Q4 2023 Brookfield Business Partners L.P. Earnings Call
Yeah.
Operator: Welcome to the Brookfield Business Partners fourth quarter 2023 results conference call and webcast. As a reminder, all participants are in a listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, simply press star 1 1 on your touchtone phone.
Welcome to the Brookfield business Partners' fourth quarter 2023 results conference call and webcast.
Minder, all participants are in a listen only mode and the conference is being recorded.
After the presentation, there will be an opportunity to ask questions.
And the question simply press Star one one on your Touchtone phone.
Alan Matthew Fleming: Now, I'd like to turn the conference over to Alan Fleming, Head of Investor Relations. Please go ahead, Mr. Fleming. Before we begin, I'd like to remind you that, in responding to questions and talking about our growth initiatives and our financial and operating performance, we may make forward-looking statements. These statements are subject to known and unknown risks, and future results may differ materially.
Now I'd like to turn the conference over to Alan Fleming head of Investor Relations. Please go ahead Mr. Fleming.
Thank you operator and good morning.
Before we begin I'd like to remind you that in responding to questions and talking about our growth initiatives and our financial and opera.
Performance, we may make forward looking statements.
Statements are subject to known and unknown risks and future results may differ materially for further information on known risk factors I encourage you to review our filings with the securities regulators in Canada, and the U S. Both of which are available on our website.
Alan Matthew Fleming: For further information on known risk factors, I encourage you to review our filings with the securities regulators in Canada and the U.S., both of which are available on our website. We'll begin the call today with a few opening remarks from Cyrus Madden, our Executive Chairman. Anuj Ranjan, our Chief Executive Officer, will then provide an update on our business performance and strategic initiatives. He will then turn the call over to Dennis Turcotte, our Chief Operating Officer, to share an update on our operating environment and progress at Clare. Jasprey Dell, our Chief Financial Officer, will finish with a discussion of our financial results. The team will then be available to take your questions. Thank you, Alan. Good morning, everyone.
We'll begin the call today with a few opening remarks from Cyrus Madden executive Chairman.
Our news Ranjan, our Chief Executive Officer will then provide an update on our business performance and strategic initiatives.
We'll then turn the call over to Dennis <unk>, our Chief operating officer to share an update on our operating environment and progress that clear yes.
Jeffrey <unk>, our Chief Financial Officer will finish with a discussion of our financial results. The team will then be available to take your questions I'd like to now pass the call over to Sars. Thank you Alan and good morning, everyone. Thanks, very much for joining us on the call today.
Cyrus Madden: Thanks very much for joining us on the call today. We've been very busy over the last few months, we had a super strong fourth quarter, it capped off a great year for our business, and I'm very pleased to inform you that our Board of Directors has appointed Anuj as Chief Executive Officer of Brookfield Business Partners. Anuj and I have worked together for nearly 20 years.
We've been very busy over the last few months.
Super strong fourth quarter capped off a great year for our business.
I'm very pleased to inform you that our board of directors has appointed a new Chief Executive Officer of Brookfield business partners.
Huge and I have worked together for nearly 20 years. He's held a number of leadership roles across Brookfield. He's been instrumental in many of Brookfield activities over that time and since being appointed president of <unk>.
Cyrus Madden: He's held a number of leadership roles across Brookfield. He's been instrumental in many of Brookfield's activities over that time, and since being appointed president of BBU nearly two years ago, he's taken on increasing responsibility managing our day-to-day operations. I can tell you without any hesitation that Anuj is an exceptional investor and I'm confident he will seamlessly transition to the CEO role. I have joined the board in the capacity of Executive Chairman, where I will continue to remain fully active in the business.
Nearly two years ago.
He's taken on increasing responsibility managing our day to day operations I can tell you without any hesitation that.
An exceptional investor and I'm confident he will seamlessly transition into the CEO role.
I have joined the board in the capacity of executive Chairman I will continue to remain fully active in the business I will remain active in our investment process strategy and supporting our niche in the broader management team, including maintaining my role on our investment Committee.
Cyrus Madden: I will remain active in our investment process strategy, including maintaining my role on our investor board. These changes provide a strong foundation for our future, And while you should expect our business to continue to evolve, the guiding principles underpinning our track record of success and strong performance will remain undefeated. With that, I'd like to turn it over to our CEO, Anuj Ranjan. Thank you, Cyrus.
These changes provide a strong foundation for our future and while you should expect our business to continue to evolve the guiding principles underpinning our track record of success and strong performance will remain unchanged.
With that I'd like to turn it over to our CEO and huge ranjan.
Anuj Ranjan: And good morning, everyone. I'm excited to be here today and join you on my first call as CEO. I've had the opportunity to meet many of you over the past few years, and I look forward to spending more time with all of our investors. I also want to take this opportunity to thank you for your continued support and interest. We had a very successful 2020.
Thank you Sarah and good morning, everyone I'm excited to be here today and join you on my first call as CEO I've had the opportunity to meet many of you over the past few years and I look forward to spending more time with all of our investors.
I also want to take this opportunity to thank you for your continued support and interest in our business we.
We had a very successful 2023.
Anuj Ranjan: BBU achieved a record full-year adjusted EBITDA of $2.5 billion, and our adjusted EBITDA margins improved to 19%. These are great results that reflect the quality of our businesses and our hands-on approach to operational improvement, both of which continue to be our key to friends. Apart from strong financial results, we generated more than $2 billion of proceeds from our capital recycling initiative, which has meaningfully reduced our corporate borrowings and further strengthened our capital. We've made a real focused effort to sell a number of our smaller properties, and we are now coming into a cycle of monetizing our larger investments. As you know, we completed the sale of Westinghouse last November, and we are in the process of positioning a few other large businesses for sale, subject to market changes.
<unk> achieved record full year, adjusted EBITDA of $2 5 billion and our adjusted EBITDA margins improved to 19%. These are great results that reflect the quality of our businesses and our hands on approach to operationally improving them both of which continue to be our key differentiators.
Apart from strong financial results, we generated more than $2 billion of proceeds from our capital recycling initiatives.
Which has meaningfully reduced our corporate borrowings and further strengthen our capital position we've.
We've made a real focused effort to sell a number of our smaller businesses and we are now coming into a cycle of monetizing our larger investments.
As you know we completed the sale of Westinghouse last November and we are in the process of positioning a few other large businesses for sale subject to market conditions.
