Brookfield Infrastructure (NYSE:BIPC) has marked a 7% increase in its Q3 FFO to $560 million, spurred by the completion of capital projects worth $1 billion over the past year. The company's earnings growth is attributed to organic drivers and strategic acquisitions, including HomeServe, a European tower business, Data4, and the $1.2 billion privatization of Triton International (NYSE:TRTN).
The utilities segment of Brookfield saw a 17% rise in FFO, driven by organic growth, inflation-indexed rates, and the HomeServe acquisition. Meanwhile, the transportation and data segments reported 7% and 10% growth, respectively. On the other hand, the midstream platform's FFO declined by 5%, despite contributions from the Heartland Petrochemical Complex and the LNG export terminal.
In a bid to recycle capital, Brookfield has been selling mature assets such as a regulated utility in Australia, its Indian toll road portfolio, an integrated data distribution business in New Zealand, and a partial stake in the U.S. gas pipeline. The company then reinvests in high-return opportunities like Compass Datacenters and Data4. The company closed nearly $2 billion of asset sales in Q2, which impacted Q3 results. However, it reinvested that capital into deals expected to boost its Q4 bottom line.
Further expanding its global data center platform, Brookfield plans to acquire a portfolio of data centers from Cyxtera out of bankruptcy to integrate into its existing Evoque business. This move follows previous acquisitions like Compass Datacenters and Data4.
These acquisitions combined with strong organic growth drivers are expected to position Brookfield for double-digit FFO-per-share growth over the next few years. This aligns with the company's plan to grow its dividend at a 5% to 9% annual rate over the long term.
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