Warren Buffett at Berkshire Hathaway’s annual meeting in Los Angeles, California. May 1, 2021.
Gerard Miller | CNBC
Earnings for Warren Buffett’s Berkshire Hathaway jumped in the first quarter, thanks in part to a rebound in the conglomerate’s insurance business.
Operating earnings, which encompass profits from the conglomerate’s fully-owned businesses, totaled $8.065 billion in the first quarter. That’s up 12.6% from $7.16 billion a year prior.
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Profit from insurance underwriting came in at $911 million, up sharply from $167 million a year prior. Insurance investment income also jumped 68% to $1.969 billion from $1.170 billion.
The company’s railroad business, BNSF, along with its energy company saw year-over-year earnings declines. Operations classified under “other controlled businesses” and “non-controlled businesses” had slight increases from the year-earlier period.
Berkshire’s cash hoard swelled to $130.616 billion from $128 billion in the fourth quarter of 2022. Berkshire also repurchased $4.4 billion worth of stock, up from $2.8 billion at the end of last year.
Berkshire’s net earnings, which includes short-term investment gains, increased to $35.5 billion in the quarter from $5.6 billion in the same period a year ago, reflecting a first quarter comeback in Warren Buffett’s equity investments and income. Though Buffett cautions investors to not pay attention to quarterly fluctuations in unrealized gains on investments.
“The amount of investment gains (losses) in any given quarter is usually meaningless and delivers figures for net earnings per share that can be extremely misleading to investors who have little or no knowledge of accounting rules,” Berkshire said in a statement.
The company’s latest quarterly results come ahead of the conglomerate’s annual shareholder meeting, an event known as “Woodstock for Capitalists.”
Berkshire Class A shares are up 4.9% this year through Friday’s close, lagging the S&P 500’s 7.7% advance. However, the stock is less than 3% below an all-time high.
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