All amounts in
BROOKFIELD, News,
“Our business performed well this quarter building on the strong start to 2023, delivering year-to-date double digit FFO growth. We also agreed to acquire
| For the three months ended |
For the six months ended |
|||||||||||
| US$ millions (except per unit amounts), unaudited | 2023 | 2022 | 2023 | 2022 | ||||||||
| Net income (loss) attributable to Unitholders | $ | (39 | ) | $ | 1 | $ | (71 | ) | $ | (77 | ) | |
| − per LP unit(1) | (0.10 | ) | (0.03 | ) | (0.20 | ) | (0.19 | ) | ||||
| Funds From Operations (FFO)(2) | 312 | 294 | 587 | 537 | ||||||||
| − per Unit(2)(3) | 0.48 | 0.46 | 0.91 | 0.83 | ||||||||
Brookfield Renewable reported FFO of
Additional highlights:
- We were successful in our growth activities, signing transactions for
$1.3 billion of equity investment ($300 million net to Brookfield Renewable) alongside our institutional partners; - Continued to advance development activities, commissioning approximately 1,500 megawatts of capacity year to date including the final phase of the 1.2-gigawatt Janaúba solar complex in
Brazil , one of the largest solar projects in theAmericas , which we successfully developed from the permitting phase through to generation; - Advanced key commercial priorities this quarter including signing contracts to deliver an incremental 2,000 gigawatt hours per year of generation, including 900 gigawatt hours to corporate offtakers;
- Moved forward the regulatory approval processes for recently announced acquisitions and expect to close the Westinghouse,
Duke Energy Renewables , and X-Elio acquisitions in the second half of this year. We also expect to close the Origin acquisition early next year, if not sooner; and - To date we have executed asset recycling activities generating proceeds of approximately
$600 million (~$400 million net to Brookfield Renewable) and advanced other processes which when completed, we expect to generate significant additional capital.
The Benefit of a Diverse and Global Franchise
We continue to see increasing corporate demand for renewable energy contracted at attractive prices and expect demand from select large technology companies to increase significantly through the mid-to-latter part of this decade on the back of growth in expected generative AI computing demand. These companies, with whom we have long standing global relationships, are already the largest corporate procurers of green power and we are well positioned to be a trusted partner given our capability and credibility in providing large scale clean energy solutions. We expect that as their demand continues to grow, the market will increasingly favor businesses like ours that have the ability to execute across the development spectrum and across all major power markets. With the growth in the sector, continuing to scale in-line with the increasing market demand remains a competitive advantage.
As an example, in June, we agreed to acquire
We also continue to identify and successfully execute repowering projects where we enhance the productivity and extend the life of assets located at sites with strong renewable resources. The majority of our repowering activity is in the
Operating Results
We generated FFO of
During the quarter, our hydroelectric segment delivered FFO of
Our wind and solar segment continued to perform well generating a combined
Our renewable power development pipeline is now 134,400 megawatts, with approximately 5,000 megawatts on track for commissioning this year and another approximately 19,000 megawatts in our advanced stage pipeline. So far this year, we have commissioned approximately 1,500 megawatts, including battery storage projects at our existing assets helping to improve our realized power pricing and grid reliability.
Our approach to development is predicated on matching our cash flows and costs to materially de-risk projects. As a result, we have mitigated the impact of cost escalation that many renewable power developers are experiencing in the current market and positioned ourselves to realize the forecasted benefits of our projects. Once completed, we expect new capacity commissioned this year will add approximately
Balance Sheet & Liquidity
Our financial position remains strong with over
Coinciding with the agreement to acquire
We have always focused on financing our growth via asset recycling, upfinancings and with a measured amount corporate debt or preferred equity. However, given our step-change in terms of run-rate growth, which we expect to continue, and our recent ability to acquire assets at attractive valuations, we issued equity capital to supplement these sources of financing. Following the offering, we are well positioned to continue to fund our long-term growth targets through a mix of our normal course funding sources.
During the quarter, we advanced non-recourse financing initiatives and our asset recycling program, where we continue to see strong demand for renewable energy assets globally with long term sector tailwinds offsetting the near-term effects from inflation and higher interest rates.
Thus far in 2023, we have generated approximately
During the quarter, our asset recycling activities were highlighted by an agreement to sell a ~120-megawatt wind and solar portfolio in
We are advancing additional capital recycling opportunities across our business that together with year-to-date agreements could generate significant additional capital when closed.
Distribution Declaration
The next quarterly distribution in the amount of
The quarterly dividends on BEP's preferred shares and preferred LP units have also been declared.
Distribution Currency Option
The quarterly distributions payable on the BEP units and BEPC shares are declared in
Registered unitholders who are residents in
Distribution Reinvestment Plan
Additional information on Brookfield Renewable’s distributions and preferred share dividends can be found on our website at www.bep.brookfield.com.
