Berkshire Hathaway CEO Abel Outlines Vision for Firm's Long-Term Success Post-Buffett Era

Berkshire Hathaway Annual Report Highlights Commitment to Long-Term Value Investing

Berkshire Hathaway Inc., led by Chief Executive Officer Greg Abel, has reaffirmed its commitment to the long-term value investing principles established by legendary CEO Warren Buffett. In the company's annual report, published on February 24, 2024, Abel vowed to maintain Berkshire's core values of capital discipline, integrity, and investing for the long run.

Abel's inaugural letter to shareholders, which marked the end of an era for Buffett's leadership, emphasized the company's focus on creating long-term value for shareholders. Berkshire will continue to prioritize investments that meet its stringent criteria, including a focus on quality and a long-term horizon. The company will also maintain its shareholder returns policy, which involves buying back shares when they trade below their intrinsic value.

Berkshire reported a 30% decline in operating profits in the fourth quarter of 2023, primarily due to a slump in insurance underwriting earnings. The company took a $4.5 billion impairment charge in the quarter and recorded a $8.3 billion hit related to its Kraft Heinz Co. and Occidental Petroleum Corp. holdings. Abel acknowledged that the company's investment in Kraft Heinz has been disappointing, with returns falling short of adequate.

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Financial Highlights

• Cash pile: $373.3 billion (down from $381.7 billion in the previous quarter)
• Insurance interest and other investment income: 11.9% decline over the past year
• Equity sales: $3.2 billion in the period
• Annual insurance underwriting pretax earnings: 17% decline in 2023 from a year ago
• Geico pretax underwriting earnings: $6.8 billion (down 13% from a year ago)
• BNSF operating earnings: 5.4% growth to $1.3 billion in the fourth quarter
• Utilities business operating earnings: 5.2% decline to $691 million over the quarter

Berkshire will hold its annual meeting in May 2024, which will feature appearances by other business executives from the Berkshire empire, including BNSF's Katie Farmer and NetJets' Adam Johnson.