(BRK.A; BRK.B) –
We show below summary financial data for the fourth quarter and
full year. However, we urge investors and reporters to carefully
read our Annual Report, which has been posted on the Internet at
www.berkshirehathaway.com. The limited information that follows in
this press release is totally inadequate for making an informed
investment judgment or for an evaluation of 2017 business
performance. Earnings are stated on an after-tax basis. (Dollar
amounts are in millions, except for per share amounts).
Fourth
Quarter
Full Year
2017
2016
2017
2016
Net earnings attributable to Berkshire shareholders
$
32,551 $ 6,286
$ 44,940 $
24,074 Net earnings includes: Investment and
derivative gains/losses 107 1,904 1,377 6,497* Earnings impact from
the enactment of the 2017 Tax Act
29,106**
— 29,106**
—
Non-operating earnings 29,213 1,904 30,483 6,497 Operating earnings
3,338 4,382
14,457 17,577 Net earnings
attributable to Berkshire shareholders
$
32,551 $ 6,286
$ 44,940 $
24,074
*
Includes after-tax gains of approximately
$2.7 billion from the disposition of preferred stock in Wrigley and
Kraft Heinz and conversion of preferred stock of Dow Chemical. Also
includes after-tax gain of approximately $1.9 billion from the
exchange of Procter & Gamble common stock for Duracell.
**
Attributable to a one-time net benefit
from the enactment of the Tax Cuts and Jobs Act on December 22,
2017. The benefit primarily derives from a reduction of net
deferred income tax liabilities that arose as a result of the
reduction in the U.S. corporate income tax rate from 35% to
21%.
Net earnings per Class A equivalent share
attributable
to Berkshire
shareholders
$19,790
$3,823
$27,326
$14,645
Average Class A equivalent shares outstanding
1,644,796
1,644,157 1,644,615 1,643,826 Book value per Class A equivalent
share at December 31
$211,750 $172,108
Note: Per share amounts for the Class B shares are 1/1,500th
those shown for the Class A.
An analysis of Berkshire’s operating earnings follows (dollar
amounts are in millions).
Fourth
Quarter
Full Year
2017
2016
2017
2016
Insurance-underwriting $ (491 ) $ 548 $ (2,219 ) $ 1,370
Insurance-investment income 1,000 889 3,917 3,636
Railroad, utilities and energy
businesses
1,224 1,425 6,042 5,856 Other businesses 1,894 1,553 7,543 7,058
Other
(289 )
(33 )
(826 )
(343 ) Operating earnings
$3,338
$4,382 $14,457
$17,577
Operating earnings for 2017 are net of pre-tax underwriting
losses of approximately $3.0 billion ($1.95 billion after-tax)
attributable to three major hurricanes in the U.S. and Puerto Rico
and wildfires in California.
In the table on the prior page (which, as noted, reports
after-tax results), we give investment and derivative gains/losses
a line of their own because the amounts of these in any given
quarter or year are often meaningless.
Berkshire’s gain in net worth during 2017 was $65.3 billion
which increased per-share book value by 23% since yearend 2016 to
$211,750 per Class A equivalent share ($141.17 per Class B
equivalent share). Insurance float (the net liabilities we assume
under insurance contracts) at December 31, 2017 was approximately
$114 billion.
Use of Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures.
The reconciliations of such measures to the most comparable GAAP
figures in accordance with Regulation G are included herein.
Berkshire presents its results in the way it believes will be
most meaningful and useful, as well as most transparent, to the
investing public and others who use Berkshire’s financial
information. That presentation includes the use of certain non-GAAP
financial measures. In addition to the GAAP presentations of net
earnings, Berkshire shows operating earnings defined as net
earnings exclusive of investment and derivative gains/losses and
the earnings impact from the enactment of the Tax Cuts and Jobs Act
of 2017.
Although the investment of insurance and reinsurance premiums to
generate investment income and investment gains or losses is an
integral part of Berkshire’s operations, the generation of
investment income and investment gains or losses is independent of
the insurance underwriting process. Moreover, under applicable GAAP
accounting requirements, gains or losses can be created when
certain types of investments are marked-to-market through earnings.
In sum, investment and derivative gains/losses for any particular
period are not indicative of quarterly business performance.
About Berkshire
Berkshire Hathaway and its subsidiaries engage in diverse
business activities including insurance and reinsurance, utilities
and energy, freight rail transportation, finance, manufacturing,
retailing and services. Common stock of the company is listed on
the New York Stock Exchange, trading symbols BRK.A and BRK.B.
Cautionary Statement
Certain statements contained in this press release are “forward
looking” statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements are not guaranties
of future performance and actual results may differ materially from
those forecasted.
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version on businesswire.com: http://www.businesswire.com/news/home/20180224005015/en/
Berkshire Hathaway Inc.Marc D. Hamburg, 402-346-1400
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