Berkshire News Briefs - 2015 Yearly and Q4 Earnings plus Buffett's Letter

Berkshire Hathaway's 4th Quarter and Full Year earnings are out, along with its annual report and Warren Buffett's Annual Letter to Shareholders.

4th Quarter News Release

2015 Annual Report

Buffett's Letter

No time to read all that today? Here are some shorter analysis stories to get you up to speed: Berkshire Profit Climbs 32%, Capping Record Year for Buffett (Bloomberg)

Berkshire Hathaway Inc., the conglomerate controlled by billionaire Warren Buffett, said fourth-quarter profit climbed 32 percent on investments and earnings from the company’s expanding stable of operating businesses.

Net income rose to $5.48 billion, or $3,333 a share, from $4.16 billion, or $2,529, a year earlier, the company said Saturday in a statement. Operating earnings, which exclude some investment results, were $2,843 a share, beating the average $2,814 estimate of three analysts surveyed by Bloomberg. [...]

Buffett Says Politicians ‘Dead Wrong’ With Negative U.S. Outlook (Bloomberg)

Billionaire investor Warren Buffett, long an optimist about the nation where he made his fortune, rejected the economic pessimism dominating the 2016 U.S. presidential campaign and forcefully made the case for a bright future.

“As a result of this negative drumbeat, many Americans now believe that their children will not live as well as they themselves do,” Buffett wrote in a letter to shareholders of his Berkshire Hathaway Inc. posted online on Saturday. “That view is dead wrong: The babies being born in America today are the luckiest crop in history.” [...]

Want to ask Warren Buffett your own question? You can tweet questions for his Monday appearance on CNBC:

Legendary Investor Warren Buffett to Join CNBC’s Becky Quick for a Special Edition of “Squawk Box” on Monday, February 29 6AM-9AM ET

On Monday, February 29th, billionaire investor Warren Buffett joins CNBC's Becky Quick for his ninth annual "Ask Warren" appearance in a special edition of CNBC's signature morning program "Squawk Box" (M-F, 6AM-9AM ET). Throughout "Squawk Box," the Berkshire Hathaway Chairman will answer questions submitted by viewers via Twitter, Facebook, Instagram and The List App about Berkshire's 2015 annual report, including Buffett's letter to shareholders, among other topics.

To submit questions, use the hashtag #AskWarren on Twitter, Facebook, Instagram or The List App. Viewers can also submit video questions by tweeting their clips to @CNBC or sharing videos on Instagram and using the #AskWarren hashtag.

Berkshire News Briefs - 2/19/16

The quarterly 10-K statement, detailing Berkshire Hathaway's investment portfolio holdings, came out this week. An easy-to-read summary of the holdings is available, as always, at Dataroma.

Buffett's Berkshire Hathaway Discloses Stake in Kinder Morgan (Bloomberg)

Warren Buffett’s Berkshire Hathaway Inc. added an investment in Kinder Morgan Inc. during the fourth quarter, snapping up shares of the pipeline operator as its market value plunged.

Berkshire held 26.5 million shares of the company as of Dec. 31, according to a regulatory filing Tuesday disclosing U.S. stock holdings. The stake was valued at $395.9 million at the end of 2015. [...]

Berkshire Hathaway Buys Kinder Morgan, Sells Chicago Bridge, Reduces AT&T (Nasdaq)

In the third quarter 2015, Buffett held on to most of what he had, buying no new stocks and only increasing some of his existing holdings. Since the start of the 2016, his company of choice has been oil refiner Phillips 66, in which he increased his stake to 14.2%. He did not purchase its shares during the fourth quarter, however. [...]

In the fourth quarter, Berkshire Hathaway bought Kinder Morgan, increased Deere & Co., exited Chicago Bridge & Iron Co. and reduced AT&T. [...]

Yahoo to Live-Stream Warren Buffett’s Berkshire Hathaway Meeting (Variety)

Yahoo has thrown in the towel on entertainment video content, but it’s still banking on big video events to try to grab eyeballs and boost its business.