Anuj Ranjan: On that note, our largest businesses are performing exceptionally well. Adjusted EBITDA of our five largest companies, which we call the Fabulous Five, increased by more than 10% over the prior year, and their margins exceeded 25%. Together, these fabulous five make up the majority of our earnings and cash flow, and each is an incredible business in its own right. They are market leaders and provide mission-critical products and services to their customers, which cannot be easily replaced. This means they have real competitive advantages, strong pricing power, and resilient margins. What's amazing is that great businesses like... continue to have strong access to capital even in difficult financing markets like today. It is truly a tale of two cities.
On that note our largest businesses are performing exceptionally well.
Adjusted EBITDA of our five largest companies, which we call the fabulous five increased by more than 10% over the prior year and the margins exceeded 25%.
Together these fabulous five make up the majority of our earnings and cash flow and each is an incredible business in its own right. They are market leaders and provide mission critical products and services to their customers, which cannot be easily replaced this means we have real competitive advantages strong pricing power and resilient margins.
Whats amazing is that great businesses like these continue to have strong access to capital even in difficult financing markets like today. It truly is a tale of two cities for example over the past year, we've refinanced more than $17 billion of nonrecourse borrowings in our businesses and also extended their duration with.
Anuj Ranjan: For example, over the past year, we've refinanced more than $17 billion of non-recourse borrowings in our businesses and also extended their duration with no increase to our overall cost of debt. As the earnings of our businesses increase, we should be able to prudently increase their borrowing capacity and possibly generate even more revenue. While I'm thrilled with our performance, the trading price of our units has been materially disconnected from their fundamental value ever since central banks began tightening interest rates in early 2020. In a sense, our unit price has effectively become inversely correlated with the U.S. Treasury, And despite increasing 60% from the lows last year, our units still trade at less than 8.5x EBITDA, which compares to the S&P 500 at 14x We believe rates have peaked as central banks have signaled an end to the tightening cycle.
No increase to our overall cost of debt.
As the earnings of our business increase we should be able to prudently increase their borrowing capacity and possibly generate even more proceeds for btu.
Well I'm thrilled with our performance the trading price of our units has been materially disconnected from their fundamental value ever since central blanks.
Again tightening interest rates in early 2022.
In a sense our unit price has effectively become inversely correlated with U S treasury rates and.
And despite increasing 60% from the lowest last year are you still trade at less than eight five times EBITDA, which compares to the S&P 500 at 14 times or businesses that generate similar margins to our is trading at 15 times.
We believe rates have peaked.
Central banks have signaled an end to the tightening cycle over time as interest rates decline BB you should benefit in three ways.
Anuj Ranjan: Over time, as interest rates decline, BBU should benefit in three ways. First, transaction and IPO activities should create opportunities for us to monetize our larger-scale businesses and generate additional liquidity. Second, all else equal, even a 100 basis point decline in base rates should result in a $50 million improvement to our annual cash flow. And third, investors should resume valuing our units on a fundamental basis. We should materially improve our trading.
First transaction IPO activity should create opportunities for us to monetize our largest scale businesses and generate additional liquidity.
Second all else equal even a 100 basis point decline in base rates should result in a $50 million improvement to our annual cash flow.
And third investors should resume valuing our units on a fundamental basis, which should materially improve our trading performance.
Dennis Turcotte: Over the last five years, we've invested about $6 billion of capital to acquire a number of high-quality, Today, the quality of our earnings is the best in our history. The prospect for further value creation is strong as we continue to execute our business plans to improve performance and cash flow. When we take all of this together, this provides a great entry point. I'll now pass the call over to, Thanks.
Over the last five years, we've invested about $6 billion of capital to acquire a number of high quality businesses and today the quality of our earnings is the best in our history.
The prospects for further value creation as strong as we continue to execute our business plans to improve performance and cash flow.
When you take all of this together this provides a great entry point for <unk> I will now pass the call over to Dennis.
Dennis Turcotte: I thought I'd begin with a few comments on the global operating environment and then provide an update on our progress at Clarion. Starting with the global operating environment, like many, we've dealt with a number of headwinds over the past year, but with a few exceptions, volumes at our operations have held up well. We've also made progress passing through higher costs in a measured way to support our margin performance. Today, many elements that define the cost structures of our businesses have reset lower or are trending toward long-term norms. That said, global labor markets remain tight in certain areas.
Thanks <unk>.
I thought I'd begin with a few comments on the global operating environment, and then provide an update on our progress at <unk>.
Starting with the global operating environment like many we've dealt with a number of headwinds over the past year, but with a few exceptions volumes at our operations have held up well.
<unk> also made progress passing through higher cost in a measured way to support our margin performance.
Many elements that define the cost structures of our businesses have reset lower or are trending toward long term norms.
That said global labor the labor markets remain tight in certain areas.
Dennis Turcotte: We're also keeping a close eye on recent geopolitical tension in the Red Sea, which has had a direct impact on ocean freight and container rates, as well as certain commodities, including oil. At this point, we have not experienced any material disruption to our overall operation. We're working closely with all our managers and the conditions in the region to mitigate impacts caused by delays in rerouting shipments. Turning to Clarios, as many of you know, Clarios is the world's leading provider of low-voltage batteries, powering 1 in 3 vehicles globally.
We're also keeping a close eye on our recent geopolitical tension in the Red Sea, which has had a direct impact on ocean freight and container rates as well as certain commodities, including oil.
At this point, we have not experienced material disruption to our overall operations.
We're working closely with all our management teams to respond to rapidly changing conditions in the region and to mitigate impacts caused by delays and rerouting shipments of components and finished goods.
Turning to <unk> as many of you know <unk> is the world's leading provider of low voltage batteries powering one in three vehicles globally.
Dennis Turcotte: It's the only true global player in the market with unmatched scale and geographic reach. About 80% of its profitability is generated from the high margin. The business achieved a record performance in calendar year 2023 and is off to a good start in 2020, for with a plan. Doe Inn, and even D.A.M.
It's the only true global player in the market with unmatched scale and geographic reach about 80% of its profitability is generated from the high margin resilient aftermarket.
The business achieved a record performance in calendar year 2023, and is off to a good start in 2024 with a plan to exceed $2 billion in EBITDA in the near term.
