Berkshire Hathaway, the firm of billionaire Warren Buffett, lost last year
Regarding the last quarter of the year, the company based in Omaha (Nebraska) announced this Saturday a profit of 18,164 million, less than half of the 39,646 achieved between October and December 2021.
The accounts of Buffett’s firm have been especially volatile since 2018 due to an accounting standard that came into force at that time that requires including the change in value of shares in his possession, which, given his huge portfolio, causes large movements depending on the direction of the markets.
The famous investor, very critical of these accounting rules, always points to operating profits as a more reliable way of seeing the progress of his company.
Every year, his company’s statement typically contains a warning to this effect: “The amount of investment gain/loss in a given quarter is often meaningless and yields net earnings (loss) per share figures that may be very misleading for investors with little or no knowledge of accounting standards”.
Based on these operating benefits, Berkshire Hathaway obtained a profit of 30,793 million in 2022, 12.15% more than the 27,455 million registered in 2021.
Following this logic, in the last quarter of 2022, the investment company recorded operating profits of 6,709, 7.9% less than the 7,285 million obtained between October and December 2021.
In a letter from Buffett to investors, he assures that “Berkshire will always maintain a large amount of cash and US Treasury bills along with a wide range of businesses.”
“We will also avoid behavior that could give rise to uncomfortable cash needs at inopportune times, including unprecedented financial panics and insurance losses,” said the investor, known in the financial world as the Oracle of Omaha.
In the statement, the company noted that approximately $2.6 billion was used to repurchase Berkshire shares in the fourth quarter, bringing the total for the year to about $7.9 billion in purchases of the company’s own shares in the first nine years.