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Berkshire Hathaway Energy

NV Energy CEO Lauds New Nevada Bill Increasing Renewable Portfolio Standard to 50 Percent

(BRK.A), (BRK.B)

NV Energy officials were on hand last week as the Governor of Nevada signed into law Senate Bill 358, which increases Nevada’s renewable portfolio standard to 50 percent by 2030.

“NV Energy has been vocal about our aspirational goal of providing our customers with 100 percent renewable energy, and this is an important next step in accomplishing that,” said Doug Cannon, NV Energy president and CEO. “We announced our support of the renewable standard increase in 2018 and are honored to have worked closely with Governor Sisolak, Senator Chris Brooks, who was instrumental in leading this effort; and other stakeholders to accomplish this so early in the legislative session.”

The company’s 2018 announcement that it planned to add six more large-scale solar projects, three of which will include battery storage for the first time, reinforced its commitment to add more low-cost solar to its energy mix.

NV Energy also recently submitted its annually-required renewable portfolio standard (RPS) compliance filing to the Public Utilities Commission of Nevada, which stated that the company had exceeded the current RPS requirement for the ninth-straight year. Instead of the 20 percent required today, 24 percent of the energy the company provides is generated from renewable resources.

Nevada is a leader in renewable energy, ranking fourth in solar and second in geothermal.

NV Energy has fostered renewable development since before a renewable standard was put into place, having signed its first geothermal contract in 1986. Thanks to expanding renewable energy serving its customers and the retirement of coal-fueled generation in Nevada, Nevada experienced an 85 percent reduction in coal-fueled carbon emissions from 2005 to 2015.

During that same period, Nevada reduced carbon emissions from the electric industry by 44 percent.

“Our company has made great strides over the last decade to increase our use of clean energy resources and reduce our carbon footprint, all while keeping costs low for our customers. Today signifies another step in building Nevada’s a clean energy economy and we’re proud to be one of the leaders in that effort,” added Cannon.

© 2019 David Mazor


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.

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Johns Manville

Johns Manville Names John Vasuta President of Engineered Products business

(BRK.A), (BRK.B)

Berkshire Hathaway’s Johns Manville, a leading manufacturer and marketer of premium-quality building and specialty products has announced John Vasuta is the new President of the company’s Engineered Products business.

“John is an accomplished leader and a welcome addition to JM’s leadership team,” said Mary Rhinehart, JM’s President and CEO. “He brings to JM a proven track record of successfully growing businesses and global commercial leadership.”

Vasuta will lead a global business that manufactures premium-quality glass fiber nonwovens, polyester spunbonds and glass fibers for the building and construction industry, as well as for automotive, industrial and residential applications.

JM products cover an extensive range of applications such as waterproofing membranes, flooring, building and technical insulation, air and liquid filtration, energy storage, composites and gypsum boards. The business operates manufacturing plants in the United States, Germany, Slovakia and China.

“Johns Manville is built on a rich history and has a well-earned reputation as a global market leader,” Vasuta said. “I am excited to join the company and to lead the Engineered Products business.”

Vasuta most recently worked at Bridgestone Corp. as President and Managing Director, Firestone Building Products International as well as Global Senior Vice President, Firestone Building Products. He joined Bridgestone as Deputy General Counsel and later held a variety of executive-level jobs, including President of Bridgestone’s 250 commercial store division and VP of International Sales and Operations for building products.

Vasuta earned a bachelor’s degree in engineering, an MBA and a Juris Doctorate, all from the University of Akron, and he worked earlier in his career in private law practices and the semi-conductor industry.

© 2019 David Mazor


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.

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Lubrizol

Lubrizol to Build Plant in Chiba, Japan

(BRK.A), (BRK.B)

The Lubrizol Corporation will build a new plant within the Ichihara Works (Ichihara City, Chiba, Japan) to manufacture LUCANT(TM) hydrocarbon-based synthetic fluid.

