Year	Annual Percentage Change		Relative Results (1)-(2)
	in Per-Share Book Value of Berkshire (1)	in S&P 500 with Dividends Included (2)
1965	23.8	10.0	13.8
1966	20.3	(11.7)	32.0
1967	11.0	30.9	(19.9)
1968	19.0	11.0	8.0
1969	16.2	(8.4)	24.6
1970	12.0	3.9	8.1
1971	16.4	14.6	1.8
1972	21.7	18.9	2.8
1973	4.7	(14.8)	19.5
1974	5.5	(26.4)	31.9
1975	21.9	37.2	(15.3)
1976	59.3	23.6	35.7
1977	31.9	(7.4)	39.3
1978	24.0	6.4	17.6
1979	35.7	18.2	17.5
1980	19.3	32.3	(13.0)
1981	31.4	(5.0)	36.4
1982	40.0	21.4	18.6
1983	32.3	22.4	9.9
1984	13.6	6.1	7.5
1985	48.2	31.6	16.6
1986	26.1	18.6	7.5
1987	19.5	5.1	14.4
1988	20.1	16.6	3.5
1989	44.4	31.7	12.7
1990	7.4	(3.1)	10.5
1991	39.6	30.5	9.1
1992	20.3	7.6	12.7
1993	14.3	10.1	4.2
1994	13.9	1.3	12.6
1995	43.1	37.6	5.5
1996	31.8	23.0	8.8
1997	34.1	33.4	0.7
1998	48.3	28.6	19.7
1999	0.5	21.0	(20.5)
2000	6.5	(9.1)	15.6
2001	(6.2)	(11.9)	5.7
2002	10.0	(22.1)	32.1
2003	21.0	28.7	(7.7)
2004	10.5	10.9	(0.4)
2005	6.4	4.9	1.5
2006	18.4	15.8	2.6
2007	11.0	5.5	5.5
2008	(9.6)	(37.0)	27.4
2009	19.8	26.5	(6.7)
2010	13.0	15.1	(2.1)
2011	4.6	2.1	2.5
2012	14.4	16.0	(1.6)
Compounded Annual Gain – 1965-2012	19.7%	9.4%	10.3
Overall Gain – 1964-2012	586,817%	7,433%

Notes: Data are for calendar years with these exceptions: 1965 and 1966, year ended 9/30; 1967, 15 months ended 12/31. Starting in 1979, accounting rules required insurance companies to value the equity securities they hold at market rather than at the lower of cost or market, which was previously the requirement. In this table, Berkshire's results through 1978 have been restated to conform to the changed rules. In all other respects, the results are calculated using the numbers originally reported. The S&P 500 numbers are pre-tax whereas the Berkshire numbers are after-tax. If a corporation such as Berkshire were simply to have owned the S&P 500 and accrued the appropriate taxes, its results would have lagged the S&P 500 in years when that index showed a positive return, but would have exceeded the S&P 500 in years when the index showed a negative return. Over the years, the tax costs would have caused the aggregate lag to be substantial.

BERKSHIRE HATHAWAY INC.

To the Shareholders of Berkshire Hathaway Inc.:

In 2012, Berkshire achieved a total gain for its shareholders of \$24.1 billion. We used \$1.3 billion of that to repurchase our stock, which left us with an increase in net worth of \$22.8 billion for the year. The per-share book value of both our Class A and Class B stock increased by 14.4%. Over the last 48 years (that is, since present management took over), book value has grown from \$19 to \$114,214, a rate of 19.7% compounded annually.*

A number of good things happened at Berkshire last year, but let's first get the bad news out of the way.

- When the partnership I ran took control of Berkshire in 1965, I could never have dreamed that a year in which we had a gain of \$24.1 billion would be subpar, in terms of the comparison we present on the facing page.

But subpar it was. For the ninth time in 48 years, Berkshire's percentage increase in book value was less than the S&P's percentage gain (a calculation that includes dividends as well as price appreciation). In eight of those nine years, it should be noted, the S&P had a gain of $15\%$ or more. We do better when the wind is in our face.

To date, we've never had a five-year period of underperformance, having managed 43 times to surpass the S&P over such a stretch. (The record is on page 103.) But the S&P has now had gains in each of the last four years, outpacing us over that period. If the market continues to advance in 2013, our streak of five-year wins will end.

One thing of which you can be certain: Whatever Berkshire's results, my partner Charlie Munger, the company's Vice Chairman, and I will not change yardsticks. It's our job to increase intrinsic business value – for which we use book value as a significantly understated proxy – at a faster rate than the market gains of the S&P. If we do so, Berkshire's share price, though unpredictable from year to year, will itself outpace the S&P over time. If we fail, however, our management will bring no value to our investors, who themselves can earn S&P returns by buying a low-cost index fund.

Charlie and I believe the gain in Berkshire's intrinsic value will over time likely surpass the S&P returns by a small margin. We're confident of that because we have some outstanding businesses, a cadre of terrific operating managers and a shareholder-oriented culture. Our relative performance, however, is almost certain to be better when the market is down or flat. In years when the market is particularly strong, expect us to fall short.

- The second disappointment in 2012 was my inability to make a major acquisition. I pursued a couple of elephants, but came up empty-handed.

Our luck, however, changed early this year. In February, we agreed to buy 50% of a holding company that will own all of H. J. Heinz. The other half will be owned by a small group of investors led by Jorge Paulo Lemann, a renowned Brazilian businessman and philanthropist.

We couldn't be in better company. Jorge Paulo is a long-time friend of mine and an extraordinary manager. His group and Berkshire will each contribute about \$4 billion for common equity in the holding company. Berkshire will also invest \$8 billion in preferred shares that pay a 9% dividend. The preferred has two other features that materially increase its value: at some point it will be redeemed at a significant premium price and the preferred also comes with warrants permitting us to buy 5% of the holding company's common stock for a nominal sum.

Our total investment of about \$12 billion soaks up much of what Berkshire earned last year. But we still have plenty of cash and are generating more at a good clip. So it's back to work; Charlie and I have again donned our safari outfits and resumed our search for elephants.

Now to some good news from 2012:

- Last year I told you that BNSF, Iscar, Lubrizol, Marmon Group and MidAmerican Energy – our five most profitable non-insurance companies – were likely to earn more than \$10 billion pre-tax in 2012. They delivered. Despite tepid U.S. growth and weakening economies throughout much of the world, our “powerhouse five” had aggregate earnings of \$10.1 billion, about \$600 million more than in 2011.

Of this group, only MidAmerican, then earning \$393 million pre-tax, was owned by Berkshire eight years ago. Subsequently, we purchased another three of the five on an all-cash basis. In acquiring the fifth, BNSF, we paid about 70% of the cost in cash, and for the remainder, issued shares that increased the amount outstanding by 6.1%. Consequently, the \$9.7 billion gain in annual earnings delivered Berkshire by the five companies has been accompanied by only minor dilution. That satisfies our goal of not simply growing, but rather increasing per-share results.

Unless the U.S. economy tanks – which we don’t expect – our powerhouse five should again deliver higher earnings in 2013. The five outstanding CEOs who run them will see to that.

- Though I failed to land a major acquisition in 2012, the managers of our subsidiaries did far better. We had a record year for “bolt-on” purchases, spending about \$2.3 billion for 26 companies that were melded into our existing businesses. These transactions were completed without Berkshire issuing any shares.

Charlie and I love these acquisitions: Usually they are low-risk, burden headquarters not at all, and expand the scope of our proven managers.

- Our insurance operations shot the lights out last year. While giving Berkshire \$73 billion of free money to invest, they also delivered a \$1.6 billion underwriting gain, the tenth consecutive year of profitable underwriting. This is truly having your cake and eating it too.

GEICO led the way, continuing to gobble up market share without sacrificing underwriting discipline. Since 1995, when we obtained control, GEICO's share of the personal-auto market has grown from 2.5% to 9.7%. Premium volume meanwhile increased from \$2.8 billion to \$16.7 billion. Much more growth lies ahead.

