Net income was nearly $36 billion, compared with a loss of more than $43 billion a year earlier
Berkshire Hathaway, the conglomerate led by billionaire Warren Buffett, announced on Saturday the highest quarterly operating profit in its history, Reuters reported.
Second-quarter operating profit rose 7% to $10.04 billion, or about $6,938 per Class A share, from $9.42 billion a year earlier.
Net income was $35.91 billion, or $24,775 per Class A share, compared with a loss of $43.62 billion a year earlier.
Rising interest rates and dividend payouts, as well as recovering results at auto insurer Geico, helped Berkshire’s insurance business generate more cash, with profit rising 38% from a year earlier.
That helped offset declines in other businesses, including rail company BNSF, where smaller supplies of consumer goods and increased price competition from trucking contributed to a 24 percent drop in overall profit.
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Investors keep a close eye on Berkshire because of its reputation as a legendary investor and because the results of the conglomerate’s dozens of companies often reflect broader economic trends.
These units also include Berkshire’s eponymous energy company, several industrial companies and household names such as Dairy Queen, Duracell, Fruit of the Loom and See’s Candies.
Berkshire also said it bought back $1.4 billion worth of stock during the quarter.
The company also remained a large net seller of shares, with the value of the shares it sold about $8 billion more than those it bought. Berkshire has a stock portfolio valued at $353 billion, about half of which is Apple stock.
That helped boost Berkshire’s cash holdings to $147.4 billion as of June 30 from $130.6 billion three months earlier.
Net results also included $25.9 billion in largely unrealized gains on investments and derivatives.
These results are volatile because accounting rules require Berkshire to report unrealized gains even if it doesn’t sell anything. Buffett urges investors to ignore the volatility.
The quarter is the first to fully include the results of bus station operator Pilot, in which Berkshire owns an 80% stake. Pilot contributed $114 million to operating profit.
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Buffett turns 93 on August 30. According to Forbes magazine, he owns 117.5 billion dollars and is the sixth richest person in the world.
Berkshire’s Class A shares closed Friday at $533,600, about 2% below their record high. The stock is up 14% this year, while the S&P 500 is up 17%.
2023-08-05 13:38:00
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