LUCANT is a high performance, hydrocarbon-based, specialty synthetic fluid used primarily as a viscosity modifier. It is used in the most demanding applications including automotive driveline, industrial lubricants and greases, and is the approved choice for leading OEMs and global oil marketers. Mitsui Chemicals was the first manufacturer to offer this unique synthetic fluid which boasts industry leading efficiency and durability.

“This investment in additional LUCANT capacity will allow the Lubrizol Additives business to further optimize its strategic relationship with Mitsui Chemicals to meet the evolving and demanding needs of lubricant market, while ensuring we remain a trusted, reliable and secure supply partner,” said Barrie Masters, global business director for the viscosity modifier business at Lubrizol.

Commercial operation at the new plant is planned for 2021 and Mitsui Chemicals, Inc. and The Lubrizol Corporation are excited to further invest in their partnership.

In 2014, Lubrizol entered into an exclusory agreement with Mitsui Chemicals, Inc. to become the exclusive worldwide seller and marketer of the LUCANT polymer products in the lubricant industry.

© 2019 David Mazor

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.

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Berkshire Hathaway Energy

Rocky Mountain Power Considers Early Coal Plant Closures

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Berkshire Hathaway’s PacifiCorp is looking at early closures of some of its coal-fired generating stations.

The potential PacifiCorp coal unit closures are operated by its Rocky Mountain Power subsidiary in Wyoming, Utah and Idaho.

Most of PacifiCorp’s coal units will reach the end of their depreciable lives at different points over the next 20 years.

While no resource decision will be made ahead of completion of the 2019 IRP, a PacifiCorp study identified potential benefits for customers through early retirement of some coal units.

“We continuously examine the costs and benefits of how the company generates electricity to ensure we are making the best decisions for customers,” said Rick Link, PacifiCorp vice president of resource planning and acquisitions. “The study reflects the ongoing changing economics for coal driven by market forces.”

For purposes of the study, the company examined whether customers would benefit if units are retired as early as 2022 and replaced with other resources. The timing and sequencing of any actual coal unit closures will ultimately be determined by a range of factors that also include workforce and community transition considerations.

The units the study identifies as being less economic to operate beyond 2022 than alternatives and are candidates for early retirement are:

• Naughton Units 1 and 2 in Wyoming.
• Jim Bridger Units 1 and 2 in Wyoming.

PacifiCorp is a majority owner and the operator of these units.

The company anticipates issuing a preferred portfolio for input from regulators and stakeholders before submitting a final plan to state regulators in August.

© 2019 David Mazor


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.

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Commentary

Commentary: Race Between Tesla and BYD Not Going Well for Tesla

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If there ever were two companies on a collision course for investors dollars it’s Tesla and China’s BYD (Build Your Dreams), a world leader and pioneer in battery and zero-emission vehicles.

Both companies have staked their claim as the leaders in the electrification of everything from cars to forklifts, and both companies have intrigued investors looking for explosive growth on the manufacturing side of investing.

Unfortunately, for Tesla, which lost $702 million in its first quarter and is already looking towards another capital raise in the $2.5 billion range to keep the battery-powered lights on, its overseas competitor is making money.

Lots of money.

BYD has announced that its first quarter profit skyrocketed 632 percent to 749.73 million yuan (US$111.4 million).

In the race to become number one in electric cars, BYD’s already firmly in the lead.

While US investors may pay more attention to Tesla’s US sale figures (increasingly nervously), BYD is number one in the biggest electric vehicle market in the world, China.

“New energy vehicles are expected to continue to sell well in the second quarter, and new energy vehicle sales and revenues continue to maintain strong growth,” noted BYD in its stock exchange filing.

BYD is looking even further down the road, and just signed an agreement with the city government of Changzhou city government for its fourth car factory, which will produce some 400,000 electric cars annually.

Not Just Cars, Buses

While you don’t see any BYD cars on US highways, you do see an increasing number of BYD pure electric buses. The company has made huge headway since it opened an assembly plant in Lancaster, California in 2013, and recently produced its 300th bus.

