Mr. Bruce Flatt reports

BROOKFIELD ASSET MANAGEMENT REPORTS STRONG FIRST QUARTER 2015 RESULTS

Brookfield Asset Management Inc. has released its financial results for the quarter ended March 31, 2015.

"Brookfield's businesses started the year with strong performance and we continue to see attractive investment opportunities across all of our global platforms," commented Bruce Flatt, chief executive officer of Brookfield. "Our asset management business continues to expand as our clients increase their capital allocations to real asset investment strategies."

• Net income for the first quarter totalled $1.4-billion, or $1.09 per share. The 36-per-cent year-over-year increase in net income per share reflects the contribution from acquired and developed assets, and the value created by operating initiatives across operations. Strong leasing results and development activities within property operations contributed to increased fair value gains.
• Funds from operations (FFO) for Brookfield shareholders during the quarter were $557-million, or 82 cents per share, up 14 per cent from a year ago. FFO benefited from the continued expansion of asset management operations, which contributed to a 27-per-cent increase in fee-related earnings. The increased contribution from growth initiatives throughout the portfolio was offset by a reduced contribution from renewable energy operations relative to the particularly strong energy prices experienced in the comparative quarter and lower hydrology levels in the current period. The company also generated a higher level of disposition gains as it continued to rotate capital into higher returning opportunities.
• Fee-bearing capital increased to $93-billion. Fee revenues increased 18 per cent to $791-million on a last-12-month basis and the company's annualized fee base, including target carried interest, now stands at $1.3-billion.
• To finance future growth initiatives, the company raised $1.2-billion with an equity offering subsequent to quarter-end. The company also announced a three-for-two stock split, effective May 12, 2015, together with a 6-per-cent increase in the company's dividend. This was on top of the company's 6-per-cent dividend increase announced in February, representing a 12.5-per-cent aggregate increase in dividend.
• The company committed or deployed $3-billion of capital in new investments during the quarter, including an oil and gas business in Australia, wind facilities in Portugal, and U.S. multifamily apartments. This increases the amount of capital deployed over the past 12 months to over $15-billion. The company continues to use this environment to recycle capital by selling mature property and infrastructure assets.

                                FINANCIAL RESULTS
               (In millions of U.S. dollars, except per share)

                        Three months ended March 31, 12 months ended March 31,
                                   2015        2014          2015        2014

Consolidated net income        $  1,438    $    843      $  5,804    $  3,990
Per Brookfield share               1.09        0.80          4.96        3.42
Funds from operations          $    557    $    492      $  2,225    $  3,179
Per Brookfield share               0.82        0.72          3.27        4.84

Operating highlights

The company expanded its asset management franchise and its flagship listed partnerships.

Fee-bearing capital increased to $93-billion at quarter-end; net inflows and market growth totalled $17-billion over the last 12 months. Growth in fee related earnings was 27 per cent, as fees were earned on a higher capital base with relatively small increases in related costs. The capitalization of listed partnerships increased by 9 per cent, or $4-billion, during the quarter. Subsequent to quarter-end, the company's flagship infrastructure listed partnership raised an additional $950-million in an equity offering to finance growth. The company invested $350-million in the offering, maintaining its ownership interest.

Earlier this year, the company commenced marketing a number of private funds targeting over $11-billion of capital. In addition, the company has fully invested or has committed to invest the capital of its flagship property and private equity funds, and its flagship infrastructure fund is nearly 70 per cent invested, which puts the company in a position to launch its next fund. The company's public markets business increased assets under management by $1.2-billion to $19.1-billion. Total assets under management were $207-billion at the end of the quarter.

The company announced or completed acquisitions and capital expansions that will deploy over $3-billion of capital on behalf of clients and Brookfield shareholders.

