Brookfield Business (BBUC) - 2023 Q1 - Quarterly Report

Financial Performance - For Q1 2023, total revenues increased by $670 million to$2,921 million, compared to $2,251 million in Q1 2022, driven by contributions from dealer software and nuclear technology services operations [142]. - Direct operating costs rose by$526 million to $2,551 million in Q1 2023, up from$2,025 million in Q1 2022, primarily due to acquisitions in dealer software and nuclear technology services [143]. - General and administrative expenses increased by $39 million to$107 million in Q1 2023, compared to $68 million in Q1 2022, mainly due to recent acquisitions [144]. - Net loss for Q1 2023 was$185 million, an increase of $22 million from a net loss of$163 million in Q1 2022 [141]. - Interest expense, net increased by $172 million to$279 million in Q1 2023, compared to $107 million in Q1 2022, attributed to higher borrowings and interest rates [145]. - Revenues for Q1 2023 were$2,921 million, a decrease of 6.5% from Q4 2022's $3,124 million [150]. - Net income for Q1 2023 was a loss of$185 million, compared to a profit of $158 million in Q4 2022 [150]. - Adjusted EBITDA for Q1 2023 was$622 million, an increase from $486 million in Q1 2022 [164]. Cash Flow and Liquidity - Cash flow used in operating activities for the three months ended March 31, 2023 was$140 million, compared to cash provided of $34 million for the same period in 2022 [175]. - Cash flow provided by financing activities was$89 million for the three months ended March 31, 2023, a significant improvement from cash used of $155 million in the same period in 2022 [176]. - Cash flow provided by investing activities was$110 million for the three months ended March 31, 2023, compared to cash used of $135 million in the same period in 2022 [177]. - The company aims to maintain sufficient liquidity through cash flows, credit facilities, and monetization of mature operations [165]. - As of March 31, 2023, the company had cash and cash equivalents of$810 million, an increase from $736 million as of December 31, 2022 [173]. Assets and Liabilities - Accounts receivable increased by$321 million to $3,512 million as of March 31, 2023, due to timing of billed receivables [155]. - Other assets rose by$343 million to $1,809 million as of March 31, 2023, attributed to reclassification of a non-core division [156]. - Goodwill decreased by$286 million to $6,628 million as of March 31, 2023, primarily due to reclassification related to a non-core division [159]. - Non-recourse borrowings in subsidiaries increased by$283 million to $13,196 million as of March 31, 2023, driven by higher borrowings in water and wastewater operations [165]. - The company has total contractual obligations of$24.65 billion as of March 31, 2023, including borrowings of $13.55 billion and pension obligations of$3.81 billion [184]. Investments and Capital Expenditures - Capital expenditures for Q1 2023 included $47 million for maintenance and$96 million for growth, compared to $42 million and$97 million respectively in Q1 2022 [158]. - The company has an equity commitment of $2 billion from Brookfield Business Partners to enhance access to equity capital [167]. - Brookfield has subscribed for up to$1.5 billion of 6% perpetual preferred equity securities, with $1,475 million subscribed from other subsidiaries as of March 31, 2023 [170]. Other Financial Activities - The board declared a quarterly dividend of$0.0625 per exchangeable share, payable on June 30, 2023 [172]. - The company has outstanding bank guarantees, insurance bonds, and letters of credit totaling approximately $1.6 billion as of March 31, 2023 [178]. - The company did not repurchase any of its exchangeable shares during the three months ended March 31, 2023 [182]. - Remeasurement losses on exchangeable and class B shares were$121 million in Q1 2023, compared to a loss of $168 million in Q1 2022, reflecting the closing price of one LP Unit at$18.62 [146]. - Other net expenses increased by $14 million to$57 million in Q1 2023, compared to $43 million in Q1 2022, including$31 million in business separation expenses and restructuring charges [147]. Future Outlook - The company anticipates continued growth in revenues from healthcare services due to higher admission rates and patient days, despite foreign exchange impacts [142]. - The increase in revenues was partially offset by lower revenues from construction operations, indicating a mixed performance across segments [142]. - The company is focused on enhancing cash flows and pursuing new acquisitions to drive future growth [138].