Buffett's Berkshire Posts Record Profit On Insurance, Investment

Warren Buffett's Berkshire Hathaway 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, according to Jonathan Stempel's report for Reuters.

Buffett assured investors about Berkshire's long-term health, saying the approximately $903 billion conglomerate's "extreme fiscal conservatism." I Photo: Berkshire Hathaway Home Services Facebook

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.

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.

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