During the quarter and subsequent to quarter-end, the company invested capital in new regions and asset sectors. The company closed the purchase of telecom towers in France, acquired generation assets in Portugal and Brazil, and completed construction of two wind farms in Ireland. The company's private equity group committed to acquire an oil and gas business in Australia with a partner for $2.1-billion and more recently offered to take private a producer of graphite electrodes used in steel manufacturing.

The company's property group and a sovereign wealth fund partner closed the acquisition of the portion of the Canary Wharf development it did not previously own. The company also agreed to acquire a portfolio of 56 U.S. apartment buildings in a $2.5-billion transaction. In the company's private equity group, it completed the privatization of its North American land development business. The company continues to work on a number of potential investments, focused on South America and Australia, and energy and infrastructure.

The company increased cash flow and created value with growth initiatives and operational improvements in its major businesses.

The company's asset management business generated fee revenues of $206-million, or $791-million over the last 12 months, leading to quarterly fee related earnings of $108-million. Fee revenues benefited from the increase in market values at the flagship listed partnerships and performance-based fees that are linked to increases in cash distributions.

The company's property group generated $283-million of FFO, up 37 per cent year over year, as a result of increased ownership of North American and European office portfolios, as well as rising lease rates. The company recycled capital by selling mature properties, with disposition gains of $162-million on the sale of an interest in a shopping mall in Honolulu, and office buildings in Seattle and Toronto.

In the renewable energy business, the company recorded $81-million of FFO compared with $164-million in the previous year. Generation levels were 11 per cent below long-term averages, particularly in Brazil, which is experiencing drought conditions. In addition, electricity prices in North America were particularly strong in the same quarter a year ago.

The infrastructure group generated FFO of $57-million, in line with the 2014 quarter as organic growth initiatives and strong performance from the company's Australian and Brazilian railways and South American toll road network were offset by the impact of lower currencies on the financial results of non-U.S. operations.

In the private equity group, the company closed the merger of its two oriented strand-board (OSB) producers, expanded its cold storage business, and moved forward on recapitalizations of a Canadian infrastructure products company and a palladium miner. Quarterly results reflected lower OSB prices in the U.S. housing market compared with last year. The company's residential operations performed on plan, with strong growth in the United States, while its construction business expanded its operations, securing nearly $1-billion of projects and increased its FFO contribution to $40-million.

FFO for the last 12 months was $2,225-million, representing a decrease from the $3,179-million generated in 2014. FFO from operating activities increased by 4 per cent to $1,597-million; however, this was more than offset by a $1,015-million decrease in the amount of realized carried interest and disposition gains compared with 2014. Realized carried interest and gains in 2014 were generated on several particularly large transactions, which crystallized gains that had accrued over a number of years.

Dividend declaration

The board declared all of the regular monthly and quarterly dividends on its preferred shares. The board previously declared a quarterly dividend of 12 cents per share (representing 48 cents per annum), payable on June 30, 2015, to shareholders of record as at the close of business on May 29, 2015. This dividend will be paid following the three-for-two stock split of the Class A shares that will occur on May 12, 2015, and represents, on a presplit basis, 18 cents per share (or 72 cents per annum).

                  CONSOLIDATED STATEMENTS OF OPERATIONS
             (In millions of U.S. dollars, except per share)

                                                Three months ended March 31,
                                                        2015           2014

Revenues                                         $     4,396    $     4,338
Direct costs                                          (3,006)        (2,990)
                                                       1,390          1,348
Other income and gains                                     -             35
Equity accounted income                                  267            274
                                                       1,657          1,657
Expenses
Interest                                                (701)          (626)
Corporate costs                                          (29)           (33)
                                                         927            998
Fair value changes                                     1,113            715
Depreciation and amortization                           (401)          (376)
Income tax                                              (201)          (494)
Net income                                       $     1,438    $       843
Net income attributable to
Brookfield shareholders                          $       729    $       541
Non-controlling interests                                709            302
                                                 $     1,438    $       843
Net income per share
Diluted                                          $      1.09    $      0.80
Basic                                                   1.12           0.82

We seek Safe Harbor.