Brookfield Infrastructure Partners LP

Good day, and welcome to the Brookfield Infrastructure Partners' 2026 Results Conference Call and Webcast. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Mr. David Krantz, Chief Financial Officer. Please go ahead.

Thank you, Cherie, and good morning, everyone. Welcome to Brookfield Infrastructure Partners' first quarter 2026 earnings conference call. As introduced, my name is David Krantz, and I am the Chief Financial Officer of Brookfield Infrastructure. I am joined today by our Chief Executive Officer, Sam Pollack, and our Chief Operating Officer, Ben Vaughn. Also joining us today is Dave Joint, a managing partner on our investments team. I'll begin the call today with a discussion of our first quarter 2026 financial and operating results, followed by an update on our capital recycling initiatives. I'll then turn the call over to Sam, who will provide an update on our recent strategic initiatives before concluding with an outlook for the business. At this time, I'd like to remind you that in our remarks today, we may make forward-looking statements. These statements are subject to known and unknown risk factors, 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. So with that, Brookfield Infrastructure had a strong start to the year, delivering record results while continuing to advance a number of strategic initiatives across the business. We generated funds from operations, or SFO, of $709 million or $0.90 per unit in the first quarter. This is a 10% increase compared to the prior year. This performance was driven by strong base business results highlighted by FFO from our data and midstream segments increasing 46% and 12% respectively compared to the prior year. Results in our utilities and transport segments reflected resilient underlying performance with the current period impacted by higher levels of capital recycling activity achieved during 2025. I'll now go through our results by segment in more detail. Our utility segment generated FFO of $201 million, up 5% year over year. The increase was primarily driven by inflation indexation and the benefit of over $500 million of capital commissioned into rate base, along with a contribution from our recently acquired South Korean industrial gas business. Moving on to our transport segment, SFO was $283 million, slightly below the same period last year. The decrease was primarily attributable to lost contributions from our successful asset sales. As a reminder, this included our Australian export and container terminal operations, the partial sale of a UK port operation, and the majority interest in a portfolio of fully contracted containers at our global intermodal logistics business. This was partially offset by the acquisition of a North American rail car leasing platform that closed on the 1st of January. After adjusting for all these factors, FFO was ahead of the prior year, reflecting higher volumes and tariffs generally across our rail and road operations. Our midstream segment generated FFO of $190 million, up 12% compared to the same period last year. The increase reflects attractive commodity pricing, strong asset utilization, and robust customer activity levels across our portfolio. Lastly, FFO from our data segment was $149 million, representing a step-changing increase of 46% compared to the prior year. The increase was driven by the contribution from our U.S. bulk fiber network, which we acquired in the third quarter of last year, as well as organic growth across our data storage businesses, which included the commissioning of over 200 megawatts of operating data centers into earnings over the last year. In addition to the strong financial and operating results we have delivered, we also made meaningful progress towards our 2026 capital recycling goal, with proceeds secured of $1 billion to date. This includes closing the initial tranche of our partnership on a portfolio of stabilized and under-construction data centers in North America, and the closing of the sale of the largest of four concessions within our Brazilian electricity transmission business. We also completed a secondary sale of a 12% interest in our North American gas storage business. And finally, in April, we signed an agreement to sell our bulk liquid storage business, the largest independent storage provider in Scandinavia. These asset sales improved our strong corporate liquidity position, which was $2.5 billion at the end of the first quarter. Our balance sheet remains well capitalized, and our proactive approach to managing debt maturities has allowed us to remain opportunistic in the capital markets. During the quarter, we refinanced approximately $1.5 billion of non-recourse debt on a net-to-bid basis with no incremental borrowing costs for the business. Before turning the call over to Sam, I would like to briefly note that we have recently begun exploring whether a single combined corporate structure would be the best path forward for the business. The goal is to determine if on a tax-free basis we can create a single corporate security that would enhance liquidity, increase index inclusion, and create value for investors. We are in the early stages of this evaluation and will provide an update when appropriate. So that concludes my remarks for this morning. I'll now turn the call over to Sam.

Thank you, David, and good morning, everyone. For my remarks today, I'm going to discuss our strategic initiatives before concluding with an outlook for the year ahead. We've had an active start to the year with business development activity resulting in new strategic capital partnerships and continued progress under established frameworks. These partnerships are bilaterally sourced with high-quality counterparties and gives us exclusive access to investment opportunities that require long-duration capital at scale. Increasingly, these frameworks are becoming a more meaningful avenue for growth, reinforcing our position as a partner of choice and expanding our opportunity set to deploy large-scale capital at attractive risk-adjusted returns. During the quarter, we established a new framework with a leading global investment grade OEM, launching an exclusive leasing platform for industrial equipment. Through this platform, we will provide long-term leasing solutions that are expected to generate predictable cash flows without residual value, interest rate, or refinancing risk. We will have the sole discretion to enter leases under the framework with BIP's share of the equity investment expected to be upwards of $375 million. Our $5 billion strategic partnership to install up to 1 gigawatts behind-the-meter power generation advanced further this quarter as well. We secured an additional $430 million CapEx project, bringing the total capital committed under the framework to approximately $1.6 billion. BIP's total equity commitment associated with the framework to date is approximately $60 million. Given the success of the behind-the-meter solution, and strong customer demand based on speed to market, we may have the ability to expand the platform in the coming months. We also remain on track to close Claris. This is New Zealand's leading gas infrastructure utility in the second quarter for an equity purchase price of approximately $70 million at our share. Now moving to our outlook, we are progressing through 2026 from a position of strength and remain very constructive on the backdrop for infrastructure. While recent geopolitical developments have contributed to greater market volatility, the essential nature of our businesses and the regulator contractual profile of our cash flows continue to provide resilience and growth. More broadly, demand for additional power, connectivity, and logistics capacity continues to expand. This is being driven by digitalization, accelerating power demand, the rapid build out of AI infrastructure, and the ongoing reconfiguration of global supply chains. These tailwinds are expanding our opportunity set and providing attractive admins to deploy capital at compelling risk-adjusted returns. Coupled with strong operating performance and a visible pipeline of organic growth projects, these factors position us well to deliver 10% plus per unit FFO growth in 2026. As David mentioned, our capital recycling program and balance sheet continues to provide the flexibility to fully self-fund the growth ahead. With multiple sale processes underway across our business and continued access to capital markets through windows of opportunity, we are well positioned to fund our investment pipeline while maintaining financial discipline. Taken together, this supports our confidence in the outlook for 2026 and our ability to continue compounding value for our unit holders over the long term. That concludes our remarks, and I'm going to pass it back to Sherry to open the line for Q&A.