Brookfield Renewable
Brookfield Renewable operates one of the world’s largest publicly traded, pure-play renewable power platforms. Our portfolio consists of hydroelectric, wind, utility-scale solar and storage facilities in
Brookfield Renewable is the flagship listed renewable power company of Brookfield Asset Management, a leading global alternative asset manager with approximately
Please note that Brookfield Renewable’s previous audited annual and unaudited quarterly reports filed with the
| Contact information: | |
| Media: | Investors: |
| Managing Director – Communications | Vice President – Investor Relations |
| +44 (0)7398 909 278 | (416-649-8196) |
| [email protected] | [email protected] |
Quarterly Earnings Call Details
Investors, analysts and other interested parties can access Brookfield Renewable’s Second Quarter 2023 Results as well as the Letter to Unitholders and Supplemental Information on Brookfield Renewable’s website at https://bep.brookfield.com.
The conference call can be accessed via webcast on
| Consolidated Statements of Financial Position |
||||||||
| As of | ||||||||
| UNAUDITED (MILLIONS) |
||||||||
| 2023 | 2022 | |||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 1,202 | $ | 998 | ||||
| Trade receivables and other financial assets(5) | 3,885 | 3,747 | ||||||
| Equity-accounted investments | 1,644 | 1,392 | ||||||
| Property, plant and equipment, at fair value | 56,262 | 54,283 | ||||||
| 2,908 | 3,691 | |||||||
| Total Assets | $ | 65,901 | $ | 64,111 | ||||
| Liabilities | ||||||||
| Corporate borrowings(7) | $ | 2,651 | $ | 2,548 | ||||
| Borrowings which have recourse only to assets they finance(8) | 21,764 | 22,302 | ||||||
| Accounts payable and other liabilities(9) | 6,098 | 6,468 | ||||||
| Deferred income tax liabilities | 6,876 | 6,507 | ||||||
| Equity | ||||||||
| Non-controlling interests | ||||||||
| Participating non-controlling interests – in operating subsidiaries | $ | 16,604 | $ | 14,755 | ||||
| General partnership interest in a holding subsidiary held by Brookfield | 59 | 59 | ||||||
| Participating non-controlling interests – in a holding subsidiary – Redeemable/Exchangeable units held by Brookfield | 2,908 | 2,892 | ||||||
| BEPC exchangeable shares | 2,686 | 2,561 | ||||||
| Preferred equity | 584 | 571 | ||||||
| Perpetual subordinated notes | 592 | 592 | ||||||
| Preferred limited partners' equity | 760 | 760 | ||||||
| Limited partners' equity | 4,319 | 28,512 | 4,096 | 26,286 | ||||
| Total Liabilities and Equity | $ | 65,901 | $ | 64,111 | ||||
.
| Consolidated Statements of Operating Results |
|||||||||||||
| UNAUDITED | For the three months ended |
For the six months ended |
|||||||||||
| (MILLIONS, EXCEPT AS NOTED) | 2023 | 2022 | 2023 | 2022 | |||||||||
| Revenues | $ | 1,205 | $ | 1,274 | $ | 2,536 | $ | 2,410 | |||||
| Other income | 61 | 14 | 87 | 85 | |||||||||
| Direct operating costs(10) | (425 | ) | (366 | ) | (826 | ) | (716 | ) | |||||
| Management service costs | (55 | ) | (65 | ) | (112 | ) | (141 | ) | |||||
| Interest expense | (402 | ) | (294 | ) | (796 | ) | (560 | ) | |||||
| Share of earnings from equity-accounted investments | 13 | 29 | 46 | 48 | |||||||||
| Foreign exchange and financial instrument (loss) gain | 153 | (12 | ) | 295 | (49 | ) | |||||||
| Depreciation | (458 | ) | (389 | ) | (887 | ) | (790 | ) | |||||
| Other | 78 | (7 | ) | 28 | (54 | ) | |||||||
| Income tax recovery (expense) | |||||||||||||
| Current | (37 | ) | (31 | ) | (80 | ) | (73 | ) | |||||
| Deferred | 18 | (31 | ) | 37 | (5 | ) | |||||||
| Net income | $ | 151 | $ | 122 | $ | 328 | $ | 155 | |||||
| Net income attributable to preferred equity, preferred limited partners' equity, perpetual subordinated notes and non-controlling interests in operating subsidiaries | $ | (190 | ) | $ | (121 | ) | $ | (399 | ) | $ | (232 | ) | |
| Net (loss) income attributable to Unitholders | (39 | ) | 1 | (71 | ) | (77 | ) | ||||||
| Basic and diluted loss per LP unit | $ | (0.10 | ) | $ | (0.03 | ) | $ | (0.20 | ) | $ | (0.19 | ) | |
