Berkshire Hathaway Profits Drop -- AP
OMAHA, Neb. (AP) - The stock market's recent swings also hit the
pocketbook of billionaire investor Warren Buffett's company,
Berkshire Hathaway Inc. (NYSE:BRKa - news)
But continued growth from the holding company's largest
operation, car insurer GEICO, made up for the company's
investment losses as Berkshire saw only a slight drop in
third-quarter earnings from last year.
Berkshire said Thursday that its net income for the three-month
period ending Sept. 30 were $365 million, or $293 per diluted
share, down from $366.6 million, or $297 per share, a year
earlier - a difference of less than one-half percent.
Realized investment gains dropped during the quarter from $119
million last year to $101 million this year. But the company's
earnings from operations, primarily GEICO, nearly erased
investment losses on the earnings report as operating profits
jumped from $248 million last year to $264 million.
Berkshire's net earnings for the first nine months of the year
were $2.263 billion, or $1,822 per share, up from $929 million
from the year-ago period, or $754 per share.
The net earnings for 1998 are meaningless for evaluating
Berkshire, the company said.
While realized gains had a material impact on Berkshire's
reported earnings, they had a minor impact on shareholders'
equity, company officials said. Berkshire records its investments
at market value and most of the appreciation in the investments
sold during 1998 were reflected in previous earnings reports.
Omaha-based Berkshire, which has stakes in such companies as
Coca-Cola, Gillette, American Express and Walt Disney, said it
soon plans to finish its acquisition of Stamford, Conn.-based
General Re, the largest reinsurer in the United States and
third-largest in the world.
In September, both companies' shareholders approved the
transaction. In addition, all regulatory approvals have been
obtained. It is expected the transaction will close in the fourth
quarter after receiving certain rulings from the Internal Revenue
Service.
Berkshire's Class A shares, the highest priced on the New York
Stock Exchange, were down $150 at $66,700 in afternoon trading
Thursday.
The ''Baby Berkshire'' Class B shares, the second most expensive
on the NYSE, were up $2 at $2,228 each. |