The credit for GEICO's extraordinary performance goes to Tony Nicely and his 27,000 associates. And to that cast, we should add our Gecko. Neither rain nor storm nor gloom of night can stop him; the little lizard just soldiers on, telling Americans how they can save big money by going to GEICO.com.

When I count my blessings, I count GEICO twice.

- Todd Combs and Ted Weschler, our new investment managers, have proved to be smart, models of integrity, helpful to Berkshire in many ways beyond portfolio management, and a perfect cultural fit. We hit the jackpot with these two. In 2012 each outperformed the S&P 500 by double-digit margins. They left me in the dust as well.

Consequently, we have increased the funds managed by each to almost \$5 billion (some of this emanating from the pension funds of our subsidiaries). Todd and Ted are young and will be around to manage Berkshire's massive portfolio long after Charlie and I have left the scene. You can rest easy when they take over.

- Berkshire's yearend employment totaled a record 288,462 (see page 106 for details), up 17,604 from last year. Our headquarters crew, however, remained unchanged at 24. No sense going crazy.

- Berkshire's “Big Four” investments – American Express, Coca-Cola, IBM and Wells Fargo – all had good years. Our ownership interest in each of these companies increased during the year. We purchased additional shares of Wells Fargo (our ownership now is 8.7% versus 7.6% at yearend 2011) and IBM (6.0% versus 5.5%). Meanwhile, stock repurchases at Coca-Cola and American Express raised our percentage ownership. Our equity in Coca-Cola grew from 8.8% to 8.9% and our interest at American Express from 13.0% to 13.7%.

Berkshire's ownership interest in all four companies is likely to increase in the future. Mae West had it right: “Too much of a good thing can be wonderful.”

The four companies possess marvelous businesses and are run by managers who are both talented and shareholder-oriented. At Berkshire we much prefer owning a non-controlling but substantial portion of a wonderful business to owning 100% of a so-so business. Our flexibility in capital allocation gives us a significant advantage over companies that limit themselves only to acquisitions they can operate.

Going by our yearend share count, our portion of the “Big Four’s” 2012 earnings amounted to \$3.9 billion. In the earnings we report to you, however, we include only the dividends we receive – about \$1.1 billion. But make no mistake: The \$2.8 billion of earnings we do not report is every bit as valuable to us as what we record.

The earnings that the four companies retain are often used for repurchases – which enhance our share of future earnings – and also for funding business opportunities that are usually advantageous. Over time we expect substantially greater earnings from these four investees. If we are correct, dividends to Berkshire will increase and, even more important, so will our unrealized capital gains (which, for the four, totaled \$26.7 billion at yearend).

- There was a lot of hand-wringing last year among CEOs who cried “uncertainty” when faced with capital-allocation decisions (despite many of their businesses having enjoyed record levels of both earnings and cash). At Berkshire, we didn’t share their fears, instead spending a record \$9.8 billion on plant and equipment in 2012, about 88% of it in the United States. That’s 19% more than we spent in 2011, our previous high. Charlie and I love investing large sums in worthwhile projects, whatever the pundits are saying. We instead heed the words from Gary Allan’s new country song, “Every Storm Runs Out of Rain.”

We will keep our foot to the floor and will almost certainly set still another record for capital expenditures in 2013. Opportunities abound in America.

* * * * * * * * * * * *

A thought for my fellow CEOs: Of course, the immediate future is uncertain; America has faced the unknown since 1776. It’s just that sometimes people focus on the myriad of uncertainties that always exist while at other times they ignore them (usually because the recent past has been uneventful).

American business will do fine over time. And stocks will do well just as certainly, since their fate is tied to business performance. Periodic setbacks will occur, yes, but investors and managers are in a game that is heavily stacked in their favor. (The Dow Jones Industrials advanced from 66 to 11,497 in the $20^{\text{th}}$ Century, a staggering $17,320\%$ increase that materialized despite four costly wars, a Great Depression and many recessions. And don't forget that shareholders received substantial dividends throughout the century as well.)

Since the basic game is so favorable, Charlie and I believe it's a terrible mistake to try to dance in and out of it based upon the turn of tarot cards, the predictions of “experts,” or the ebb and flow of business activity. The risks of being out of the game are huge compared to the risks of being in it.

My own history provides a dramatic example: I made my first stock purchase in the spring of 1942 when the U.S. was suffering major losses throughout the Pacific war zone. Each day's headlines told of more setbacks. Even so, there was no talk about uncertainty; every American I knew believed we would prevail.

The country's success since that perilous time boggles the mind: On an inflation-adjusted basis, GDP per capita more than quadrupled between 1941 and 2012. Throughout that period, every tomorrow has been uncertain. America's destiny, however, has always been clear: ever-increasing abundance.

If you are a CEO who has some large, profitable project you are shelving because of short-term worries, call Berkshire. Let us unburden you.

* * * * * * * * * * * *

In summary, Charlie and I hope to build per-share intrinsic value by (1) improving the earning power of our many subsidiaries; (2) further increasing their earnings through bolt-on acquisitions; (3) participating in the growth of our investees; (4) repurchasing Berkshire shares when they are available at a meaningful discount from intrinsic value; and (5) making an occasional large acquisition. We will also try to maximize results for you by rarely, if ever, issuing Berkshire shares.

Those building blocks rest on a rock-solid foundation. A century hence, BNSF and MidAmerican Energy will continue to play major roles in the American economy. Insurance, moreover, will always be essential for both businesses and individuals – and no company brings greater resources to that arena than Berkshire. As we view these and other strengths, Charlie and I like your company’s prospects.

Intrinsic Business Value

As much as Charlie and I talk about intrinsic business value, we cannot tell you precisely what that number is for Berkshire shares (or, for that matter, any other stock). In our 2010 annual report, however, we laid out the three elements – one of which was qualitative – that we believe are the keys to a sensible estimate of Berkshire’s intrinsic value. That discussion is reproduced in full on pages 104-105.

Here is an update of the two quantitative factors: In 2012 our per-share investments increased 15.7% to \$113,786, and our per-share pre-tax earnings from businesses other than insurance and investments also increased 15.7% to \$8,085.

Since 1970, our per-share investments have increased at a rate of $19.4\%$ compounded annually, and our per-share earnings figure has grown at a $20.8\%$ clip. It is no coincidence that the price of Berkshire stock over the 42-year period has increased at a rate very similar to that of our two measures of value. Charlie and I like to see gains in both areas, but our strong emphasis will always be on building operating earnings.

* * * * * * * * * * * *

Now, let's examine the four major sectors of our operations. Each has vastly different balance sheet and income characteristics from the others. Lumping them together therefore impedes analysis. So we'll present them as four separate businesses, which is how Charlie and I view them.

Insurance

Let's look first at insurance, Berkshire's core operation and the engine that has propelled our expansion over the years.

Property-casualty (“P/C”) insurers receive premiums upfront and pay claims later. In extreme cases, such as those arising from certain workers’ compensation accidents, payments can stretch over decades. This collect-now, pay-later model leaves us holding large sums – money we call “float” – that will eventually go to others. Meanwhile, we get to invest this float for Berkshire’s benefit. Though individual policies and claims come and go, the amount of float we hold remains quite stable in relation to premium volume. Consequently, as our business grows, so does our float. And how we have grown, as the following table shows:

Year	Float (in $ millions)
1970	$ 39
1980	237
1990	1,632
2000	27,871
2010	65,832
2012	73,125

Last year I told you that our float was likely to level off or even decline a bit in the future. Our insurance CEOs set out to prove me wrong and $did$ , increasing float last year by \$2.5 billion. I now expect a further increase in 2013. But further gains will be tough to achieve. On the plus side, GEICO's float will almost certainly grow. In National Indemnity's reinsurance division, however, we have a number of run-off contracts whose float drifts downward. If we do experience a decline in float at some future time, it will be very gradual – at the outside no more than 2% in any year.