| Consolidated Statements of Cash Flows | |||||||||||||
| For the three months ended |
For the six months ended |
||||||||||||
| UNAUDITED (MILLIONS) |
2023 | 2022 | 2023 | 2022 | |||||||||
| Operating activities | |||||||||||||
| Net income | $ | 151 | $ | 122 | $ | 328 | $ | 155 | |||||
| Adjustments for the following non-cash items: | |||||||||||||
| Depreciation | 458 | 389 | 887 | 790 | |||||||||
| Unrealized foreign exchange and financial instrument loss (gain) | (144 | ) | 56 | (274 | ) | 106 | |||||||
| Share of earnings from equity-accounted investments | (13 | ) | (29 | ) | (46 | ) | (48 | ) | |||||
| Deferred income tax (expense) recovery | (18 | ) | 31 | (37 | ) | 5 | |||||||
| Other non-cash items | (15 | ) | 12 | 22 | 12 | ||||||||
| 419 | 581 | 880 | 1,020 | ||||||||||
| Net change in working capital and other(11) | (37 | ) | (143 | ) | 165 | (279 | ) | ||||||
| 382 | 438 | 1,045 | 741 | ||||||||||
| Financing activities | |||||||||||||
| Net corporate borrowings | — | — | 293 | — | |||||||||
| Non-recourse borrowings, commercial paper, and related party borrowings, net | (794 | ) | 1,081 | (1,056 | ) | 2,355 | |||||||
| Capital contributions from participating non-controlling interests – in operating subsidiaries, net | 587 | 168 | 1,581 | 274 | |||||||||
| Issuance of equity instruments, net and related costs | 630 | (88 | ) | 630 | (137 | ) | |||||||
| Distributions paid: | |||||||||||||
| To participating non-controlling interests - in operating subsidiaries | (307 | ) | (666 | ) | (449 | ) | (857 | ) | |||||
| To unitholders of Brookfield Renewable or BRELP | (246 | ) | (228 | ) | (489 | ) | (458 | ) | |||||
| (130 | ) | 267 | 510 | 1,177 | |||||||||
| Investing activities | |||||||||||||
| Acquisitions net of cash and cash equivalents in acquired entity | (6 | ) | 1 | (87 | ) | (779 | ) | ||||||
| Investment in property, plant and equipment | (484 | ) | (449 | ) | (1,056 | ) | (901 | ) | |||||
| Disposal (purchase) of associates and other assets | 321 | (98 | ) | (218 | ) | (59 | ) | ||||||
| Restricted cash and other | (31 | ) | 10 | (15 | ) | — | |||||||
| (200 | ) | (536 | ) | (1,376 | ) | (1,739 | ) | ||||||
| Foreign exchange gain (loss) on cash | 16 | (19 | ) | 30 | (20 | ) | |||||||
| Cash and cash equivalents | |||||||||||||
| Decrease (increase) | 68 | 150 | 209 | 159 | |||||||||
| Net change in cash classified within assets held for sale | (6 | ) | (1 | ) | (5 | ) | — | ||||||
| Balance, beginning of period | 1,140 | 910 | 998 | 900 | |||||||||
| Balance, end of period | $ | 1,202 | $ | 1,059 | $ | 1,202 | $ | 1,059 | |||||
PROPORTIONATE RESULTS FOR THE THREE MONTHS ENDED
The following chart reflects the generation and summary financial figures on a proportionate basis for the three months ended
| (GWh) | (MILLIONS) | |||||||||||||||||||||||||
| Actual Generation | LTA Generation | Revenues | Adjusted EBITDA | FFO | ||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||
| Hydroelectric | ||||||||||||||||||||||||||
| 3,028 | 3,478 | 3,569 | 3,569 | $ | 274 | $ | 297 | $ | 181 | $ | 204 | $ | 114 | $ | 155 | |||||||||||
| 1,062 | 938 | 1,020 | 1,017 | 58 | 45 | 42 | 34 | 36 | 24 | |||||||||||||||||
| 904 | 1,125 | 907 | 949 | 66 | 67 | 47 | 45 | 21 | 26 | |||||||||||||||||
| 4,994 | 5,541 | 5,496 | 5,535 | 398 | 409 | 270 | 283 | 171 | 205 | |||||||||||||||||
| Wind | ||||||||||||||||||||||||||
| 921 | 1,055 | 1,148 | 1,163 | 73 | 85 | 84 | 54 | 68 | 38 | |||||||||||||||||
| 173 | 210 | 204 | 215 | 35 | 32 | 32 | 33 | 27 | 28 | |||||||||||||||||
| 149 | 126 | 181 | 167 | 9 | 7 | 7 | 6 | 5 | 4 | |||||||||||||||||
| 198 | 154 | 240 | 139 | 13 | 10 | 10 | 9 | 7 | 6 | |||||||||||||||||
| 1,441 | 1,545 | 1,773 | 1,684 | 130 | 134 | 133 | 102 | 107 | 76 | |||||||||||||||||
| Utility-scale solar | 661 | 541 | 843 | 663 | 110 | 112 | 107 | 104 | 77 | 74 | ||||||||||||||||
| Distributed energy & sustainable solutions(12) | 447 | 351 | 291 | 270 | 81 | 68 | 63 | 47 | 54 | 38 | ||||||||||||||||
| Corporate | — | — | — | — | — | — | 13 | 11 | (97 | ) | (99 | ) | ||||||||||||||