Dennis Turcotte: Just as importantly, the business generates significant free cash flow each year. On March 23, Clarios repaid more than $850 million of debt, bringing its net debt-to-EBITDA leverage ratio down to less than 4.5 times, compared to 6.5 when we acquired it. It's important to remember that every single car, whether a full battery electric, hybrid, start-stop, or internal combustion..., requires a low-voltage battery like Last year, the business was awarded over 40 new electric vehicle platforms, nearly halfway toward achieving its recently increased goal of partnering on 300 electric vehicle platforms by 2030. The shift in automotive electrification is driving increased demand for advanced batteries, which are the low-voltage battery of choice for nearly every electric vehicle.
Just as importantly, the business generates significant free cash flow each year in 2023, <unk> repaid more than $850 million of debt, bringing its net debt to EBITDA leverage ratio down to less than four five times compared to $6 five when we acquired it.
It is important to remember that every single car, whether a full battery electric hybrid start stop or internal combustion engine requires a low voltage battery like the ones <unk> produces.
Last year the business was awarded over 40, new electric vehicle platforms and is nearly halfway toward achieving its recently increased goal of partnering on 300 electric vehicle platforms by 2027.
The shift in automotive electrification is driving increased demand for advanced batteries, which are the low voltage battery of choice for nearly every electric vehicle manufacturer in 2023, 29% of <unk> units sold were advanced batteries, which is up nearly threefold from 10% of its volumes in 2015.
Dennis Turcotte: In 2023, 29% of Clarios's units sold were advanced batteries, which is up nearly three-fold from 10% of its volume. By 2028, the company expects about 50% of its volumes will be advanced batteries. This is a meaningful tailwind for Clarios, given advanced batteries are technologically superior to standard low-voltage batteries and two times as profitable. Given some auto manufacturers are looking for low-voltage lithium-ion solutions... Clarius has invested
<unk>.
By 2028, the business expects about 50% of his volumes will be advanced batteries.
This is a meaningful tailwind for <unk> given advanced batteries are technologically superior to standard low voltage batteries and two times as profitable.
Given some auto manufacturers are looking for low voltage lithium ion solutions <unk> has invested in development to become a leader in this space with an application on multiple global platforms.
Dennis Turcotte: I'm a leader in this space with an application on multiple global platforms, and leveraging its global capabilities and 15 plus years of lithium-ion software experience, will work with OEMs to help meet their future requirements. Apart from growth, our team is continuing to work closely with management to advance our ongoing operational transformation plan. We have made meaningful progress on improving our overall equipment effectiveness, driven by a focus on attracting and retaining operational talent, and R.O.P.T.I.M.E., www.LiptonLiptonLipton.com, Preventive Maintenance Practices, and Selective Capital Investments. State-of-the-Art Manufacturing Technology
Averaging its global capabilities, and 15, plus years of lithium ion software and systems expertise to work with Oems to help meet their future requirements.
Apart from growth our team is continuing to work closely with management to advance our ongoing operational transformation plans.
We have made meaningful progress improving our overall equipment effectiveness driven by our focus on attracting and retaining operational talent, increasing our uptime through implementation of predictive and preventative maintenance practices and selective capital investments in state of the art manufacturing technology in particular.
We're focused on increasing AGM capacity and modest and moderate modernizing the entire manufacturing system, while doing so.
These enhancements have contributed to improved manufacturing throughput better inventory management and reduction of in process and finished goods scrap.
Dennis Turcotte: We are particularly focused on increasing AGM capacity and modernizing Pyra Manufacturing. These enhancements have contributed to improved manufacturing throughput, better inventory management, and reduction of in-process, Unscripted. Unscripted.
In addition, <unk> is revamping its sales inventory and operations planning process to better account for changing patterns and customer ordering practices and higher on time delivery expectations.
As a result customers are experiencing improved service levels as the business continues to focus on enhancing its commercial excellence by aligning its strategy and organization to deliver value added solutions that meet customer needs.
Overall, we're very pleased with the progress achieved that clarity as to date and have uncovered a range of opportunities to increase EBITDA and cash flow from this point forward.
Dennis Turcotte: In addition, Clarius is revamping its sales, inventory, and operations planning process to better account for changing patterns in customer ordering practices and Higher On-Time Delivery. As a result, customers are experiencing improved service levels as the business focuses on Enhancing its Commercial Excellence by aligning its strategy and organization to deliver value-added solutions that meet customers' needs. Overall, we're very pleased with the progress achieved at Clarius to date and have uncovered a range of A and Cash Flow from this point forward. Given the planned deleveraging and accelerated growth, the business will be ready for a potential public offering later this year. Thank you, and I'll now hand it over to Jaspreet for a review of our... Thanks, Dennis, and good morning everyone.
Given the planned deleveraging and accelerated growth the business will be ready for a potential public offering later this year.
And I'll now hand, it over to Jess <unk> for a review of our financial performance. Thanks, Jonathan Good morning, everyone.
Generated strong financial results in 2023.
Adjusted EBITDA increased to $2 5 billion, an increase of 11% compared to the prior year driven by increased performance of operations on a same store basis and contributions from recent acquisitions.
Adjusted <unk> was $2 9 billion and included $2 billion of after tax net gains on sales during the year.
Turning to our segment performance business services generated full year EBITDA of 900 million compared to $641 million in 2022.
Adjusted <unk> was $636 million, an increase from $427 million in 2022.
Results benefited from increased contributions from our dealer software and technology services operation.
And strong performance at our residential mortgage insurer.
Jaspreet Dell: We generated strong financial results in 2020. Adjusted EBITDA increased to $2.5 billion, an increase of 11% compared to the prior year, driven by increased performance of operations on a same-store basis and contributions from recent assets. Adjusted EFO was $2.9 billion and included $2 billion of after-tax net gains on sales during the period.
During the year, our residential mortgage insurer generated $140 million of distributions at our share and has now returned 75% of the initial equity that we invested in the business less than four years ago.
Moving to our infrastructure segment, we generated full year adjusted EBITDA of 853 million adjusted <unk> was $2 1 billion and included a one 7 billion net gain on the sale of our nuclear technology services operation incur.
Jaspreet Dell: Turning to our segment performance, business services generated full-year EBITDA of $900 million compared to $641 million in 2020. Adjusted EFO was $636 million, an increase from $427 million in 2018. Results benefited from increased contributions from our dealer software and technology services operations and Strong Performance at Our Residential Mortgage Insurance. During the year, our residential mortgage insurance business generated $140 million in distributions at our share and has now returned 75% of the initial equity that we invested in the business less than four years ago. Moving to our infrastructure segment, we generated a full-year adjusted EBITDA of $853 million. The adjusted EFO was $2.1 billion and included a $1.7 billion net gain on the sale of our nuclear technology services operations. Increased contribution from Lottery Services and resilient performance at our Work Access Services Office benefited results during. Finally, our industrial segment generated full-year adjusted EBITDA of $855,000.
