Profile: Berkshire Hathaway Inc (BRKa.N)
19 Aug 2019
Berkshire Hathaway Inc. (Berkshire), incorporated on June 16, 1998, is a holding company owning subsidiaries engaged in various business activities. The Company's segments include Insurance, Burlington Northern Santa Fe, LLC (BNSF), Berkshire Hathaway Energy, Manufacturing, McLane Company, Service and retailing, and Finance and financial products. The Company conducts insurance businesses on both a primary basis and a reinsurance basis, a freight rail transportation business and a group of utility and energy generation and distribution businesses. Berkshire also owns and operates a range of other businesses engaged in a range of activities. Its insurance and reinsurance business activities are conducted through various domestic and foreign-based insurance entities. Its insurance businesses provide insurance and reinsurance of property and casualty risks and also reinsure life, accident and health risks across the world.
The Company's Insurance segment includes GEICO, Berkshire Hathaway Primary Group (BH Primary), General Re Corporation (General Re) and Berkshire Hathaway Reinsurance Group (BHRG). GEICO insures motorcycles, all-terrain vehicles, recreational vehicles, boats and small commercial fleets and acts as an agent for other insurers offering homeowners, renters, boat, life and identity management insurance to individuals to provide insurance and financial services for buyers desiring insurance coverages other than those offered by GEICO. GEICO markets its policies primarily through direct response methods in which applications for insurance are submitted directly to the companies through the Internet or by telephone.
General Re is the holding company of General Reinsurance Corporation (GRC) and its subsidiaries and affiliates. GRC's subsidiaries include General Reinsurance AG, (GRAG), international reinsurer. General Re subsidiaries conduct business provide insurance and reinsurance coverages throughout the world. General Re provides property/casualty insurance and reinsurance, life/health reinsurance and other reinsurance intermediary and risk management services, underwriting management and investment management services. General Star is a specialty and surplus lines provider, underwriting an array of property, casualty and professional liability business through a select group of wholesale brokers, managing general underwriters and program administrators.
BHRG provides excess and quota-share reinsurance to other property and casualty insurers and reinsurers. BHRG also offers life reinsurance and annuity contracts through Berkshire Hathaway Life Insurance Company of Nebraska (BHLN). BHRG underwrites traditional non-catastrophe property and casualty insurance and reinsurance, catastrophe excess-of-loss treaty and facultative reinsurance, and individual primary insurance policies. BH Primary is a collection of independently managed primary insurance operations that provide a range of insurance coverages to policyholders.
Burlington Northern Santa Fe, LLC
The Company's BNSF operates railroad systems in North America. In serving the Midwest, Pacific Northwest, Western, Southwestern and Southeastern regions and ports of the United States, BNSF transports a range of products and commodities derived from manufacturing, agricultural and natural resource industries. BNSF's primary routes, including trackage rights, allow it to access major cities and ports in the western and southern United States, as well as parts of Canada and Mexico.
Berkshire Hathaway Energy
Berkshire owns interest in Berkshire Hathaway Energy Company (BHE). BHE is a global energy company with subsidiaries that generate, transmit, store, distribute and supply energy. As of December 31, 2016, BHE's domestic regulated energy interests consisted of four regulated utility companies serving retail customers, interstate natural gas pipeline companies with approximately 16,400 miles of pipeline and a design capacity of approximately 7.9 billion cubic feet of natural gas per day and ownership interests in electricity transmission businesses. As of December 31, 2016, BHE's Great Britain electricity distribution subsidiaries served electricity end users and its electricity transmission-only business in Alberta, Canada.
The natural gas pipelines consist of Northern Natural Gas Company (Northern Natural) and Kern River Gas Transmission Company (Kern River). Northern Natural owns the interstate natural gas pipeline system reaching from west Texas to Michigan's Upper Peninsula. Kern River transports natural gas for electric and natural gas distribution utilities, oil and natural gas companies or affiliates of such companies, electric generating companies, energy marketing and trading companies, and financial institutions. As of December 31, 2016, BHE Renewables owned interests in independent power projects having approximately 4,000 net megawatts of generation capacity that are in service or under construction. These independent power projects sell power generated primarily from solar, wind, geothermal and hydro sources under long-term contracts.
