Buffett's Berkshire says quarterly profit rises 15pct

Warren Buffett's Berkshire Hathaway Inc on Saturday said fourth-quarter profit rose 15 percent

NEW YORK: Warren Buffett's Berkshire Hathaway Inc on Saturday said fourth-quarter profit rose 15 percent from a year earlier, helped by gains from investments and derivatives.

Net income rose to $6.29 billion, or $3,823 per Class A share, from $5.48 billion, or $3,333 per share, in the comparable quarter the previous year.

Quarterly operating profit fell 6 percent to $4.38 billion, or $2,665 per share, from $4.67 billion, or $2,843 per share.

Analysts on average had forecast operating profit of $2,716.60 per share, according to Thomson Reuters I/B/E/S.

Book value per share, which reflects assets minus liabilities and which Buffett considers a good yardstick for Berkshire's intrinsic worth, was $172,108 at the end of the year, up 5 percent from three months earlier.

Meanwhile, Buffett ramped up his criticism of Wall Street, saying investors should "stick with low-cost index funds."

"When trillions of dollars are managed by Wall Streeters charging high fees, it will usually be the managers who reap outsized profits, not the clients," Buffett, widely considered one of the world's best investors, said in his annual letter to shareholders.

"Both large and small investors should stick with low-cost index funds."

Buffett has said he believes most stock investors are better off with low-cost index funds than paying higher fees to managers who often underperform.

His latest letter adds fuel to the fire as an accelerating flow of cash moves from actively managed funds, such as hedge funds and many mutual funds, to generally lower-cost funds tracking indexes. - Reuters