No. of Recommendations: 9
There was an informative shareholder letter, and I believe it was one of the more substantive letters (but I have not read to many of the more recent letters). Things I found of interest:
1. Electrical demand: "To put this in perspective, the global installed capacity for electricity is approximately 8,000 gigawatts. To meet expected demand, this installed capacity will need to expand to more than 20,000 gigawatts in the next 20 years. In addition, nearly half of what exists today will need to be retired, as it is very carbon-intensive. Said differently, we need to more than double the current capacity (which was largely built over the past 50 years) while also replacing approximately 50% of what we have. Nothing like this has ever been attempted, but it is essential in order to reach the world’s net-zero goals and drive the AI revolution."
2. As someone else noted they view nuclear as a key component, where they feel very confident with their offering of small modular reactors through Westinghouse, along with their renewable portfolio.
3. They repurchased over $800 million of shares at an average Price of $40 per share (20 million shares or 1% of the company). They estimate Brookfield is currently worth $84 per share.
4. Succession planning - They named a new CEO and other key members with very senior roles in Brookfield. "Connor Teskey was identified as the next CEO of Brookfield Asset Management at that time—and this change will happen when we feel the time is right for all our stakeholders. In addition to Connor’s many exceptional skills and talents, he has the advantage of being 36 years old today, which gives him the opportunity to lead the organization for 20 plus years through the next phase of our growth. Anuj Ranjan, Sachin Shah, Nick Goodman and others have also been assigned very senior “CEO” roles across Brookfield and will continue to have crucial responsibilities as the organization evolves further over time."
It will be fascinating to watch how fast we make progress going forward. I think there are two key areas not mentioned in their report, that are worth paying attention to, and could impact the business (positively or negatively) going forward; 1. Advances in quantum computing that could provide vast increases in computing power per unit of energy required, and 2. Advances in space and energy required data storage - one in particular I don't see a lot of discussion on is storing data in DNA (
https://www.scientificamerican.com/article/dna-the...).
