Profit Falls 40% at Berkshire Hathaway

Berkshire Hathaway said Friday that its second-quarter profit fell 40 percent as falling stock prices depressed the value of its derivatives contracts.

Operating profit nevertheless rose 73 percent, helped by the takeover of the railroad operator Burlington Northern Santa Fe Corporation, improvement in insurance underwriting results and a turnaround at the NetJets corporate plane unit.

Net income fell to $1.97 billion, or $1,195 a Class A share, from $3.3 billion, or $2,123 a share, a year earlier. Excluding investments, operating profit rose to $3.07 billion, or $1,866 a share, from $1.78 billion, or $1,147 a share.

Berkshire recorded $1.41 billion in losses on derivatives, including long-term contracts tied to equity indexes, compared with a profit of $1.53 billion a year ago.

Read Full Article from New York Times

- Posted: 2010-08-06 21:51:01

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