Increased contribution from lottery services and resilient performance at our work access services operation benefited results during the year.
Finally, our industrial segment generated full year, adjusted EBITDA of $855 million compared to $879 million in 2022.
Record results at our advanced energy storage operation driven by increased sales of higher margin advanced batteries was offset by reduced contributions from graphite electrode operations and western Canadian energy related operations during the year.
Adjusted <unk> of $492 million included net gains of $148 million during the year.
Before wrapping up I wanted to spend a minute discussing our balance sheet and capital position we.
We ended the year with $2 1 billion of liquidity at the corporate level after accounting for the impact of our known funding commitment and proceeds from recent monetization corporate liquidity is one 5 billion, which provides us with ample capacity to support our operations and growth.
As in each mentioned earlier, we completed the sale of Westinghouse in November proceeds from the sale were used to redeem $750 million of preferred securities held by Brookdale Corporation, and repaid $580 million of borrowings on our corporate credit facility.
Jaspreet Dell: Compared to $879 million in 2010, record results at our advanced energy storage operation, driven by increased sales of higher-margin advanced batteries, were offset by reduced contribution from Graphite Electrode Operations and Western Canadian Energy-Related Operations during Adjusted EFO of $492 million, including net gains of $148 million during. Before wrapping up, I wanted to spend a minute discussing our balance sheet and capital. We ended the year with $2.1 billion of liquidity at the corporate level after accounting for the impact of our known funding commitments and Proceeds from Recent Monetization. Corporate liquidity is $1.5 billion, which provides us with ample capacity to support our operations annually. As Aneesh mentioned earlier, we completed the sale of Westinghouse in November.
Ongoing distributions and future sales of businesses.
Several of which could be meaningful should reduce borrowings drawn at the corporate level overtime.
As a reminder, nearly all our large operations are financed with long term maturities that have limited or no financial maintenance covenants and no recourse to our business or other operations.
We have no significant maturities coming due over the next 12 months.
With the majority of our refinancing needs behind us we have flexibility to opportunistically manage our maturities over the next few years.
With that I'd like to close our comments and turn the call back over to the operator for questions.
Thank you <unk>.
Remind me to ask a question. Please press star one one on your telephone and wait for your name to be announced to withdraw your question. Please press star one again.
And our first question comes from the line of Geoffrey Kwan with RBC capital markets.
Jaspreet Dell: Proceeds from the sale were used to redeem $750 million of preferred securities held by Brookfield Corporation, and we paid $580 million of borrowings on our corporate credit. Ongoing distributions and future sales of business, several of which could be meaningful, should reduce borrowings drawn at the corporate level over time. As a reminder, nearly all our large operations are financed with long-term maturities that have limited or no financial impact. Company, and no recourse to our business or other operations.
Okay.
Hi, Good morning, just wanted to see.
Start out on the.
$850 million of debt that was repaid in 2023.
Is that a level that you think that you can be able to deleverage in direction kind of future years in terms of that rough ballpark, assuming you don't have any other uses for that free cash flow and.
Can you remind me you've talked about with the IPO like what's the kind of the target leverage.
To be at to be able to look at pursuing a potential monetization.
Hi, Geoff it's Jeff <unk>.
Jaspreet Dell: We have no significant maturities coming due over the next 12, and with the majority of our refinancing needs behind us, we have flexibility to opportunistically manage our maturities over the next year. With that, I'd like to close our comments and turn the call back over to the operator for questions. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. And our first question comes from the line of Jeffrey Kwan with RBC Capital Markets. Hi, good morning. I just wanted to start out on Clarios.
I'll start and then others can join in.
So in terms of the $850 million that we paid down debt.
If you think about the business January 2 billion of EBITDA after <unk>.
<unk> taxes maintenance Capex free cash flow is anywhere around 70 $800 million.
Neely.
And then there is opportunities for growth Capex in the business.
Dennis mentioned.
Some of the investments that we're making on the Aegean lines and.
Increasing kind of the throughput on our facilities, but I would say between $5 million to $700 million, depending on what we put on.
Jaspreet Dell: The $850 million of debt that was repaid in 2023, Is that a level that you think that you can be able to leverage in direction for future years in terms of that rough ballpark, assuming you don't have any other uses for the free cash flow? And can you remind me, you talked about with the IPO, like what's the kind of target leverage that you'd like to be at to be able to look at pursuing a potential monetization? Hi Jeff, it's Jaspreet.
Allocate the growth Capex, we should be able to deleverage.
Last year there was.
So a part.
Part of a JV that we had that generated some excess cash, which we used to delever. So it might've been a little bit higher last year, but between that $5 million to $700 million.
Lynch.
Uh huh.
I think as.
It.
You should expect that and then as we look forward EBITDA is going to continue to grow our cash flow generation is going to continue to grow.
Jaspreet Dell: I'll start, and then others can join in. So in terms of the $850 million that we paid down debt, if you think about the business, it generates $2 billion of EBITDA after interest taxes, maintenance capex, and free cash flow is anywhere around $7-800 million annually. And then there are opportunities for growth capex in the business. Dennis mentioned some of the investments that we're making on the AGM lines, FLTC implementation.
So that free cash flow number is also going to continue to grow.
Okay, and sorry, just on the on the leverage where you like Adobe.
Yes.
We're sitting at about four and a half times now I'd say by.
At the end of September which is the fiscal year end for <unk>, we expect will be slightly below four times.
And then.
Jaspreet Dell: Those include the gains, the improvement and improvement of our funding system and also the benefits and potential/p>p begin="00.100.466.866">defining and at ESS. Again, we've had successes in regions across the world, not just in Tel Aviv, which may have been occupying CEO positions but in the future, where we are both still struggling to get a position. So these are key areas for us to avoid high payoffs./p>p begin="00.100.400.600">DC, Part of a JV that we had that generated some excess cash, which we used to deliver. So it might have been a little bit higher last year, but between that $500 to $700 million dollar range and, you know, I think as You should expect that.
I'd say yeah.
And IPO and proceeds kind of 335 times, maybe a little bit lower but plus or minus three and a half time.
Okay No that's helpful.
On the monetization side it sounds like.
