February 28, 2015 / 1:17 PM / in 3 years

Berkshire Hathaway net falls, operating profit rises

(Reuters) - Warren Buffett’s Berkshire Hathaway Inc on Saturday said fourth-quarter profit declined 17 percent as investment gains declined, but operating results improved.

Berkshire Hathaway CEO Warren Buffett listens to a shareholder at the Berkshire-owned Borsheims jewelry store where Buffett was selling jewelry as part of the company annual meeting weekend in Omaha, Nebraska May 4, 2014. REUTERS/Rick Wilking

Earnings fell short of analyst forecasts as profit declined from insurance underwriting, though results improved in Berkshire’s railroad and energy operations.

Net income fell to $4.16 billion, or $2,529 per Class A share, from $4.99 billion, or $3,035 per share, a year earlier.

Quarterly operating profit rose 5 percent to $3.96 billion, or $2,412 per share, from $3.78 billion, or $2,297 per share.

Analysts on average had forecast operating profit of $2,701 per share, according to Thomson Reuters I/B/E/S. Quarterly revenue rose 3 percent to $48.26 billion.

Book value per share, which Buffett considers a good measure of Berkshire’s worth, rose 8.3 percent from a year earlier to $146,186.

For all of 2014, profit rose 2 percent to $19.87 billion, or $12,092 per share, while operating profit rose 9 percent to $16.55 billion, or $10,071 per share.

Buffett, 84, has run Berkshire since 1965, transforming it from a failing textile company into a conglomerate with more than 80 operating businesses in such areas as insurance, railroads, energy, food and apparel, and real estate.

The Omaha, Nebraska-based company also has $117.5 billion of equity investments, roughly 59 percent of which is in just four stocks: American Express Co, Coca-Cola Co, IBM Corp and Wells Fargo & Co.

Berkshire ended the year with $63.27 billion of cash, giving Buffett the ability to make one or more large acquisitions while still leaving a sufficient cushion.

Reporting by Jonathan Stempel in New York; Editing by David Holmes

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