If our premiums exceed the total of our expenses and eventual losses, we register an underwriting profit that adds to the investment income our float produces. When such a profit is earned, we enjoy the use of free money – and, better yet, get paid for holding it. That’s like your taking out a loan and having the bank pay you interest.

Unfortunately, the wish of all insurers to achieve this happy result creates intense competition, so vigorous in most years that it causes the P/C industry as a whole to operate at a significant underwriting loss. This loss, in effect, is what the industry pays to hold its float. For example, State Farm, by far the country's largest insurer and a well-managed company besides, incurred an underwriting loss in eight of the eleven years ending in 2011. (Their financials for 2012 are not yet available.) There are a lot of ways to lose money in insurance, and the industry never ceases searching for new ones.

As noted in the first section of this report, we have now operated at an underwriting profit for ten consecutive years, our pre-tax gain for the period having totaled \$18.6 billion. Looking ahead, I believe we will continue to underwrite profitably in most years. If we do, our float will be better than free money.

So how does our attractive float affect the calculations of intrinsic value? When Berkshire's book value is calculated, the full amount of our float is deducted as a liability, just as if we had to pay it out tomorrow and were unable to replenish it. But that's an incorrect way to look at float, which should instead be viewed as a revolving fund. If float is both costless and long-enduring, which I believe Berkshire's will be, the true value of this liability is dramatically less than the accounting liability.

A partial offset to this overstated liability is \$15.5 billion of “goodwill” that is attributable to our insurance companies and included in book value as an asset. In effect, this goodwill represents the price we paid for the float-generating capabilities of our insurance operations. The cost of the goodwill, however, has no bearing on its true value. For example, if an insurance business sustains large and prolonged underwriting losses, any goodwill asset carried on the books should be deemed valueless, whatever its original cost.

Fortunately, that's not the case at Berkshire. Charlie and I believe the true economic value of our insurance goodwill – what we would happily pay to purchase an insurance operation producing float of similar quality – to be far in excess of its historic carrying value. The value of our float is one reason – a huge reason – why we believe Berkshire's intrinsic business value substantially exceeds its book value.

Let me emphasize once again that cost-free float is not an outcome to be expected for the P/C industry as a whole: There is very little “Berkshire-quality” float existing in the insurance world. In 37 of the 45 years ending in 2011, the industry’s premiums have been inadequate to cover claims plus expenses. Consequently, the industry’s overall return on tangible equity has for many decades fallen far short of the average return realized by American industry, a sorry performance almost certain to continue.

A further unpleasant reality adds to the industry's dim prospects: Insurance earnings are now benefitting from “legacy” bond portfolios that deliver much higher yields than will be available when funds are reinvested during the next few years – and perhaps for many years beyond that. Today’s bond portfolios are, in effect, wasting assets. Earnings of insurers will be hurt in a significant way as bonds mature and are rolled over.

* * * * * * * * * * * *

Berkshire's outstanding economics exist only because we have some terrific managers running some extraordinary insurance operations. Let me tell you about the major units.

First by float size is the Berkshire Hathaway Reinsurance Group, run by Ajit Jain. Ajit insures risks that no one else has the desire or the capital to take on. His operation combines capacity, speed, decisiveness and, most important, brains in a manner unique in the insurance business. Yet he never exposes Berkshire to risks that are inappropriate in relation to our resources. Indeed, we are far more conservative in avoiding risk than most large insurers. For example, if the insurance industry should experience a \$250 billion loss from some mega-catastrophe – a loss about triple anything it has ever experienced – Berkshire as a whole would likely record a significant profit for the year because it has so many streams of earnings. All other major insurers and reinsurers would meanwhile be far in the red, with some facing insolvency.

From a standing start in 1985, Ajit has created an insurance business with float of \$35 billion and a significant cumulative underwriting profit, a feat that no other insurance CEO has come close to matching. He has thus added a great many billions of dollars to the value of Berkshire. If you meet Ajit at the annual meeting, bow deeply.

* * * * * * * * * * * *

We have another reinsurance powerhouse in General Re, managed by Tad Montross.

At bottom, a sound insurance operation needs to adhere to four disciplines. It must (1) understand all exposures that might cause a policy to incur losses; (2) conservatively assess the likelihood of any exposure actually causing a loss and the probable cost if it does; (3) set a premium that, on average, will deliver a profit after both prospective loss costs and operating expenses are covered; and (4) be willing to walk away if the appropriate premium can't be obtained.

Many insurers pass the first three tests and flunk the fourth. They simply can't turn their back on business that is being eagerly written by their competitors. That old line, “The other guy is doing it, so we must as well,” spells trouble in any business, but none more so than insurance.

Tad has observed all four of the insurance commandments, and it shows in his results. General Re's huge float has been better than cost-free under his leadership, and we expect that, on average, it will continue to be. We are particularly enthusiastic about General Re's international life reinsurance business, which has achieved consistent and profitable growth since we acquired the company in 1998.

* * * * * * * * * * *

Finally, there is GEICO, the insurer on which I cut my teeth 62 years ago. GEICO is run by Tony Nicely, who joined the company at 18 and completed 51 years of service in 2012.

I rub my eyes when I look at what Tony has accomplished. Last year, it should be noted, his record was considerably better than is indicated by GEICO's GAAP underwriting profit of \$680 million. Because of a change in accounting rules at the beginning of the year, we recorded a charge to GEICO's underwriting earnings of \$410 million. This item had nothing to do with 2012's operating results, changing neither cash, revenues, expenses nor taxes. In effect, the writedown simply widened the already huge difference between GEICO's intrinsic value and the value at which we carry it on our books.

GEICO earned its underwriting profit, moreover, despite the company suffering its largest single loss in history. The cause was Hurricane Sandy, which cost GEICO more than three times the loss it sustained from Katrina, the previous record-holder. We insured 46,906 vehicles that were destroyed or damaged in the storm, a staggering number reflecting GEICO's leading market share in the New York metropolitan area.

Last year GEICO enjoyed a meaningful increase in both the renewal rate for existing policyholders (“persistence”) and in the percentage of rate quotations that resulted in sales (“closures”). Big dollars ride on those two factors: A sustained gain in persistency of a bare one percentage point increases intrinsic value by more than \$1 billion. GEICO’s gains in 2012 offer dramatic proof that when people check the company’s prices, they usually find they can save important sums. (Give us a try at 1-800-847-7536 or GEICO.com. Be sure to mention that you are a shareholder; that fact will usually result in a discount.)

* * * * * * * * * * * *

In addition to our three major insurance operations, we own a group of smaller companies, most of them plying their trade in odd corners of the insurance world. In aggregate, these companies have consistently delivered an underwriting profit. Moreover, as the table below shows, they also provide us with substantial float. Charlie and I treasure these companies and their managers.

Late in 2012, we enlarged this group by acquiring Guard Insurance, a Wilkes-Barre company that writes workers compensation insurance, primarily for smaller businesses. Guard's annual premiums total about \$300 million. The company has excellent prospects for growth in both its traditional business and new lines it has begun to offer.

	Underwriting Profit		Yearend Float
	(in millions)
Insurance Operations	2012	2011	2012	2011
BH Reinsurance	$ 304	$(714)	$34,821	$33,728
General Re	355	144	20,128	19,714
GEICO	680*	576	11,578	11,169
Other Primary	286	242	6,598	5,960
	$1,625	$ 248	$73,125	$70,571

*After a \$410 million charge against earnings arising from an industry-wide accounting change.

Among large insurance operations, Berkshire's impresses me as the best in the world. It was our lucky day when, in March 1967, Jack Ringwalt sold us his two property-casualty insurers for \$8.6 million.

Regulated, Capital-Intensive Businesses

We have two major operations, BNSF and MidAmerican Energy, that have important common characteristics distinguishing them from our other businesses. Consequently, we assign them their own section in this letter and split out their combined financial statistics in our GAAP balance sheet and income statement.