Conditions are getting better and.
Looking to monetize some of your assets. My question was just on the bid ask spreads are you seeing any.
Movement there.
And the markets.
That could help facilitate it or are the spreads maybe still relatively wide in terms of sellers' asking prices.
Yeah, Thanks to new sure I'll take that one.
It feels like interest rates have peaked the market has recognized that and seems to be pricing in a declining rate environment, which is going.
<unk> going to be pretty enabling for both valuations and the financing that's available for them, they're still be pretty good for monetization. We are seeing that bid ask spread I would say start to narrow.
And I think that depending how the year goes with our continued performance, particularly for businesses that generate a lot of cash like the ones, we own we should be able to to get a very good valuation.
Jaspreet Dell: And then as we look forward, you know, EBITDA is going to continue to grow. Cash flow generation is going to continue to grow. So that free cash flow number is all, Okay, I'm sorry, just on the leverage of where you like it to be. Yeah. Yeah. So, we're sitting at about four and a half times now. I'd say by the end of September, which is, you know, the fiscal year end for Clarios, we expect it to be slightly below four times, and then, you know, I would say with an IPO and proceeds. 3.5 times, maybe a little bit lower, but plus or minus three and a half.
Okay.
Maybe if I can ask one last question is.
I think at different points in time, you guys have talked about there may be certain business are you able to I can you might want to hold it longer than your kind of typical hold period.
As we're looking to may be entering a new monetization cycle. When you take a look at your portfolio and maybe some of your large investments or are there. Some that you really like that you may want to hold on and may not necessary monetize unless you get some fantastic offer.
Anuj Ranjan: Okay, no, that's helpful. On the monetization side, it sounds like conditions are getting better, and you're looking to monetize some of your assets. My question was just on the bid-ask spreads. Are you seeing any movement there in the markets that could help facilitate that? Or are the spreads maybe still relatively wide in terms of sellers asking prices? It's a new chair; I'll take that one.
Jeff.
I'll take that as Jesper It and then pass it onto others.
Are.
Our business model, we want to buy for value, we wanted to fix the operations that we buy and.
Eventually recycle capital and reinvest and earn those.
Anuj Ranjan: So it feels like interest rates have peaked. The market has recognized that and seems to be pricing in a declining rate environment, which is going to be pretty enabling for both valuations and the financing that's available for them. This will be pretty good for monetizations. We're seeing that bid-ask spread, I'd say, start to narrow. And I think that, depending on how the year goes with our continued performance... Particularly for businesses that generate a lot of cash, like the ones we own, we should be able to get very good value. Okay, maybe if I can ask one last question. I think at different points in time, you guys have talked about there may be certain businesses you really like, and you might want to hold them longer than your kind of typical hold period as we're looking to maybe enter a new monetization cycle. When you take a look at your portfolio, and maybe some of your larger investments, are there some that you really like?
Kind of high risk adjusted returns every once in a while youll come across the business that is.
It's an amazing business generates a lot of free cash flow and can be helpful. Just broadly for.
Reinvestment purposes, as well as providing that stable base of cash for <unk>.
I'd say the.
<unk> investment in a residential insurance business just as an example, we bought that business with the view of having a long term hold.
And you could see us hold that for the long term, but what I'd say.
Cyrus what he used to say is everything is on sale for the right price. So.
I'd say just keep that in mind.
Okay, Yes staging was one I would think about a particular bad but that's very helpful. Thanks guys.
Thank you one moment please for our next question.
And our next question comes from the line of Gary Ho with Desjardins capital markets.
Thanks, Good morning, maybe just sticking with declared <unk> here, thanks for providing that update.
Jaspreet Dell: You may want to hold on and may not necessarily monetize unless you get some fantastic offer. Jeff, I'll take that. It's just great, and then I'll pass it on to others. Look at our business model. We want to buy for value, we want to fix the operations that we buy and, you know, eventually recycle capital and reinvest and earn those High Risk Adjusted Returns. Yeah, every once in a while, you know, you'll come across a business that is, you know, it's an amazing business that generates a lot of free cash flow and can be helpful, just broadly for reinvestment purposes, as well as, you know, providing that stable base of cash for BBU. I'd say, you know, the sage in investment in our residential insurance business, just as an example, we bought And, you know, you could see us hold that for the long term. But what I say, you know, to quote Cyrus, and what he used to say is, everything is on sale for the right price. So, you know, I just keep that in mind. Okay, yes, aging was the one I was thinking about in particular, but that's very helpful.
Just doing the math here.
Just create the getting from four to three and half turns. So you are looking for probably a smaller size IPO roughly $1 billion.
Time round, and maybe maybe share with us what gives you confidence to be able to succeed.
Versus the prior.
IPO and then just on valuation a new jet.
Right.
You'll be able to get similar valuation what you tried to IPO with us at last night.
So maybe I can start and then I'll pass it onto in which to comment on valuation so look.
I think we'd want to target an IPO at $1 billion or even smaller.
Gary.
The one of the.
Hum.
Earnings from the process that we undertook in 2021 with just sizing the right.
Rate level for the market.
We had tried to do last time around I think was a bit too large so we're very cognizant of that and given kind of the strong performance of the business, both EBITDA growth as well as the cash that would be used to pay down debt. We're in a much better leverage position.
Jaspreet Dell: Thanks, Jess. Thank you. One moment, please, for our next question. And our next question comes from the line of Gary Ho with Desjardins Capital Markets. Thanks. Good morning. Maybe just sticking with the cereal here.
And we don't need to be that large.
752, 1 billion should probably do it from an IPO perspective.
And then I would say kind of more broadly some of the.
Jaspreet Dell: Thanks for providing that update. So just doing the math here, just getting from four to three and a half turns. So you're looking for probably a smaller-sized IPO, roughly a billion this time around, and maybe share with us what gives you confidence to be able to succeed versus the prior IPO. And then just on valuation, Anuj, early read, do you think you'll be able to get a similar valuation to what you tried to IPO this at last time? So maybe I can start and then I'll pass it on to Anuj to comment on the valuation.
Questions that were raised around the business I see the performance of <unk> exceeded what we had discussed back then I think the business has outperformed pretty much on every metric, whether it's EBITDA volume cash flow generation.
<unk>.
There is concern around EV penetration and the impact on the business the business is done in.
An exceptional job.
We are now.
