Berkshire CEO Warren Buffett reports big increase in operating profit

US investor Warren Buffett

Berkshire Hathaway’s figures were released on Saturday.

(Photo: Reuters)

Denver Berkshire Hathaway reports a big jump in operating profit. It increased by almost 39 percent to $9.3 billion in the second quarter and includes profits from the conglomerate’s subsidiaries. The group from Omaha in the US state of Nebraska includes an energy and an insurance division and around 80 small and medium-sized companies, from the textile manufacturer “Fruit of the Loom” to the private aircraft rental company “Net Jet” and the candy manufacturer “See’s Candy”. “.

But star investor Warren Buffett’s group also reported a loss of $53 billion in its stock portfolio, which fluctuates sharply from quarter to quarter. “The investment gains or losses in the quarter are mostly meaningless,” Buffett said when the earnings were released on Saturday.

After significant rate hikes by the US Federal Reserve (Fed), the markets slipped into a bear market in the second quarter. The broad S&P 500 fell 16 percent from April through June, down almost 21 percent for the first half of the year — its biggest loss since 1970. Buffett’s well-publicized stock portfolio was worth $328 billion at the end of June, down $63 billion than the end of March.

Berkshire stock also felt the effects of investor uncertainty. The Class A stock is the most expensive in the US and fell 22 percent in the second quarter.

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On an annual basis, however, the Berkshire stock has fared significantly better than the S&P 500, which has been down 2.5 percent since early January, while the leading index is down 13 percent. The stock slipped around 1.2 percent in after-hours trading on Saturday and cost $434,100.

>> Read here: Is It Worth Copying Warren Buffett’s Investing Strategies? – Eight insights to caution

Buffett was also more hesitant about stock buybacks in the second quarter. Berkshire bought back $1 billion worth of securities in the first three months of the year, $3.2 billion – significantly less than 2021. At that time, buybacks totaled $27.1 billion.

Warren Buffett is expanding oil investments

Cash reserves were $105.4 billion at the end of June, down only slightly from the first quarter. Berkshire’s continued investment in oil company Occidental Petroleum in recent months. Buffett now owns 19.4 percent of the shares, which are worth around $11 billion.

Occidental is the most successful stock in the S&P 500. The price has more than doubled since the beginning of the year. Analysts are speculating that Buffett could take over the company entirely.

More: Berkshire Hathaway — Warren Buffett is overlooking these two big risks

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