Hard-hit by the market rout surrounding the coronavirus pandemic, Berkshire Hathaway, the holding company of Warren Buffett, has reported first-quarter net losses of nearly $50 billion, it reported Saturday.
The company, based in Omaha, Nebraska, called the setback “temporary” but said it could not reliably predict when its many businesses would return to normal or when consumers would resume their former buying habits.
Buffett is considered one of the savviest investors anywhere. His fortune of $72 billion is the fourth-largest in the world, according to Forbes, and in normal years, the company’s annual gathering in Omaha is a high-point of the calendar for investors, a “Woodstock for capitalists.”
But the devastating economic impact of the pandemic has hit hard at Berkshire Hathaway’s wide range of investments, and the need for social distancing forced it to hold the annual meeting online.
The meeting is set to begin at 3:45pm Central time (2045 GMT) and will be live-streamed.
– Growth by one measure –
Buffett, in a statement, played down the bleak-looking net figure. He said a better measure of the company’s performance was its operating earnings, which exclude investments and are less subject to sharp fluctuations.
By that measure, Berkshire Hathaway saw growth to $5.9 billion from $5.55 billion a year earlier.
The brutal drop in the net — to a loss of $49.75 billion from a profit last year of $21.7 billion — resulted primarily from the virus-related decline in value of its broad investment portfolio, which ranges from energy to transport to insurance and technology.
The annual meeting often has an almost carnival atmosphere, as thousands of fans and investors flock to Nebraska to hear from the celebrated “Oracle of Omaha.” Buffett, famous for his relatively sedate lifestyle, turns 90 on August 30.
In documents filed Saturday, Berkshire noted that until mid-March many of its companies were posting “comparative revenue and earnings increases” over the same 2019 period.
Many of its companies — including in rail transport, energy production and some manufacturing and service businesses — are deemed essential and are able to continue working amid the far-reaching confinement orders.
But their turnover slowed considerably in April, the company statement said.
© 2020 AFP/FRANCE24
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