A key characteristic of both companies is their huge investment in very long-lived, regulated assets, with these partially funded by large amounts of long-term debt that is not guaranteed by Berkshire. Our credit is in fact not needed because each business has earning power that even under terrible conditions amply covers its interest requirements. In last year's tepid economy, for example, BNSF's interest coverage was 9.6x. (Our definition of coverage is pre-tax earnings/interest, not EBITDA/interest, a commonly-used measure we view as deeply flawed.) At MidAmerican, meanwhile, two key factors ensure its ability to service debt under all circumstances: the company's recession-resistant earnings, which result from our exclusively offering an essential service, and its great diversity of earnings streams, which shield it from being seriously harmed by any single regulatory body.

Every day, our two subsidiaries power the American economy in major ways:

- BNSF carries about $15\%$ (measured by ton-miles) of all inter-city freight, whether it is transported by truck, rail, water, air, or pipeline. Indeed, we move more ton-miles of goods than anyone else, a fact making BNSF the most important artery in our economy's circulatory system.

BNSF also moves its cargo in an extraordinarily fuel-efficient and environmentally friendly way, carrying a ton of freight about 500 miles on a single gallon of diesel fuel. Trucks taking on the same job guzzle about four times as much fuel.

- MidAmerican's electric utilities serve regulated retail customers in ten states. Only one utility holding company serves more states. In addition, we are the leader in renewables: first, from a standing start nine years ago, we now account for $6\%$ of the country's wind generation capacity. Second, when we complete three projects now under construction, we will own about $14\%$ of U.S. solar-generation capacity.

Projects like these require huge capital investments. Upon completion, indeed, our renewables portfolio will have cost \$13 billion. We relish making such commitments if they promise reasonable returns – and on that front, we put a large amount of trust in future regulation.

Our confidence is justified both by our past experience and by the knowledge that society will forever need massive investment in both transportation and energy. It is in the self-interest of governments to treat capital providers in a manner that will ensure the continued flow of funds to essential projects. And it is in our self-interest to conduct our operations in a manner that earns the approval of our regulators and the people they represent.

Our managers must think today of what the country will need far down the road. Energy and transportation projects can take many years to come to fruition; a growing country simply can't afford to get behind the curve.

We have been doing our part to make sure that doesn't happen. Whatever you may have heard about our country's crumbling infrastructure in no way applies to BNSF or railroads generally. America's rail system has never been in better shape, a consequence of huge investments by the industry. We are not, however, resting on our laurels: BNSF will spend about \$4 billion on the railroad in 2013, roughly double its depreciation charge and more than any railroad has spent in a single year.

In Matt Rose, at BNSF, and Greg Abel, at MidAmerican, we have two outstanding CEOs. They are extraordinary managers who have developed businesses that serve both their customers and owners well. Each has my gratitude and each deserves yours. Here are the key figures for their businesses:

MidAmerican (89.8% owned)	Earnings (in millions)
	2012	2011
U.K. utilities	$429	$469
Iowa utility	236	279
Western utilities	737	771
Pipelines	383	388
HomeServices	82	39
Other (net)	91	36
Operating earnings before corporate interest and taxes	1,958	1,982
Interest	314	336
Income taxes	172	315
Net earnings	$1,472	$1,331
Earnings applicable to Berkshire	$1,323	$1,204
BNSF	Earnings (in millions)
	2012	2011
Revenues	$20,835	$19,548
Operating expenses	14,835	14,247
Operating earnings before interest and taxes	6,000	5,301
Interest (net)	623	560
Income taxes	2,005	1,769
Net earnings	$3,372	$2,972

Sharp-eyed readers will notice an incongruity in the MidAmerican earnings tabulation. What in the world is HomeServices, a real estate brokerage operation, doing in a section entitled “Regulated, Capital-Intensive Businesses?”

Well, its ownership came with MidAmerican when we bought control of that company in 2000. At that time, I focused on MidAmerican's utility operations and barely noticed HomeServices, which then owned only a few real estate brokerage companies.

Since then, however, the company has regularly added residential brokers – three in 2012 – and now has about 16,000 agents in a string of major U.S. cities. (Our real estate brokerage companies are listed on page 107.) In 2012, our agents participated in \$42 billion of home sales, up 33% from 2011.

Additionally, HomeServices last year purchased 67% of the Prudential and Real Living franchise operations, which together license 544 brokerage companies throughout the country and receive a small royalty on their sales. We have an arrangement to purchase the balance of those operations within five years. In the coming years, we will gradually rebrand both our franchisees and the franchise firms we own as Berkshire Hathaway HomeServices.

Ron Peltier has done an outstanding job in managing HomeServices during a depressed period. Now, as the housing market continues to strengthen, we expect earnings to rise significantly.

Manufacturing, Service and Retailing Operations

Our activities in this part of Berkshire cover the waterfront. Let's look, though, at a summary balance sheet and earnings statement for the entire group.

Balance Sheet 12/31/12 (in millions)

Assets		Liabilities and Equity Notes payable	$1,454
Cash and equivalents	$5,338
Accounts and notes receivable	7,382	Other current liabilities	8,527
Inventory	9,675	Total current liabilities	9,981
Other current assets	734
Total current assets	23,129
		Deferred taxes	4,907
Goodwill and other intangibles	26,017	Term debt and other liabilities	5,826
Fixed assets	18,871	Non-controlling interests	2,062
Other assets	3,416	Berkshire equity	48,657
	$71,433		$71,433

Earnings Statement (in millions)

	2012	2011*	2010
Revenues	$83,255	$72,406	$66,610
Operating expenses	76,978	67,239	62,225
Interest expense	146	130	111
Pre-tax earnings	6,131	5,037	4,274
Income taxes and non-controlling interests	2,432	1,998	1,812
Net earnings	$3,699	$3,039	$2,462

*Includes earnings of Lubrizol from September 16.

Our income and expense data conforming to Generally Accepted Accounting Principles (“GAAP”) is on page 29. In contrast, the operating expense figures above are non-GAAP. In particular, they exclude some purchase-accounting items, primarily the amortization of certain intangible assets. We present the data in this manner because Charlie and I believe the adjusted numbers more accurately reflect the real expenses and profits of the businesses aggregated in the table.

I won't explain all of the adjustments – some are small and arcane – but serious investors should understand the disparate nature of intangible assets: Some truly deplete over time while others never lose value. With software, for example, amortization charges are very real expenses. Charges against other intangibles such as the amortization of customer relationships, however, arise through purchase-accounting rules and are clearly not real expenses. GAAP accounting draws no distinction between the two types of charges. Both, that is, are recorded as expenses when calculating earnings – even though from an investor's viewpoint they could not be more different.

In the GAAP-compliant figures we show on page 29, amortization charges of \$600 million for the companies included in this section are deducted as expenses. We would call about 20% of these “real” – and indeed that is the portion we have included in the table above – and the rest not. This difference has become significant because of the many acquisitions we have made.

“Non-real” amortization expense also looms large at some of our major investees. IBM has made many small acquisitions in recent years and now regularly reports “adjusted operating earnings,” a non-GAAP figure that excludes certain purchase-accounting adjustments. Analysts focus on this number, as they should.

A “non-real” amortization charge at Wells Fargo, however, is not highlighted by the company and never, to my knowledge, has been noted in analyst reports. The earnings that Wells Fargo reports are heavily burdened by an “amortization of core deposits” charge, the implication being that these deposits are disappearing at a fairly rapid clip. Yet core deposits regularly increase. The charge last year was about \$1.5 billion. In no sense, except GAAP accounting, is this whopping charge an expense.

And that ends today's accounting lecture. Why is no one shouting “More, more?”

* * * * * * * * * * * *

The crowd of companies in this section sell products ranging from lollipops to jet airplanes. Some of the businesses enjoy terrific economics, measured by earnings on unleveraged net tangible assets that run from 25% after-tax to more than 100%. Others produce good returns in the area of 12-20%. A few, however, have very poor returns, a result of some serious mistakes I made in my job of capital allocation.

