Brookfield Infrastructure Partners LP

Good day and thank you for standing by. Welcome to the Brookfield Infrastructure Partners' fourth quarter 2025 results conference call and webcast. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I'd now like to hand the conference over to your speaker today, David Krent, Chief Financial Officer. Please go ahead.

Thank you, Liz, and good morning, everyone. Welcome to Brookfield Infrastructure Partners' fourth quarter 2025 earnings call. As introduced, my name is David Krent, and I'm the Chief Financial Officer of Brookfield Infrastructure. I'm joined today by our Chief Executive Officer, Sam Pollack, and our Chief Operating Officer, Ben Vaughn. Also with us today is Dave Joint, a managing partner, and Uday Mathialagan, head of our global data center businesses. I'll begin the call today by highlighting our results for 2025, followed by a recap of our record year of capital recycling. I'll then hand the call over to Uday, who will elaborate on our approach to AI infrastructure investing and how we have been able to turn sector tailwinds into durable value for unit holders. Finally, Sam will provide an update on our recent investments before concluding with an outlook of the business. At this time, I would like to remind you that in our remarks today, we may make forward-looking statements. These statements are subject to known and unknown risks, and future results may differ materially. For further information on known risk factors, I would encourage you to review our latest annual report on Form 20F, which is available on our website. 2025 was another strong year for Brookfield infrastructure. Our key accomplishments include exceeding our capital recycling target of $3 billion, investing approximately $2.2 billion of equity into growth initiatives, and completing approximately $16 billion of financing to further de-risk our operating company balance sheets. From a results perspective, we generated FFO, or funds from operations, of $2.6 billion during 2025. Normalized for the impact of asset sales and foreign exchange, FFO increased 10% compared to 2024, in line with our target and reflective of our operational performance and the strength of our business. This result includes record FFO during the fourth quarter of 87 cents per unit. Given this performance, a conservative pay ratio for the year of 66% and a strong outlook for 2026, I'm pleased to report that the Board of Directors has approved a quarterly distribution increase of 6% to $1.82 per unit on an annualized basis. This marks the 17th consecutive year of distribution increases of at least 5%. I'll now go through 7% year over year. The base business continued to perform well during the year, driven by inflation indexation across the portfolio and the contribution of roughly $500 million of capital commission in the rate base over the last 12 months. Moving on to our transport segment, FFO totaled $1.1 billion in line with the prior year after normalizing for $1.8 billion of capital recycling initiatives. The loss of earnings from these sales was partially offset by higher revenues across our transportation networks, particularly in our rail and toll road segments, where volumes and rates grew on average by 2% and 3% respectively. Our midstream segment generated FFO of $668 million for the year, representing a 7% year-over-year increase. This growth reflects higher volumes and activity levels across our midstream assets, particularly at our Canadian natural gas gathering and processing operation and our recently acquired U.S. refined products pipeline system. Lastly, FFO from our data segment was $502 million, a step-change increase over 50% compared to the prior year period. The increase is attributable to several new investments completed over the last 12 months, the most recent being our U.S. bulk fiber network, which is now fully contributing to earnings in the fourth quarter. In addition, we achieved strong organic growth across our data storage business, which included the commissioning of 220 megawatts of capacity at our hyperscale data centers, 200 megawatts of new billings at our U.S. retail co-location data center operation, and income generated by our global data center developers. Our global data center platform now has development potential consisting of approximately 3.6 gigawatts, including contracted capacity of over 2.3 gigawatts today. Before turning it over to Uday, I would like to briefly touch on our record liquidity, which totaled $6 billion at the end of 2025 and included just under $3 billion at the corporate level. Contributing to this strong position was a record $3.1 billion in asset sale proceeds raised in 2025. We believe that the elevated pace of capital recycling will continue into the year ahead. We already have two transactions secured that crystallize attractive returns. The first, which is we agreed to sell the largest of four concessions within our Brazilian electricity transmission operation. We expect proceeds of approximately $150 million net to BIP, generating an attractive IRR of 45% and over eight times multiple of capital. Closing for the transaction is expected at the end of the first quarter in 2026. Secondly, we formed a capital partnership for a portfolio of stabilized and under-construction data centers in North America. Proceeds from this sale are expected to be used to support the build-out of our powered land bank within the business. That concludes my remarks for this morning. I'll now pass the call over to Uday.

