Mazor'sEdge – Page 107 – News and analysis on Berkshire Hathaway

Gen Re Names Ulrich Pasdika to Executive Board

Post author By David Mazor
Post date May 7, 2020

(BRK.A), (BRK.B)

Berkshire Hathaway’s Gen Re has announced that Ulrich Pasdika has been appointed to the Executive Board of General Reinsurance AG, effective 1 August 2020.

General Reinsurance AG is Gen Re’s German legal entity and the main risk carrier for its international business.

The appointment comes as part of Gen Re’s succession plan for its long-standing Head of International Life/Health business, Winfried Heinen, whose forthcoming retirement was announced earlier this year. Mr. Heinen will continue to serve in his roles until 31 July 2020.

Ulrich (Uli) Pasdika is an experienced re/insurance executive who has been with Gen Re for close to 20 years. He will continue to be responsible for the recently created Life/Health business segment Europe, Latin America and MENA. Prior to this role, he led Gen Re’s Life/Health business in Germany and headed-up the international Research & Development team – a core unit that combines underwriting and actuarial resources and underpins Gen Re’s successful risk management and product development services.

Mr. Heinen stated “I am very pleased about this move. Uli and I have worked closely together for almost two decades. During this time, he has played an instrumental role in building our franchise in the German market. In addition, in recent years he has spearheaded our digitisation and insurtech activities. He embodies both Gen Re’s traditional strengths and values and our focus on the future.”

Charlie Shamieh, Gen Re’s Chairman, said “I’m delighted about Uli’s appointment. His vast experience and strong expertise in the international protection markets, in combination with his unwavering client focus, make him the ideal candidate for this position.”

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Tags Insurance

BYD Reports Decline in Revenues for Q1

Post author By David Mazor
Post date May 6, 2020

Battery and carmaker BYD has announced that its net profit for the first quarter fell roughly 85 percent from the same period last year.

Total revenues in the first quarter slumped 35 percent to 19.68 billion yuan.

BYD’s total vehicle sales for the first three months plunged 48 percent from the same period in 2019 to 61,273 units. Of those sales, New Energy Vehicles accounted for 22,192 vehicles with electric and plug-in hybrid drive, which in addition to reduced sales due to the impact of COV-19, were also hurt by a decrease in government subsidies that went into place mid-2019.

With China reopening rapidly from the COVID-19 shutdown, BYD projected that revenues would rebound and predicted profits will increase 10 to 23 percent for the first half of the year.

BYD and Berkshire Hathaway

In 2008, Berkshire Hathaway bet on BYD’s potential, purchasing 225 million shares. It’s an investment that has paid off handsomely. Berkshire’s original investment of $230 million has grown in value almost ten-fold.

For More on BYD, read the Special Report: BYD, Berkshire’s Tesla.

Tags BYD Co, Stock Portfolio

Berkshire Hathaway Specialty Insurance

Berkshire Hathaway Specialty Insurance Expands Local Property Team in France

Post author By David Mazor
Post date May 5, 2020

(BRK.A), (BRK.B)

Berkshire Hathaway Specialty Insurance has expanded its property team in France with the addition of Jean-François Leandri as Risk Control Consultant.

“Jean François’s extensive risk control consulting expertise significantly enhances our property underwriting and service for customers across France and Belux ” said François-Xavier d’Huart. “We are pleased to welcome him to our team, while we continue to expand both our local underwriting and services in the region.”

Trained as both a boiler & machinery and fire prevention consultant, Jean-François has nearly 25 years of engineering experience. He spent the last 17 years as District Manager at Global Risk Consultants, where he led a Paris-based technical team responsible for risk consulting on a range of occupancies across portions of Europe and Africa. He began his carrier as Field Engineer at UAP Kemper HPR Company.

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway and BYD, and this article is not a recommendation on whether to buy or sell a stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Tags Berkshire Hathaway Specialty Insurance

Financial Reports

Berkshire Hathaway First Quarter Earnings

Post author By David Mazor
Post date May 2, 2020

Berkshire’s operating results for the first quarters of 2020 and 2019 are summarized in the following paragraphs. However, we urge investors and reporters to read our 10-Q, which has been posted at www.berkshirehathaway.com. The limited information that follows in this press release is not adequate for making an informed investment judgment.

Earnings of Berkshire Hathaway Inc. and its consolidated subsidiaries for the first quarters of 2020 and 2019 are summarized below. Earnings are stated on an after-tax basis. (Dollar amounts are in millions, except for per share amounts).

