Brookfield Business Corporation

Welcome to the Brookfield Business Partner's fourth quarter 2024 results conference call and webcast. As a reminder, all participants are in listening mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, simply press star 1-1 on your touchtone phone. Now, I'd like to turn the conference over to Alan Fleming, head of investor relations. Please go ahead, Mr. Fleming.

Thank you, operator, and good morning. Good morning. Before we begin, I'd like to remind you that in responding to questions and talking about our growth initiatives and our financial and operating performance, we may make forward-looking statements. These statements are subject to known and unknown risks, and future events and results may differ materially. For further information on known risk factors, I encourage you to review our filings with the securities regulators in Canada and the U.S., which are available on our website. We'll begin the call today with an update on business performance and strategic initiatives from Anuj Ranjan, our Chief Executive Officer. Anuj will then turn the call over to Mark Wallace, the Chief Executive Officer at Clarios, who will provide an update on the business. We'll end the call with Jaspreet Del, our Chief Financial Officer, for a discussion of our financial results. After we finish our prepared remarks, the team will be available to take your questions. With that, I'd like to now pass the call over to Anuj.

Thanks, Alan, and good morning, everyone. Thank you all for joining us on the call today. We made excellent progress over the past year, continuing to build value in our business and strengthen our capital position. Our operations are performing well, margins increasing to over 20% to deliver a record full-year adjusted EBITDA of $2.6 billion. We've always described our business as a compounding engine. When we buy great businesses for value, increasing their underlying cash flows through operational improvements and then recycling capital when the time is right. Our objective is to do this again and again, compounding shareholder value over the long term. Over the last 12 months, we've generated more than $2 billion from these capital recycling initiatives, including about $1 billion from monetizations and distributions funded by ongoing cash flows in our operations. As many of you are aware, we also recently completed an up financing at Clarios. The debt raise was significantly oversubscribed, and we were able to fund a $4.5 billion distribution. BBU's share of this was about $1.2 billion, which equates to a 1.5 times multiple of our investment, and we continue to hold our full interest in Clarios. This is a phenomenal outcome for BBU. Simply put, businesses like Clarios don't come around all that often, and as you'll hear from Mark shortly, Clarios has an incredibly strong trajectory of increasing earnings and cash flows. The opportunity to crystallize a strong return while continuing to remain fully invested in Calerios will be a meaningful driver of value for BDU. Proceeds we recently generated put us in a very strong position with significant financial flexibility. Consistent with our capital deployment priorities, this morning we announced a new $250 million share buyback program. Given our trading price today, this is an extremely efficient use of our capital, which will be meaningfully accretive to the per unit value of BDU. We plan to be active with our buyback activity, including regular buybacks in the market and the repurchase of blocks if they come up for sale. We're also putting capital to work in new investments where we believe we can create additional value and generate market-leading cash flows returns. Just yesterday, we completed the acquisition of Chemilex, a leading manufacturer of electric heat tracing systems, which we carved out from a larger industrial company. BBU's share of the equity investment with approximately $210 million. Chemilexa specialized products are used to regulate the temperature of pipes in industrial and commercial applications. It generates durable cash flows supported by resilient aftermarket replacement demand across a very large installed base. It's exactly the type of market-leading industrial business that we've been investing in for years, and we see lots of opportunity in this situation to optimize operations and leverage the strength of the overall Brookfield platform to support the business's growth. As we look to the year ahead, the resilience of our larger businesses, underpinned by market leadership, pricing power, and stable demand, will continue to serve us well amid a potential backdrop of geopolitical and economic uncertainty. Our confidence also comes from how we invest, generating most of our returns through buying good businesses at reasonable prices, executing our improvement plans to increase cash flows, and recycling the capital to optimize returns. This takes time, but allows us to compound value and generate strong returns across economic cycles. The proof is really in our track record. Since going public, we've generated over $6 billion of proceeds from the sale of over 20 businesses. realizing a three times multiple of our invested capital and a 30% IRR. We're committed to continuing to generate strong returns for our shareholders, and we're pleased with the progress we've made over the past year to strengthen our balance sheet, which is enabling us to seize growth opportunities and accelerate buybacks, all of which is accretive to the intrinsic value of our business. I'll now pass the call over to Mark Wallace. Mark is a Chief Executive Officer at Clarios, And he's joined us today to spend time talking about the opportunities ahead for his business and the drivers which are underpinning its excellent performance.