Worldwide, BYD dominates the market and has produced over 50,000 pure electric buses in just nine years.

As for the battle of the lithium-ion battery, Tesla’s Gigafactories are going head-to-head with BYD’s factories for the production crown, and for now BYD has the world’s largest.

Located in the western province of Qinghai, BYD’s 24GWh power battery factory is aiming to increase total production capacity to 60GWh by 2020. And it has the advantage that Qinghai province is a major source of lithium.

The Qinghai plant is BYD’s third battery factory in China after Shenzhen and Huizhou, and the company is constructing a fourth plant in Chongqing, which will have an annual capacity of 20 GWh.

“Electrification is a done deal as several countries have announced a deadline for the sale of internal combustion engine cars to end. Electric vehicles are on the cusp of another boom,” said BYD President and Chairman Wang Chuanfu, at the time of the Qinghai plant’s opening.

The question is whether BYD’s race with Tesla is a “done deal” as well.

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, and is now worth roughly $1.96 billion.

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

© 2019 David Mazor


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 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.

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Pilot Flying J

Pilot Flying J Out to Hire 5,000 Workers

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Pilot Flying J, the largest travel center network in North America, has announced its first-ever National Hiring Day on May 2 – the largest in-person and virtual hiring event in the company’s history.

Gearing up for the influx of travelers this summer, the company aims to hire more than 5,000 new team members across its network of more than 750 travel centers in the U.S. and Canada. Pilot Flying J invites job seekers to experience and explore what it means to be part of the Pilot Flying J team with on-the-spot in-person and virtual interviews.

“Making the decision to start a career at Pilot Flying J provides the opportunity to work hard, have fun and live up to one’s full potential, while also advancing professionally,” said Paul Shore, chief people officer of Pilot Flying J. “Hiring 5,000 enthusiastic team members to join our company in a wide array of positions across North America is an exciting challenge, especially during a time of low unemployment. To help candidates get a feel for our values and culture, learn about the great benefits we offer and find the right job opportunity, we can’t rely on standard outreach. That’s why we’re inviting everyone to join us on National Hiring Day.”

Berkshire Hathaway and Pilot Flying J

In October 2017, Berkshire Hathaway made a $2.76 billion investment in Pilot Travel Centers. Under the terms of the agreement, Berkshire will become the majority owner in five years.

© 2019 David Mazor


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.

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Berkshire Hathaway Specialty Insurance Insurance

Feeling Adventurous? Berkshire Hathaway Has Insurance For You

If you’ve got the adrenaline, Berkshire Hathaway has the insurance for your adventures.

Berkshire Hathaway Travel Protection (BHTP), a leading provider of travel insurance, has announced the launch of AdrenalineCare, a new comprehensive travel insurance that is specifically tailored for adventure travelers, with features such as enhanced baggage protection, coverage for extreme activities and higher medical limits
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“Our annual State of Travel Insurance study found that adventure travel continues to be one of the most popular and fastest-growing travel types,” said Dean Sivley, president of BHTP. “Adventure travelers are eager to explore the world but also know that their adrenaline-packed trips warrant more protection. We created AdrenalineCare so they can fully enjoy their adventures without worrying about equipment delays or insufficient medical coverage if traveling in a remote location.”

AdrenalineCare coverage includes:

• Up to $750,000 in medical evacuation coverage, BHTP’s highest limits
• Up to $50,000 in emergency travel medical insurance
• Up to $500 in equipment delay coverage if the traveler’s sports equipment such as skis, scuba gear, mountain climbing equipment or other gear is delayed 6 hours or longer
• Up to $1,500 in baggage coverage to cover lost, stolen or damaged luggage
• A $150 fixed benefit for the inconvenience if baggage is delayed 12 or more hours; if eligible, travelers are awarded the full $150 to use as they wish for simply enduring the delay
• Up to $200 to reimburse the fee paid for a hunting or fishing license if the insured must cancel
• Comprehensive trip cancellation, interruption, delay, and missed connection protection
• 24/7 global travel assistance available via phone or email for travel and medical emergencies.

