By Jonathan Stempel
Feb 28 (Reuters) – Berkshire Hathaway’s new chief executive Greg Abel moved to put his stamp on the conglomerate with his first annual letter to shareholders on Saturday, pledging to maintain its “fortress-like” balance sheet while upholding the values of his predecessor and mentor, Warren Buffett.
Abel, 63, said he would not rush to deploy Berkshire’s near-record $373.3 billion cash stake, though it gave the company plenty of “dry powder,” and that he had no plans to begin paying dividends, which Buffett also opposed. Berkshire has also repurchased none of its own stock since the spring of 2024.
“I recognize how you want us to succeed together, and to do so in the right way,” Abel wrote. “My role is to ensure our liquidity levels and capital deployment remain intentional and deliberate.”
Abel also paid homage to Buffett, 95, who stepped down at year-end after 60 years as chief executive. Buffett remains chairman and goes to Berkshire’s offices five days a week.
“Warren Buffett is arguably the greatest investor of all time, with generations benefiting from his investment acumen,” Abel wrote. “To invest in Berkshire has long been a vote of trust in our founder – a trust that now rests with Berkshire.”
ABEL TRIES TO SHOW CONTINUITY
Abel said Berkshire’s culture and values will continue “into perpetuity,” and signaled no changes in its decentralized structure where its dozens of businesses operate largely without interference from him.
He also said Berkshire, which owns the BNSF railroad, had “no interest” in buying another major railroad, and acknowledged pressures facing the PacifiCorp utility from litigation over wildfires in Oregon.
“PacifiCorp is not an insurer of last resort and should not be treated as a deep pocket,” Abel wrote.
Cathy Seifert, an analyst at CFRA Research, said Abel’s letter might be reassuring to investors.
“He needed to show a degree of continuity, that the Berkshire franchise would continue despite the change in leadership, and it would be business as usual,” she said. “In my opinion, he hit the mark.”
PROFIT DECLINES
Berkshire also reported declining profit for both the fourth quarter and the full year, after taking write-downs for longstanding investments in packaged food company Kraft Heinz and Occidental Petroleum.
Quarterly operating profit fell 30% to $10.2 billion. Including changes in the value of equity holdings led by Apple and American Express, net income fell 3% to $19.2 billion.
For all of 2025, operating profit fell 6% to $44.49 billion, while net income fell 25% to $67 billion.
Buffett had long urged investors to ignore fluctuations in Berkshire’s net income, which reflect accounting rules that require Berkshire to report gains and losses on stocks that Berkshire is not selling.
(Reporting by Jonathan Stempel in New York; Editing by Louise Heavens and Lisa Shumaker)
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