BAM Investments Corp.
TSX : BNB

BAM Investments Corp.

August 14, 2007 17:51 ET

BAM Investments Announces Second Quarter Results

TORONTO, ONTARIO--(Marketwire - Aug. 14, 2007) - BAM Investments Ltd. (TSX:BNB) today announced its financial results for the second quarter ended June 30, 2007.

BAM Investments Corp. recorded net income of $1.8 million for the three months ended June 30, 2007 compared to net income of $12.5 million in the same period last year. The 2006 results include a tax recovery of $11.2 million. After providing for interest and dividends on financing obligations, net income per common share was $0.01 for the three month period, compared with a net income per common share of $0.17 for the comparable period in 2006.

The company's principal investment is a direct and indirect interest in 55.5 million Class A Limited Voting shares ("Class A shares") of Brookfield Asset Management Inc. ("Brookfield).

The company split its shares on a ten-for-one basis during the quarter. Also during the quarter Brookfield completed a three-for-two stock split of its outstanding Class A shares.

Brookfield reported cash flow from operations of US$440 million for the three months ended June 30, 2007, compared to US$267 million recorded in the same period last year. Brookfield's 2007 net income was US$153 million for the three months ended June 30, compared to US$135 million in 2006. Further information on Brookfield can be found at the company's web site at www.brookfield.com.



Consolidated Statements of Operations
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(unaudited) Three months ended Six months ended
June 30 June 30
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$thousands, except
per share amounts 2007 2006 2007 2006
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Investment income $ 9,474 $ 4,657 $ 17,297 $ 7,665
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Expenses
Operating 219 115 685 316
Interest expense on
exchangeable debenture 1,083 - 2,158 -
Amortization of deferred
financing costs 406 379 784 756
Retractable preferred share
dividends 6,125 2,943 10,236 5,886
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7,833 3,437 13,863 6,958
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Net income before income taxes 1,641 1,220 3,434 707
Future tax recovery 144 11,244 1,441 11,244
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Net income $ 1,785 $ 12,464 $ 4,875 $ 11,951
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Net income per common share(1) $ 0.01 $ 0.17 $ 0.05 $ 0.13
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1) Adjusted to reflect ten-for-one share split


Net Asset Value

The calculated net asset value of the company's common shares as at June 30, 2007 based on the stock market price of Brookfield's Class A shares of $42.49 was $21.48 per share. BAM Investments holds 6.98 Brookfield Class A shares for every 10 common shares of BAM Investments. The net asset value per common share does not take into account tax and transaction costs on disposition.



Statement of Financial Position
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As at June 30, 2007
(unaudited)
$thousands, except per share amounts Net Asset Value
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Assets
Cash and equivalents $ 49,072
Investment in Brookfield Asset Management Inc.(1) 2,356,124
Other assets 10,627
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$ 2,415,823
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Liabilities
Accounts payable and provisions 2,487
Retractable preferred shares(2) 399,042
Future tax liability(3) 297,989
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699,518
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Shareholders' Equity
Common shares 1,716,305
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$ 2,415,823
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Net Asset Value Per Common Share(4) $ 21.48
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Notes:

1) The investent in Brookfield Asset Management Inc. consists of 60.8 million Class A Limited Voting shares of Brookfield less the value of debentures that are exchangeable into 5.3 million Brookfield Class A shares. The net investment of 55.5 million shares had a market value of $42.49 per share as at June 30, 2007.

2) Represents $405.0 million retractable preferred shares issued by BAM Split Corp, which is a subsidiary of the company, net of unamortized issuance costs.

3) The future tax liability represents the potential future income tax liability of the company based on the difference between the carrying values of the company's assets and liabilities and their respective tax values, as well as giving effect to estimated capital and non-capital losses as at the date of this statement.

4) As at June 30, 2007, there were 79,418,910 common shares of the company issued and outstanding.

BAM Investments Corp. is a publicly listed investment company whose principal business mandate is to provide its common shareholders with a leveraged investment in Brookfield common shares. The company's common shares trade on the Toronto Stock Exchange under the ticker symbol "BNB".

Note: This news release contains "forward-looking statements". The words "believe", "expect", "anticipate", "intend", "estimate" and other expressions which are predictions of or indicate future events and trends and which do not relate to historical matters identify forward-looking statements. Reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the company to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those set forth in the forward-looking statements include general economic conditions, interest rates, availability of equity and debt financing and other risks detailed from time to time in the company's continuous disclosure documents. The company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Contact Information

  • BAM Investments Ltd.
    Brian D. Lawson
    President and Chief Executive Officer
    (416) 359-8620