More than 50 years ago, Charlie told me that it was far better to buy a wonderful business at a fair price than to buy a fair business at a wonderful price. Despite the compelling logic of his position, I have sometimes reverted to my old habit of bargain-hunting, with results ranging from tolerable to terrible. Fortunately, my mistakes have usually occurred when I made smaller purchases. Our large acquisitions have generally worked out well and, in a few cases, more than well.

Viewed as a single entity, therefore, the companies in this group are an excellent business. They employ \$22.6 billion of net tangible assets and, on that base, earned 16.3% after-tax.

Of course, a business with terrific economics can be a bad investment if the price paid is excessive. We have paid substantial premiums to net tangible assets for most of our businesses, a cost that is reflected in the large figure we show for intangible assets. Overall, however, we are getting a decent return on the capital we have deployed in this sector. Furthermore, the intrinsic value of the businesses, in aggregate, exceeds their carrying value by a good margin. Even so, the difference between intrinsic value and carrying value in the insurance and regulated-industry segments is far greater. It is there that the huge winners reside.

* * * * * * * * * * * *

Marmon provides an example of a clear and substantial gap existing between book value and intrinsic value. Let me explain the odd origin of this differential.

Last year I told you that we had purchased additional shares in Marmon, raising our ownership to 80% (up from the 64% we acquired in 2008). I also told you that GAAP accounting required us to immediately record the 2011 purchase on our books at far less than what we paid. I’ve now had a year to think about this weird accounting rule, but I’ve yet to find an explanation that makes any sense – nor can Charlie or Marc Hamburg, our CFO, come up with one. My confusion increases when I am told that if we hadn’t already owned 64%, the 16% we purchased in 2011 would have been entered on our books at our cost.

In 2012 (and in early 2013, retroactive to yearend 2012) we acquired an additional $10\%$ of Marmon and the same bizarre accounting treatment was required. The \$700 million write-off we immediately incurred had no effect on earnings but did reduce book value and, therefore, 2012's gain in net worth.

The cost of our recent 10% purchase implies a \$12.6 billion value for the 90% of Marmon we now own. Our balance-sheet carrying value for the 90%, however, is \$8 billion. Charlie and I believe our current purchase represents excellent value. If we are correct, our Marmon holding is worth at least \$4.6 billion more than its carrying value.

Marmon is a diverse enterprise, comprised of about 150 companies operating in a wide variety of industries. Its largest business involves the ownership of tank cars that are leased to a variety of shippers, such as oil and chemical companies. Marmon conducts this business through two subsidiaries, Union Tank Car in the U.S. and Procor in Canada.

Union Tank Car has been around a long time, having been owned by the Standard Oil Trust until that empire was broken up in 1911. Look for its UTLX logo on tank cars when you watch trains roll by. As a Berkshire shareholder, you own the cars with that insignia. When you spot a UTLX car, puff out your chest a bit and enjoy the same satisfaction that John D. Rockefeller undoubtedly experienced as he viewed his fleet a century ago.

Tank cars are owned by either shippers or lessors, not by railroads. At yearend Union Tank Car and Procor together owned 97,000 cars having a net book value of \$4 billion. A new car, it should be noted, costs upwards of \$100,000. Union Tank Car is also a major manufacturer of tank cars – some of them to be sold but most to be owned by it and leased out. Today, its order book extends well into 2014.

At both BNSF and Marmon, we are benefitting from the resurgence of U.S. oil production. In fact, our railroad is now transporting about 500,000 barrels of oil daily, roughly 10% of the total produced in the “lower 48” (i.e. not counting Alaska and offshore). All indications are that BNSF’s oil shipments will grow substantially in coming years.

* * * * * * * * * * * *

Space precludes us from going into detail about the many other businesses in this segment. Company-specific information about the 2012 operations of some of the larger units appears on pages 76 to 79.

Finance and Financial Products

This sector, our smallest, includes two rental companies, XTRA (trailers) and CORT (furniture), as well as Clayton Homes, the country's leading producer and financer of manufactured homes. Aside from these $100\%$ -owned subsidiaries, we also include in this category a collection of financial assets and our $50\%$ interest in Berkadia Commercial Mortgage.

We include Clayton in this sector because it owns and services 332,000 mortgages, totaling \$13.7 billion. In large part, these loans have been made to lower and middle-income families. Nevertheless, the loans have performed well throughout the housing collapse, thereby validating our conviction that a reasonable down payment and a sensible payments-to-income ratio will ward off outsized foreclosure losses, even during stressful times.

Clayton also produced 25,872 manufactured homes last year, up $13.5\%$ from 2011. That output accounted for about $4.8\%$ of all single-family residences built in the country, a share that makes Clayton America's number one homebuilder.

CORT and XTRA are leaders in their industries as well. Our expenditures for new rental equipment at XTRA totaled \$256 million in 2012, more than double its depreciation expense. While competitors fret about today's uncertainties, XTRA is preparing for tomorrow.

Berkadia continues to do well. Our partners at Leucadia do most of the work in this venture, an arrangement that Charlie and I happily embrace.

Here's the pre-tax earnings recap for this sector:

	2012	2011
	(in millions)
Berkadia	$ 35	$ 25
Clayton	255	154
CORT	42	29
XTRA	106	126
Net financial income*	410	440
	$848	$774

*Excludes capital gains or losses

Investments

Below we show our common stock investments that at yearend had a market value of more than \$1 billion.

Shares	Company	Percentage of Company Owned	12/31/12
			Cost*	Market
			(in millions)
151,610,700	American Express Company	13.7	$ 1,287	$ 8,715
400,000,000	The Coca-Cola Company	8.9	1,299	14,500
24,123,911	ConocoPhillips	2.0	1,219	1,399
22,999,600	DIRECTV	3.8	1,057	1,154
68,115,484	International Business Machines Corp.	6.0	11,680	13,048
28,415,250	Moody’s Corporation	12.7	287	1,430
20,060,390	Munich Re	11.3	2,990	3,599
20,668,118	Phillips 66	3.3	660	1,097
3,947,555	POSCO	5.1	768	1,295
52,477,678	The Procter & Gamble Company	1.9	336	3,563
25,848,838	Sanofi	2.0	2,073	2,438
415,510,889	Tesco plc	5.2	2,350	2,268
78,060,769	U.S. Bancorp	4.2	2,401	2,493
54,823,433	Wal-Mart Stores, Inc.	1.6	2,837	3,741
456,170,061	Wells Fargo & Company	8.7	10,906	15,592
	Others		7,646	11,330
	Total Common Stocks Carried at Market		$49,796	$87,662

*This is our actual purchase price and also our tax basis; GAAP “cost” differs in a few cases because of write-ups or write-downs that have been required.

One point about the composition of this list deserves mention. In Berkshire's past annual reports, every stock itemized in this space has been bought by me, in the sense that I made the decision to buy it for Berkshire. But starting with this list, any investment made by Todd Combs or Ted Weschler – or a combined purchase by them – that meets the dollar threshold for the list (\$1 billion this year) will be included. Above is the first such stock, DIRECTV, which both Todd and Ted hold in their portfolios and whose combined holdings at the end of 2012 were valued at the \$1.15 billion shown.

Todd and Ted also manage the pension funds of certain Berkshire subsidiaries, while others, for regulatory reasons, are managed by outside advisers. We do not include holdings of the pension funds in our annual report tabulations, though their portfolios often overlap Berkshire's.

* * * * * * * * * * * *

We continue to wind down the part of our derivatives portfolio that involved the assumption by Berkshire of insurance-like risks. (Our electric and gas utility businesses, however, will continue to use derivatives for operational purposes.) New commitments would require us to post collateral and, with minor exceptions, we are unwilling to do that. Markets can behave in extraordinary ways, and we have no interest in exposing Berkshire to some out-of-the-blue event in the financial world that might require our posting mountains of cash on a moment's notice.

