Warren Buffett's Berkshire Hathaway Inc on Saturday reported its highest-ever annual operating profit, even as foreign currency losses and lower gains from investments caused fourth-quarter profit to fall.
A dearth of new investments helps explain how Berkshire boosted its cash stake despite having spent $11.5 billion in the fourth quarter to buy the insurance company Alleghany Corp.
That purchase helped Berkshire boost insurance "float," which reflects premiums collected up front before claims are paid and help fund growth, 12% last year to $164.1 billion. "We're delighted to see the growth in float," said Thomas Russo, a partner at Gardner Russo & Quinn who helps invest $8 billion, about 17% of which is in Berkshire stock. "Buffett often describes float as more important than cash."
Berkshire also spent $8.2 billion on Jan. 31 to boost its stake in truck stop operator Pilot Travel Centers to 80% from 38.6%.which fell 18% including dividends, and reflecting Berkshire's status as a defensive investment in rocky markets.Reporting by Jonathan Stempel in New York Editing by Mark Potter and Diane Craft
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