Berkshire Hathaway operating earnings jump 28% in the fourth quarter, cash pile surges to record

Berkshire Hathaway on Saturday reported a giant rise in working earnings within the fourth quarter, thanks to large beneficial properties in its insurance coverage enterprise, whereas its money pile expanded to document ranges.

The Omaha-based conglomerate posted working earnings — which refers to earnings from companies throughout insurance coverage, railroads and utilities — of $8.481 billion within the quarter ending December. That is 28% above the $6.625 billion from the year-ago interval.

For the complete yr 2023, that introduced working earnings as much as $37.350 billion, up 17% from $30.853 billion within the prior yr.

Berkshire additionally held $167.6 billion in money within the fourth quarter, a document stage that surpasses the $157.2 billion the conglomerate held within the prior quarter.

Berkshire Class A shares have rallied roughly 16% this yr.

Geico, the auto insurer thought-about Buffett’s “favourite baby,” reported a worthwhile yr, with internet underwriting earnings of $5.428 billion in 2023. The improved earnings was pushed by premium charge will increase and decrease claims final yr.

In the meantime, Burlington Northern Santa Fe (BNSF) reported full-year internet earnings of $5.087 billion final yr, a 14% drop from $5.946 billion within the prior yr.

Insurance coverage underwriting surged to $848 million within the fourth quarter, spiking 430% from $160 million from the year-ago interval, driving working earnings for the conglomerate.

Insurance coverage funding earnings additionally rose to $2.759 billion on a quarterly foundation, up 37% from $2.0 billion in the identical interval within the yr prior.

However working earnings from railroads fell within the fourth quarter, because it did in utilities and power. Working earnings from railroads dropped to $1.355 billion, down from $1.469 billion a yr in the past. Working earnings for utilities and power fell to $632 million, down from $739 million the prior yr.

Total Berkshire earnings, which embrace the corporate’s funding beneficial properties from publicly traded corporations, greater than doubled throughout the quarter from the year-earlier interval, reaching $37.57 billion. For the complete yr, general earnings got here in at $96.22 billion.

The conglomerate, nevertheless, included its common disclaimer advising buyers to look previous fluctuations in quarterly outcomes.

“We consider that funding beneficial properties and losses on investments in fairness securities, whether or not realized from tendencies or unrealized from modifications in market costs, are typically meaningless in understanding our reported periodic outcomes or evaluating the financial efficiency of our working companies,” learn a press release within the annual report.