The Company's manufacturing businesses are grouped into three categories: industrial products, building products and consumer products. Berkshire's industrial products businesses manufacture specialty chemicals, metal cutting tools, components for aerospace and power generation applications, and a range of other products primarily for industrial use. The Lubrizol Corporation (Lubrizol) is a specialty chemical company that produces and supplies technologies for the global transportation, industrial, oilfield and consumer markets. Lubrizol operates in two business sectors: Lubrizol Additives, which includes engine additives, driveline additives and industrial specialties products, and Lubrizol Advanced Materials, which includes personal and home care, engineered polymers, performance coatings and life science solutions. Lubrizol's products are used in a range of applications, including engine oils, refineries and oilfields, pipelines, metalworking fluids, compressor lubricants, greases for transportation and industrial applications, sporting goods and plumbing and fire sprinkler systems.
The General Re segment consists of General Re Corporation (General Re), which is the holding company of General Reinsurance Corporation (GRC), and its subsidiaries and affiliates. General Re's subsidiaries conduct business activities globally in over 50 cities, and provide insurance and reinsurance coverages throughout the world. General Re provides property/casualty insurance and reinsurance, life/health reinsurance and other reinsurance intermediary and risk management services, underwriting management and investment management services. General Re's property/casualty reinsurance business in North America is conducted through GRC. General Re's North American life/health business operates through two divisions: the individual products division, and the group & specialty division in the United States and Canada. The business segments include life, disability, supplemental health, critical illness and long-term care.
Berkshire Hathaway Reinsurance Group
The BHRG segment includes activities conducted through various subsidiaries, such as National Indemnity Company (NICO) and Columbia Insurance Company. BHRG provides principally excess and quota-share reinsurance to other property and casualty insurers and reinsurers. BHRG also offers life reinsurance and annuity contracts through Berkshire Hathaway Life Insurance Company of Nebraska (BHLN) and financial guaranty insurance through Berkshire Hathaway Assurance Corporation. BHRG underwrites traditional non-catastrophe property and casualty insurance and reinsurance, catastrophe excess-of-loss treaty and facultative reinsurance, and individual primary insurance policies on an excess-of-loss basis.
Berkshire Hathaway Primary Group
The Berkshire Hathaway Primary Group segment is a collection of independently managed insurance operations that provide various insurance coverages to policyholders located principally in the United States. The segment's operations include NICO and certain affiliates (NICO Primary), which underwrite motor vehicle and general liability insurance to commercial enterprises. The Berkshire Hathaway Homestate Companies (BHHC) offer standalone workers compensation, commercial auto and commercial property coverages. MedPro Group (MedPro) offers healthcare liability insurance, claims, patient safety and risk solutions to physicians, surgeons, dentists and other healthcare professionals, as well as hospitals, senior care and other healthcare facilities, all offered through Medical Protective Company and its subsidiaries and affiliates.
U.S. Investment Corporation (USIC) and its subsidiaries are specialty insurers that underwrite commercial, professional and personal lines of insurance on an admitted and excess and surplus basis. Applied Underwriters, Inc. (Applied), through its subsidiaries, markets SolutionOne, a product that bundles workers' compensation and other employment related insurance coverages and business services into a package that removes the burden of administrative and regulatory requirements faced by small to mid-sized employers. Applied also markets EquityComp, which is a workers' compensation only product with a profit sharing component targeted to medium-sized employers. WestGUARD Insurance Company and its subsidiaries provide commercial property and casualty insurance coverage to small and mid-sized businesses.
Burlington Northern Santa Fe, LLC
The BNSF segment operates railroad systems in North America with approximately 32,500 route miles of in over 30 states, and also operates in approximately three Canadian provinces. BNSF owns approximately 23,000 route miles, including easements. It operates over 9,000 route miles of trackage rights that permit BNSF to operate its trains with its crews over other railroads' tracks. The total BNSF Railway system, including single and multiple main tracks, yard tracks and sidings, consists of over 50,000 operated miles of track, all of which are owned by or held under easement by BNSF except for over 10,000 miles operated under trackage rights. BNSF transports a range of products and commodities derived from manufacturing, agricultural and natural resource industries.
Berkshire Hathaway Energy
The Berkshire Hathaway Energy segment offers regulated electric and gas utility, including power generation and distribution activities and real estate brokerage activities. The segment consists of the operations of Berkshire Hathaway Energy Company (BHE). BHE is an energy company with subsidiaries that generate, transmit, store, distribute and supply energy. As of December 31, 2016, BHE's domestic regulated energy interests consisted of four regulated utility companies serving approximately 4.7 million retail customers, over two interstate natural gas pipeline companies with approximately 16,400 miles of pipeline and a design capacity of approximately 7.8 billion cubic feet of natural gas per day, and ownership interests in electricity transmission businesses.
