Warren Buffett’s Berkshire Hathaway recorded a double-digit increase in operating profit in the third quarter of the year, thanks to the ongoing recovery of its rail, utility and energy services from the effects of the pandemic, with the company’s liquidity to climb to new record levels as the “Fortune Teller of Omaha” maintains a waiting attitude.
More specifically, the Berkshire Hathaway Group reported operating profit of $ 6.47 billion for the third quarter of the year, up 18% from $ 5.48 billion in the same period last year.
Berkshire said its myriad businesses had benefited from the restart of the economy as demand began to return to pre-pandemic levels. Operating gains in the railways, utilities and energy sectors increased by 11% in the third quarter of the current fiscal year, reaching $ 3.03 billion.
“Starting in the third quarter of 2020, many of our companies showed significantly higher sales and profits than in the second quarter, which reflects higher consumer demand,” Berkshire said in a statement of financial results, adding: the long-term impact cannot be assessed at this stage ”.
Record liquidity
Meanwhile, at the end of September, Berkshire liquidity liquidity climbed to a record $ 149.2 billion, up from $ 144.1 billion in the second quarter. This is also due to the fact that Warren Buffett has not made any significant acquisitions in recent years, as valuations have hit record levels and competition between companies has intensified.
The company, in fact, has record liquidity despite the aggressive repurchases of shares it has made. It notes that Berkshire repurchased $ 7.6 billion worth of treasury shares in the third quarter of the year, raising spending to $ 20.2 billion in nine months. Last year, the company spent a record $ 24.7 billion on repurchases of treasury shares.
Total profits, reflecting Berkshire investments, fell to $ 10.3 billion in the third quarter, down more than 60% from a year earlier. Berkshire’s total return on investment stood at $ 3.8 billion last quarter, up from $ 24.8 billion a year ago.
The oracle oracle, however, reassured investors, noting that they should not place particular emphasis on quarterly changes in investment gains or losses.
“The amount of investment gains / losses in any quarter usually does not make sense and provides data on net earnings per share which can be extremely misleading for investors with little or no knowledge of accounting rules,” the group said in its quarterly report. .
Berkshire shares have gained more than 24% this year and are trading about 2% lower than the high recorded in May.
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Source From: Capital
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