Brookfield Business Partners: Q3 Results and Strategic Sales Drive Growth

Brookfield Business Partners (BBU) reported strong third-quarter results, driven by strategic sales and a robust capital recycling program. The company generated over $350 million in proceeds from distributions and monetizations, including the sale of a significant portion of its offshore oil services operation. This sale, along with other strategic initiatives, has significantly reduced corporate-level borrowings and supported continued growth.
BBU's Q3 2024 financial results were impressive, with net income attributable to unitholders reaching $301 million ($1.39 per limited partnership unit) compared to a net loss of $44 million ($0.20 loss per limited partnership unit) in the prior period. Adjusted EBITDA for the quarter was $844 million, up from $655 million in the prior year. The company's Industrials segment contributed significantly to this growth, with Adjusted EBITDA increasing to $500 million, driven by a $296 million U.S. IRA benefit at its advanced energy storage operation.
One of the key drivers of BBU's strong performance was its strategic sales and capital recycling initiatives. The company's offshore oil services operation, which had been through a restructuring process, reached an agreement to sell its shuttle tanker operations for $1.9 billion. BBU's share of net proceeds from this sale is expected to be approximately $265 million. This sale, along with other monetizations, has generated over $350 million in proceeds, substantially reducing debt and enhancing the company's financial flexibility.

BBU's acquisition of Network International, a leading digital payment processor in the Middle East, also aligns with its strategy to create core financial infrastructure and drive unparalleled expansion and innovation. This acquisition, combined with the acquisition of Magnati, creates a market leader with considerable scale, enabling the optimization of the business by leveraging a combined technology stack and improving the customer experience.

In conclusion, Brookfield Business Partners' strong Q3 results and strategic sales have positioned the company for continued growth and value creation. The company's ability to generate significant proceeds from strategic sales and its focus on creating core financial infrastructure have driven its success. As rates continue to decline and transaction activity returns, investors should resume valuing BBU's units on a fundamental basis, setting the stage for further improvement in its trading performance.