Brookfield Infrastructure posts $125-million profit amid investment spree

TORONTO — Brookfield Infrastructure Partners L.P.’s recent spending spree helped the company land a $125 million net profit in its second quarter.

The owner and operator of energy, freight and data networks, which reports earnings in U.S. dollars, said Thursday that the profit was a sharp increase from the $5 million it made the year before and was largely fuelled by recent investments.

Days before, it had announced it will acquire home heating and cooling company Enercare Inc. for $4.3 billion and in early July, it said it scooped up Enbridge’s Western Canadian natural gas gathering and processing business for $3.3 billion.

On Thursday, executives from the company seemed optimistic that both investments would prove increasingly valuable for Brookfield because they said that Enbridge had not exploited all of the opportunities Brookfield intends to, particularly in the liquids industry.

“(The Enbridge deal) is an ideal platform to establish our midstream presence in Canada as it is competitively positioned for growth given the highly economic acreage throughout the Montney region (of British Columbia and Alberta),” said Rene Lubianski, Brookfield’s senior vice president of corporate development.

“We believe the region’s massive scale and low breakeven cost will ensure that it continues to be a focal point for development by top-tier producers with over 40 years of anticipated economic drilling inventory at current price levels.”

Lubianski and other executives on the company’s earning call said they see the biggest opportunities for the company coming from its fibre and data operations. It recently signed an agreement to acquire Texas-based AT&T’s large-scale data centre business for $1.1 billion, growing its asset portfolio to include centres on five continents, 11 countries and 26 metropolitan markets with the vast majority located in the U.S.

Roberto Marcogliese, Brookfield’s deputy chief investment officer for infrastructure, trumpeted the deal, saying he expects the data field to experience strong growth and the acquisition to place the company in an ideal position to capture some of that growth with minimal capital investments.

“We have been evaluating the data centre sector for some time now and we believe we have a scalable business and an attractive portfolio,” he said.

Earlier in the call, Brookfield said a loss of income from the sale of assets and the time it has taken the company to redeploy money into new investments has resulted in a slight decline in funds from operations, which fell to $294 million from $295 million the quarter before.

The company also revealed its revenues also took a tumble, decreasing to $1.04 billion from $2.06 billion.

On an adjusted basis, Brookfield earned 21 cents per share in the most recent quarter, beating analyst expectations for 12 cents per share, according to Thomson Reuters Eikon.

(Companies in this story: TSX:BIP)

Tara Deschamps, The Canadian Press