Warren Buffett's conglomerate Berkshire Hathaway Inc announced on Friday that first-quarter profit fell by 58% from a year earlier because of insurance losses related to major natural disasters in Japan, New Zealand and Australia, reported AP
The sharp drop answer the preliminary results outlined by Buffett's annual shareholders meeting last Saturday.
Berkshire's net profit for the quarter to end-March amounted to 1.5 billion dollars or 917 dollars per share Class A year earlier it was 3.6 billion, or 2,272 dollars per share.
Revenue rose to 33.7 billion dollars from 32 billion a year ago.
The biggest problem for the results during the quarter are insurance losses worth 1.7 billion dollars related to the earthquake and tsunami in Japan on March 11 earthquake in New Zealand on 22 February and floods in Australia.
"This probably was the second worst quarter for the insurance industry in terms of disasters worldwide," said Buffett told shareholders.
Despite losing zastrohovatelniya business conglomerate has contributed 131 million dollars to Berkshire's net profit for the quarter, which is significantly less than 1,2 billion dollars a year earlier.
Berkshire owns about 80 subsidiaries, including companies from the textile, furniture and jewelry sector. Insurance business and utility companies usually form more than half of net profit of the company. Berkshire also has major investments in companies like Coca-Cola Co. and Wells Fargo & Co.
The results of the conglomerate are backed by strong performance of the railway company Burlington Northern Santa Fe, which acquired a year ago. Railway segment has contributed 607 million dollars to net profit to 282 million a year earlier, although the results for the previous year does not include the entire quarter.
Manufacturing, retail trade and services have generated a profit of 558 million dollars, more than 477 million dollars a year earlier.
Utility companies and those from the energy sector, which includes MidAmerican Energy, has added 301 million dollars to Berkshire's net profit to 223 million dollars a year ago.
The quarterly report does not mention David Sokol, former manager of Berkshire, tipped to succeed Buffett, whose sudden resignation at the end of the quarter set up a scandal and prompted examination of the U.S. Commission on securities and stock transactions.