	First Quarter
	2020			2019

Net earnings (loss) attributable to Berkshire shareholders	$	(49,746	)	$	21,661
Net earnings (loss) includes:
Investment and derivative gains (losses) –
Investments		(54,517	)		15,498
Derivatives		(1,100	)		608
		(55,617	)		16,106
Operating earnings		5,871			5,555
Net earnings (loss) attributable to Berkshire shareholders	$	(49,746	)	$	21,661

Net earnings (loss) per average equivalent Class A Share	$	(30,653	)	$	13,209
Net earnings (loss) per average equivalent Class B Share	$	(20.44	)	$	8.81

Average equivalent Class A shares outstanding		1,622,889			1,639,821
Average equivalent Class B shares outstanding		2,434,333,367			2,459,731,886

Due to a change in Generally Accepted Accounting Principles (“GAAP”) in 2018, we are required to include the changes in unrealized gains/losses of our equity security investments as a component of investment gains/losses in our earnings statements. In the table above, investment gains/losses include a loss of approximately $55.5 billion in the first quarter of 2020 and a gain of approximately $15.1 billion in the first quarter of 2019 due to changes during the first quarters of 2020 and 2019 in the amount of unrealized gains that existed in our equity security investment holdings. Investment gains (losses) also include after-tax realized gains on sales of investments of approximately $965 million and $392 million in the first quarters of 2020 and 2019, respectively.

The amount of investment gains/losses in any given quarter is usually meaningless and delivers figures for net earnings per share that can be extremely misleading to investors who have little or no knowledge of accounting rules.

An analysis of Berkshire’s operating earnings follows (dollar amounts are in millions).
	First Quarter
	2020			2019

Insurance-underwriting	$	363		$	389
Insurance-investment income		1,386			1,237
Railroad, utilities and energy		1,751			1,858
Other businesses		2,038			2,200
Other		333			(129	)
Operating earnings	$	5,871		$	5,555

At March 31, 2020, insurance float (the net liabilities we assume under insurance contracts) was approximately $130 billion, an increase of approximately $1 billion since yearend 2019.

Use of Non-GAAP Financial Measures

This press release includes certain non-GAAP financial measures. The reconciliations of such measures to the most comparable GAAP figures in accordance with Regulation G are included herein.

Berkshire presents its results in the way it believes will be most meaningful and useful, as well as most transparent, to the investing public and others who use Berkshire’s financial information. That presentation includes the use of certain non-GAAP financial measures. In addition to the GAAP presentations of net earnings, Berkshire shows operating earnings defined as net earnings exclusive of investment and derivative gains/losses.

Although the investment of insurance and reinsurance premiums to generate investment income and investment gains or losses is an integral part of Berkshire’s operations, the generation of investment gains or losses is independent of the insurance underwriting process. Moreover, as previously described, under applicable GAAP accounting requirements, we are now required to include the changes in unrealized gains/losses of our equity security investments as a component of investment gains/losses in our periodic earnings statements. In sum, investment gains/losses for any particular period are not indicative of quarterly business performance.

About Berkshire

Berkshire Hathaway and its subsidiaries engage in diverse business activities including insurance and reinsurance, utilities and energy, freight rail transportation, manufacturing, retailing and services. Common stock of the company is listed on the New York Stock Exchange, trading symbols BRK.A and BRK.B.

Cautionary Statement

Certain statements contained in this press release are “forward looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are not guaranties of future performance and actual results may differ materially from those forecasted.

Tags Earnings

Charlie Munger Warren Buffett

Don’t Expect 5 Hours of Q&A at Berkshire Hathaway’s Virtual Annual Meeting

Post author By David Mazor
Post date April 30, 2020

(BRK.A), (BRK.B)

Warren Buffett’s and Charlie Munger’s legendary five hours of Q&A at the Berkshire Hathaway annual meeting has come to an end. In fact, Munger will not even be taking questions at this year’s virtual event to be held on Saturday, having been replaced by Greg Abel, Berkshire’s Vice Chairman-Non-Insurance Operations.

Also the lengthy Q&A that in recent years has combined shareholder questions from the meeting floor, emailed questions, and questions from journalists, has been simplified and reduced.

In a statement, the company announced:

Warren Buffett, Berkshire’s CEO and Greg Abel, Berkshire’s Vice Chairman-Non-Insurance Operations will be physically present at the meeting. However, the other Berkshire directors will not be attending the meeting. In addition to the formal business to be conducted at the meeting, Mr. Buffett and Mr. Abel will respond to shareholder questions that were submitted to three journalists (Becky Quick, Carol Loomis and Andrew Ross Sorkin). Ms. Quick will ask those questions that the journalists decide are the most interesting and important. Mr. Buffett and Mr. Abel will have no prior knowledge of what questions will be asked, but they will not discuss politics or specific investment holdings.

The 2020 Annual Shareholders Meeting on Saturday May 2, 2020 will formally begin at 3:45 p.m. central time. As previously announced, we will not be able to allow shareholders to physically attend the meeting. However, the meeting will be streamed live on the Internet by Yahoo with a pre-meeting show beginning at 3:00 p.m. central time and can be accessed at https://finance.yahoo.com/brklivestream.

