Berkshire Hathaway Inc. of Warren Buffett reported last Friday that its earnings for the third-quarter dropped by 9% but its operating results beat analyst estimates.
The company’s profit went down as Berkshire took a big write off on one of its investments while its operating results gained because of the improvement on its railroad, energy and insurance operations.
Berkshire’s net income knocked down from $5.05 billion or a per Class A share of $3,074 for the same period last year to the present record of $4.62 billion which is equivalent to $2,811 Class A shares.
However, the operating profit of the company improved by 29% that is $2,876 per Class A share or $4.72 billion net profits from what it logged last year that was $2,228 per Class A share or $3.66 billion. The third quarter’s operating profit for Berkshire in fact beat the forecast of analysts that its earnings would be around $2,594 per Class A share.
For the most part, the drop of profits for Berkshire came from its loss on derivatives and investments that amounted to $107 million while it recorded a growth of $1.39 billion last year.
During the third-quarter which ended on the 30th of September, the company wrote off an investment in British grocery chain Tesco Plc. for $678 million which was investigated by regulators because of accounting errors.