Charlie and I believe in operating with many redundant layers of liquidity, and we avoid any sort of obligation that could drain our cash in a material way. That reduces our returns in 99 years out of 100. But we will survive in the $100^{\text{th}}$ while many others fail. And we will sleep well in all 100.

The derivatives we have sold that provide credit protection for corporate bonds will all expire in the next year. It’s now almost certain that our profit from these contracts will approximate \$1 billion pre-tax. We also received very substantial sums upfront on these derivatives, and the “float” attributable to them has averaged about \$2 billion over their five-year lives. All told, these derivatives have provided a more-than-satisfactory result, especially considering the fact that we were guaranteeing corporate credits – mostly of the high-yield variety – throughout the financial panic and subsequent recession.

In our other major derivatives commitment, we sold long-term puts on four leading stock indices in the U.S., U.K., Europe and Japan. These contracts were initiated between 2004 and 2008 and even under the worst of circumstances have only minor collateral requirements. In 2010 we unwound about 10% of our exposure at a profit of \$222 million. The remaining contracts expire between 2018 and 2026. Only the index value at expiration date counts; our counterparties have no right to early termination.

Berkshire received premiums of \$4.2 billion when we wrote the contracts that remain outstanding. If all of these contracts had come due at yearend 2011, we would have had to pay \$6.2 billion; the corresponding figure at yearend 2012 was \$3.9 billion. With this large drop in immediate settlement liability, we reduced our GAAP liability at yearend 2012 to \$7.5 billion from \$8.5 billion at the end of 2011. Though it’s no sure thing, Charlie and I believe it likely that the final liability will be considerably less than the amount we currently carry on our books. In the meantime, we can invest the \$4.2 billion of float derived from these contracts as we see fit.

We Buy Some Newspapers . . . Newspapers?

During the past fifteen months, we acquired 28 daily newspapers at a cost of \$344 million. This may puzzle you for two reasons. First, I have long told you in these letters and at our annual meetings that the circulation, advertising and profits of the newspaper industry overall are certain to decline. That prediction still holds. Second, the properties we purchased fell far short of meeting our oft-stated size requirements for acquisitions.

We can address the second point easily. Charlie and I love newspapers and, if their economics make sense, will buy them even when they fall far short of the size threshold we would require for the purchase of, say, a widget company. Addressing the first point requires me to provide a more elaborate explanation, including some history.

News, to put it simply, is what people don't know that they want to know. And people will seek their news – what's important to them – from whatever sources provide the best combination of immediacy, ease of access, reliability, comprehensiveness and low cost. The relative importance of these factors varies with the nature of the news and the person wanting it.

Before television and the Internet, newspapers were the primary source for an incredible variety of news, a fact that made them indispensable to a very high percentage of the population. Whether your interests were international, national, local, sports or financial quotations, your newspaper usually was first to tell you the latest information. Indeed, your paper contained so much you wanted to learn that you received your money's worth, even if only a small number of its pages spoke to your specific interests. Better yet, advertisers typically paid almost all of the product's cost, and readers rode their coattails.

Additionally, the ads themselves delivered information of vital interest to hordes of readers, in effect providing even more “news.” Editors would cringe at the thought, but for many readers learning what jobs or apartments were available, what supermarkets were carrying which weekend specials, or what movies were showing where and when was far more important than the views expressed on the editorial page.

In turn, the local paper was indispensable to advertisers. If Sears or Safeway built stores in Omaha, they required a “megaphone” to tell the city’s residents why their stores should be visited today. Indeed, big department stores and grocers vied to outshout their competition with multi-page spreads, knowing that the goods they advertised would fly off the shelves. With no other megaphone remotely comparable to that of the newspaper, ads sold themselves.

As long as a newspaper was the only one in its community, its profits were certain to be extraordinary; whether it was managed well or poorly made little difference. (As one Southern publisher famously confessed, “I owe my exalted position in life to two great American institutions – nepotism and monopoly.”)

Over the years, almost all cities became one-newspaper towns (or harbored two competing papers that joined forces to operate as a single economic unit). This contraction was inevitable because most people wished to read and pay for only one paper. When competition existed, the paper that gained a significant lead in circulation almost automatically received the most ads. That left ads drawing readers and readers drawing ads. This symbiotic process spelled doom for the weaker paper and became known as “survival of the fattest.”

Now the world has changed. Stock market quotes and the details of national sports events are old news long before the presses begin to roll. The Internet offers extensive information about both available jobs and homes. Television bombards viewers with political, national and international news. In one area of interest after another, newspapers have therefore lost their “primacy.” And, as their audiences have fallen, so has advertising. (Revenues from “help wanted” classified ads – long a huge source of income for newspapers – have plunged more than 90% in the past 12 years.)

Newspapers continue to reign supreme, however, in the delivery of local news. If you want to know what's going on in your town – whether the news is about the mayor or taxes or high school football – there is no substitute for a local newspaper that is doing its job. A reader's eyes may glaze over after they take in a couple of paragraphs about Canadian tariffs or political developments in Pakistan; a story about the reader himself or his neighbors will be read to the end. Wherever there is a pervasive sense of community, a paper that serves the special informational needs of that community will remain indispensable to a significant portion of its residents.

Even a valuable product, however, can self-destruct from a faulty business strategy. And that process has been underway during the past decade at almost all papers of size. Publishers – including Berkshire in Buffalo – have offered their paper free on the Internet while charging meaningful sums for the physical specimen. How could this lead to anything other than a sharp and steady drop in sales of the printed product? Falling circulation, moreover, makes a paper less essential to advertisers. Under these conditions, the “virtuous circle” of the past reverses.

The Wall Street Journal went to a pay model early. But the main exemplar for local newspapers is the Arkansas Democrat-Gazette, published by Walter Hussman, Jr. Walter also adopted a pay format early, and over the past decade his paper has retained its circulation far better than any other large paper in the country. Despite Walter's powerful example, it's only been in the last year or so that other papers, including Berkshire's, have explored pay arrangements. Whatever works best – and the answer is not yet clear – will be copied widely.

* * * * * * * * * * * *

Charlie and I believe that papers delivering comprehensive and reliable information to tightly-bound communities and having a sensible Internet strategy will remain viable for a long time. We do not believe that success will come from cutting either the news content or frequency of publication. Indeed, skimpy news coverage will almost certainly lead to skimpy readership. And the less-than-daily publication that is now being tried in some large towns or cities – while it may improve profits in the short term – seems certain to diminish the papers' relevance over time. Our goal is to keep our papers loaded with content of interest to our readers and to be paid appropriately by those who find us useful, whether the product they view is in their hands or on the Internet.

Our confidence is buttressed by the availability of Terry Kroeger's outstanding management group at the Omaha World-Herald, a team that has the ability to oversee a large group of papers. The individual papers, however, will be independent in their news coverage and editorial opinions. (I voted for Obama; of our 12 dailies that endorsed a presidential candidate, 10 opted for Romney.)

Our newspapers are certainly not insulated from the forces that have been driving revenues downward. Still, the six small dailies we owned throughout 2012 had unchanged revenues for the year, a result far superior to that experienced by big-city dailies. Moreover, the two large papers we operated throughout the year – The Buffalo News and the Omaha World-Herald – held their revenue loss to 3%, which was also an above-average outcome. Among newspapers in America’s 50 largest metropolitan areas, our Buffalo and Omaha papers rank near the top in circulation penetration of their home territories.

This popularity is no accident: Credit the editors of those papers – Margaret Sullivan at the News and Mike Reilly at the World-Herald — for delivering information that has made their publications indispensable to community-interested readers. (Margaret, I regret to say, recently left us to join The New York Times, whose job offers are tough to turn down. That paper made a great hire, and we wish her the best.)

Berkshire's cash earnings from its papers will almost certainly trend downward over time. Even a sensible Internet strategy will not be able to prevent modest erosion. At our cost, however, I believe these papers will meet or exceed our economic test for acquisitions. Results to date support that belief.

