Berkshire's Profit Windfall

Income at Warren Buffett's company more than quadruples.
Publish date:

Berkshire Hathaway

late Friday said that income in the third quarter rose by nearly five times on help from its Geico car insurance unit and a bounce-back from hurricane-related insurance claims.

For the quarter ended Sept. 30, the insurance and investment company posted a profit of $2.77 billion, or $1,797 a Class-A share, more than four times the $586 million, or $381 a share, in the year-ago period.

Revenue at Berkshire, which is led by billionaire Warren Buffett, rose 24% to $25.36 billion from $20.53 billion, in the same quarter a year ago.

Excluding items, Berkshire reported a profit of $2.6 billion, or $1,687 a share, up from $189 million, or $123 a share, last year.

"Clearly, our insurance business has benefited in a major way from the absence of catastrophe losses," Berkshire Hathaway said. "This is due not to managerial brilliance but rather to good luck. Last year, conversely, we got clobbered by a spate of hurricanes, more of which we will surely see in the future."

Berkshire Class A shares closed the regular session up $894 at $105,000; Class B shares rose $28 to $3,501.

Omaha, Neb.-based Berkshire, which generally withholds comment on quarterly earnings reports, previously estimated its losses to hurricanes Katrina, Rita and Wilma at $3.4 billion, with about $3 billion of those losses happening in last year's third quarter.