stockmarket

Buffett's Berkshire swings to big profit as stocks gain


© Reuters. FILE PHOTO: FILE PHOTO: Warren Buffett, CEO of Berkshire Hathaway Inc, at the company annual meeting weekend in Omaha

OMAHA, Neb. (Reuters) – Warren Buffett’s Berkshire Hathaway (NYSE:) Inc on Saturday swung to a big quarterly profit, bolstered by gains in its stock investments, and also posted a small increase in operating earnings.

The $21.66 billion (16.44 billion pounds) overall profit, or $13,209 per Class A share, compared with a year-earlier net loss of $1.14 billion, or $692 per share, and a fourth-quarter net loss of $25.39 billion.

These results illustrate what Buffett has called the “wild and capricious” and, in his view, meaningless swings caused by an accounting rule requiring the reporting of unrealized stock gains with earnings, regardless of Berkshire’s plans to sell. Berkshire had $15.1 billion of these gains in the first quarter.

Operating profit, which Buffett considers a better performance measure, rose 5 percent to $5.56 billion, or about $3,388 per Class A share, from $5.29 billion, or $3,215 per share, a year earlier.

Analysts on average expected operating profit of about $3,399 per Class A share, according to Refinitiv data.

Results excluded operating earnings tied to Berkshire’s 26.7 percent stake in Kraft Heinz (NASDAQ:) Co because the food company has not reported its own quarterly results. In last year’s fourth quarter, Berkshire took a $3-billion writedown on Kraft.

Berkshire ended March with $114.2 billion of cash and equivalents.

That, in part, reflected Buffett’s inability to find a major business to add to Berkshire’s stable of more than 90 companies in the insurance, chemicals, energy, food and retail, industrial, railroad and other sectors.

Last month, Berkshire committed $10 billion to Occidental (NYSE:) Petroleum Corp’s cash-and-stock bid for Anadarko Petroleum Corp (NYSE:), which Chevron Corp (NYSE:) also wants to buy. The Berkshire investment is contingent on Occidental completing its proposed acquisition of Anadarko.

Berkshire’s Class A shares closed Friday at $327,765.61, and its Class B shares closed at $218.60.

Results were released before Buffett, 88, and Vice Chairman Vice Chairman Charlie Munger, 95, were expected to answer more than five hours of questions from shareholders, journalists and analysts at Berkshire’s annual meeting.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.