Warren Buffett’s Berkshire Hathaway reported a quarterly profit that doubled to a record high, reflecting a large gain on its stake in Kraft Heinz Co. The company also said operating profit declined on weaker results from insurance underwriting.
Third-quarter net income rose to $9.43 billion, or $5,737 per Class A share, up from $4.62 billion, or $2,811, a year earlier.
Operating profit fell 4% to $4.55 billion, or $2,769 per share. Analysts had expected an operating profit of $2,720.60 per share
“Overall, quite decent operating earnings,” said Jeff Matthews, a principal at the Ram Partners LP hedge fund and author of “Pilgrimage to Warren Buffett’s Omaha.” “Nothing wrong with that given the weakness in the industrial side of the economy.”
Berkshire was helpful in financing the July merger that created the food company. The company had previously owned a majority share in H.J. Heinz Co.
Kraft Heinz helped Berkshire offset recent struggles with other large investments such as IBM and Wal-Mart Stores Inc, and in some operating businesses including the Geico auto insurer.
Berkshire’s Class A shares is down 10% this year.
In the meantime, Berkshire Hathaway has experienced a 34% decline in insurance underwriting to $414 million.