Jaspreet Dell: So, look, I think we'd want to target an IPO at a billion or even smaller, I'd say, Gary. And one of the learnings from the process that we undertook in 2021 was just sizing the right... the right level for the market. What we tried to do last time around, I think, was a bit too large.
Over 150, EV platforms today, I think that number was 30% or 48 back when we were trying to when we did the IPO. When we tried to do the IPO in 2021, so I'd say broadly across all of the metrics the business performance has been exceptional and.
<unk>.
<unk> much better positioned today in the business as.
A much better position today, and then I'll hand, it to <unk> to talk to valuations.
Jaspreet Dell: So we're very cognizant of that. And given kind of the strong performance of the business, both EBITDA growth as well as the cash that we used to pay down debt, we're in a much better leverage position. And, you know, we don't need to be that large.
Yes.
I think on valuation for some markets, obviously need to be open.
And we do expect that to happen ideally in the next in this year.
We won't give this business the way, it's doing very very well as <unk> said the business has fundamentally changed and grown.
Jaspreet Dell: So I'd say 750 to a billion should probably do it from an IPO perspective. And then, kind of more broadly, you know, some of the questions that were raised around the business, I'd say the performance of Clarios has exceeded kind of what we had discussed back then. I think the business has outperformed pretty much on every metric, whether it's EBITDA, volume, and cash flow generation. You know, there was concern around EV penetration and the impact on the business. The business has done an exceptional job. We are, you know, on over 150 EV platforms today. I think that number was 30 or 40 back when we were trying when we tried to do the IP in 2021.
B the indicated we're now in a number of EV platforms and so it's.
It's a different business, we'd be taking to market this year than the last time.
I can say, we would look for a fair value valuation multiple in the context of what the business is today.
And also the market environment at the time.
Okay. That's very very helpful. And then each while I have you here.
As mentioned in your letter to shareholders.
Disconnecting your.
Unit price and how undervalued at us versus peers, but then on the other hand, you talk about the number of high quality assets opportunities that may require.
Financing so how should we think about capital allocation priorities over the near term.
Yes, that's a good question, we always maintain a balanced approach.
Jaspreet Dell: So I'd say broadly across, you know, all of the metrics, the business performance has been exceptional. And I think we're much, much better positioned today and the business is much better, and I'll hand it to Anuj to talk. On valuation, first the markets obviously need to be open, and we do expect that to happen ideally in the next, this year. We won't give this business away.
Our focus continues to be on deleveraging, our balance sheet today, and ensuring we have sufficient liquidity.
We did touch on in the letter the distressed investing landscape and the opportunities. We are seeing which are our pipeline is very robust, but the bar is high and we continue to be selective and in some cases, we even for example repurchased shares in the past year. So I think between further share repurchases new investments and Delever.
Anuj Ranjan: It's doing very, very well, as Jaspreet said. The business has fundamentally, you know, changed. As Jess has indicated, we're now on a number of EVE platforms, and so it's a different business we'd be taking to market this year than the last, and I can say we would look for a fair valuation multiple in the context of what the business is today and also the market environment. Okay, that's very, very helpful.
<unk> will continue to maintain that sort of balanced approach.
Okay, Great and just wait if I can just sneak in one more just clarification question in your pro forma liquidity of $1 5 billion. There is a $900 million adjustment for acquisition and investment can you remind me what that is for again.
Anuj Ranjan: And Anish, while I have you here, it was mentioned in your letter to the shareholders about the disconnect in your unit price and how undervalued it is versus peers. But then, on the other hand, you talk about the number of high-quality assets and opportunities that may require financing. So how should we think about capital allocation priorities over the near term? Yeah, that's a good question. We always maintain a balanced approach.
Yes sure.
A number of the acquisitions that we've made over the last year or 18 months is because we make them alongside Brookfield private equity funds, we find those acquisitions based on timing of capital calls that come in from the funds. So we haven't.
Funded everything for the recent acquisitions.
Anuj Ranjan: The focus continues to be on leveraging our balance sheet today and ensuring we have sufficient liquidity. We did touch on, you know, in the letter, the distressed investing landscape and the opportunities we are seeing, of which our pipeline is very robust. The bar is high, and we continue to be.
In early January we received a capital call and concluded a part of our funding for CDK.
And some of the other more recent acquisitions, so that that's what those adjustments are for.
Okay got it yes, yes, just to be clear like it doesn't change the total amount that we said we've invested in CDK.
That remains the same it's just kind of the timing of the actual cash going out.
Anuj Ranjan: And in some cases, we even, for example, repurchased shares in the past year. So I think between further share repurchases, new investments, and deleveraging, we'll continue to maintain that sort of balance. Okay, great.
Okay makes sense, okay. Thanks very much.
Thank you one moment please for our next question.
And our next question comes from the line of Devin Dodge with BMO capital markets.
Jaspreet Dell: I'd like to sneak in one more clarification question. In your performance liquidity of $1.5 billion, there's a $900 million adjustment for acquisition and investment. Can you remind me what that is for again?
Thanks, I wanted to pick up on one of the earlier questions on capital deployment. So the letter talked about leveraged loans and high yielding public debt.
Are you starting to see distressed situations become more near term opportunities.
Jaspreet Dell: Yeah, sure. So a number of the acquisitions that we've made over the last year or 18 months, because we make them alongside Brookfield's private equity funds, we fund those acquisitions based on the timing of capital calls that come in from the funds. So we haven't funded everything for the recent acquisitions. So, in early January, we received a capital call and concluded part of our funding for CDK and some of the other more recent acquisitions. So that's what those adjustments are for.
Discussions or is it more about monitoring the situations and just maybe more just broadly where are you seeing where you're most optimistic about capital deployment over the next six to 12 months.
Sure, it's a new chair I'll start with that hydro we have.
Today, we are monitoring and I'd say that.
It looks like things might be come actionable in the medium term. So I wouldn't say that there are immediate opportunities coming out of.
Those businesses that we're watching but but things are advancing more so than they have in the past.
This really is a medium term opportunity.
Okay. Okay. Thanks, and then maybe a question on CDK.
A lot of progress.
As already been made but what are the remaining goals that you've mentioned previously is to upgrade the technology stack.
Jaspreet Dell: Okay, got it. That's all. Yeah, just to be clear, like the total amount that we said we'd invested in CDK, but like that, that remains the same. It's just kind of the timing of the actual cash.
Just can you help us better understand the focus there I'm just trying to understand whether it's improving the existing product or bolting on new offerings.
And if you expect this effort to be done in house, there via tuck in M&A.