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

Tags Charlie Munger, Greg Abel, Warren Buffett

Berkshire Hathaway Specialty Insurance Insurance

Berkshire Hathaway Specialty Insurance Names Dubai-based Alessandro Cerase to Global Property Underwriting Officer Team

Post author By David Mazor
Post date April 28, 2020

(BRK.A), (BRK.B)

Berkshire Hathaway Specialty Insurance has expanded its Global Property Underwriting Officer team to include Alessandro Cerase, who will focus on General Property, Energy and Construction. Alessandro will also retain his role as Senior Executive Officer (SEO) for BHSI’s Middle East region.

“With our property portfolio growing worldwide, it is the perfect time to expand our global property leadership team, led by Dean LaPierre, and to expand Alessandro’s invaluable contributions to BHSI globally,” said David Fields, Global Chief Underwriting Officer, BHSI. “This move is indicative of the strength and depth of BHSI’s team, not only in property but across all our lines of business — and of the excellent advancement opportunities available for BHSI teammates around the globe.”

Alessandro joined BHSI as SEO for the Middle East in 2018. A chemical engineer by background, he has more than 20 years of experience with energy and technical risks. As he assumes his additional responsibilities, Alessandro will remain based in Dubai.

Tags Berkshire Hathaway Specialty Insurance, Insurance

Mouser Electronics

Mouser Electronics Received 3rd Consecutive Distributor of the Year Award From Neutrik

Post author By David Mazor
Post date April 24, 2020

(BRK.A), (BRK.B)

Berkshire Hathaway’s Mouser Electronics, Inc., the authorized global distributor with the newest semiconductors and electronic components, has been honored by Neutrik USA with three top awards for 2019 performance. Neutrik USA presented Mouser with the Distributor of the Year — Top Revenue award and Outstanding Performance of the Year award, and named Mouser’s Ryan Virostek as Supplier Manager of the Year. Neutrik is the leading provider of professional audio, video, and lighting connector systems.

Mouser received the awards based on Neutrik’s rigorous criteria, including overall sales performance, personnel relationships, on-time delivery and quality of inventory. Virostek received the Supplier Manager of the Year award based on overall support of the Neutrik line.

“Neutrik is pleased to present Mouser with these well-deserved awards, which recognize the team’s key role in contributing to the strong growth of Neutrik’s distribution reach,” said Tom Chudyk, Sales Director for Neutrik USA. “We appreciate the successful partnership we have with Mouser.”

“We are truly honored to receive these three top awards from Neutrik,” said Krystal Jackson, Mouser Vice President of Supplier Management. “Mouser is committed to providing best-in-class service to our customers, as well as our suppliers. We look forward to continuing our strong relationship with Neutrik.”

Neutrik is the recognized leader in connectivity solutions for the professional AVL and broadcast markets. In addition to its famous screwless XLR cable connectors, Neutrik is the inventor of powerCON®, etherCON®, speakON®, opticalCON®, combo 1/4-inch XLR chassis connectors, the D-size flange, rearTWIST® BNC connectors, and dozens of other innovations.

The 2019 award marks the third consecutive and fifth time overall that Mouser has received the Distributor of the Year — Top Revenue award from Neutrik.

In 2018, Neutrik also named Mouser the 2017 Distribution Partner of the Year and presented the distributor with the Outstanding Performance award. In the past decade, Mouser has been recognized with over a dozen distributor awards from Neutrik.

As an authorized distributor, Mouser Electronics is focused on the rapid introduction of new products and technologies, giving customers an edge and helping speed time to market. Over 800 semiconductor and electronic component manufacturers count on Mouser to help them introduce their products into the global marketplace. Mouser’s customers can expect 100% certified, genuine products that are fully traceable from each manufacturer.

Tags Mouser Electronics

GEICO Insurance

GEICO Extends Policy Cancellation Pause Through May 31

Post author By David Mazor
Post date April 23, 2020

(BRK.A), (BRK.B)

With the economic effects of COVID-19 continuing to touch so many Americans, GEICO is extending its GEICO Giveback policy cancellation pause through May 31, 2020.

The company estimates the GEICO Giveback benefit to its customers will be approximately $2.5 billion.

On March 20, 2020, GEICO voluntarily announced it would pause policy cancellations due to non-payment and policy expiration through April 30, 2020. The company is extending the cancellation pause to further assist customers during this period of great uncertainty.

“As an insurer, we are used to being there for our customers at difficult times,” GEICO President and CEO Todd Combs said. “Our commitment to our customers is unwavering, and we are committed to supporting them through this unprecedented crisis.”

Earlier this month, GEICO announced it was providing a 15 percent credit to its private passenger auto, motorcycle and RV policyholders, where permitted. The GEICO Giveback is applied as policies come up for renewal between April 8 and Oct 7 (or April 8, 2020, and April 7, 2021, for 12-month policies). The credit also applies to new policies purchased through Oct. 7.

