Berkshire profit doubles to record on Kraft Heinz

Fri Nov 6, 2015 6:37pm EST
 
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By Jonathan Stempel and Jennifer Ablan

NEW YORK (Reuters) - Warren Buffett's Berkshire Hathaway Inc (BRKa.N: Quote) (BRKb.N: Quote) said quarterly profit doubled to a record high, reflecting a large gain on its stake in Kraft Heinz Co (KHC.O: Quote), while operating profit declined on weaker results from insurance underwriting.

Third-quarter net income rose to $9.43 billion, or $5,737 per Class A share, from $4.62 billion, or $2,811, a year earlier.

Operating profit fell 4 percent to $4.55 billion, or $2,769 per share, from $4.72 billion, or $2,876.

    Analysts on average expected operating profit of $2,720.60 per share, according to Thomson Reuters I/B/E/S.

Among Berkshire's larger businesses, profit fell 34 percent from insurance underwriting to $414 million, rose 12 percent at the BNSF railroad to $1.16 billion, and rose 13 percent to $786 million at Berkshire Hathaway Energy.

"Overall, quite decent operating earnings," said Jeff Matthews, a principal at the Ram Partners LP hedge fund and author of "Pilgrimage to Warren Buffett's Omaha." "Nothing wrong with that given the weakness in the industrial side of the economy."

Berkshire has close to 90 operating businesses including the General Re reinsurer, Lubrizol chemicals, NetJets business jets and Dairy Queen ice cream. Buffett, 85, has run Omaha, Nebraska-based Berkshire since 1965.

  Continued...

 
Warren Buffett, Chairman and CEO, Berkshire Hathaway, speaks at the Fortune's Most Powerful Women's Summit in Washington October 13, 2015.  REUTERS/Kevin Lamarque