Hurricane Losses Have $816 Million Impact on Berkshire’s Q3 Earnings

Berkshire Hathaway Inc., the giant investment group run by Warren Buffet, reported a significant decrease in third quarter net earnings, primarily due to the hurricanes that struck Florida in August and September. Berkshire earned $1.137 billion during the period, compared to $1.803 billion in the third quarter of 2003.

Over 60 percent of Berkshire’s holdings are in insurance, including General Re, GEICO and National Indemnity. The report noted, however: “All of Berkshire’s insurance operations are performing very well.” It did acknowledge the storms’, noting that, “third quarter results include after-tax losses of about $816 million from the hurricanes.”

Other details of the report include the following:
— $215 million Q3 loss on insurance underwriting, compared to a gain of $260 million in Q3 2003.
— $399 million earned from insurance underwriting for the first 9 months of 2004, compared to $711 million in the first 9 months of 2003.
— Q3 insurance-investment income of $484 million, compared to $519 million in Q3, 2003.
— 9-month insurance investment income of $1.418 billion in 2004, compared to $1.682 billion in 2003.
— Non-insurance businesses earned $371 million in the third quarter, compared to $608 million in Q3, 2003.
— Non-insurance earnings for the first nine months were $1.466 billion, compared to $1.587 billion in 2003.

Berkshire’s net earnings, excluding investment gains/losses for the third quarter were $619 million, compared to $1.353 billion in the third quarter of 2003. For the nine months ended Sept. 30 they wrere $3.208 billion, down from $$3.881 billlion in the first nine months of 2003.

The full earnings report is available on the Group’s Web site at: www.berkshirehathaway.com.