Yes, we have been very focused on that over the last.
Jaspreet Dell: Okay, that makes sense. Okay, thanks very much. Thank you. One moment, please, for our next question. Our next question comes from the line of Devin Dodge with BMO Capital Markets. Thanks.
Eight to 10 months in particular, starting with hiring two new professionals one on the product development one on technology development.
In a nutshell, it's really transforming from a more historic structural ERP type model into something that is more advanced modern may incorporate some AI definitely much easier user interface, that's all going to be led internally.
Anuj Ranjan: I wanted to pick up on one of the earlier questions on capital deployment. The letter talked about leveraged loans and high-yielding public debt. Are you starting to see distressed situations become more near-term opportunities, you know, with active discussions, or is it more about monitoring the situations? And maybe, more broadly, where are you seeing, where are you most optimistic about capital deployment over the next 6 to 12 months? I'll start with that. Hi Devin.
We feel we've built a very strong capability in particular with these two individuals who are pressing forward on that as we move forward.
Okay. Thanks for that I'll turn it over.
Thank you.
One moment please for our next question.
And our next question comes from the line of James <unk> with National Bank.
Anuj Ranjan: Today we're monitoring, and I'd say that it looks like things might become actionable. I wouldn't say that there are immediate opportunities coming out of those businesses that we're watching, but things are advancing more so than they have in the past, and this really is a. Okay. Okay. Thanks for that. Okay. And then maybe a question on CDK.
Yes, good morning.
First off congrats unusual on that.
The appointment.
<unk>.
Cyrus on that move into the EC Chair.
Just wanted to start off on the fab five EBITDA I think I heard this correctly I just wanted to clarify.
Dennis Turcotte: Look, a lot of progress has already been made, but one of the remaining goals that you've mentioned previously is to upgrade the technology stack. Can you help us better understand the focus there? I'm just trying to understand whether it's improving the existing product or bolting on new offerings, and if you expect this effort to be done in-house or via Tuck and M&A. Yeah, we have been very focused on that over the last 8 to 10 months in particular, starting with hiring two new professionals, one on product development and one on technology development. In a nutshell, it's really transforming from a more historic, structural, ERP-type model into something that is more advanced, modern, may incorporate some AI, and definitely has a much easier user interface.
The organic growth in EBITDA for the Fab five was that was 10% year over year for versus the prior year period.
And would you have at your fingertips, the organic growth of the lot.
Say rest of the business.
Yeah.
It's Jeff <unk>.
On a same store basis, if you look at the entire business were up about 14%.
And adjusted for the dispositions that we've done so on a same store basis, if we look at.
Q4 last year versus Q4 2022, it's about 14%.
That was for the fab five.
No thats for the entire business in the fab okay.
<unk>.
Got it okay great.
Shifting to the CGM business, obviously, a really great year, and it's still a loss ratios are running below average and good enough to provide a distribution up too.
Dennis Turcotte: That's all going to be led internally. We feel we've built a very strong capability, in particular with these two individuals, so we're pressing forward on that as we move forward. Okay, thanks for that. I'll turn it over to you.
Could be Bu, just wondering if you could provide a little bit more details on that on the capital position I'd say Gen <unk>.
Operator: Thank you. One moment, please, for our next question. And our next question comes from the line of Jane Gloyne with National Bank. Yeah, good morning.
And perhaps what you have forecasted for 'twenty four 'twenty five in terms of what could be potential distribution from from that business.
Operator: First off, congratulations to Anuj on the appointment and Cyrus on moving to the EC chair. Just wanted to start off on the Fab 5 EBITDA. I think I heard this correctly; I just want to clarify.
Yes. It is.
<unk> again so.
Yeah look on <unk>.
Kind of a full cycle basis stage in January at circa 500 to 600 million Canadian.
Jaspreet Dell: The organic growth in EBITDA for the Fab 5 was 10% year-over-year versus the prior year period. And would you have at your fingertips the organic growth of the, let's say, rest of the business? Yeah, it's just three.
Sir.
Of earnings and cash.
Now they need to make sure they have cash within the business to meet their regulatory requirements, but.
Jaspreet Dell: So on a same store basis, if you look at the entire business, we're up about 14%, and adjusted for the dispositions that, you know, we've done. So on a same store basis, if you look at Q4 last year versus Q4, that was for the Fab Five.
On average thats been the size of distributions that the business has been doing so we don't expect that that will change in the near term.
On the capital position within <unk> is extremely strong today.
I don't I don't know the exact numbers, but again, Mike had requirement of 165% I think they're in the high 175, 480%, even so there's quite a large buffer.
Jaspreet Dell: I know, that's for the entire business and the Fab 5 and the rest of us. Got it. Okay, great. Shifting to the SageN business, obviously, a really great year and still loss ratios running below average and good enough to provide a distribution up to BBU. Just wondering if you could provide a little bit more details on the capital position at SageN and perhaps what you have forecasted for 2024 and 2025 in terms of what could be a potential distribution from that business. Hi Jaspreet, again.
Thats a significant cash in the business, which allowed us to do this special distribution.
So.
Given kind of the broad market dynamics <unk>.
Triste rates start to trend downwards, we're seeing.
<unk> activity start to pick up a little bit more.
I think.
The loss ratios over the long term will.
Jaspreet Dell: So, look, on a kind of full cycle basis, Cajun generates circa 500 to 600 million Canadian dollars in earnings and cash. They need to make sure they have cash within the business to meet their regulatory requirements. But on average, that's been the size of distributions that the business has been making, so we don't expect that that will change in the near term. The capital position within Cajun is extremely strong today. I don't know the exact numbers, but against the MICAT requirement of 165%, I think they're in the high 175, 480% even.
Start to creep up and go back to long term averages, but the business is very well positioned and I think should continue to be able to generate cash up for btu.
Okay great.
Understood and then carrying that question to the other businesses I recall in the past I've talked about some other business with the potential to deliver some distributions are you able to provide any more any more insight or or clarity on what other businesses might be able to distribute to be bu in the near term.
Jaspreet Dell: So there's quite a large buffer. There's significant cash in the business, which allowed us to do this. So, you know, given kind of the broad market dynamics, if interest rates start to trend downwards, we're seeing, you know, housing activities start to pick up a little bit more. I think the loss ratio, over the long term, will start to creep up and go back to long-term averages.
Yes, and look a few.