GEICO has also committed to offering maximum flexibility to policyholders who need special payment options and adjusting policies for customers driving less because of stay-at-home directives.

Tags GEICO, Insurance

Lubrizol

Lubrizol Part of Nike’s Efforts to Make Full-Face Shields for Frontline Medical Workers

Post author By David Mazor
Post date April 22, 2020

(BRK.A), (BRK.B)

Berkshire Hathaway’s Lubrizol together with NIKE, Inc. is helping protect frontline medical workers fighting against COVID-19. To support Nike’s efforts to develop and donate full-face shields and powered, air-purifying respirator (PAPR) lenses to hospitals across several U.S. cities, Lubrizol donated ESTANE® thermoplastic polyurethane (TPU) polymers, an important element in both pieces of personal protective equipment (PPE).

Nike’s version of the full-face shield transforms elements of the brand’s footwear and apparel, including TPU. Lubrizol’s innovation team quickly evaluated materials, provided insights to optimize performance and re-orchestrated its production and supply chain to produce and donate the necessary material to Nike as part of this effort.

In addition to the full-face shields, the ESTANE TPU donation will be used in lenses for powered, air-purifying respirator (PAPR) helmets, used in situations where medical professionals face the greatest airborne pathogen exposure as they provide critical care to infected patients.

With Lubrizol’s support, Nike has shipped full-face shields and PAPR lenses to health systems in Oregon, where Nike is headquartered, and several other U.S. cities, including Cleveland, where Lubrizol’s world headquarters sit.
“We are grateful for the generosity of companies around the country as we build up our supply levels in anticipation of a surge in COVID-19 patients,” said Lara Kalafatis, Chair of Cleveland Clinic’s Philanthropy Institute. “This collaboration between Lubrizol and Nike demonstrates ingenuity applied alongside compassion and a sincere interest to help thousands of our caregivers.”

“These face shields will allow us to treat patients while keeping our front-line medical providers safe,” said MetroHealth President and CEO Akram Boutros, MD, FACHE. “We appreciate this generous donation. It’s another example of the community coming together to care for each other.”

Lubrizol’s TPU is an incredibly versatile polymer that bridges the gap between flexible rubber and rigid plastics, which allows partners to apply TPU across a wide range of applications. In addition to full-face shields, Lubrizol’s TPU is being used in medical gowns, medical equipment, hospital mattresses, tubing, hoses, and medical devices for many other critical applications.

“We are thrilled to collaborate with Nike to improve lives and support those in need during COVID-19,” says Rick Tolin, President, Lubrizol Advanced Materials. “Every day our employees enable products used across the world, and our team is fully committed to enabling our science and applications expertise to deliver even greater impact during this global crisis.”

Earlier this month, Lubrizol announced a $2 million donation commitment to support COVID-19 needs globally. The company has contributed critical supplies to hospitals across the world, donated to Food Banks where Lubrizol has major operations and supported local restaurants by purchasing meals for hospital workers, amongst other efforts. The company has also challenged its employees to contribute 2,020 virtual or at-home volunteer hours to assist organizations providing support in this environment.

Tags Lubrizol

Johns Manville

Johns Manville Producing Nonwoven Media for Face Masks

Post author By David Mazor
Post date April 21, 2020

(BRK.A), (BRK.B)

Berkshire Hathaway’s Johns Manville, a leading manufacturer and marketer of premium-quality building and specialty products, started production this month to make nonwoven filtration media that will be used to create needed face masks to help stop the spread of COVID-19. The filtration media is being produced at its plant in Richland, Mississippi.

“Johns Manville is in a unique position to serve a market that is fulfilling a great need across the world,” said Mary Rhinehart, President and CEO of Johns Manville. “We are proud of our teams in Richland and throughout JM for finding new ways to support the communities and people who are on the front lines of this global crisis.”

Most nonwoven production of face masks was abandoned in the U.S. many years ago and moved to Asia. Given the shortage of face masks in the U.S. and Europe, JM’s Engineered Products business decided to build on its existing capabilities and help fill the market demand.

“Our high-performance nonwoven material is designed to provide high levels of filtration for various types of face masks,” said John Vasuta, President of JM’s Engineered Products business.

JM media meets or exceeds Level 1 BFE 95% (Bacterial Filtration Efficiency) and VFE (Viral Filtration Efficiency) requirements. These results were verified by an FDA-registered national laboratory.

The JM plant in Richland employs about 50 people and produces a variety of filtration products for various air and liquid applications using polypropylene and polyester meltblown technology. Richland’s meltblown filtration media can be found in numerous industrial, automotive, consumer products and FDA-approved food and healthcare applications.

Tags Johns Manville