Berkshire Hathaway’s Railroad Says Annual Profit Up in Sneak Preview

On the eve of Warren Buffett’s annual letter, Berkshire Hathaway Inc.’s railroad gave investors a sneak preview of what’s to come, noting in a regulatory filing that the unit’s profit increased 5% last year.

BNSF’s net income of $5.48 billion was helped by a 3.8% decline in operating expenses, which countered a slump in revenue, according to thefiling on Friday. Usually, BNSF doesn’t submit its filing until two days after Berkshire publishes its annual shareholder letter on a Saturday.

Buffett’s annual letter is often scoured by investors looking for updates on the billionaire’s strategy and on the many components of his sprawling conglomerate. While the railroad accounted for a sizable portion of Berkshire’s results in 2018, profit at Buffett’s company is also affected by his network of insurance companies, energy businesses and an array of manufacturers and retailers.

Railroads in the U.S. have been stung over the past year by an industrial slowdown in the country. Buffett’s railroad reported that revenues from shipping coal, consumer and agricultural products dropped last year, even as income from industrial products gained. Rival Union Pacific Corp., which faced a drop in carloads last year,said in January that it expects freight volumes to turn “slightly positive” this year.

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