BAM Investments Corp.
TSX : BNB

BAM Investments Corp.

May 15, 2009 17:23 ET

(TSX:BNB) BAM Investments Reports First Quarter Results

TORONTO, ONTARIO--(Marketwire - May 15, 2009) - BAM Investments Corp. (TSX:BNB) today announced its financial results for the first quarter ended March 31, 2009.

The company recorded net income of $9.1 million for the quarter ended March 31, 2009, compared with $7.1 million in the same period last year. The increase in net income reflects the impact of the higher U.S. dollar on dividends received by the company, which are declared in U.S. dollars, and a $1.2 million gain recorded on the repurchase of preferred share obligations. After providing for interest and preferred share dividends on financing obligations, net income per common share was $0.11 for 2009, compared with $0.09 for the comparable period in 2008.

During the quarter the company redeemed all of the exchangeable debentures that it had previously issued, by delivering 5.3 million Class A Limited Voting Shares ("Class A Shares") of Brookfield Asset Management Inc. ("Brookfield") and 0.2 million units of Brookfield Infrastructure Partners LP ("Brookfield Infrastructure"). This reduced dividend income and interest expense.

The company's principal investment is a direct interest in 55.5 million Class A Shares of Brookfield.



Consolidated Statements of Operations
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Three months ended March 31
(unaudited)
$thousands, except per share amounts 2009 2008
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Investment income
Dividends, interest and other $ 9,854 $ 7,792
Gain on the repurchase of preferred share
obligations 1,180 -
Gain on sale of investments 434 -
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11,468 7,792
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Expenses
Operating 321 222
Interest expense 137 1,027
Amortization of deferred financing costs 418 418
Subsidiary preferred share dividends 4,632 5,118
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5,508 6,785
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Net income before income taxes 5,960 1,007
Future income tax recovery 3,095 6,138
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Net income $ 9,055 $ 7,145
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Net income per common share $ 0.11 $ 0.09
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Net Book Value

The net book value of the company's common shares as at March 31, 2009 based on the stock market price of Brookfield's Class A Shares of $17.37 was $7.64 per share. BAM Investments holds approximately 7 Brookfield Class A Shares for every 10 common shares of BAM Investments. The information in the following table has been extracted from the company's consolidated balance sheet as at March 31, 2009.



Statement of Financial Position
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(unaudited)
As at March 31, 2009 ($thousands, except per share amounts) Net Asset Value
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Assets
Investment in Brookfield Asset Management Inc.(1) $ 963,449
Investment in Brookfield Infrastructure Partners(2) 36,772
Cash and equivalents 49,601
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$ 1,049,822
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Liabilities
Accounts payable and provisions $ 2,056
Retractable preferred shares(3) 361,005
Future tax liabilities(4) 80,341
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443,402
Shareholders' Equity
Common shares 606,420
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$ 1,049,822
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Net Asset Value Per Common Share, pre tax(5) $ 8.65

Net Asset Value Per Common Share, after tax(5) $ 7.64
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Notes:
(1) The investment in Brookfield Asset Management Inc. consists of 55.5
million Class A Shares at a bid price of $17.37 per Brookfield Class
A Share at March 31, 2009.
(2) The investment in Brookfield Infrastructure Partners consists of 2.2
million Limited Partnership Units at a bid price of $16.57 per unit at
March 31, 2009.
(3) Represents $364 million retractable preferred shares issued by BAM Split
Corp, which is a subsidiary of the company, net of 3.0 million of
unamortized issuance costs.
(4) 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.
(5) As at March 31, 2009, there were 79,382,710 common shares of the company
issued and outstanding.


Note: This news release contains "forward-looking information" within the meaning of Canadian provincial securities laws and regulations. The words "potential" and "estimated" and other expressions which are predictions of or indicate future events, trends or prospects and which do not relate to historical matters identify forward-looking information. Forward-looking information in this news release includes statements with regard to potential future income taxes.

Although the company believes that the anticipated future results or achievements expressed or implied by the forward-looking information and statements are based upon reasonable assumptions and expectations, the reader should not place undue reliance on the forward-looking information and 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 achievement expressed or implied by such forward-looking information and statements.

Factors that could cause actual results to differ materially from those contemplated or implied by the forward-looking information and statements include: the behavior of financial markets, including fluctuations in interest and exchange rates, availability of equity and debt financing and other risks and factors detailed from time to time in the company's other documents filed with the Canadian securities regulators.

We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking information to make decisions with respect to the company, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as may be required by law, the company undertakes no obligation to publicly update or revise any forward-looking information or statements, whether written or oral, that may be as a result of new information, future events or otherwise. Reference should be made to the company's most recent Annual Information Form for a description of the major risk factors.

Contact Information

  • BAM Investments Corp.
    Edward C. Kress
    President
    (416) 956-5140