Buffett opened the letter by acknowledging that he has often made errors over time with out providing many particular examples, however he assured shareholders that the person he has chosen to sooner or later succeed him as CEO, Greg Abel, is not one in every of them. He wrote that Abel will probably be able to act each time he spots important funding alternatives.
“We’re neutral in our selection of fairness autos, investing in both selection primarily based upon the place we are able to finest deploy your (and my household’s) financial savings. Typically, nothing seems to be compelling; very occasionally we discover ourselves knee-deep in alternatives. Greg has vividly proven his potential to behave at such instances,” Buffett wrote.
And Abel could have loads of sources to work with on condition that Berkshire now holds $334.201 billion money after promoting off a lot of its Apple and Financial institution of America inventory prior to now yr and persevering with to generate cash from all its subsidiaries that embrace Geico insurance coverage, BNSF railroad, a group of main utilities and an assortment of main producers and well-known retail companies that embrace manufacturers like Dairy Queen and See’s Sweet. That is nearly double the $167.6 billion money Berkshire held a yr in the past.
Buffett did discover just a few issues to make use of a few of that money on final yr by spending $3.9 billion to accumulate the remainder of its utility enterprise from the property of a former companion and one other $2.6 billion to purchase the remainder of the Pilot truck cease chain. Buffett stated he additionally elevated Berkshire’s funding in 5 main Japanese conglomerates. Berkshire has now spent $13.8 billion over the previous six years on these Japanese investments that are actually value $23.5 billion.
However whereas Buffett has struggled to seek out main acquisitions in recent times he affirmed that he has no plans to supply a dividend. In what may be a nod to the 94-year-old Buffett’s age, the legendary investor introduced that this yr’s shareholder assembly in Might that routinely attracts tens of 1000’s of individuals will probably be shorter. Buffett and Berkshire’s two vice chairmen will solely reply questions from 8 a.m. till 1 p.m. – a number of hours lower than standard. Buffett additionally acknowledged utilizing a cane nowadays to keep away from “falling flat on my face.”