Charlie and I, however, still operate under economic principle 11 (detailed on page 99) and will not continue the operation of any business doomed to unending losses. One daily paper that we acquired in a bulk purchase from Media General was significantly unprofitable under that company's ownership. After analyzing the paper's results, we saw no remedy for the losses and reluctantly shut it down. All of our remaining dailies, however, should be profitable for a long time to come. (They are listed on page 108.) At appropriate prices – and that means at a very low multiple of current earnings – we will purchase more papers of the type we like.

* * * * * * * * * * * *

A milestone in Berkshire's newspaper operations occurred at yearend when Stan Lipsey retired as publisher of The Buffalo News. It's no exaggeration for me to say that the News might now be extinct were it not for Stan.

Charlie and I acquired the News in April 1977. It was an evening paper, dominant on weekdays but lacking a Sunday edition. Throughout the country, the circulation trend was toward morning papers. Moreover, Sunday was becoming ever more critical to the profitability of metropolitan dailies. Without a Sunday paper, the News was destined to lose out to its morning competitor, which had a fat and entrenched Sunday product.

We therefore began to print a Sunday edition late in 1977. And then all hell broke loose. Our competitor sued us, and District Judge Charles Brieant, Jr. authored a harsh ruling that crippled the introduction of our paper. His ruling was later reversed – after 17 long months – in a 3-0 sharp rebuke by the Second Circuit Court of Appeals. While the appeal was pending, we lost circulation, hemorrhaged money and stood in constant danger of going out of business.

Enter Stan Lipsey, a friend of mine from the 1960s, who, with his wife, had sold Berkshire a small Omaha weekly. I found Stan to be an extraordinary newspaperman, knowledgeable about every aspect of circulation, production, sales and editorial. (He was a key person in gaining that small weekly a Pulitzer Prize in 1973.) So when I was in big trouble at the News, I asked Stan to leave his comfortable way of life in Omaha to take over in Buffalo.

He never hesitated. Along with Murray Light, our editor, Stan persevered through four years of very dark days until the News won the competitive struggle in 1982. Ever since, despite a difficult Buffalo economy, the performance of the News has been exceptional. As both a friend and as a manager, Stan is simply the best.

Dividends

A number of Berkshire shareholders – including some of my good friends – would like Berkshire to pay a cash dividend. It puzzles them that we relish the dividends we receive from most of the stocks that Berkshire owns, but pay out nothing ourselves. So let’s examine when dividends do and don’t make sense for shareholders.

A profitable company can allocate its earnings in various ways (which are not mutually exclusive). A company's management should first examine reinvestment possibilities offered by its current business – projects to become more efficient, expand territorially, extend and improve product lines or to otherwise widen the economic moat separating the company from its competitors.

I ask the managers of our subsidiaries to unendingly focus on moat-widening opportunities, and they find many that make economic sense. But sometimes our managers misfire. The usual cause of failure is that they start with the answer they want and then work backwards to find a supporting rationale. Of course, the process is subconscious; that's what makes it so dangerous.

Your chairman has not been free of this sin. In Berkshire's 1986 annual report, I described how twenty years of management effort and capital improvements in our original textile business were an exercise in futility. I wanted the business to succeed and wished my way into a series of bad decisions. (I even bought another New England textile company.) But wishing makes dreams come true only in Disney movies; it's poison in business.

Despite such past miscues, our first priority with available funds will always be to examine whether they can be intelligently deployed in our various businesses. Our record \$12.1 billion of fixed-asset investments and bolt-on acquisitions in 2012 demonstrate that this is a fertile field for capital allocation at Berkshire. And here we have an advantage: Because we operate in so many areas of the economy, we enjoy a range of choices far wider than that open to most corporations. In deciding what to do, we can water the flowers and skip over the weeds.

Even after we deploy hefty amounts of capital in our current operations, Berkshire will regularly generate a lot of additional cash. Our next step, therefore, is to search for acquisitions unrelated to our current businesses. Here our test is simple: Do Charlie and I think we can effect a transaction that is likely to leave our shareholders wealthier on a per-share basis than they were prior to the acquisition?

I have made plenty of mistakes in acquisitions and will make more. Overall, however, our record is satisfactory, which means that our shareholders are far wealthier today than they would be if the funds we used for acquisitions had instead been devoted to share repurchases or dividends.

But, to use the standard disclaimer, past performance is no guarantee of future results. That's particularly true at Berkshire: Because of our present size, making acquisitions that are both meaningful and sensible is now more difficult than it has been during most of our years.

Nevertheless, a large deal still offers us possibilities to add materially to per-share intrinsic value. BNSF is a case in point: It is now worth considerably more than our carrying value. Had we instead allocated the funds required for this purchase to dividends or repurchases, you and I would have been worse off. Though large transactions of the BNSF kind will be rare, there are still some whales in the ocean.

The third use of funds – repurchases – is sensible for a company when its shares sell at a meaningful discount to conservatively calculated intrinsic value. Indeed, disciplined repurchases are the surest way to use funds intelligently: It’s hard to go wrong when you’re buying dollar bills for 80¢ or less. We explained our criteria for repurchases in last year’s report and, if the opportunity presents itself, we will buy large quantities of our stock. We originally said we would not pay more than 110% of book value, but that proved unrealistic. Therefore, we increased the limit to 120% in December when a large block became available at about 116% of book value.

But never forget: In repurchase decisions, price is all-important. Value is destroyed when purchases are made above intrinsic value. The directors and I believe that continuing shareholders are benefitted in a meaningful way by purchases up to our 120% limit.

And that brings us to dividends. Here we have to make a few assumptions and use some math. The numbers will require careful reading, but they are essential to understanding the case for and against dividends. So bear with me.

We'll start by assuming that you and I are the equal owners of a business with \$2 million of net worth. The business earns 12% on tangible net worth – \$240,000 – and can reasonably expect to earn the same 12% on reinvested earnings. Furthermore, there are outsiders who always wish to buy into our business at 125% of net worth. Therefore, the value of what we each own is now \$1.25 million.

You would like to have the two of us shareholders receive one-third of our company's annual earnings and have two-thirds be reinvested. That plan, you feel, will nicely balance your needs for both current income and capital growth. So you suggest that we pay out \$80,000 of current earnings and retain \$160,000 to increase the future earnings of the business. In the first year, your dividend would be \$40,000, and as earnings grew and the one-third payout was maintained, so too would your dividend. In total, dividends and stock value would increase 8% each year (12% earned on net worth less 4% of net worth paid out).

After ten years our company would have a net worth of \$4,317,850 (the original \$2 million compounded at 8%) and your dividend in the upcoming year would be \$86,357. Each of us would have shares worth \$2,698,656 (125% of our half of the company's net worth). And we would live happily ever after – with dividends and the value of our stock continuing to grow at 8% annually.

There is an alternative approach, however, that would leave us even happier. Under this scenario, we would leave all earnings in the company and each sell 3.2% of our shares annually. Since the shares would be sold at 125% of book value, this approach would produce the same \$40,000 of cash initially, a sum that would grow annually. Call this option the “sell-off” approach.

Under this “sell-off” scenario, the net worth of our company increases to \$6,211,696 after ten years (\$2 million compounded at 12%). Because we would be selling shares each year, our percentage ownership would have declined, and, after ten years, we would each own 36.12% of the business. Even so, your share of the net worth of the company at that time would be \$2,243,540. And, remember, every dollar of net worth attributable to each of us can be sold for \$1.25. Therefore, the market value of your remaining shares would be \$2,804,425, about 4% greater than the value of your shares if we had followed the dividend approach.

Moreover, your annual cash receipts from the sell-off policy would now be running 4% more than you would have received under the dividend scenario. Voila! – you would have both more cash to spend annually and more capital value.

This calculation, of course, assumes that our hypothetical company can earn an average of 12% annually on net worth and that its shareholders can sell their shares for an average of 125% of book value. To that point, the S&P 500 earns considerably more than 12% on net worth and sells at a price far above 125% of that net worth. Both assumptions also seem reasonable for Berkshire, though certainly not assured.