| Total | 7,543 | 7,978 | 8,403 | 8,152 | $ | 719 | $ | 723 | $ | 586 | $ | 547 | $ | 312 | $ | 294 | ||||||||||
PROPORTIONATE RESULTS FOR THE SIX MONTHS ENDED
The following chart reflects the generation and summary financial figures on a proportionate basis for the six months ended
| (GWh) | (MILLIONS) | |||||||||||||||||||||||||
| Actual Generation | LTA Generation | Revenues | Adjusted EBITDA | FFO | ||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||
| Hydroelectric | ||||||||||||||||||||||||||
| 6,604 | 6,622 | 6,806 | 6,806 | $ | 609 | $ | 533 | $ | 411 | $ | 345 | $ | 272 | $ | 249 | |||||||||||
| 2,269 | 2,019 | 2,028 | 2,005 | 119 | 93 | 87 | 87 | 74 | 69 | |||||||||||||||||
| 1,914 | 2,097 | 1,760 | 1,814 | 132 | 140 | 95 | 98 | 44 | 61 | |||||||||||||||||
| 10,787 | 10,738 | 10,594 | 10,625 | 860 | 766 | 593 | 530 | 390 | 379 | |||||||||||||||||
| Wind | ||||||||||||||||||||||||||
| 2,051 | 2,202 | 2,527 | 2,356 | 158 | 171 | 145 | 114 | 111 | 82 | |||||||||||||||||
| 426 | 454 | 481 | 492 | 75 | 83 | 64 | 79 | 53 | 69 | |||||||||||||||||
| 282 | 227 | 314 | 293 | 17 | 13 | 13 | 10 | 10 | 7 | |||||||||||||||||
| 373 | 288 | 463 | 272 | 23 | 19 | 19 | 16 | 12 | 10 | |||||||||||||||||
| 3,132 | 3,171 | 3,785 | 3,413 | 273 | 286 | 241 | 219 | 186 | 168 | |||||||||||||||||
| Utility-scale solar | 1,147 | 895 | 1,414 | 1,086 | 198 | 193 | 176 | 194 | 117 | 138 | ||||||||||||||||
| Distributed energy & sustainable solutions(13) | 717 | 599 | 484 | 442 | 160 | 127 | 119 | 95 | 97 | 75 | ||||||||||||||||
| Corporate | — | — | — | — | — | — | 16 | 8 | (203 | ) | (223 | ) | ||||||||||||||
| Total | 15,783 | 15,403 | 16,277 | 15,566 | $ | 1,491 | $ | 1,372 | $ | 1,145 | $ | 1,046 | $ | 587 | $ | 537 | ||||||||||
RECONCILIATION OF NON-IFRS MEASURES
The following table reflects Adjusted EBITDA and provides a reconciliation from Net income (loss) to Adjusted EBITDA for the three months ended
| Attributable to Unitholders | ||||||||||||||||||
| (MILLIONS) | Hydroelectric |
Wind |
Utility- scale solar |
Distributed energy & sustainable solutions |
Corporate |
Total |
||||||||||||
| Net income (loss) | $ | 93 | $ | 59 | $ | 39 | $ | 45 | $ | (85 | ) | $ | 151 | |||||
| Add back or deduct the following: | ||||||||||||||||||
| Depreciation | 163 | 175 | 84 | 35 | 1 | 458 | ||||||||||||
| Deferred income tax expense (recovery) | (26 | ) | 9 | 6 | (8 | ) | 1 | (18 | ) | |||||||||
| Foreign exchange and financial instrument loss (gain) | (6 | ) | (75 | ) | (28 | ) | (41 | ) | (3 | ) | (153 | ) | ||||||
| Other(14) | (7 | ) | 14 | (11 | ) | 21 | — | 17 | ||||||||||
| Management service costs | — | — | — | — | 55 | 55 | ||||||||||||
| Interest expense | 193 | 81 | 67 | 36 | 25 | 402 | ||||||||||||
| Current income tax expense | 25 | 6 | 6 | — | — | 37 | ||||||||||||
| Amount attributable to equity accounted investments and non-controlling interests(15) | (165 | ) | (136 | ) | (56 | ) | (25 | ) | 19 | (363 | ) | |||||||
| Adjusted EBITDA | $ | 270 | $ | 133 | $ | 107 | $ | 63 | $ | 13 | $ | 586 | ||||||
The following table reflects Adjusted EBITDA and provides a reconciliation from Net income (loss) to Adjusted EBITDA for the three months ended
| Attributable to Unitholders | ||||||||||||||||||
| (MILLIONS) | Hydroelectric |
Wind |
Utility- scale solar |
District energy & sustainable solutions |
Corporate |
Total |
||||||||||||
| Net income (loss) | $ | 132 | $ | 13 | $ | 1 | $ | 25 | $ | (49 | ) | $ | 122 | |||||
| Add back or deduct the following: | ||||||||||||||||||
| Depreciation | 154 | 134 | 68 | 31 | 2 | 389 | ||||||||||||
| Deferred income tax expense (recovery) | 21 | 21 | 4 | 3 | (18 | ) | 31 | |||||||||||
| Foreign exchange and financial instrument loss (gain) | 25 | (20 | ) | 10 | (2 | ) | (1 | ) | 12 | |||||||||
| Other(14) | (3 | ) | 9 | 33 | — | (3 | ) | 36 | ||||||||||
| Management service costs | — | — | — | — | 65 | 65 | ||||||||||||
| Interest expense | 144 | 60 | 46 | 19 | 25 | 294 | ||||||||||||
| Current income tax expense | 27 | 2 | 2 | — | — | 31 | ||||||||||||
