Billionaire businessman Warren Buffett, the chairman of conglomerate Berkshire Hathaway, admitted on Saturday that a decision he made in 2016 has cost the company a whopping $11 billion.
In his annual statement to shareholders, the “Oracle of Omaha” conceded he erred in overpaying for metal-fabrication company Precision Castparts Corp. — a deal he referred to as “ugly.”
“No one misled me in any way — I was simply too optimistic about PCC’s normalized profit potential,” explained the 90-year-old business whiz. “Last year, my miscalculation was laid bare by adverse developments throughout the aerospace industry, PCC’s most important source of customers.”
Despite the big-time blunder, Buffett boasted that Berkshire Hathaway remains tops in asset values, claiming that the worth of Berkshire Hathaway’s stakes in companies is $154 billion — $27 billion more than No. 2 AT&T.
Billionaire businessman Warren Buffett, the chairman of conglomerate Berkshire Hathaway, admitted on Saturday that a decision he made in 2016 cost the company a whopping $11 billion.Billionaire businessman Warren Buffett, the chairman of conglomerate Berkshire Hathaway, admitted on Saturday that a decision he made in 2016 cost the company a whopping $11 billion.
He then praised the entrepreneurial spirit of America and the potential for any citizen to strike it rich.
“Success stories abound throughout America,” explained Buffett, who according to Bloomberg has a net worth of $92.7 billion. “Since our country’s birth, individuals with an idea, ambition and often just a pittance of capital have succeeded beyond their dreams by creating something new or by improving the customer’s experience with something old.”
Buffett then focused on two of the company’s wholly owned U.S. subsidiaries, BNSF Railway and Berkshire Hathaway Energy, which earned a combined $8.3 billion in 2020 despite plummeting demand amid the coronavirus outbreak.
He noted that he expects BHE to become a clean-energy leader in the near-future and railways such as BNSF transport 15% of all American freight.
“The history of American railroads is fascinating,” explained Buffett. “After 150 years or so of frenzied construction, skullduggery, overbuilding, bankruptcies, reorganizations and mergers, the railroad industry finally emerged a few decades ago as mature and rationalized.”
In addition to spelling out the specifics of various 2020 company deals, Buffett said the U.S. remains a formidable world power.
“In its brief 232 years of existence . . . there has been no incubator for unleashing human potential like America,” he stated. “Despite some severe interruptions, our country’s economic progress has been breathtaking. Our unwavering conclusion: Never bet against America.”
