Brookfield Infrastructure Partners BIP’s operations are principally organized as follows: Utilities operations:  consist of our regulated distribution, regulated terminal and electricity transmission operations, located in  Australasia, North and South America and Europe. These businesses typically earn a pre-determined return based on their asset  base, invested capital or capacity and the applicable regulatory frameworks and long-term contracts. Accordingly, the returns  tend to be highly predictable and typically not impacted to any great degree by short-term volume or price fluctuations. Transport operations:  is comprised of open access systems that provide transportation for freight, bulk commodities and  passengers, for which we are paid an access fee. Profitability is based on the volume and price achieved for the provision of  these services. These operating are comprised of businesses with regulated tariff structures, such as our railroad and toll road  operations, as well as unregulated businesses, such as our ports. Approximately 70% of our transport operations are supported  by long-term contracts or regulation. Energy operations:  consists of systems that provide energy transportation, distribution and storage services. Profitability is  based on the volume and price achieved for the provision of these services. These operations are comprised of businesses that  are subject to light regulation, such as our natural gas transmission business whose services are subject to price ceilings, and  businesses that are essentially unregulated like our district energy business. Approximately 80% of our energy operations are  supported by long-term contractual revenues. Utilities FFO increased by $19 million from the prior year, primarily due to the contribution from investments completed near  the end of 2012 that doubled the size of our UK regulated distribution business and an increased ownership interest in our  Chilean electricity transmission system. In addition, our businesses also benefitted from inflation indexation and contributions  from organic growth investments. Transport FFO increased by $45 million. Our Australian railroad contributed an increase of $23 million over the prior year,  primarily due to the completion of our $600 million expansion program in the beginning of 2013 and a strong grain harvest.  Our South American toll roads contributed an additional $22 million of FFO compared to 2012, primarily from our increased  ownership in these toll roads, following our follow-on $670 million investment and by higher traffic volumes and regulatory  tariffs.  Energy FFO decreased by $2 million primarily due to the impact of a challenging North American natural gas market that  continues to negatively impact results at our North American gas transmission business. This decrease was partially offset by a  full year’s contribution from our district energy operations, which were acquired in the fourth quarter of 2012.  Our share FFO from sustainable resource investments decreased by $15 million to $37 million primarily due to our lower level of  common equity in these operations after we sold our U.S. Pacific Northwest timberlands in June of 2013. These operations were  owned both directly and by BIP. Our other directly held assets include our investment in Acadian Timber Corp. which owns and  operates timberlands in the northeastern U.S. and Canada, and our equity invested in a number of timber and agriculture private  funds we manage. Our agriculture funds are focused on Brazil’s agricultural sector based on the country’s strong competitive  position as a leading agricultural producer.  We sold non-core assets during the year, generating $1.5 billion of proceeds, of which our share was $833 million. Dispositions  included Pacific Northwest timberlands, a regulated distribution business in New Zealand and a 20% interest in our UK regulated  distribution business, which collectively gave rise to $250 million of realized disposition gains.  Invested capital decreased by $400 million to $2,171 million at the end of 2013 from $2,571 million at the end of 2012, reflecting  the sale of our direct investment in timberlands, offset by our proportionate participation in a $330 million equity offering at BIP. In the utilities platform, we expect to earn a return on incremental investments which is consistent with our current return on  rate base and expect to benefit from the completion of a Texas electric transmission system. Within our transport and energy  operations we are increasing our investments in transportation assets such as ports and toll roads, as we see attractive valuations  and exposure to GDP growth through increasing traffic volumes. We have also recently completed or committed to $1.1 billion  of new investments in these operations. Our timber funds continue to attract strong interest from institutional investors and we continue to deploy capital in these  funds. Our R$330 million Brazil Agriland Fund is currently almost fully invested and we will use the remaining capital to fund  conversion of additional lands to crop production. Sustainable Resources Realized Disposition Gains Common Equity by Segment Outlook and Growth Initiatives 46 BROOKFIELD ASSET MANAGEMENT 