According to BHTP’s State of Travel Insurance 2019 report, adventure travelers take more trips than regular road trippers (4.87 annually versus 3.45). Whether they are traveling to experience a sport like motor racing, or packing expensive equipment to ski or climb, they also face greater risk. AdrenalineCare is tailored specifically for these adventurous travelers.

Well-known for its revolutionary travel insurance products and services, BHTP also provides travelers with an easy “pic-and-a-click” claims process, flight tracking and expedited payments for travel disruptions via BHTP Burst.

© 2019 David Mazor


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.

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Lubrizol

Lubrizol’s Diamond Dispersions Business Wins Queen’s Award for International Trade

(BRK.A), (BRK.B)

The Lubrizol Corporation has announced its Sheffield, UK-based Diamond Dispersions business has won the Queen’s Award for International Trade for outstanding short-term growth.

The award was presented for growth in overseas sales over the last three years.

Since 1966, the Queen’s Award for Enterprise recognizes British businesses that excel in four categories, including International Trade, Innovation, Sustainable Development and Promoting Opportunity. It is the highest official UK awards program.

Diamond Dispersions, which manufactures color concentrates used in the manufacture of inkjet inks, mainly for the digital printing of textiles, is no stranger to this accolade having previously won the Queen’s Award for International Trade in 2012. Overseas sales have more than doubled over the past three years, and the proportion of sales exported has increased to over 80% of total sales.

“We couldn’t be prouder to receive recognition for our continued efforts and commitment to grow the company in such a prestigious way”, says Keith Malone, commercial manager, Diamond Dispersions. “The Queen’s Award is an honor that is admired across the globe, not just in the UK – and it deeply matters to every one of us at Diamond Dispersions.”

“Over the last few years, our strategic planning has driven us to work more closely with print machine manufacturers (OEMS), enabling them to develop bespoke ink products,” shares Andrew Grantham, marketing manager, Diamond Dispersions. “The closer relationships we’ve built have been a key driver to our sales growth over the last three years.”

Diamond Dispersions has responded effectively to the rapidly growing digital print market by supporting customers as they seek to deliver customization, shorter print runs, just-in-time manufacturing and a desire for reduced stocks and wastage.

“We’ve also developed specific products for use in the pigmented digital textile printing market, which has huge potential for growth, “adds Grantham. “Pigment-based digital printing of cotton textiles, in particular, is much more environmentally friendly than dye-based printing as it requires less energy and water and eliminates waste-water effluent.”

“Ever since Diamond Dispersions was established in 2007, we have taken every opportunity to further improve and enhance our customer service,” concludes Grantham. “For example, to better serve customers locally and achieve the response times demanded by those customers, last year we made the decision to hold stock in several different countries including China, the US, India and Brazil.”

“The Queen’s Award is a great achievement and our whole team is justifiably very proud of the award,” shares Charles Nelson, general manager, Diamond Dispersions. “Lubrizol is planning further investments in the business to ensure we keep pace with growing demand.”

Diamond Dispersions will celebrate the award during a royal reception for Queen’s Awards’ winners in Summer 2019 and will host its own celebration in Sheffield in Autumn.

© 2019 David Mazor

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.

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BNSF

BNSF Carloads Continue to Lag 2019 Levels

(BRK.A), (BRK.B)

BNSF Railway’s carloads for 2019 have continued their downward trend as compared to 2018. The decline is due in part to a major decrease in coal shipments.

Coal shipments as of the week ending April 13, 2019, are down 10.25% over the same period last year, and combined intermodal and carloads numbers are down 5.15% in the aggregate.

Also, showing weaker numbers are grain shipments, which are down 12.85%, and shipments of motor vehicles are down 5.51%.