The Internet company announced an agreement to host the first live-streaming coverage of billionaire Warren Buffet’s Berkshire Hathaway annual shareholders meeting on April 30 in Omaha, Neb. The conglomerate’s event has previously been unavailable to the general public, and Yahoo is treating it as if it were the Super Bowl of modern capitalist culture. [...]

In addition, Yahoo Finance has exclusive rights to offer a VOD replay of the Berkshire Hathaway meeting for 30 days after the event. Yahoo will sell video and display advertising, as well as sponsorship opportunities, for the live stream.

Yahoo will deliver the Berkshire Hathaway meeting in up to 1080p HD format at 60 frames per second, equivalent to Blu-ray disc quality.

Berkshire Hathaway makes $642 million in deal (Omaha World-Herald)

Berkshire Hathaway made nearly $642 million when Symetra Financial was acquired by Sumitomo Life Insurance Co.

Warren Buffett’s company said in documents filed with the Securities and Exchange Commission this week that it sold all 20 million of its Symetra shares as part of the deal.

See’s Candies blames ‘kosher’ candy error on printing mix-up (Omaha World-Herald)

See’s Candies said a printing error resulted in it selling some Valentine’s Day chocolates as kosher when they weren’t, a problem brought to light by a federal lawsuit filed in California alleging “fraudulent inducement.”

See’s, a part of Berkshire Hathaway Inc. of Omaha since 1972, said that after learning of the lawsuit, it found that shelf cards for some of its candy were mistakenly printed with the symbol of Kosher Supervision of America (KSA), which designates food as kosher.

The company offered refunds and said it apologizes to customers who purchased the boxes. [...]

This indie retailer is thriving thanks to Warren Buffett (Crain's Chicago Business)

In metro Chicago, the J.C. Licht chain, which sells [Benjamin] Moore paint in 31 locations from the West Loop to Northbrook and Hinsdale, is under aggressive new ownership and plans to expand to 50 stores in the next five years.

Elliot Greenberg, a former vice president of sales at Ring's End, a Darien, Conn.-based home improvement chain with about $38 million in paint sales, purchased the Licht stores from Benjamin Moore corporate ownership last year. This week, Greenberg will unveil a 38,000-square-foot paint mixing and distribution facility in Addison. [...]

Today, the Moore brand is on its third CEO since 2012: Mike Searles, a former CEO of Wilson's Leather. Under Searles, Buffett reissued his promise to dealers, and the company decided to sell its corporate stores back to experienced independents. Company executives reached out to Greenberg, who paid an unspecified sum for the Licht chain last year.

Lemonade: World’s First Peer-to-Peer Insurance Platform Receives Backing from Lloyds & Berkshire Hathaway (Crowdfund Insider)

Lemonade, a peer to peer insurance platform that seeks to address the profound shortcomings of the multi-trillion dollar insurance industry now has some prominent names backing the young company. Announced today, Lemonade has now received the support of “top tier” global reinsurance partners including Berkshire Hathaway National Indemnity and Lloyd’s of London. [...]

Berkshire News Briefs - 2/9/16

As Berkshire Hathaway meeting set to be streamed online, will fewer make Omaha pilgrimage? (Omaha World-Herald)

Berkshire Hathaway’s annual meeting, which draws nearly 40,000 people to Omaha each year in a pilgrimage to see investor Warren Buffett, will be streamed over the Internet this year for the first time, the company’s chief financial officer told The World-Herald.

That could have implications for the city’s tourism industry: People from around the globe descend on Omaha each year, filling hotels and restaurants. They also shop at Berkshire-owned stores, which offer discounts to shareholders during the annual meeting weekend. Will it keep people away from fair Omaha, which once a year is dubbed Woodstock for Capitalists?

Meeting Ted Weschler (Yaniv's Blog)

Many value investors, at some point of their careers, get to “see the light” and move away from investing in what’s called “cigar butt investing” (bad business at a great price) to investing in companies that trade at richer valuations but have great underlying businesses (great businesses at a reasonable price). The fortunate few, manage through this transition without a negative impact on performance. I asked Ted about this transition process and how he sees the two approaches. He said that when you try to map the risks that inherent to a “cigar butt” investing you end up with a much longer list than when you carry out the same exercise with a high quality business. Of course, many investors manage to achieve great performance over time with the bad-business-at-a-great-price approach so that is not to say that there is anything wrong with this approach–these are just two different styles. [...]