| Amount attributable to equity accounted investments and non-controlling interests(15) | (217 | ) | (117 | ) | (60 | ) | (29 | ) | (10 | ) | (433 | ) | ||||||
| Adjusted EBITDA | $ | 283 | $ | 102 | $ | 104 | $ | 47 | $ | 11 | $ | 547 | ||||||
RECONCILIATION OF NON-IFRS MEASURES
The following table reflects Adjusted EBITDA and provides a reconciliation to net income (loss) to Adjusted EBITDA for the six months ended
| Attributable to Unitholders | ||||||||||||||||||
| (MILLIONS) | Hydroelectric |
Wind |
Utility- scale solar |
Distributed energy & sustainable solutions |
Corporate |
Total |
||||||||||||
| Net income (loss) | $ | 331 | $ | 105 | $ | (7 | ) | $ | 79 | $ | (180 | ) | $ | 328 | ||||
| Add back or deduct the following: | ||||||||||||||||||
| Depreciation | 317 | 330 | 167 | 72 | 1 | 887 | ||||||||||||
| Deferred income tax expense (recovery) | (1 | ) | 10 | 5 | (22 | ) | (29 | ) | (37 | ) | ||||||||
| Foreign exchange and financial instrument loss (gain) | (100 | ) | (115 | ) | (26 | ) | (50 | ) | (4 | ) | (295 | ) | ||||||
| Other(14) | 18 | 19 | 1 | 24 | 25 | 87 | ||||||||||||
| Management service costs | — | — | — | — | 112 | 112 | ||||||||||||
| Interest expense | 376 | 148 | 133 | 64 | 75 | 796 | ||||||||||||
| Current income tax expense | 59 | 10 | 11 | — | — | 80 | ||||||||||||
| Amount attributable to equity accounted investments and non-controlling interests(15) | (407 | ) | (266 | ) | (108 | ) | (48 | ) | 16 | (813 | ) | |||||||
| Adjusted EBITDA | $ | 593 | $ | 241 | $ | 176 | $ | 119 | $ | 16 | $ | 1,145 | ||||||
The following table reflects Adjusted EBITDA and provides a reconciliation to net income (loss) to Adjusted EBITDA for the six months ended
| Attributable to Unitholders | ||||||||||||||||||
| (MILLIONS) | Hydroelectric |
Wind |
Utility- scale solar |
District energy & sustainable solutions |
Corporate | Total | ||||||||||||
| Net income (loss) | $ | 218 | $ | (1 | ) | $ | 9 | $ | 62 | $ | (133 | ) | $ | 155 | ||||
| Add back or deduct the following: | ||||||||||||||||||
| Depreciation | 311 | 282 | 134 | 61 | 2 | 790 | ||||||||||||
| Deferred income tax expense (recovery) | 15 | 32 | (7 | ) | — | (35 | ) | 5 | ||||||||||
| Foreign exchange and financial instrument loss (gain) | 85 | (24 | ) | 17 | (9 | ) | (20 | ) | 49 | |||||||||
| Other(14) | 5 | 32 | 54 | 7 | 14 | 112 | ||||||||||||
| Management service costs | — | — | — | — | 141 | 141 | ||||||||||||
| Interest expense | 268 | 122 | 86 | 35 | 49 | 560 | ||||||||||||
| Current income tax expense | 64 | 6 | 3 | — | — | 73 | ||||||||||||
| Amount attributable to equity accounted investments and non-controlling interests(15) | (436 | ) | (230 | ) | (102 | ) | (61 | ) | (10 | ) | (839 | ) | ||||||
| Adjusted EBITDA | $ | 530 | $ | 219 | $ | 194 | $ | 95 | $ | 8 | $ | 1,046 | ||||||
The following table reconciles the non-IFRS financial metrics to the most directly comparable IFRS measures. Net income is reconciled to Funds From Operations:
| For the three months ended |
For the six months ended |
|||||||||||
| UNAUDITED (MILLIONS) |
2023 | 2022 | 2023 | 2022 | ||||||||
| Net income | $ | 151 | $ | 122 | $ | 328 | $ | 155 | ||||
| Add back or deduct the following: | ||||||||||||
| Depreciation | 458 | 389 | 887 | 790 | ||||||||
| Deferred income tax recovery | (18 | ) | 31 | (37 | ) | 5 | ||||||
| Foreign exchange and financial instruments gain (loss) | (153 | ) | 12 | (295 | ) | 49 | ||||||
| Other(16) | 17 | 36 | 87 | 112 | ||||||||
| Amount attributable to equity accounted investment and non-controlling interest(17) | (143 | ) | (296 | ) | (383 | ) | (574 | ) | ||||
| Funds From Operations | $ | 312 | $ | 294 | $ | 587 | $ | 537 | ||||
The following table reconciles the per Unit non-IFRS financial metrics to the most directly comparable IFRS measures. Net income per LP unit is reconciled to Funds From Operations:
| For the three months ended |
For the six months ended |
|||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||
| Net income (loss) per LP unit(1) | $ | (0.10 | ) | $ | (0.03 | ) | $ | (0.20 | ) | $ | (0.19 | ) |
