BROOKFIELD, NEWS,
| Unaudited As of and for the periods ended (US$ millions, except per share amounts) |
Three Months Ended | Six Months Ended | |||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||
| Total assets | $ | 130,533 | $ | 47,994 | $ | 130,533 | $ | 47,994 | |||
| Adjusted equity1 | 11,384 | 5,047 | 11,384 | 5,047 | |||||||
| Distributable operating earnings1 | 298 | 160 | 577 | 305 | |||||||
| Net income | 269 | 360 | 606 | 267 | |||||||
| Net income per each class A and A-1 share | $ | 0.08 | $ | 0.07 | $ | 0.16 | $ | 0.14 | |||
- See Non-GAAP and Performance Measures on page 7 and a reconciliation from net income and reconciliation from equity on page 6.
Highlights
- Completed the acquisition of American Equity Investment Life Holding Company (“AEL”) on
May 2, 2024 , and have since redeployed more than$3 billion of assets into Brookfield strategies - Across our full portfolio, originated approximately
$5 billion in proprietary investment strategies during the quarter at returns in excess of 8.5% - Generated
$3 billion of retail annuity sales, including approximately$1.3 billion of sales at AEL during our two months of ownership - Closed 25 pension risk transfer transactions, representing over
$450 million in premiums in the quarter
Operating Update
We recognized $298 million and
We recorded net income of
Today, we are in a strong liquidity position across the portfolio, with over
Update on Capital Structure and Name Change
At a meeting on
Shareholders also approved a resolution authorizing the change of our name from “Brookfield Reinsurance” to “Brookfield Wealth Solutions”. We expect that the name change will be effected on or about
Regular Distribution Declaration
The Board declared a quarterly distribution of
Brookfield Corporation Operating Results
An investment in Class A shares of our company is intended to be, as nearly as practicable, functionally and economically, equivalent to an investment in the Brookfield Class A Shares. A summary of Brookfield Corporation’s second quarter operating results is provided below:
| Unaudited As of and for the periods ended (US$ millions, except per share amounts) |
Three Months Ended | Last Twelve Months Ended | ||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||
| Net income attributable to Brookfield shareholders1 | $ | 43 | $ | 81 | $ | 1,074 | $ | 308 | ||||
| Net income (loss) of consolidated business2 | (285 | ) | 1,512 | 3,403 | 2,696 | |||||||
| Distributable earnings before realizations1,3,4 | 1,113 | 1,013 | 4,379 | 4,078 | ||||||||
| – Per Brookfield share1,3,4 | 0.71 | 0.64 | 2.77 | 2.56 | ||||||||
| Distributable earnings1,3 | 2,127 | 1,187 | 5,805 | 5,205 | ||||||||
| – Per Brookfield share1,3 | 1.35 | 0.75 | 3.67 | 3.26 | ||||||||
- Excludes amounts attributable to non-controlling interests.
- Consolidated basis – includes amounts attributable to non-controlling interests.
- See Reconciliation of Net Income to Distributable Earnings on page 5 and Non-IFRS and Performance Measures section on page 8 of Brookfield Corporation’s press release dated
August 8, 2024 . - Distributable earnings before realizations, including per share amounts, for the twelve months ended
June 30, 2023 were adjusted for the special distribution of 25% of Brookfield’s asset management business onDecember 9, 2022 . Prior to the adjustment, distributable earnings before realizations were$4 .3 billion for the twelve months endedJune 30, 2023 .