Thank you, David, and good morning, everyone. AI is justifiably dominating headlines with many bold predictions ranging from data centers in space, to breakthrough in quantum computing that could one day redefine how the world operates. At the same time, many are questioning the merits of the magnitude and velocity of capital flowing into AI, and whether demand will materialize at a level that justifies the spending. The sheer scale of investment underway to build the physical backbone that makes AI possible is staggering. In 2025 alone, corporates invested approximately $500 billion into AI-related infrastructure, with capital investment over the next two years expected to rise further. Much of this build-out is fundamental to the development of AI, enabling power-intensive workloads to run reliably, securely, and at scale in well-connected locations. The reality is, driving a sustained wave of investment into the backbone infrastructure that enables AI, including data center capacity, grid resiliency, power generation, and transmission. The sector remains exposed to overbuilding, technological change, and disruption. With capital moving quickly, not all participants will be rewarded, and there will be mistakes made. Our approach is designed to protect against such exuberance. Brookfield infrastructure is applying a prudent, risk-focused approach to participating in the build-out of AI infrastructure, maintaining strict guardrails to safeguard our capital. First, our development projects are underpinned by long-term contracts with favorable terms. We do not build speculatively and earn an attractive return within the initial contract period. mitigating technology risk. Second, the second guardrail is that we selectively focus on the strongest investment-grade counterparties, who are some of the largest, well-capitalized, and most profitable technology companies in the world. Third, we concentrate on top-tier workload-agnostic locations for our data centers, that can support the full spectrum of demand, reducing the risk of the single theme exposure and increases the durability of demand through cycles. The fourth is our discipline strategy. We are deliberate in how much land and powered shells we control and develop. We have created a self-funding model that provides funding for future development and locks in attractive develop economics. as well as reduces the size of our platform while maintaining the benefits of scale. And fifth, we match the capital structure to the tenor of the contracted cash flows with a focus on preserving flexibility and ensuring that we can finance growth responsibly. To illustrate the benefits of our approach, during 2025, we experienced exceptional demand at our data center platforms, securing record growth commercialization, capital recycling, and capital markets activities. For example, at our U.S. core location data center business, we experienced 11 consecutive quarters of record bookings, and it's now fully utilized across several markets. During the quarter, we signed several large contracts at a data center in Illinois, achieving 100% occupancy. and adding approximately 45 million of annual EBITDA on a run rate basis commencing later this year. Without investing any further equity, we acquired and added a 40-site data set of portfolio in January 2024 to our existing business and subsequently increased EBITDA from a combined base of approximately 200 million to approximately 500 million on a contracted basis. The exciting part that the growth journey is expected to continue, led by high returning undergrowth densification and in-footprint expansion capacity, which total over 600 megawatts of identified growth potential. Across our global data center platform, we achieved a significant lease up of our land bank during the fourth quarter, which is expected to be commissioned over the next three years. We execute agreements for approximately 800 megawatts of capacity, predominantly in North America. The vast majority of these leases are with investment grade customers and underpinned by long-term contracts. Since acquiring our North American and European platforms, our adherence to the guardrails outlined above has allowed us to maintain a consistent greenfield data center yield on cost. In 2025, we partnered on almost 850 megawatts of stabilized and operating sites in North America and Europe, crystallizing developer premiums and demonstrating strong demand. Taken together, we hope these examples highlight both the strength of demand we're seeing and importance of disciplined execution converting demand into durable returns. As AI workloads scale, the value well located Powered infrastructure intensifies. In this environment, scale, reliability, and access to capital are differentiating factors to counterparties, and we believe our global operating capabilities and longstanding relationships benefit us. Our risk-focused approach and strict adherence to guardrails will enable us to continue investing in the core infrastructure needed to deliver AI at scale while protecting our downside. That concludes my remarks for this morning, and I will now pass the call over to Sam.