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BUSINESSMonday 9 November 2015
Buffett’s firm doubles its 3Q profit on Kraft Heinz merger
JOSH FUNK clude investments and de-
rivatives, which can vary
AP Business Writer widely. Berkshire’s operat-
ing earnings per Class A
OMAHA, Neb. (AP) — Berk- share were $2,769 this year,
down slightly from $2,876
shire Hathaway Inc.’s third- last year.
The four analysts surveyed
quarter profit more than by FactSet expected Berk-
shire Hathaway to report
doubled as the completion operating earnings per
Class A share of $2,716.26.
of the Kraft-Heinz merger Berkshire officials do not
typically comment on the
boosted the paper value company’s quarterly earn-
ings reports, and they did
of its stake in the food gi- not immediately respond
to an interview request on
ant. Friday.
BNSF railroad added $1.16
The conglomerate War- billion to Berkshire’s net in-
come, up from $1.04 billion
ren Buffett leads said this last year thanks to better
operations and a 1 per-
weekend it earned $9.4 bil- cent increase in total vol-
ume.
lion, or $5,737 per Class A Berkshire’s utility business-
es generated $786 million
share. That’s up from $4.6 net income, up from $697
million a year ago.
billion, or $2,811 per share, But the operating profit at
its insurance companies,
in last year’s third quarter. which include Geico and
General Reinsurance, fell
Berkshire’s revenue grew to $414 million from last
year’s $629 million as the
15 percent to nearly $59
billion. Several of its non-
insurance businesses,
such as BNSF railroad, per-
formed well, but the results
across its nearly 90 compa-
nies were mixed.
Berkshire holds about 27 Berkshire Hathaway Chairman and CEO Warren Buffett speaks in Omaha, Neb. Berkshire
Hathaway Inc.’s third-quarter profit more than doubled as the completion of the Kraft-Heinz
percent of the stock in the merger boosted the value of its stake in the food giant, the firm announced this weekend.
Kraft Heinz Food Co., and it (AP Photo/Nati Harnik)
recorded a $4.4 billion af-
ter-tax gain as the result of company wrote less rein- Cathy Seifert said. “This is a Berkshire has two large
surance and covered a large, complex company deals in the works that are
the merger that was com- $44 million loss related to with a lot of moving parts, expected to close in next
an explosion in Tianjin, Chi- but increasingly it seems year’s first quarter: Preci-
pleted over the summer. na. like the gains are coming sion Castparts and Procter
“It’s a mediocre quarter,” from acquisitions.” & Gamble’s Duracell bat-
Buffett has said operat- S&P Capital IQ analyst On the acquisition front, tery business.q
ing earnings offer a better
view of quarterly perfor-
mance because they ex-
Square boosts expected IPO value by 47% in rocky market
Dr. Greg Werner poses for a picture with his Square credit card reader at his office in New York. cial-services startup was $403.7 million. That includes
Square, the six-year-old company known for its white, cube-shaped card readers that plug founded and is led by Jack about 4 million shares set
into smartphones , is boosting its planned initial public offering value by 47 percent in what has Dorsey, who co-founded aside for underwriters. The
become a very dicey market for new companies trying to raise cash. (AP Photo/Seth Wenig) Twitter and recently re- company had previously
turned to lead that com- filed regulatory papers for
NEW YORK (AP) — Square, card readers that plug into what has become a tough pany again. Dorsey, 38, an IPO valued at up to
the six-year-old company smartphones, is boosting its market for new companies who owns 24.4 percent of $275 million.
known for its white, cube- planned initial public offer- trying to raise cash. Square, did not give up the Shares will trade under the
shaped credit and debit ing value by 47 percent in The San Francisco finan- CEO job at Square when symbol SQ on the New York
he returned to his former Stock Exchange.
company. A number of companies
The traditional manner of have recently canceled
valuing a company, done IPOs, or scaled back their
by multiplying the total expectations, fearing mal-
outstanding shares by the aise in U.S. markets. The U.S.
price of each share, puts IPO market slowed in the
Square’s worth at $4.2 bil- third quarter to 34 deals,
lion if the top end of the down 43 percent year over
pricing range is used. That year, according to Renais-
is a substantially lower than sance Capital, hurt by the
a $6 billion valuation by the market sell-off over the
private investors in connec- summer and a lack of tech
tion with the $150 million and energy deals, in partic-
Series E fundraising in Octo- ular. Additionally, average
ber 2014, according to the IPO returns were negative
website crunchbase.com, for the first time since 2011.
which tracks investments in Square helps small busi-
tech companies. nesses process credit card
Square Inc. plans to offer payments on phones and
just over 31 million shares at tablet computers, turning
a maximum of $13 apiece them into electronic sales
for total value of up to terminals.q