Look at our business side in theory E. Adjusted UFO takeoff maintenance capex across the board the businesses generate significant free cash flow.
And we saw a little bit of pressure last year, just with the higher interest rates.
<unk>.
<unk> been in that $500 million range of free cash flow.
Jaspreet Dell: But the business is very well positioned and I think it should continue to be able to generate cash. Okay, great. Understood. And then carry that question to other businesses.
<unk> generated on a run rate basis.
So.
The.
The question really for Us is.
What is the best allocation of that capital if there's opportunities within the business to do bolt on M&A delever within that business or distribution up to be Bu.
Jaspreet Dell: I recall in the past, we've kind of talked about some other businesses that have the potential to deliver some distributions. Are you able to provide any more insight or, or clarity on what other businesses might be able to distribute to BBU in the near term? Yeah, and look, if you look at our business and the adjusted EFO, take off maintenance capex, like across the board, the businesses generate significant free cash flow. And we saw a little bit of pressure last year just with the higher interest rates, but it's still, you know, been in that $500 million range of free cash flow that's generated on a run rate basis.
In the case of stage in that cash.
Is the best distributed up to us and that's what we do so there is call it.
500 ish million of run rate free cash flow.
Could come up from the businesses and then it's a bit of a decision on a case by case basis of what we do.
Okay understood.
Turn it over there.
Thank you one moment please for our next question.
And our next question comes from the line of Nik Priebe with CIBC capital markets.
Okay. Thanks for the question.
Jaspreet Dell: So the, the, you know, the question really for us is, what is the best allocation of that capital if there's opportunities within the business to do bolt-on M&A, you know, de-lever within that business, or distribution up to BBU. Like in the case of Sajan, you know, that cash is best distributed to us, and that's... So there's, you know, call it $500-ish million of run rate free cash flow that could come up from the businesses, and then it's a bit of a decision on a case-by-case basis. Okay. I'll turn it over there.
Just going back to the <unk> IPO it sounds like Youre contemplating at smaller scale IPO, then what might've been attempted a few years ago.
In that context should we expect both the treasury and the secondary component to an IPO or would you consider doing an offering entirely from treasury to help facilitate the accelerated repayment of debt just wondering if you've given some thought to the composition of that yet.
Yes.
Our focus right now Nick is very much on making sure that we delever <unk> to an appropriate level.
Jaspreet Dell: Thank you. One moment, please, for our next question. And our next question comes from the line of Nick Preeb with CIBC Capital Markets. Okay, thanks for the question. Just going back to the Clarios IPO, sounds like you're contemplating a smaller-scale IPO than what might have been attempted a few years ago. In that context, should we expect both a treasury and a secondary component to an IPO? Or would you consider doing an offering entirely from the treasury to help facilitate the accelerated repayment of debt?
This is a phenomenal business and we wanted to make sure that.
Set up to trade well in the market. So we expect.
The first.
The IPO and the offering will be primary and it'll be used to delever Clarion.
Understood, Okay and then.
Around mid last year I think you had indicated that <unk> is in the midst of an efficiency program that was progressing but might have another six months or so to go.
Jaspreet Dell: Just wondering if you've given some thought to the composition of that yet. Yeah, I'd say our focus right now, Nick, is very much on making sure that we de-lever Clarios to an appropriate level. This is a phenomenal business, and we want to make sure that, you know, it's set up to trade well in the markets. So we expect the first IPO and the offering will be primary, and it'll be used to de-lever.
Are you able to just update us on the status there and maybe the outlook for <unk>.
Potential realization event on that investment.
Sure things are going Dennis here things are going very well it would be RK one of our partners in Brazil has moved in as acting CEO, a few quarters back and he and the team have done a phenomenal job taking costs out and frankly streamlining the business. So it runs much more effectively in parallel they focused.
Jaspreet Dell: And then, just around mid last year, I think you had indicated that BRK Ambientel was in the midst of an efficiency program that was progressing but might have another six months or so to go. Are you able to just update us on the status there and maybe the outlook for a potential realization event on that investment? Dennis here.
On concession management and have have done what was originally intended.
Re circulated certain of the contracts there in a way where we now have increasing margins we have.
Dennis Turcotte: Things are going very well at BRK. One of our partners in Brazil moved in as acting CEO a few quarters ago, and he and the team have done a phenomenal job taking costs out and, frankly, streamlining the business so it runs much more effectively. In parallel, they focus on concession management and have done what was originally intended and recirculated certain of the contracts there in a way where we now have increasing margin. We have EBITDA less, CapEx, and free cash flow for the first time, and we're moving in a very positive direction, and frankly, we feel there's a lot more to be gained there, so I wouldn't necessarily just look at the next six months; we As far as monetization, again, that'll be a function of the markets, and it's hard to predict what will happen.
EBITDA less capex free cash flow for the first time and we're moving in a very positive direction and frankly, we feel there is a lot more to be gained there. So I wouldn't necessarily just look at the next six months, we see this as a continuing initiative with lots of room for improvement as far as monitor.
<unk> again that'll down there it will be a function of the markets and it's hard to predict what will happen.
Understood. Okay very good that's it for me thank you.
Thank you I will now hand, the call back over to CEO, a news ranjan for any closing remarks.
Thank you everyone for being on the call and look forward to speaking with you again next quarter.
Thank you for participating this concludes today's program and you may now disconnect.
Dennis Turcotte: You understand? Okay, very good. That's it for me.
Yeah.
Okay.
Yes.
Anuj Ranjan: Thank you. Thank you. I'll now hand the call back over to CEO Anuj Ranjan for any closing remarks. Thank you everyone for being on the call and look forward to speaking with you again next. Thank you for participating. This concludes today's program and you may now disconnect, www.un.org.uk Alan Fleming, Mark Wallace, Devin Dodge, BBU.UN, Brookfield Business Partners LP Alan Fleming, Mark Wallace, Devin Dodge, BBU.UN, Brookfield Business Partners LP Alan Fleming, Mark Wallace, Devin Dodge, BBU.UN, Brookfield Business Partners LP Alan Fleming, Mark Wallace, Devin Dodge, BBU.UN, Brookfield Business Partners LP, Alan Fleming, Mark Wallace, Devin Dodge, BBU.UN, Brookfield Business Partners LP
Okay.
[music].
Okay.
Okay.
Yes.
[music].
Okay.
[music].
Thank you.
[music].
Okay.
[music].
Okay.
So.
Dan.
[music].
Yes.
Okay.
[music].