approximately $2 billion of capital deployed in acquisitions over the same period.
BIP’s infrastructure assets comprise a global mix of Utilities, Transport, Midstream (natural gas distribution) and Data. Worldwide, the Data segment consists of 162,100 telecom towers and active rooftop sites, 13,200 fiber route-miles and 50 data centers. All segments showed high-single digit to double-digit FFO growth on a YoY basis. Continue Reading
“Brookfield Infrastructure had record quarterly results as a function of our high-quality asset base, proven risk management approach and execution of our asset rotation strategy,” said Sam Pollock, BIP CEO. “Our strategic and financial principles provide a basis to capitalize on deep value investments when these opportunities arise.”
Net income for the three-month period ended September 30, 2022 was $113 million, compared to $413 million in the prior year. Prior year results included a one-time gain of approximately $425 million from the sale of a U.S. energy business.
Strategic Initiatives
In August, BIP announced a partnership with Intel Corporation to invest in a $30 billion semiconductor foundry in Arizona, as Inside Towers reported. BIP will be providing approximately $15 billion over the construction period for a 49 percent interest in the facility. This investment is structured to achieve an attractive risk-adjusted return. The deal has parallels to other data investments such as hyperscale data centers that are generally contracted on a long-term basis, with highly creditworthy counterparties, where BIP does not assume technological risk.
For the remainder of 2022, the company will focus on closing the two announced transactions, HomeServe, a residential infrastructure and service offering in the U.S. and Europe, and the DFMG tower acquisition in Germany. Once closed, BIP’s attention turns to the execution of growth plans in both businesses.
With DFMG, BIP, teaming with DigitalBridge Group, acquired from Deutsche Telekom a marquee portfolio of 36,000 towers in Germany and Austria, Inside Towers reported. The deal also includes a greenfield development portfolio of an additional 5,200 build-to-suit towers. These additional towers are to be constructed over the next five years and are underpinned by the credit quality of Deutsche Telekom. In addition to the built-in organic growth, BIP plans to use this business as a platform for follow-on opportunities in the fragmented European telecom tower market.
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