Financial Performance - Net earnings attributable to Berkshire Hathaway shareholders reached $89.8 billion in 2021, up from $42.5 billion in 2020 and $81.4 billion in 2019[124]. - The effective income tax rate for Berkshire Hathaway was 22.2% in 2021, slightly up from 21.5% in 2020[130]. - Consolidated shareholders' equity increased by $63.0 billion to $506.2 billion by December 31, 2021, with net earnings attributable to shareholders at $89.8 billion[219]. - Net earnings for the company reached $11.12 billion in 2021, up from $8.3 billion in 2020[180]. Insurance Operations - Insurance underwriting earnings were $728 million in 2021, compared to $657 million in 2020 and $325 million in 2019, with significant catastrophe losses of approximately $2.3 billion in 2021[126]. - GEICO's pre-tax underwriting earnings were $1.26 billion in 2021, down from $3.43 billion in 2020, impacted by changes in average claims frequencies due to the COVID-19 pandemic[131]. - Berkshire Hathaway's insurance businesses face ongoing challenges from the COVID-19 pandemic, including increased claims and operational costs[129]. - After-tax earnings from insurance investment income decreased by 4.6% in 2021 compared to 2020, affected by declining interest rates[124]. Revenue Growth - Total revenue for Berkshire Hathaway increased to $25.0 billion in 2021, compared to $21.0 billion in 2020, reflecting growth across various segments[170]. - Manufacturing, service, and retailing businesses saw a 34.0% increase in earnings in 2021 compared to 2020, despite higher input costs due to global supply chain disruptions[126]. - Operating revenues from consumer products increased by 13.7% to $8.3 billion in 2021, with volumes up by 7.7% driven by growth in intermodal shipments[163]. - Energy operating revenue for Berkshire Hathaway Energy increased to $18.9 billion in 2021 from $15.6 billion in 2020, marking a significant growth in the energy sector[170]. Investment Performance - Investment and derivative gains totaled $62.34 billion in 2021, significantly up from $31.59 billion in 2020, reflecting strong market performance[124]. - Net investment income decreased to $4,807 million in 2021 from $5,039 million in 2020, primarily due to a decline in interest and other investment income[153]. - The fair value of investments in equity securities was $350.7 billion as of December 31, 2021, with a hypothetical 30% increase potentially raising it to $452.9 billion[242]. Operational Metrics - After-tax earnings from the railroad business increased by 16.1% in 2021 compared to 2020, driven by higher freight volumes and improved productivity[126]. - Railroad operating revenues increased by 11.6% in 2021 to $22.5 billion compared to $20.2 billion in 2020, driven by a 6.9% increase in volumes and a 3.5% increase in average revenue per car/unit[161]. - Total railroad operating expenses increased by 10.2% to $13.7 billion in 2021, with the operating expenses to revenue ratio decreasing to 60.9%[163]. Claims and Liabilities - GEICO's gross unpaid losses were $23.9 billion, with net claim liabilities of $22.7 billion as of December 31, 2021[227]. - Estimated ultimate claim liabilities for contracts written in prior years were reduced by $974 million in 2021, contributing to pre-tax underwriting earnings of $142 million[147]. - Consolidated claim liabilities, including retroactive reinsurance, were approximately $125 billion as of December 31, 2021, with 80% related to GEICO and Berkshire Hathaway Reinsurance Group[226]. Capital Expenditures and Borrowings - Consolidated capital expenditures for property, plant, and equipment were $13.3 billion in 2021, with forecasts of approximately $11.1 billion for 2022[221]. - Consolidated borrowings were $114.3 billion as of December 31, 2021, with expected principal and interest payments outlined for the next five years[219]. - BHE and its subsidiaries had outstanding borrowings of $51.8 billion, a decrease of $382 million since December 31, 2020, and issued new term debt of approximately $2.2 billion in 2021[221]. Market Conditions and Challenges - The building products group experienced supply chain disruptions, contributing to raw material and logistics cost inflation[190]. - GEICO's claims frequencies increased across all coverages in 2021, with average claims severities also rising significantly[134]. - The company does not utilize derivative contracts to manage foreign currency risks in a meaningful way[248].
Berkshire Hathaway(BRK_A) - 2021 Q4 - Annual Report