Berkshire purchases Castparts for $37B (Lincoln JournalStar)

Berkshire Hathaway completed its $37.2 billion acquisition of Precision Castparts on Friday.

Berkshire Hathaway’s acquisition of the manufacturer of components for aircraft, power plants and other industries reportedly is its biggest deal ever.

Warren Buffett agreed to purchase Precision Castparts in August.

Berkshire Hathaway names new board of directors for Precision Castparts (Omaha World-Herald)

In a securities filing Thursday, Berkshire said the directors are Warren Buffett, chairman and chief executive of Berkshire; Todd Combs, a Berkshire investment officer; Marc Hamburg, chief financial officer of Berkshire; and three Precision Castparts executives: CEO Mark Donegan, corporate counsel Ruth Beyer and Shawn Hagel, chief financial officer.

Donegan and Hagel were directors before Berkshire’s $32 billion purchase of Precision Castparts [...]

Musk vs. Buffett: The Billionaire Battle to Own the Sun (Bloomberg)

Buffett got into utilities in 1999. While many investors chased the latest Silicon Valley IPO, he bought a nice electric company in Des Moines. Building power plants and maintaining the grid offered almost endless opportunities to reinvest cash, which he had a lot of. And, as a monopoly providing an essential service, the local power company wasn’t going away anytime soon. Owning utilities isn’t “a way to get rich,” he later said. “It’s a way to stay rich.”

By 2013 the energy unit at Berkshire had expanded to include power companies serving parts of Oregon, Washington, Idaho, Wyoming, and Utah. It had also invested billions of dollars in wind farms in Iowa and giant solar arrays in California and Arizona. Two months after SolarCity got its love money from Nevada, Buffett offered $5.6 billion to buy NV Energy. Soon after Berkshire completed the purchase, NV Energy accounted for about a fifth of the company’s energy revenue. [...]

Buffett's BNSF to Cut Spending $1.5 Billion as Cargo Slumps (Bloomberg)

BNSF Railway Co., the railroad owned by Warren Buffett’s Berkshire Hathaway Inc., plans to reduce capital expenditures for the first time in six years as railroads seek to rein in costs amid a freight slump.

The rail carrier said Tuesday that it will spend $4.3 billion, down 26 percent from a record $5.8 billion in 2015, on locomotives, rail cars, track and maintenance. BNSF had increased investment since 2010, which marked a six-year low of $2.7 billion. [...]

Warren Buffett ups stake in Phillips 66 — again (Houston Business Journal)

Warren Buffett’s Nebraska-based Berkshire Hathaway Inc. has further increased its stake in Houston-based Phillips 66.

During the first three days of February, the company bought about 1.7 million Phillips 66 shares for nearly $132 million, according to CNBC. That means that over the past 30 days alone, the company has bought 12.5 million shares for $964 million.

The company now owns 73.98 million shares — or nearly 14 percent of Phillips 66 — worth about $5.9 billion, the Associated Press reports. [...]

What Happens After Warren Buffett Leaves Berkshire Hathaway? (Fool)

Warren Buffett has made it clear that the board of directors already knows who Berkshire's next CEO will be. And while the identity of that person remains a secret, we do have a couple of clues:

Berkshire's directors believe that future CEOs should come from internal candidates.

The new CEO will be relatively young -- Buffett wants the next CEO to stay on the job for decades and says that the company will operate best if its CEOs stay for 10 years or more. [...]

Warren Buffett will be advisor for 'Celebrity Apprentice' (CNBC)

Warren Buffett continues to raise his public profile with an upcoming appearance on the new season of NBC's "The Celebrity Apprentice."

In a news release, the network says that Buffett, "one of the most successful businessmen in the world," will be an advisor on the program, along with former Microsoft chief and Los Angeles Clippers owner Steve Ballmer, model and businesswoman Tyra Banks, actress and entrepreneur Jessica Alba, and entertainment attorney Patrick Knapp Schwarzenegger. [...]