Warren Buffett, the CEO of Berkshire Hathaway released a statement on Saturday saying that the company’s operating profit for the current quarter has doubled. He said that the insurance business of his companies has benefited a lot because of the lower taxes.
The results will give now give more power to the company in terms of cash. The company has resorted to buying back the company’s own stock worth $928. Buffett has stated that the company was struggling to find an apt place to invest and therefore has decided upon buying back.
The operating profits of the company increased from $3.44 billion in the same quarter of the previous year to $6.11 billion for this quarter thereby doubling in a year. According to the IBES data from Refinitiv, the operating profit for this quarter was higher than the expectations of the Wall Street which predicted it to be $6.11 billion.
In the previous year the company had witnessed losses due to the hurricanes in the United States and an earthquake in Mexico. The insurance operations as a result of these calamities have witnessed loss.
The company said that the net income for the third quarter of the current fiscal year increased more than 355 percent to become $18.5 billion. Because of the increase, the company will now require new accounting rule in order to report its unrealized investment gains.
The company had earlier warned that the losses that had incurred to the company due to the hurricanes and earthquake are estimated to range between $350 million to $550 million.
The effective tax rate of Berkshire for the third quarter of the current fiscal year was reported to be 19.2 percent which was 25.3 in the same quarter of the previous year which has decreased immensely in an year.
Source: Reuters, ChannelNewAsia
