Brookfield Q1 Profit Falls, Raises $20B, Expands Strategy

Key Takeaway

• Brookfield Asset Management's Q1 2024 distributable earnings slightly fell to $547 million, but fee-related earnings grew to $552 million.
• Raised $20 billion in capital, including a significant first close of its global transition fund at $10 billion.
• Strategic expansions include a $50 billion mandate with AEL and increasing Oaktree ownership to 73%, aiming for diversified growth.

Fee-Related Earnings Growth

Brookfield Asset Management reported its financial results for the first quarter of 2024, showcasing a mix of achievements and challenges. The company, a leading global alternative asset manager, announced distributable earnings of $547 million, or 34 cents a share. This figure aligns with the average estimate of analysts surveyed by Bloomberg and represents a slight decrease from $563 million in the same period a year earlier. Despite this dip, Brookfield highlighted growth in its fee-related earnings, which stood at $552 million for the quarter, compared to $547 million in the previous year. This growth is attributed to a 15% increase in fee revenues from flagship, private credit, and insurance strategies, bolstered by a similar growth in related fee-bearing capital.

Strategic Fundraising and Investments

During the first quarter, Brookfield raised $20 billion of capital, including approximately $10 billion across more than a dozen credit strategies. Notably, the firm finalized the first close of its flagship global transition fund strategy at $10 billion and raised over $3.0 billion within its infrastructure business. These fundraising efforts contribute to Brookfield's strategic positioning, with President Connor Teskey stating, "We are off to a strong start in 2024 and are seeing accelerating momentum across our business as transaction activity picks up." The company's ambition to reach $1 trillion in fee-bearing assets by 2028 is underscored by its current standing at $459 billion, marking a 6% increase over the past year.

Expansion and Diversification

Brookfield's strategic initiatives include a $50 billion asset management mandate with American Equity Investment Life (AEL) and the acquisition of a majority stake in Castlelake, enhancing its insurance and private credit capabilities. These moves are part of Brookfield's broader strategy to diversify its business mix and global footprint, aiming to capture a wide array of investment opportunities. The acquisition of an additional 5% interest in Oaktree, increasing Brookfield's ownership stake to 73%, further exemplifies this strategy.