CONSOLIDATED BALANCE SHEETS
| Unaudited | ||||||||
| (US$ millions) | 2024 | 2023 | ||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 14,335 | $ | 4,308 | ||||
| Investments | 85,117 | 39,838 | ||||||
| Reinsurance recoverables and deposit assets | 10,275 | 3,388 | ||||||
| Reinsurance funds withheld | 1,573 | 7,248 | ||||||
| Accrued investment income | 781 | 280 | ||||||
| 112,081 | 55,062 | |||||||
| Premiums due and other receivables | 725 | 711 | ||||||
| Deferred policy acquisition costs | 10,539 | 2,468 | ||||||
| Deferred tax asset | 700 | 432 | ||||||
| Other assets | 5,222 | 1,781 | ||||||
| Separate account assets | 1,266 | 1,189 | ||||||
| Total assets | 130,533 | 61,643 | ||||||
| Liabilities and equity | ||||||||
| Policy and contract claims | 7,397 | 7,288 | ||||||
| Future policy benefits | 10,920 | 9,813 | ||||||
| Policyholders’ account balances | 80,489 | 24,939 | ||||||
| Deposit liabilities | 1,546 | 1,577 | ||||||
| Market risk benefits | 3,276 | 89 | ||||||
| Unearned premium reserve | 2,037 | 2,056 | ||||||
| 105,665 | 45,762 | |||||||
| Other policyholder funds | 343 | 335 | ||||||
| Due to related parties | 734 | 564 | ||||||
| Notes payable | 657 | 174 | ||||||
| Corporate borrowings | 1,615 | 1,706 | ||||||
| Subsidiary borrowings | 2,846 | 1,863 | ||||||
| Funds withheld for reinsurance liabilities | 3,526 | 83 | ||||||
| Other liabilities | 2,115 | 1,118 | ||||||
| Separate account liabilities | 1,266 | 1,189 | ||||||
| Junior preferred shares | 2,751 | 2,694 | ||||||
| Non-controlling interest | 848 | 146 | ||||||
| Class A, class A-1 and class B | 1,591 | 1,591 | ||||||
| Class C | 6,576 | 9,015 | 4,418 | 6,155 | ||||
| Total liabilities and equity | $ | 130,533 | $ | 61,643 | ||||
CONSOLIDATED STATEMENTS OF OPERATIONS
| Unaudited For the periods ended US$ millions |
Three Months Ended | Six Months Ended | |||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net premiums and other policy revenue | $ | 1,716 | $ | 1,202 | $ | 3,359 | $ | 2,099 | |||||||
| Net investment income, including funds withheld | 1,162 | 517 | 1,832 | 975 | |||||||||||
| Net investment gains (losses), including funds withheld | 24 | 255 | 196 | 75 | |||||||||||
| Total revenues | 2,902 | 1,974 | 5,387 | 3,149 | |||||||||||
| Benefits and claims paid on insurance contracts | (1,515 | ) | (1,133 | ) | (2,929 | ) | (1,875 | ) | |||||||
| Interest sensitive contract benefits | (422 | ) | (156 | ) | (607 | ) | (243 | ) | |||||||
| Amortization of deferred policy acquisition costs | (276 | ) | (185 | ) | (501 | ) | (332 | ) | |||||||
| Changes in fair value of insurance-related derivatives and embedded derivatives | 13 | 30 | 57 | (39 | ) | ||||||||||
| Changes in fair value of market risk benefits | (168 | ) | 14 | (199 | ) | 8 | |||||||||
| Other reinsurance expenses | (7 | ) | 30 | (14 | ) | 36 | |||||||||
| Operating expenses | (461 | ) | (141 | ) | (694 | ) | (315 | ) | |||||||
| Interest expense | (95 | ) | (60 | ) | (167 | ) | (120 | ) | |||||||
| Total benefits and expenses | (2,931 | ) | (1,601 | ) | (5,054 | ) | (2,880 | ) | |||||||
| Net income before income taxes | (29 | ) | 373 | 333 | 269 | ||||||||||
| Income tax recovery (expense) | 298 | (13 | ) | 273 | (2 | ) | |||||||||
| Net income for the period | $ | 269 | $ | 360 | $ | 606 | $ | 267 | |||||||
| Attributable to: | |||||||||||||||
| Class A, class A-1 and class B shareholders1 | $ | 3 | $ | 1 | $ | 6 | $ | 2 | |||||||
| Class C shareholder | 261 | 362 | 593 | 263 | |||||||||||
| Non-controlling interest | 5 | (3 | ) | 7 | 2 | ||||||||||
| $ | 269 | $ | 360 | $ | 606 | $ | 267 | ||||||||
- Class A and A-1 shares receive distributions at the same amount per share as the cash dividends paid on each Brookfield Class A Share.
