正文
Berkshire Hathaway Net Rises 64%
By KAREN RICHARDSON
November 3, 2007
Berkshire Hathaway Inc. posted a 64% surge in third-quarter net income, driven by big investment gains in its stock portfolio, including the sale of its stake in PetroChina.
The Omaha, Neb.-based holding company headed by billionaire Warren Buffett posted net income of $4.55 billion, or $2,942 a Class A share. In the year-earlier period, Berkshire reported a 373% surge in earnings to $2.77 billion, or $1,797 a Class A share, after the company bet correctly on a mild hurricane season and collected hefty premiums in its insurance business.
Berkshire\'s operating earnings, which exclude investments gains, were slightly lower at $2.56 billion, compared with $2.60 billion a year earlier, as revenue from its insurance operations fell amid lower pricing and the company\'s retreat from some areas of underwriting business.
Berkshire\'s investment gains amounted to $1.99 billion, compared with $174 million a year earlier.
Decreases in revenue from Berkshire\'s housing-relating businesses, which continue to be affected by the slowdown in the housing sector, were offset by gains in other new businesses, such as Iscar Metalworking Cos., as well as its energy and aviation businesses. Berkshire\'s housing-related subsidiaries include such units as Acme Brick Co.; Benjamin Moore & Co., a paint company; and Johns Manville, an insulation and roofing maker.
Together, Berkshire\'s manufacturing, service and retailing units, which don\'t include insurance, posted third-quarter revenue of $15.2 billion, up from $13.72 billion.
Net underwriting gain from Berkshire\'s insurance businesses, which include auto insurer Geico and reinsurer General Re, was $486 million, down 47%. Premiums fell sharply in the reinsurance business as capacity in the industry increased, while there were no major catastrophes to incur losses.
Securities investments, in both stocks and bonds, didn\'t help reduce Berkshire\'s mounting cash pile. At the end of the past nine months, $47.08 billion in cash and equivalents sat on its books compared, with $46.95 billion at the end of the second quarter. The company spent about $5.4 billion on stocks in the third quarter, after putting $6.12 billion into stocks in the second quarter and $5.31 billion in the first quarter. Berkshire spent $5.7 billion on bonds in the third quarter, or $9.06 billion in the first nine months compared with $3.4 billion at the end of six months.
In October, Berkshire completed selling its stake in PetroChina, the Chinese energy company, for at least seven times the price he bought the shares for several years ago.
By KAREN RICHARDSON
November 3, 2007
Berkshire Hathaway Inc. posted a 64% surge in third-quarter net income, driven by big investment gains in its stock portfolio, including the sale of its stake in PetroChina.
The Omaha, Neb.-based holding company headed by billionaire Warren Buffett posted net income of $4.55 billion, or $2,942 a Class A share. In the year-earlier period, Berkshire reported a 373% surge in earnings to $2.77 billion, or $1,797 a Class A share, after the company bet correctly on a mild hurricane season and collected hefty premiums in its insurance business.
Berkshire\'s operating earnings, which exclude investments gains, were slightly lower at $2.56 billion, compared with $2.60 billion a year earlier, as revenue from its insurance operations fell amid lower pricing and the company\'s retreat from some areas of underwriting business.
Berkshire\'s investment gains amounted to $1.99 billion, compared with $174 million a year earlier.
Decreases in revenue from Berkshire\'s housing-relating businesses, which continue to be affected by the slowdown in the housing sector, were offset by gains in other new businesses, such as Iscar Metalworking Cos., as well as its energy and aviation businesses. Berkshire\'s housing-related subsidiaries include such units as Acme Brick Co.; Benjamin Moore & Co., a paint company; and Johns Manville, an insulation and roofing maker.
Together, Berkshire\'s manufacturing, service and retailing units, which don\'t include insurance, posted third-quarter revenue of $15.2 billion, up from $13.72 billion.
Net underwriting gain from Berkshire\'s insurance businesses, which include auto insurer Geico and reinsurer General Re, was $486 million, down 47%. Premiums fell sharply in the reinsurance business as capacity in the industry increased, while there were no major catastrophes to incur losses.
Securities investments, in both stocks and bonds, didn\'t help reduce Berkshire\'s mounting cash pile. At the end of the past nine months, $47.08 billion in cash and equivalents sat on its books compared, with $46.95 billion at the end of the second quarter. The company spent about $5.4 billion on stocks in the third quarter, after putting $6.12 billion into stocks in the second quarter and $5.31 billion in the first quarter. Berkshire spent $5.7 billion on bonds in the third quarter, or $9.06 billion in the first nine months compared with $3.4 billion at the end of six months.
In October, Berkshire completed selling its stake in PetroChina, the Chinese energy company, for at least seven times the price he bought the shares for several years ago.
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