Market Overview

Brookfield Beats by a Penny - Analyst Blog

Brookfield Infrastructure Partners L.P. (NYSE: BIP) announced first-quarter 2014 earnings of 89 cents per unit, a penny higher than the Zacks Consensus Estimate. The bottom line also came in higher than the year-ago earnings of 80 cents by 11.2%.

The year-over-year improvement was due to incremental earnings from its transport and energy businesses.

Total Revenue

Total revenues at the end of the first quarter were $553 million, down 4.5% from the prior-year quarter.

Operational Update

The partnership's direct operating costs during the quarter were $239 million, down 15.6% from the comparable prior-year period. General & administrative expenses decreased 3.6% year over year to $27 million.

Adjusted EBITDA in the reported quarter was $287 million, up 7.1% from the prior-year quarter.

Interest expenses in the reported quarter decreased 4.7% year over year to $102 million.

Financial Update

Cash & cash equivalents as of Mar 31, 2014, were $363 million versus $538 million as of Dec 31, 2013.

Cash from operating activities at the end of the first quarter was $140 million versus $147 million in the year-ago quarter.

During the quarter the partnership used $112 million for cash distribution among its unitholders.

Guidance

Brookfield Infrastructure Partners aims to inject $500 million to $1,000 million of capital in its operation this year.

Other Company Releases

Entergy Corp's (NYSE: ETR) earnings came in at $2.29 per share in the first quarter, beating the Zacks Consensus Estimate by 8.5%.

DTE Energy Co. (NYSE: DTE) reported first quarter 2014 operating earnings per share of $1.69, beating the Zacks Consensus Estimate of $1.41 by 19.8%.

American Electric Power Company Inc. (NYSE: AEP) reported first quarter 2014 operating earnings of $1.15 per share, beating the Zacks Consensus Estimate of 91 cents by 26.4%.

Our View

Brookfield Infrastructure Partners surpassed market expectation with contributions coming in from the Australian railroad program. Moreover, the worst fall in winter temperatures in more than a decade elevated natural gas prices.

The partnership continues to strategically acquire assets. This February, Brookfield Infrastructure Partners announced it would acquire a 50% equity stake in APM Terminals' (APMT) Elizabeth container terminal located in the port of New York / New Jersey. In March, the partnership closed the acquisition of a 50% interest in Mitsui OSK Lines' (MOL) container terminals in Los Angeles and Oakland.

The gradual improvement in the U.S. economy is bound to reinvigorate activities at these terminals and benefit the partnership over the long run.

Brookfield Infrastructure Partners currently holds a Zacks Rank #2 (Buy).


 
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