The Manufacturing segment offers various products, including industrial, consumer and building products. The segment's businesses are grouped into three categories: industrial products, building products and consumer products. Its industrial products businesses manufacture specialty chemicals, metal cutting tools, and a range of other products primarily for industrial use. The building products group produces flooring products, insulation, roofing and engineered products, building and engineered components, paint and coatings, and bricks and masonry products that are used in building and construction applications.
The Company, through Fruit of the Loom (FOL), manufactures and distributes basic apparel, underwear, casualwear, athletic apparel and hardgoods. Products, under the Fruit of the Loom and JERZEES labels are primarily sold in the mass merchandise, mid-tier chains and wholesale markets. In the Vanity Fair Brands product line, Vassarette and Curvation are sold in the mass merchandise market, while Vanity Fair and Lily of France products are sold to mid-tier chains and department stores. FOL also markets and sells athletic uniforms, apparel, sports equipment and balls to team dealers; collegiate licensed tee shirts and fleecewear to college bookstores, and athletic apparel, sports equipment and balls to sporting goods retailers under the Russell Athletic and Spalding brands. Garan designs, manufactures, imports and sells apparel primarily for children, including boys, girls, toddlers and infants. Products are sold under its own Garanimals and customer private label brands. The Company, through Forest River, Inc. (Forest River), manufactures recreational vehicles (RV), utility cargo trailers, buses and pontoon boats, headquartered in Elkhart, Indiana with products sold in the United States and Canada through an independent dealer network.
Service and Retailing
Berkshire's service businesses provide grocery and foodservice distribution, professional aviation training programs, fractional aircraft ownership programs and distribution of electronic components. Other service businesses include a range of media related businesses (newspaper, television and information distribution), franchising and servicing a system of quick service restaurants, as well as steel service and logistics businesses.
McLane Company, Inc. (McLane) provides wholesale distribution services to customers that include convenience stores, discount retailers, wholesale clubs, drug stores, military bases, quick service restaurants and casual dining restaurants. Its operations are divided into three business units: grocery distribution, foodservice distribution and beverage distribution. As of December 31, 2016, Grocery operations were provided products to approximately 47,000 retail locations nationwide. As of December 31, 2016, McLane's grocery distribution unit operated 23 facilities in 19 states. McLane's foodservice distribution unit focuses on serving the quick service restaurant industry. As of December 31, 2016, its operations were conducted through 18 facilities in 16 states. The foodservice distribution unit services approximately 22,000 chain restaurants nationwide. Through its subsidiaries, McLane also operates various wholesale distributors of distilled spirits, wine and beer.
Finance and Financial Products
Berkshire's finance and financial products activities include an integrated manufactured housing and finance business, leasing of transportation equipment, and furniture leasing. Clayton Homes, Inc. (Clayton) is a vertically integrated home building company. As of December 31, 2016, Clayton operated 38 manufacturing plants in 12 states. As of December 31, 2016, Clayton's homes were marketed in 48 states through a network of 1,923 retailers, including 341 Company-owned home centers and 100 subdivisions. Financing is offered through its finance subsidiaries to purchasers of Clayton's manufactured homes, as well as those purchasing homes from selected independent retailers.
The Company competes with State Farm, Allstate, Progressive, USAA, Union Pacific Railroad Company, Infineum International Ltd., Chevron Oronite Company, Afton Chemical Corporation, Nalco Energy Services, Baker Hughes Inc., Schlumberger Ltd., Halliburton Company, Sandvik, Kennametal, Inc., Kyocera, Mitsubishi, Sumitomo, Korloy, Sherwin-Williams Company, PPG Industries, Inc., The Valspar Corporation, The Home Depot, Inc., and Lowe's Companies.
Berkshire Hathaway Inc
3555 Farnam St
OMAHA NE 68131-3311
Company Web Links
- Ackman eyes more gains for his fund with help of Berkshire, others
- UPDATE 1-Ackman eyes more gains for his fund with help of Berkshire, others
- Ackman confident portfolio can keep delivering strong returns -letter
- Deals of the day-Mergers and acquisitions
- Ackman bets on idol Warren Buffett's Berkshire Hathaway