(BNB-TSX) BAM Investments Reports Second Quarter Results

• Press Release
• Source: BAM Investments Corp.
• On 4:52 pm EDT, Friday August 14, 2009

TORONTO, ONTARIO--(Marketwire - 08/14/09) - BAM Investments Corp. (TSX:BNB - News) today announced its financial results for the second quarter ended June 30, 2009.

The company recorded net income of $4.0 million for the quarter ended June 30, 2009, compared with $3.0 million in the same period last year. The increase in net income primarily relates to a decrease in interest expense and preferred share dividends, partially offset by a decrease in investment income. Net income per common share was $0.05 for the three month period, compared with $0.04 for the comparable period in 2008.

During the first quarter of 2009, 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 Limited Partnership Units of Brookfield Infrastructure Partners LP ("Brookfield Infrastructure"). As a result, the company no longer bears interest expense on the exchangeable debentures, whereas the comparable period in 2008 included $1.1 million of interest expense on the exchangeable debentures.

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

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Consolidated Statements of Operations

                                        Three months ended  Six months ended
                                                   June 30           June 30
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(unaudited) $thousands,
 except per share amounts                    2009     2008     2009     2008
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Investment income
 Dividends, interest and other            $ 8,885  $ 9,405 $ 18,739 $ 17,197
 Gain on the repurchase of preferred
  share obligations                           149        -    1,329        -
 Gain on sale of investments                    -        -      434        -
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                                            9,034    9,405   20,502   17,197
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Expenses
 Operating                                    194      179      515      401
 Interest expense on exchangeable
  debentures                                    -    1,056      137    2,083
 Amortization of deferred financing
  costs                                       269      426      687      844
 Subsidiary preferred share dividends       4,594    5,118    9,226   10,236
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                                            5,057    6,779   10,565   13,564
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Net income before income taxes              3,977    2,626    9,937    3,633
Future income tax recovery                     32      334    3,127    6,472
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Net income                                $ 4,009  $ 2,960 $ 13,064 $ 10,105
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Net income per common share                $ 0.05   $ 0.04   $ 0.16   $ 0.13
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Net Book Value

The net book value of the company's common shares as at June 30, 2009 based on the stock market price of Brookfield's Class A Shares of $19.87 was $9.10 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 June 30, 2009.

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Statement of Financial Position

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(unaudited)
As at June 30, 2009
($thousands, except per share amounts)                       Net Asset Value
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Assets
 Investment in Brookfield Asset Management Inc.(1)               $ 1,102,114
 Investment in Brookfield Infrastructure Partners(2)                  31,718
 Cash and equivalents                                                 50,874
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                                                                 $ 1,184,706
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Liabilities
 Accounts payable and provisions                                     $ 2,023
 Retractable preferred shares(3)                                     360,148
 Future tax liability(4)                                             100,740
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                                                                     462,911
Shareholders' Equity
 Common shares                                                       721,795
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                                                                 $ 1,184,706
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Net Asset Value Per Common Share, pre tax(5)                         $ 10.36
Net Asset Value Per Common Share, after tax(5)                        $ 9.10
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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 $19.87 per Brookfield Class A
    Share at June 30, 2009.
(2) The investment in Brookfield Infrastructure Partners consists of 2.2
    million Limited Partnership Units at a bid price of $14.30 per unit at
    June 30, 2009.
(3) Represents $363 million retractable preferred shares issued by BAM Split
    Corp, which is a subsidiary of the company, net of $2.7 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 June 30, 2009, there were 79,360,410 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.

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