Berkshire Hathaway’s (NYSE:BRK.A) net profit last year rose by 45% to $14.8 billion, supported by the companies’ in which the group invested and the derivative gains, but the head of Berkshire, Warren Buffett said he was unhappy with the financial results.
In the fourth quarter the net profit rose by 49%, $2,757 a share, to $4.55 billion, according to Bloomberg. Gains from derivatives rose from $163 million dollars in the last three months of 2011 to $1.4 billion in the same period last year.
Buffett built Berkshire in nearly five decades through acquisitions and investments, as the the group value rose to about $253 billion. The more than 70 operating divisions of the group have activities in freight, energy production and construction, and the sale of products and services ranging from insurance products to chocolate.
Net value of assets recorded last year a lower growth than the average advance of companies listed on S & P 500. 2012 was the ninth of the 48 years spent by Buffett at the helm of Berkshire in which he failed to have a better performance than the S & P 500. In his letter to shareholders, Buffett described the results of last year as “subpar”.
Berkshire had last year a 14.4% increase of the asset net value, compared with 16% for the S & P 500, including dividends. Another major disappointment was the lack of a major acquisition for Buffet in 2012, according to MarketWatch. “I pursued a couple of elephants, but came back empty-handed,” he said.
Todd Combs and Ted Weschler, managers brought to the company by Buffett in the past two years to identify investment opportunities, had much better results compared to the S & P 500. “They left me in the dust as well,” wrote Buffett. The two managers were rewarded for last year’s results by increasing the funds allocated for investment to nearly $5 billion.
Berkshire holds cash of almost $47 billion, but Buffett opposes payment of dividend, instead paying more attention to shares’ value.
Reply