Warren Buffett held Berkshire Hathaway’s first meeting without Charlie Munger

Warren Buffett held Berkshire Hathaway’s first meeting without Charlie Munger

Welcome to “Woodstock for capitalists.”

Tens of thousands of Berkshire Hathaway shareholders and Warren Buffett fans are flocking to Nebraska this weekend to pick up Berkshire’s ( BRKB ) See’s Candies and Dairy Queen Dilly Bars, compete in newspaper throwing contests and, perhaps most importantly, to see the Oracle of Omaha talk in person.

This year, however, the event will take on a more serious tone. Buffett will appear for the first time without longtime business partner and friend Charlie Munger, who died in November.

Greg Abel, the expected successor to Buffett who runs Berkshire’s non-insurance operations; and Ajit Jain, who runs the company’s insurance business, are expected to join Buffett on stage. However, Munger’s kind words and wise (and often sarcastic) words will be missed.

Buffett, 93, opened Berkshire’s 2023 annual report with a dedication to Munger, who died aged 99, just 33 days before the milestone birthday.

Buffett said Munger was the “architect” behind the conglomerate they built together. “In the physical world, great buildings are associated with their architects, while those who have poured concrete or installed windows are soon forgotten,” he wrote. “Berkshire has been a great company. Although I have been taking care of the construction crew for a long time; Charlie should forever be credited as the architect.

The couple first met in 1959 and three years later Munger began working in money management, the letter notes. In 1978, Munger joined Berkshire Hathaway as vice chairman and sat next to Buffett, quick with a quip or sage advice.

“Charlie never sought to take credit for his role as creator but rather let me take the credit and accept the credit. In a way, his relationship with me was part brother, part loving father. Even when he knew he was right, he gave me the reins, and when I made a mistake he never — never — reminded me of my mistake,” Buffett wrote.

Substitution question
Munger’s departure has raised questions of succession at Berkshire.

Abel, 61, is named heir in 2021 and Buffett has sought to assure investors that Berkshire ( BRK.A ) shares, which closed at $603,000 a share on Friday, have a solid succession plan.

“I don’t have a second choice. I mean it’s hard to find. But I’ve also seen Greg in action and I feel 100% comfortable,” Buffett said at last year’s shareholder meeting. “Greg inherited a good business and I think he will make it better.”

Here comes the income
Berkshire also reported first quarter 2024 earnings on Saturday morning. Buffett famously releases his quarterly report over the weekend so investors have time to fully digest its contents before trading reopens on Monday.

Berkshire’s operating profit is expected to rise 21% to $6,702 per Class A share, according to FactSet estimates. Berkshire’s Class A shares have risen nearly 10% this year, outperforming the S&P 500’s total of 7.5%.

Berkshire Hathaway reported a significant increase in fourth quarter operating income, which totaled $8.5 billion, up from $6.6 billion, or a 28% increase from last year. For this year, operating income rose to $37.3 billion, after hitting a record $30.8 billion in 2022.

The Omaha, Nebraska-based conglomerate closed the year with a net profit of $96.2 billion, a sharp turnaround from a 2022 net loss of $22.8 billion.