SUMMARIZED FINANCIAL RESULTS
RECONCILIATION OF NET INCOME TO DISTRIBUTABLE OPERATING EARNINGS
| Unaudited For the periods ended US$ millions |
Three Months Ended | Six Months Ended | |||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net income | $ | 269 | $ | 360 | $ | 606 | $ | 267 | |||||||
| Unrealized net investment gains, including funds withheld | (24 | ) | (255 | ) | (196 | ) | (75 | ) | |||||||
| Mark-to-market on insurance contracts and other net assets | 225 | 34 | 290 | 96 | |||||||||||
| 470 | 139 | 700 | 288 | ||||||||||||
| Deferred income tax (recovery) expense | (343 | ) | 11 | (328 | ) | (2 | ) | ||||||||
| Transaction costs | 137 | 5 | 149 | 9 | |||||||||||
| Depreciation | 34 | 5 | 56 | 10 | |||||||||||
| Distributable operating earnings1 | $ | 298 | $ | 160 | $ | 577 | $ | 305 | |||||||
RECONCILIATION OF EQUITY TO ADJUSTED EQUITY
| Unaudited As of US$ millions |
2024 | 2023 | ||||
| Equity | $ | 9,015 | $ | 1,911 | ||
| Add: | ||||||
| Accumulated other comprehensive (income) loss | (382 | ) | 501 | |||
| Junior preferred shares | 2,751 | 2,635 | ||||
| Adjusted equity1 | $ | 11,384 | $ | 5,047 | ||
- Non-GAAP measure - see Non-GAAP and Performance Measures on page 7.
Additional Information
Brookfield Reinsurance’s Board of Directors have reviewed and approved this document, including the summarized unaudited consolidated financial statements prior to its release.
Information on our distributions can be found on our website under Stock & Distributions/Distribution History.
| Communications & Media: Tel: (212) 618-3469 Email: [email protected] |
Investor Relations: Tel: (416) 369-3358 Email: [email protected] |
Non-GAAP and Performance Measures
This news release and accompanying financial statements are based on US GAAP, unless otherwise noted.
We make reference to Distributable operating earnings. We define distributable operating earnings as net income excluding the impact of depreciation and amortization, deferred income taxes, and breakage and transaction costs, as well as certain investment and insurance reserve gains and losses, including gains and losses related to asset and liability matching strategies, non-operating adjustments related to changes in cash flow assumptions for future policy benefits, and change in market risk benefits, and is inclusive of returns on equity invested in certain variable interest entities and our share of adjusted earnings from our investments in certain associates. Distributable operating earnings is a measure of operating performance. We use distributable operating earnings to assess our operating results. We also make reference to Adjusted equity. Adjusted equity represents the total economic equity of our Company through its Class A, A-1, B and C shares, excluding Accumulated other comprehensive income, and the Junior preferred shares issued by our Company. We use adjusted equity to assess our return on our equity.
We provide additional information on key terms and non-GAAP measures in our filings available at bnre.brookfield.com.
Notice to Readers
This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of the
Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: (i) investment returns that are lower than target; (ii) the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business including as a result of COVID-19 and the related global economic shutdown; (iii) the behavior of financial markets, including fluctuations in interest and foreign exchange rates; (iv) global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; (v) strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; (vi) changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); (vii) the ability to appropriately manage human capital; (viii) the effect of applying future accounting changes; (ix) business competition; (x) operational and reputational risks; (xi) technological change; (xii) changes in government regulation and legislation within the countries in which we operate; (xiii) governmental investigations; (xiv) litigation; (xv) changes in tax laws; (xvi) ability to collect amounts owed; (xvii) catastrophic events, such as earthquakes, hurricanes and epidemics/pandemics; (xviii) the possible impact of international conflicts and other developments including terrorist acts and cyberterrorism; (xix) the introduction, withdrawal, success and timing of business initiatives and strategies; (xx) the failure of effective disclosure controls and procedures and internal controls over financial reporting and other risks; (xxi) health, safety and environmental risks; (xxii) the maintenance of adequate insurance coverage; (xxiii) the existence of information barriers between certain businesses within our asset management operations; (xxiv) risks specific to our business segments including our real estate, renewable power, infrastructure, private equity, and other alternatives, including credits; and (xxv) factors detailed from time to time in our documents filed with the securities regulators in
We caution that the foregoing list of important factors that may affect future results is not exhaustive and other factors could also adversely affect its results. Readers are urged to consider the foregoing risks, as well as other uncertainties, factors and assumptions carefully in evaluating the forward-looking information and are cautioned not to place undue reliance on such forward-looking information. Except as required by law,
Past performance is not indicative nor a guarantee of future results. There can be no assurance that comparable results will be achieved in the future, that future investments will be similar to the historic investments discussed herein (because of economic conditions, the availability of investment opportunities or otherwise), that targeted returns, diversification or asset allocations will be met or that an investment strategy or investment objectives will be achieved.
Certain of the information contained herein is based on or derived from information provided by independent third-party sources. While
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