2018 was a strong year for BNSF, with the combined carloads including intermodal up 4.03% over 2017, however 2019’s numbers have been hurt by weak global demand for coal and severe flooding in the Midwest that has closed some routes and slowed others.

© 2019 David Mazor

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.

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Kraft Heinz

Bernardo Hees Out, Miguel Patricio In As Kraft Heinz CEO

(BRK.A), (BRK.B)

The Kraft Heinz Company has announced that the Company’s Board of Directors has appointed Miguel Patricio as Chief Executive Officer effective July 1, 2019.

Mr. Patricio will succeed Bernardo Hees, who will remain CEO through June 30, 2019, to ensure a seamless transition.

“Miguel is a proven business leader with a distinguished track record of building iconic consumer brands around the globe, driving top-line revenue growth through a focus on consumer-first marketing, innovation, and people development,” said Alex Behring, Chairman of Kraft Heinz’s Board of Directors.

“I want to personally thank Bernardo Hees for leading the Company through its first phase,” said Marcel Herrmann Telles, a member of Kraft Heinz’s Board of Directors. “I’ve worked with Miguel over the course of the past 20 years, and he is a natural business leader. From attracting and nurturing the best talent to leading the turnaround of the AB InBev China business into the phenomenal success it is today, Miguel has one of the best brand-building minds in the industry.”

A native of Portugal, Mr. Patricio will join the Company after a successful career spanning two decades at Anheuser-Busch InBev (AB InBev), where he served as part of the Executive Leadership team in various positions, driving organic growth and industry-leading margins.

At AB InBev, Mr. Patricio served as the Global Chief Marketing Officer from 2012 to 2018. In this role, he helped develop and implement a strategic playbook for global brands Corona, Budweiser and Stella Artois, accelerating organic sales growth to high single digits. This represented more than one-third of AB InBev’s organic growth and accounted for more than 20 percent of AB InBev’s 2018 year-end global revenues. In his final year as chief marketer, AB InBev was the most awarded brand owner at Cannes Lions 2018, the global benchmark for effective creative marketing communications.

Prior to that, he was AB InBev’s President of Asia Pacific from 2008 to 2012 and President of North America from 2006 to 2008, providing him with deep experience in growing businesses in developed and emerging markets.

As President of Asia Pacific, Mr. Patricio set the foundation for the growth of the China business by defining a long-term strategy focusing on the premium market, growing Budweiser to become the leading brand in China, and expanding the growth of local brands such as Harbin. This led to the transformation of AB InBev Asia Pacific, which grew from revenues of $1 billion in 2008 to $2.7 billion in 2012, making it the number one beer company in China. Asia Pacific now represents approximately 15 percent of the company’s global revenue and 18 percent of global volumes.

Prior to AB InBev, Mr. Patricio has worked at other consumer companies including Philip Morris, The Coca-Cola Company and Johnson & Johnson in Latin America, New Jersey, and Georgia.

“Kraft Heinz is an incredible company with iconic brands that are loved around the world,” Mr. Patricio said. “It will be a privilege and an honor to lead such a talented group of employees as we focus on the consumer to capitalize on the growth opportunities that exist in the rapidly evolving food industry.”

“I would like to thank Bernardo personally, and on behalf of the Board, for his many contributions to Kraft Heinz over the last six years,” Mr. Behring added. “He helped transform the food industry by leading the acquisition of Heinz in 2013 and the merger of Kraft and Heinz in 2015. Under Bernardo’s tenure, Kraft Heinz achieved industry-leading margins and sales performance in line with its U.S. peers, developed an organization with best-in-industry quality standards, and built in-house capabilities for category management, including revenue and assortment management. We appreciate his contributions.”

“It has been an honor to serve as CEO of Kraft Heinz and to see it through its transformation over the last six years,” said Mr. Hees. “I have confidence that Miguel and the team will take Kraft Heinz to new heights.”

© 2019 David Mazor

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