| Adjust for the proportionate share of | ||||||||||||
| Depreciation | 0.38 | 0.36 | 0.75 | 0.74 | ||||||||
| Deferred income tax recovery and other | 0.25 | 0.11 | 0.47 | 0.22 | ||||||||
| Foreign exchange and financial instruments loss (gain) | (0.05 | ) | 0.02 | (0.11 | ) | 0.06 | ||||||
| Funds From Operations per Unit(3) | $ | 0.48 | $ | 0.46 | $ | 0.91 | $ | 0.83 | ||||
BROOKFIELD RENEWABLE CORPORATION REPORTS
SECOND QUARTER RESULTS
All amounts in
The Board of Directors of
The BEPC exchangeable shares are structured with the intention of being economically equivalent to the non-voting limited partnership units of
| For the three months ended |
For the six months ended |
|||||||||
| US$ millions (except per unit amounts), unaudited | 2023 | 2022 | 2023 | 2022 | ||||||
| Select Financial Information | ||||||||||
| Net loss attributable to the partnership | $ | 291 | $ | 1,046 | $ | (774 | ) | $ | 70 | |
| Funds From Operations (FFO)(2) | 195 | 181 | 397 | 334 | ||||||
BEPC reported FFO of
| Consolidated Statements of Financial Position | ||||||||
| As of | ||||||||
| UNAUDITED (MILLIONS) |
||||||||
| 2023 | 2022 | |||||||
| Assets | ||||||||
| Cash and cash equivalents | $ | 595 | $ | 642 | ||||
| Trade receivables and other financial assets(5) | 2,584 | 2,567 | ||||||
| Equity-accounted investments | 561 | 451 | ||||||
| Property, plant and equipment, at fair value | 39,241 | 37,828 | ||||||
| 1,225 | 1,800 | |||||||
| Total Assets | $ | 44,206 | $ | 43,288 | ||||
| Liabilities | ||||||||
| Borrowings which have recourse only to assets they finance(8) | $ | 13,770 | $ | 13,715 | ||||
| Accounts payable and other liabilities(9) | 3,001 | 3,122 | ||||||
| Deferred income tax liabilities | 5,643 | 5,263 | ||||||
| BEPC exchangeable and class B shares | 5,298 | 4,364 | ||||||
| Equity | ||||||||
| Non-controlling interests: | ||||||||
| Participating non-controlling interests – in operating subsidiaries | $ | 10,821 | $ | 10,680 | ||||
| Participating non-controlling interests – in a holding subsidiary held by the partnership | 289 | 271 | ||||||
| The partnership | 5,384 | 16,494 | 5,873 | 16,824 | ||||
| Total Liabilities and Equity | $ | 44,206 | $ | 43,288 | ||||
| Consolidated Statements of Income (Loss) | ||||||||||||||
| UNAUDITED (MILLIONS) |
For the three months ended |
For the six months ended |
||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||
| Revenues | $ | 901 | $ | 997 | $ | 1,967 | $ | 1,926 | ||||||
| Other income | 39 | 6 | 52 | 70 | ||||||||||
| Direct operating costs(10) | (308 | ) | (296 | ) | (612 | ) | (587 | ) | ||||||
| Management service costs | (32 | ) | (43 | ) | (68 | ) | (95 | ) | ||||||
| Interest expense | (315 | ) | (255 | ) | (621 | ) | (483 | ) | ||||||
| Share of (loss) earnings from equity-accounted investments | (3 | ) | 1 | — | (1 | ) | ||||||||
| Foreign exchange and financial instrument gain (loss) | (9 | ) | 3 | 101 | (30 | ) | ||||||||
| Depreciation | (327 | ) | (286 | ) | (633 | ) | (582 | ) | ||||||
| Other | 52 | — | 18 | (26 | ) | |||||||||
| Remeasurement of BEPC exchangeable and class B shares | 380 | 1,080 | (683 | ) | 171 | |||||||||
| Income tax (expense) recovery | ||||||||||||||
| Current | (34 | ) | (29 | ) | (72 | ) | (67 | ) | ||||||
| Deferred | 16 | (41 | ) | (9 | ) | (41 | ) | |||||||
| Net income | $ | 360 | $ | 1,137 | $ | (560 | ) | $ | 255 | |||||
| Net income (loss) attributable to: | ||||||||||||||
| Non-controlling interests: | ||||||||||||||
| Participating non-controlling interests – in operating subsidiaries | $ | 68 | $ | 90 | $ | 211 | $ | 180 | ||||||
| Participating non-controlling interests – in a holding subsidiary held by the partnership | 1 | 1 | 3 | 5 | ||||||||||
| The partnership | 291 | 1,046 | (774 | ) | 70 | |||||||||
| $ | 360 | $ | 1,137 | $ | (560 | ) | $ | 255 | ||||||
| Consolidated Statements of Cash Flows | |||||||||||||
| UNAUDITED (MILLIONS) |
For the three months ended |
For the six months ended |
|||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||
| Operating activities | |||||||||||||
