New York
CNN
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Famed investor Warren Buffett revealed his annual letter to Berkshire Hathaway shareholders on Saturday with this 12 months’s be aware carrying a extra heartfelt tone after the dying in November of Buffett’s longtime enterprise associate Charlie Munger.
Buyers have lengthy sought knowledge from the Oracle of Omaha on markets, the financial system and life basically. However Buffet opened Berkshire’s 2023 annual report on a private be aware with a dedication to Munger, who died in November at age 99, simply 33 days earlier than the milestone birthday.
Buffett stated that Munger was the “architect” behind the conglomerate. “Within the bodily world, nice buildings are linked to their architect whereas those that had poured the concrete or put in the home windows are quickly forgotten,” he wrote. “Berkshire has change into an awesome firm. Although I’ve lengthy been in command of the development crew; Charlie ought to endlessly be credited with being the architect.”
The pair first met in 1959 and three years later Munger started working in cash administration, the letter notes. In 1978, Munger joined Berkshire Hathaway as vice-chairman and has sat by his facet, fast with a quip or a sage piece of recommendation.
“Charlie by no means sought to take credit score for his function as creator however as an alternative let me take the bows and obtain the accolades. In a manner his relationship with me was half older brother, half loving father. Even when he knew he was proper, he gave me the reins, and after I blundered he by no means – by no means – jogged my memory of my mistake,” wrote Buffett.
Munger’s passing has introduced up the query of succession at Berkshire.
Buffett, 93, named Greg Abel, 61, as his inheritor obvious in 2021. Abel heads Berkshire’s non-insurance companies, together with its vitality division, constructing supplies and even sweet divisions.
Buffett has labored to insure traders that Berkshire’s inventory (BRK.A), which closed at $628,930.18 on Friday, has a robust succession plan in place.
“I don’t have a second selection. I imply it’s that powerful to search out. However I’ve additionally seen Greg in motion and I really feel 100% snug,” Buffett stated at his shareholder assembly final 12 months. “Greg is inheriting a great enterprise and I believe he’ll make it higher.”
Berkshire Hathaway reported a major uptick in fourth quarter working earnings. Working earnings totaled $8.5 billion, up from $6.6 billion, or a 28% improve from a 12 months in the past. This brings its 2023 working earnings as much as $37.3 billion, from $30.8 billion in 2022.
The Omaha, Nebraska-based conglomerate additionally reported internet earnings of $37.3 billion, and closed the 12 months with a internet revenue of $96.2 billion, a pointy turnaround from 2022’s internet lack of $22.8 billion.
Berkshire’s insurance coverage underwriting enterprise, one in all its main holdings, made $848 million within the fourth quarter, up from $160 million in the identical interval a 12 months prior. General, insurance coverage underwriting generated earnings of $5.4 billion in 2023, up from a lack of $30 million in 2022.
Berkshire additionally purchased again $2.2 billion in inventory final quarter, bringing the 12 months’s complete to roughly $9.2 billion in inventory repurchases.
Saturday’s report confirmed that Buffett is sitting on a file pile of money. Berkshire has about $167.6 billion in money and equivalents, breaking final quarter’s record-high $157.2 billion.
The stockpile has led some traders to take a position on whether or not Buffett is planning to amass a brand new firm so as to add to his portfolio.
Warren Buffett’s life in footage
Berkshire Hathaway bought off 10 million shares of Apple inventory within the last three months of 2023, representing about 1% of its holdings within the tech large.
Apple has been a serious holding for Berkshire and is named one of many so-called “4 giants” — alongside its insurance coverage, railroad and vitality operations — which Buffett says drives most of Berkshire’s worth.
Berkshire had additionally introduced it had barely trimmed its place in Apple in a latest regulatory filing with the Securities and Trade Fee.
Filings also showed that Berkshire bought 80 million shares of printer firm HP within the fourth quarter of 2023, lowering its holdings by 78%. It additionally pared off 32% of its holdings in media firm Paramount.