UPDATE 1-Brookfield Asset Management cash flow drops, but dividend hiked

Wed May 7, 2014 3:55pm EDT
 
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(Adds CEO comments on investment opportunities)

TORONTO May 7 (Reuters) - Brookfield Asset Management said on Wednesday cash flow slumped 29 percent in the first quarter because of a decline in realized gains from asset sales but the result beat estimates and the company raised its dividend by 7 percent.

Funds from operation (FFO), a measure of cash flow for real estate management companies, fell to $492 million, or 72 cents per share, from $689 million, or C$1.03 per share, a year earlier, the Canadian property, power and infrastructure investor said.

The results topped expectations of FFO of 55 cents a share, according to Thomson Reuters I/B/E/S.

Consolidated net income rose to $843 million from $697 million. Assets under management were $190 billion, while fee-bearing capital rose 5 percent to $84 billion.

Brookfield has been increasing its focus on emerging markets such as Brazil, India, and China and is continuing to look there for value investments, Chief Executive Bruce Flatt said on a conference call.

"After many years of these markets being awash in capital, we find that there is less capital available," said Flatt. "We do see opportunities to acquire assets on scale. Sometimes it's not generally available in the developed economies," he said.

Europe, which Brookfield had favored up until last year, is now becoming pricier as capital flows shift to there from emerging markets, Flatt added, although he said there were still good deals to be found there.

"There are less opportunities (in Europe), although I would say there's - because there's more money - there's a lot less risk to the opportunities that are there," he said.

Brookfield declared a quarterly dividend of 16 cents a share, replacing its previous four-month dividend of 20 cents a share, representing a 7 percent annualized gain.

The company's shares were up 0.9 percent at C$46.00. (Reporting by Cameron French; Editing by Bernadette Baum and James Dalgleish)