| Net income (loss) | $ | 360 | $ | 1,137 | $ | (560 | ) | $ | 255 | ||||
| Adjustments for the following non-cash items: | |||||||||||||
| Depreciation | 327 | 286 | 633 | 582 | |||||||||
| Unrealized foreign exchange and financial instruments loss (gain) | 16 | 29 | (92 | ) | 84 | ||||||||
| Share of earnings from equity-accounted investments | 3 | (1 | ) | — | 1 | ||||||||
| Deferred income tax expense (recovery) | (16 | ) | 41 | 9 | 41 | ||||||||
| Other non-cash items | 5 | 7 | 29 | (5 | ) | ||||||||
| Remeasurement of exchangeable and class B shares | (380 | ) | (1,080 | ) | 683 | (171 | ) | ||||||
| Dividends received from equity-accounted investments | |||||||||||||
| 315 | 419 | 702 | 787 | ||||||||||
| Net change in working capital and other(11) | (62 | ) | (96 | ) | 142 | (212 | ) | ||||||
| 253 | 323 | 844 | 575 | ||||||||||
| Financing activities | |||||||||||||
| Non-recourse borrowings and related party borrowings, net | (345 | ) | 475 | (626 | ) | 665 | |||||||
| Capital contributions from participating non-controlling interests | 51 | 135 | 103 | 196 | |||||||||
| Issuance of exchangeable shares, net | 251 | — | 251 | — | |||||||||
| Distributions paid and return of capital: | |||||||||||||
| To participating non-controlling interests | (188 | ) | (642 | ) | (321 | ) | (807 | ) | |||||
| To the partnership | — | — | — | — | |||||||||
| (231 | ) | (32 | ) | (593 | ) | 54 | |||||||
| Investing activities | |||||||||||||
| Acquisitions net of cash and cash equivalents in acquired entity | — | — | (81 | ) | — | ||||||||
| Investment in equity-accounted investments | (3 | ) | — | (3 | ) | — | |||||||
| Investment in property, plant and equipment | (158 | ) | (246 | ) | (320 | ) | (414 | ) | |||||
| Disposal of subsidiaries, associates and other securities, net | 103 | 88 | 106 | 88 | |||||||||
| Restricted cash and other | (37 | ) | (19 | ) | (24 | ) | (21 | ) | |||||
| (95 | ) | (177 | ) | (322 | ) | (347 | ) | ||||||
| Foreign exchange gain (loss) on cash | 14 | (18 | ) | 27 | (17 | ) | |||||||
| Cash and cash equivalents | |||||||||||||
| Increase (decrease) | (59 | ) | 96 | (44 | ) | 265 | |||||||
| Net change in cash classified within assets held for sale | (3 | ) | — | (3 | ) | — | |||||||
| Balance, beginning of period | 657 | 694 | 642 | 525 | |||||||||
| Balance, end of period | 595 | 790 | $ | 595 | $ | 790 | |||||||
RECONCILIATION OF NON-IFRS MEASURES
The following table reconciles Net income (loss) to Funds From Operations:
| For the three months ended |
For the six months ended |
||||||||||||
| UNAUDITED (MILLIONS) |
2023 | 2022 | 2023 | 2022 | |||||||||
| Net loss | $ | 360 | $ | 1,137 | $ | (560 | ) | $ | 255 | ||||
| Add back or deduct the following: | |||||||||||||
| Depreciation | 327 | 286 | 633 | 582 | |||||||||
| Foreign exchange and financial instruments loss (gain) | 9 | (3 | ) | (101 | ) | 30 | |||||||
| Deferred income tax expense (recovery) | (16 | ) | 41 | 9 | 41 | ||||||||
| Other(18) | 34 | 35 | 78 | 85 | |||||||||
| Dividends on BEPC exchangeable shares(19) | 61 | 55 | 119 | 110 | |||||||||
| Remeasurement of BEPC exchangeable and BEPC class B shares | (380 | ) | (1,080 | ) | 683 | (171 | ) | ||||||
| Amount attributable to equity accounted investments and non-controlling interests(20) | (200 | ) | (290 | ) | (464 | ) | (598 | ) | |||||
| Funds From Operations | $ | 195 | $ | 181 | $ | 397 | $ | 334 | |||||
Cautionary Statement Regarding Forward-looking Statements
This news release contains forward-looking statements and information within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of Section 27A of the
The foregoing list of important factors that may affect future results is not exhaustive. The forward-looking statements represent our views as of the date of this letter to unitholders and should not be relied upon as representing our views as of any subsequent date. While we anticipate that subsequent events and developments may cause our views to change, we disclaim any obligation to update the forward-looking statements, other than as required by applicable law.
