The profits of Warren Buffett's company improved 17 percent thanks to a relatively mild hurricane season and more paper investment gains this year as Berkshire Hathaway continues to prepare for the legendary 95-year-old investor to relinquish the CEO title in January.
But last month's $9.7 billion investment in OxyChem won't do much to diminish the $381.7 billion cash pile that Berkshire was sitting on at the end of September even though it is the biggest deal the company has made in years.
Berkshire said on Nov. 1 that it earned $30.8 billion in the quarter. That's up from last year's $26.25 billion.
But those bottom-line figures are always distorted by the current value of Berkshire's massive investment portfolio and any stock sales, which this year added $17.3 billion to the company's profits.
That’s why Buffett has long recommended that investors pay more attention to Berkshire’s operating earnings to get a sense of how its many operating companies are performing, including well-known insurers like Geico, BNSF railroad, several major utilities and an assortment of manufacturing and retail companies.
On that measure, Berkshire's operating profit jumped to $13.5 billion, thanks to a strong rebound in its insurance companies. A year ago, Berkshire reported operating earnings of $10.09 billion.
Berkshire said fewer catastrophic losses from hurricanes this year compared to when Hurricane Helene ravaged the southeast a year ago helped its insurance underwriting profit jump $1.6 billion to $2.4 billion. The bottom line was also helped by $331 million in gains on debt held in foreign currencies this year, compared to a $1.1 billion loss on those holdings a year ago.
