Berkshire Profit Falls 8.6%

(RTTNews) - Billionaire Warren Buffett's Berkshire Hathaway Inc. (BRK.A, BRK.B) said Friday after the markets closed that its third quarter profit fell 8.6% from last year, hurt mainly by impairment charges related to its investments in equity securities of British retailer Tesco plc (TSCO.L).

However, the company's operating earnings for the quarter rose from last year, helped by strong earnings from the company's non-insurance businesses.

Berkshire is a holding company with a number of operating subsidiaries like auto insurer Geico, reinsurer General Re, railroad BNSF, lubricant maker Lubrizol, energy utilities and a host of other manufacturing and retail companies.

Berkshire also holds significant minority stakes in top notch companies like Wal-Mart Stores Inc. (WMT), American Express Co. (AXP), The Coca-Cola Co. (KO), Wells Fargo &Co. (WFC) and International Business Machines Corp. (IBM).

Operating earnings for the company's insurance underwriting business surged to $629 million in the third quarter from $170 million a year ago, while Insurance investment income fell to $811 million from $861 million last year.

Railroad's operating earnings for the quarter rose 5% to $1.04 billion, while operating earnings from Berkshire's utilities and energy businesses jumped 48% to $697 million.

For the third quarter ended September 30, 2014, the Omaha, Nebraska-based company reported net earnings of $4.62 billion or $2,811 per Class A share, compared to $5.05 billion or $3,074 per Class A share for the year-ago quarter.

Other-than-temporary impairment charges related to the investments in equity securities of Tesco were $678 million in the third quarter of 2014, Berkshire said.

Excluding items, operating earnings for the third quarter rose to $4.72 billion or $2,876 per Class A share from $3.66 billion or $2,228 per Class A share in the prior year quarter.

Total revenue for the third quarter rose 10% to $51.20 billion from $46.54 billion in the same quarter last year.

Since the beginning of the year, Berkshire's shareholders' equity has increased $15.6 billion and its book value per Class A share has increased by 7.1% to $144,542 as of September 30.

Berkshire's Class A shares are currently gaining 0.14% in after hours trading after closing the day's regular trading session at $214,970, up $170. The company's Class B shares are losing 0.28% in extended hours trading after closing the day's regular trading session at $143.61, up 32 cents.