Not even Warren Buffett was spared financially from the coronavirus, as his conglomerate, Berkshire Hathaway, reported a US$49.7 billion ($76.7b) loss in the first quarter Saturday, reflecting the outbreak's toll on an investment portfolio that
Legendary investor Warren Buffett. Photo / Getty
The loss overshadowed a 6% rise in Berkshire's operating earnings, which track the performance of the company's owned-and-operated businesses like insurer Geico. Buffett regards that as a better measure of the company's overall performance and has long argued that quarterly paper gains or losses on its investments "are often meaningless" in understanding its overall health.
But it is hard to ignore the damage to a portfolio that includes stakes in financial firms like Bank of America and American Express, both of which reported steep drops in earnings for the first quarter, and four of the biggest U.S. airlines.
Even some of the conglomerate's wholly owned businesses, like the Burlington Northern Santa Fe railroad and retailers like See's Candy, were hurt by the lockdowns that have shaken the U.S. economy. Still, Geico reported a 28% gain for the quarter, to US$984 million, while Berkshire's overall insurance investment profits rose modestly because of increased dividend income for the company.
The first-quarter results were released before Berkshire's first online-only annual shareholder meeting. It is a change, made necessary by the pandemic, to an event that usually draws tens of thousands of investors to an arena in Omaha, Nebraska, to listen to Buffett expound on the state of capitalism, business, politics and much more.
• Covid19.govt.nz: The Government's official Covid-19 advisory website