Berkshire Hathaway Inc. hits first quarter record profit at 51 percent
'This earnings report is the tip of the iceberg,' officials say
Could the recession here in the U.S. finally be over? Warren Buffett's Berkshire Hathaway Inc. hit a new record as first-quarter profit jumped 51 percent on gains from equity-linked derivatives and insurance operations. Net income climbed to $4.89 billion, or $2,977 a share, from $3.25 billion, or $1,966, a year earlier.
Warren Buffet was confident, but cautious. "It was a good quarter, it wasn't quite as good a quarter as it looks," Buffett said at the company's annual meeting in Omaha.
Improvements in the housing market have helped the U.S. economy rebound from the biggest slump since the Great Depression. Warren Buffett, as chairman and chief executive officer for more than 40 years, transformed the company through takeovers from a textile maker into a firm that hauls freight, generates electricity, sells insurance and manufactures building supplies from bricks to paint.
"This earnings report is the tip of the iceberg," Bill Smead, portfolio manager of the Smead Value Fund said. "Warren has organized the company around the rebirth of the United States economy over the next 10 years and this is the beginning of that rebirth."
Buffet was confident, but cautious. "It was a good quarter, it wasn't quite as good a quarter as it looks," Buffett said at the company's annual meeting in Omaha.
The equities portfolio was valued at $97.2 billion on March 31, up from $87.7 billion at the end of 2012 as American Express Co., Coca-Cola Co. (KO) and DirecTV rallied. Berkshire increased its stock bet in the category listed as "banks, insurance and finance" in the quarter, Buffett's firm said in a regulatory filing, without identifying companies.
Berkshire spent $1.41 billion on equities in the quarter after increasing the amount of funds overseen by deputy stock pickers Todd Combs and Ted Weschler, while selling $673 million, according to the filing. There were $1.81 billion in purchases of fixed maturity securities and $675 million in sales.
Data from the Commerce Department proved that U.S. gross domestic product climbed at a 2.5 percent annualized pace in the first quarter, driven by higher consumer spending and residential construction.
Berkshire Hathaway Reinsurance Group added $974 million before taxes, compared with a loss of $191 million a year earlier.
Berkshire cut some risks tied to a life deal with Swiss Re Ltd. in the first quarter, agreeing to pay the Zurich-based company to reduce the protection that Buffett's firm provides.
The 82-year-old Buffett has highlighted the prospects for the world's largest economy, where most of Berkshire's operations are based. The company has its "foot to the floor" and will probably set another record for capital spending this year after making a $9.8 billion outlay on plants and equipment in 2012, he wrote in his annual letter to shareholders.
© 2014 - Distributed by THE NEWS CONSORTIUM
Pope Francis Prayer Intentions for March 2014
Respect for Women: That all cultures may respect the rights and dignity of women.
Vocations: That many young people may accept the Lordís invitation to consecrate their lives to proclaiming the Gospel.
Rate This Article
Leave a Comment
More Business & Economics News
- $30 trillion increase from $70 trillion between mid-2007 and mid-2013 sends global debt over $100 trillion
- Wowza! Restaurant starts charging diners for Obamacare
- Time banking - where time is BETTER than MONEY
- Google tops Exxon as world's second-most valuable company - for a day
- Bill Gates thinks poverty will be eliminated by 2035... But he's missing this one thing!
- World's richest playboys forgot to address the world's most serious problems between parties in Davos
- CROWDFUNDING: Brother, can you spare - funding for my new movie project?
- Here we go again! Increase the government's borrowing limit before late February, Treasury Secretary warns
- Pope Francis sends a message to Davos elites -- they'd do well to listen
- Fr. Paul Schenck: Finding Living Faith on Catechetical Sunday
- The Movie Yellow: Incest as 'Normal' and Cassavates's Slides Into the World of Woes
- The Chicago School Teachers Strike Reveals the Need For School Choice
- The Sexual Barbarians and the Dissolution of Culture
- The Happy Priest Challenges Us to Ask: Who is Jesus to Me?
- Michael Coren on Canadian Public Schools: Teachers, leave those kids alone
- We Cannot Ignore Our Consciences: Cardinal Dolan On Religious Liberty
- In the Face of Danger, Successor of Peter Travels to Lebanon as a Messenger of Peace
- Reflections on the Dignity and Vocation of Women: Who or What?
Disclaimer: The columns, articles, advertisers claims and any other features provided on Catholic Online Business & Economics are provided for personal finance and investment information and are not to be construed as investment advice. Under no circumstances does the information in this content represent a recommendation to buy, sell or hold any security. The views and opinions expressed in an article or column are the author's own and not necessarily those of Catholic Online and there is no implied endorsement by Catholic Online of any advice or trading strategy.