Buffett's Berkshire posts record profit on insurance, investment
By Jonathan Stempel
(Reuters) — Warren Buffett's Berkshire Hathaway (NYSE:BRKa) on Saturday posted its second straight record annual operating profit, with its insurance business benefiting from improved underwriting and higher income from investments as interest rates rose.
Net income also reached a record $96.2 billion, as the rising stock market boosted the value of Berkshire's $354 billion equity portfolio, half of which is in Apple (NASDAQ:AAPL).
In his annual letter to Berkshire shareholders, Buffett said Berkshire's insurance businesses performed «exceptionally well» — among them, Geico, where better underwriting quality helped it more than reverse year-earlier losses.
This helped offset declining fourth-quarter and full-year profit at the BNSF railroad, where rising wages and costs for upkeep increased as revenue fell, and Berkshire Hathaway Energy, beset by wildfire litigation and a tougher regulatory climate.
Buffett nevertheless assured investors about Berkshire's long-term health, saying the approximately $903 billion conglomerate's «extreme fiscal conservatism» — including a now-record $167.6 billion cash stake — would serve them well.
Operating profit rose 28% to $8.48 billion, or about $5,884 per Class A share, in the fourth quarter, and 21% to $37.4 billion for the year.
Net income for the quarter more than doubled to $37.57 billion, or $26,043 per Class A share.
The $96.2 billion annual profit topped the old record $89.9 billion from 2021. Berkshire lost $22.8 billion in 2022, when the stock market fell.
Buffett considers net results misleading because they include gains and losses on investments that Berkshire has not sold.
Berkshire also spent about $2.2 billion in the fourth quarter and $9.2 billion
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