Brookfield Corporation

Hello and welcome to the Brookfield Corporation second quarter 2025 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 will need to press star 1-1 on your telephone. To withdraw your question, please press star 1-1 again. I would now like to hand the conference over to your speaker today, Ms. Katie Battaglia, Vice President, Investor Relations. Please go ahead.

Thank you, operator, and good morning. Welcome to Brookfield Corporation's second quarter 2025 conference call. On the call today are Bruce Platt, our chief executive officer, and Nick Goodman, president of Brookfield Corporation. Bruce will start off by giving a business update, followed by Nick, who will discuss our financial and operating results for the quarter. After our formal comments, we'll turn the call over to the operator and take analyst questions. In order to accommodate all those who want to ask questions, we ask you to refrain from asking more than two questions. I would like to remind you that in today's comments, including in responding to questions and in discussing new initiatives in our financial and operating performance, we may make forward-looking statements, including forward-looking statements within the meaning of applicable Canadian and U.S. security laws. These statements reflect predictions of future events and trends and do not relate to historic events. They are subject to known and unknown risk and future events and results may differ materially from such statements. For further information on these risks and their potential impact on our company, please see our filings with the securities regulators in Canada and the U.S. and the information available on our website. In addition, when we speak about our wealth solutions business or Brookfield Wealth Solutions, we are referring to Brookfield's investments in this business that supported the acquisition of its underlying operating subsidiaries. With that, I'll turn the call over to Bruce.

Thank you and welcome everyone on the call. We delivered strong second quarter results. Distributed earnings before realizations increased 13% year over year to 1.3 billion. That was 80 cents per share for the quarter and 5.3 billion or $3.36 per share for the last 12 months. Performance was supported by continued momentum across our core businesses and a significant pickup in transaction activity. Strong underlying operating fundamentals are driving demand and cash flow growth in both our asset management and operating businesses. Our wealth solutions business continues to grow its asset base, and last week we announced an agreement to acquire JustGroup, a leading provider of pension risk transfer solutions in the United Kingdom. This acquisition builds on the foundation we established in the UK earlier this year and will allow us to accelerate our growth in the country. As already one of the largest infrastructure, renewable, and property investors in the UK, this acquisition matches well with our capabilities and positions us to assist policyholders earn strong returns. Turning briefly to the macro environment, conditions continue to become increasingly constructive. During the quarter, as most of you will know, global equities hit all-time highs, credit spreads tighten dramatically, and interest rates remain largely unchanged, with growing expectations that we may see cuts on the short end of the curve in the next while. This relative stability has been supportive of increased monetizations, which reflects both the quality of the businesses we own and assets we have. So far this year, we've completed $55 billion of asset sales, including $35 billion in the quarter, each generating excellent returns and returning meaningful capital to investors. We also saw continued strength in the financing markets where we opportunistically completed $94 billion of financings across the franchise, enabling our capital structure, enhancing our capital structure, and deploying significant capital within the business. Against this increasingly constructive backdrop, the key themes that ground our capital deployment, digitalization, deglobalization, and decarbonization are accelerating. With a record $177 billion of deployable capital, we are well positioned to be at the forefront of these opportunities, including the next evolution of the build-out of the global economy. As an example, we are launching our AI infrastructure strategy. At the core of this strategy is the development of AI factories, which are large-scale integrated sites that combine power, data shells, and the equipment to provide compute capacity to the industry's leaders, as well as governments and corporates seeking compute capacity. This effort draws on our strength of our global operating teams in real estate, power, and infrastructure, each today a global leader in their category. At the same time, global electricity demand is accelerating at a very dramatic pace. driven by power demand for the AI revolution and the broader electrification of the energy grid. This, coupled with AI infrastructure, presents a tremendous investment opportunity, particularly for our renewables and our infrastructure platforms. As the backbone of the global economy transforms, so does our approach to investing our capital. Today we have $180 billion of our own capital on our balance sheet, predominantly invested in real assets beside or to assist our clients where we have deep investing and operating expertise. Our long-term plan is to further enhance the efficiency of our capital structure, thereby enhancing the returns we can earn on our equity without changing the risk profile of the business. This is being done by continuing to refocus overall Brookfield as an investment-led insurance organization, using our large-scale capital base to back low-risk, long-duration insurance. On the asset side of the balance sheet, importantly, we remain focused on the exact same asset classes where we have proven best-in-class investment skills for decades and which are ideally suited for wealth and insurance. This shift is a natural extension of our platform to continue to drive long-term shareholder value. Today, we have had two primary sources of capital, the first being our balance sheet and the second being institutional capital in our asset management business. In this next evolution, beside those two amounts, we're focusing our balance sheet to back our growing insurance operations, meaning that our capital will increasingly come from individual investors via our insurance float. Our intention is to continue funding our insurance operations from the Brookfield Corporation balance sheet to ensure that our policy holders and regulators know that we have our capital at risk to assist them. When we established our insurance business, we envisaged this as one arm of Brookfield. But after five years of meaningful growth, and with a large number of opportunities ahead, this business is becoming increasingly foundational part of our long-term vision for Brookfield. There will be more to come, so stay tuned. As we plan for the future, it's important also to reflect on what has been the foundation of our growth and success from past. Simply stated, it is our ability to consistently adapt and evolve with the shifts in the global economy while staying focused on generating investment returns over the long term. This started 30 years ago with real estate, moved to pipelines and electricity transmission lines, and is now led by renewable power, data centers, fiber lines, telecom towers, and more recently, AI infrastructure and battery storage, which are just developing. Each step has been about anticipating where the world is going and positioning ourselves and our investors at the center of each transformation. Our view is that AI is next and coming after that is AI-led advances in manufacturing. The world is always evolving and it's exciting to be involved. I will end my comments by saying that we look forward to seeing you at our Investor Day on September 10th at Brookfield Place in New York. Additional details are on our website and as always, thank you for your continued support and interest in Brookfield. Over to Nick.