Berkshire’s 3Q Earnings Up, Shaw’s Earnings Off

Omaha, NE, November 2, 2007--Berkshire Hathaway reported net earnings in the third quarter that rose 64% to $4.55 billion, or $2,942 a Class A share, compared with $2.77 billion, or $1,797 a Class A share, a year earlier.

The company recorded more than $3 billion in investment gains amid lower profit at its core insurance business.

The company posted revenue that increased 18% to $29.9 billion.

Insurance underwriting earnings dropped 47% to $486 million. Insurance investment earnings rose 21% to $922 million. Earnings at the company's noninsurance businesses rose 20% to $1.17 billion.

Shaw Industries, a unit of Berkshire Hathaway posted earnings that were off 9% or $13 million to $150 million on revenue that declined 8%, the result of declining home building and the meltdown in subprime mortgages. The unit's earnings have declined of late the result of declining home building and fallout from the subprime mortgage meltdown. In October, Buffett said he expects the subprime mortgage market to weigh on consumers for up to two years, but expects the U.S. economy to weather the storm.

Earnings excluding taxes and minority interests at the company's Geico car insurance unit fell 18% even as premiums rose 6.5% to $3 billion, as damage claims rose between 2% and 4% from year-earlier levels. The company said it expects a higher loss ratio over the rest of 2007 because of a decline in average premiums per policy.

The reinsurance unit General Re posted an 18% profit decline as premiums fell less than 1% to $1.49 billion. The company said competition has increased in most of the unit's markets. Additionally, policies that have been canceled or not renewed exceeded new contracts.

The company has $38.6 billion in cash on its balance sheet, compared with $38 billion at the end of 2006.

Related Topics:Shaw Industries Group, Inc.