No securities regulatory authority has either approved or disapproved of the contents of this letter to unitholders. This letter to unitholders is for information purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Cautionary Statement Regarding Use of Non-IFRS Measures
This news release contains references to FFO and FFO per Unit, which are not generally accepted accounting measures under IFRS and therefore may differ from definitions of Adjusted EBITDA, FFO and FFO per Unit used by other entities. We believe that FFO and FFO per Unit are useful supplemental measures that may assist investors in assessing the financial performance and the cash anticipated to be generated by our operating portfolio. None of FFO and FFO per Unit should be considered as the sole measure of our performance and should not be considered in isolation from, or as a substitute for, analysis of our financial statements prepared in accordance with IFRS. For a reconciliation of FFO and FFO per Unit to the most directly comparable IFRS measure, please see “Reconciliation of Non-IFRS Measures - Three Months Ended June 30” included elsewhere herein and “Financial Performance Review on Proportionate Information - Reconciliation of Non-IFRS Measures” included in our unaudited Q2 2023 interim report.”
References to Brookfield Renewable are to
Endnotes
(1) For the three and six months ended
(2) Non-IFRS measures. Refer to “Cautionary Statement Regarding Use of Non-IFRS Measures”.
(3) Average Units outstanding for the three and six months ended
(4) Normalized FFO assumes long-term average generation in all segments and uses 2022 foreign currency rates. For the three and six months ended
(5) Balance includes restricted cash, trades receivables and other current assets, financial instrument assets, and due from related parties.
(6) Balance includes goodwill, deferred income tax assets, assets held for sale, intangible assets, and other long-term assets.
(7) Balance includes current and non-current portion of corporate borrowings.
(8) Balance includes current and non-current portion of non-recourse borrowings on the consolidated statement of financial position.
(9) Balance includes accounts payable and accrued liabilities, financial instrument liabilities, due to related parties, provisions, liabilities directly associated with assets held for sale and other long-term liabilities.
(10) Direct operating costs exclude depreciation expense disclosed below.
(11) Balance includes change in working capital, dividends received from equity accounted investments and changes due to or from related parties.
(12) Actual generation includes 172 GWh (2022:98 GWh) from facilities that do not have a corresponding LTA.
(13) Actual generation includes 293 GWh (2022:203 GWh) from facilities that do not have a corresponding LTA.
(14) Other corresponds to amounts that are not related to the revenue earning activities and are not normal, recurring cash operating expenses necessary for business operations. Other also includes derivative and other revaluations and settlements, gains or losses on debt extinguishment/modification, transaction costs, legal, provisions, amortization of concession assets and Brookfield Renewable’s economic share of foreign currency hedges and realized disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term that are included within Adjusted EBITDA.
(15) Amount attributable to equity accounted investments corresponds to the Adjusted EBITDA to Brookfield Renewable that are generated by its investments in associates and joint ventures accounted for using the equity method. Amounts attributable to non-controlling interest are calculated based on the economic ownership interest held by non-controlling interests in consolidated subsidiaries. By adjusting Adjusted EBITDA attributable to non-controlling interest, our partnership is able to remove the portion of Adjusted EBITDA earned at non-wholly owned subsidiaries that are not attributable to our partnership.
(16) Other corresponds to amounts that are not related to the revenue earning activities and are not normal, recurring cash operating expenses necessary for business operations. Other also includes derivative and other revaluations and settlements, gains or losses on debt extinguishment/modification, transaction costs, legal, provisions, amortization of concession assets and Brookfield Renewable’s economic share of foreign currency hedges and realized disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term that are included in Funds From Operations.
(17) Amount attributable to equity accounted investments corresponds to the Funds From Operations that are generated by its investments in associates and joint ventures accounted for using the equity method. Amounts attributable to non-controlling interest are calculated based on the economic ownership interest held by non-controlling interests in consolidated subsidiaries. By adjusting Funds From Operations attributable to non-controlling interest, our partnership is able to remove the portion of Funds From Operations earned at non-wholly owned subsidiaries that are not attributable to our partnership.
(18) Other corresponds to amounts that are not related to the revenue earning activities and are not normal, recurring cash operating expenses necessary for business operations. Other balance also includes derivative and other revaluations and settlements, gains or losses on debt extinguishment/modification, transaction costs, legal, provisions, amortization of concession assets and the company’s economic share of foreign currency hedges and realized disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term that are included in Funds From Operations.
(19) Balance is included within interest expense on the consolidated statements of income (loss).
(20) Amount attributable to equity accounted investments corresponds to the Funds From Operations that are generated by its investments in associates and joint ventures accounted for using the equity method. Amounts attributable to non-controlling interest are calculated based on the economic ownership interest held by non-controlling interests in consolidated subsidiaries. By adjusting Funds From Operations attributable to non-controlling interest, our company is able to remove the portion of Funds From Operations earned at non-wholly owned subsidiaries that are not attributable to our company.
(21) Any references to capital refer to Brookfield's cash deployed, excluding any debt financing.
(22) Available liquidity of over
(23) 12-15% target returns are calculated as annualized cash return on investment.
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