Moreover, on the plus side, there also is a possibility that the assumptions will be exceeded. If they are, the argument for the sell-off policy becomes even stronger. Over Berkshire's history – admittedly one that won't come close to being repeated – the sell-off policy would have produced results for shareholders dramatically superior to the dividend policy.

Aside from the favorable math, there are two further – and important – arguments for a sell-off policy. First, dividends impose a specific cash-out policy upon all shareholders. If, say, 40% of earnings is the policy, those who wish 30% or 50% will be thwarted. Our 600,000 shareholders cover the waterfront in their desires for cash. It is safe to say, however, that a great many of them – perhaps even most of them – are in a net-savings mode and logically should prefer no payment at all.

The sell-off alternative, on the other hand, lets each shareholder make his own choice between cash receipts and capital build-up. One shareholder can elect to cash out, say, 60% of annual earnings while other shareholders elect 20% or nothing at all. Of course, a shareholder in our dividend-paying scenario could turn around and use his dividends to purchase more shares. But he would take a beating in doing so: He would both incur taxes and also pay a 25% premium to get his dividend reinvested. (Keep remembering, open-market purchases of the stock take place at 125% of book value.)

The second disadvantage of the dividend approach is of equal importance: The tax consequences for all taxpaying shareholders are inferior – usually far inferior – to those under the sell-off program. Under the dividend program, all of the cash received by shareholders each year is taxed whereas the sell-off program results in tax on only the gain portion of the cash receipts.

Let me end this math exercise – and I can hear you cheering as I put away the dentist drill – by using my own case to illustrate how a shareholder's regular disposals of shares can be accompanied by an increased investment in his or her business. For the last seven years, I have annually given away about 4 $^{1/4}$ % of my Berkshire shares. Through this process, my original position of 712,497,000 B-equivalent shares (split-adjusted) has decreased to 528,525,623 shares. Clearly my ownership percentage of the company has significantly decreased.

Yet my investment in the business has actually increased: The book value of my current interest in Berkshire considerably exceeds the book value attributable to my holdings of seven years ago. (The actual figures are \$28.2 billion for 2005 and \$40.2 billion for 2012.) In other words, I now have far more money working for me at Berkshire even though my ownership of the company has materially decreased. It’s also true that my share of both Berkshire’s intrinsic business value and the company’s normal earning power is far greater than it was in 2005. Over time, I expect this accretion of value to continue – albeit in a decidedly irregular fashion – even as I now annually give away more than 4 $\frac{1}{2}$ % of my shares (the increase having occurred because I’ve recently doubled my lifetime pledges to certain foundations).

* * * * * * * * * * * *

Above all, dividend policy should always be clear, consistent and rational. A capricious policy will confuse owners and drive away would-be investors. Phil Fisher put it wonderfully 54 years ago in Chapter 7 of his Common Stocks and Uncommon Profits, a book that ranks behind only The Intelligent Investor and the 1940 edition of Security Analysis in the all-time-best list for the serious investor. Phil explained that you can successfully run a restaurant that serves hamburgers or, alternatively, one that features Chinese food. But you can't switch capriciously between the two and retain the fans of either.

Most companies pay consistent dividends, generally trying to increase them annually and cutting them very reluctantly. Our “Big Four” portfolio companies follow this sensible and understandable approach and, in certain cases, also repurchase shares quite aggressively.

We applaud their actions and hope they continue on their present paths. We like increased dividends, and we love repurchases at appropriate prices.

At Berkshire, however, we have consistently followed a different approach that we know has been sensible and that we hope has been made understandable by the paragraphs you have just read. We will stick with this policy as long as we believe our assumptions about the book-value buildup and the market-price premium seem reasonable. If the prospects for either factor change materially for the worse, we will reexamine our actions.

The Annual Meeting

The annual meeting will be held on Saturday, May $4^{\text{th}}$ at the CenturyLink Center. Carrie Sova will be in charge. (Though that's a new name, it's the same wonderful Carrie as last year; she got married in June to a very lucky guy.) All of our headquarters group pitches in to help her; the whole affair is a homemade production, and I couldn't be more proud of those who put it together.

The doors will open at 7 a.m., and at 7:30 we will have our second International Newspaper Tossing Challenge. The target will be the porch of a Clayton Home, precisely 35 feet from the throwing line. Last year I successfully fought off all challengers. But now Berkshire has acquired a large number of newspapers and with them came much tossing talent (or so the throwers claim). Come see whether their talent matches their talk. Better yet, join in. The papers will be 36 to 42 pages and you must fold them yourself (no rubber bands).

At 8:30, a new Berkshire movie will be shown. An hour later, we will start the question-and-answer period, which (with a break for lunch at the CenturyLink's stands) will last until 3:30. After a short recess, Charlie and I will convene the annual meeting at 3:45. If you decide to leave during the day's question periods, please do so while Charlie is talking.

The best reason to exit, of course, is to shop. We will help you do so by filling the 194,300-square-foot hall that adjoins the meeting area with products from dozens of Berkshire subsidiaries. Last year, you did your part, and most locations racked up record sales. In a nine-hour period, we sold 1,090 pairs of Justin boots, (that's a pair every 30 seconds), 10,010 pounds of See's candy, 12,879 Quikut knives (24 knives per minute) and 5,784 pairs of Wells Lamont gloves, always a hot item. But you can do better. Remember: Anyone who says money can't buy happiness simply hasn't shopped at our meeting.

Last year, Brooks, our running shoe company, exhibited for the first time and ran up sales of \$150,000. Brooks is on fire: Its volume in 2012 grew 34%, and that was on top of a similar 34% gain in 2011. The company's management expects another jump of 23% in 2013. We will again have a special commemorative shoe to offer at the meeting.

On Sunday at 8 a.m., we will initiate the “Berkshire 5K,” a race starting at the CenturyLink. Full details for participating will be included in the Visitor’s Guide that you will receive with your credentials for the meeting. We will have plenty of categories for competition, including one for the media. (It will be fun to report on their performance.) Regretfully, I will forego running; someone has to man the starting gun.

I should warn you that we have a lot of home-grown talent. Ted Weschler has run the marathon in 3:01. Jim Weber, Brooks' dynamic CEO, is another speedster with a 3:31 best. Todd Combs specializes in the triathlon, but has been clocked at 22 minutes in the 5K.

That, however, is just the beginning: Our directors are also fleet of foot (that is, some of our directors are). Steve Burke has run an amazing 2:39 Boston marathon. (It's a family thing; his wife, Gretchen, finished the New York marathon in 3:25.) Charlotte Guyman's best is 3:37, and Sue Decker crossed the tape in New York in 3:36. Charlie did not return his questionnaire.

GEICO will have a booth in the shopping area, staffed by a number of its top counselors from around the country. Stop by for a quote. In most cases, GEICO will be able to give you a shareholder discount (usually 8%). This special offer is permitted by 44 of the 51 jurisdictions in which we operate. (One supplemental point: The discount is not additive if you qualify for another, such as that given certain groups.) Bring the details of your existing insurance and check out whether we can save you money. For at least half of you, I believe we can.

Be sure to visit the Bookworm. It will carry about 35 books and DVDs, including a couple of new ones. Carol Loomis, who has been invaluable to me in editing this letter since 1977, has recently authored Tap Dancing to Work: Warren Buffett on Practically Everything. She and I have cosigned 500 copies, available exclusively at the meeting.

The Outsiders, by William Thorndike, Jr., is an outstanding book about CEOs who excelled at capital allocation. It has an insightful chapter on our director, Tom Murphy, overall the best business manager I’ve ever met. I also recommend The Clash of the Cultures by Jack Bogle and Laura Rittenhouse’s Investing Between the Lines. Should you need to ship your book purchases, a shipping service will be available nearby.

The Omaha World-Herald will again have a booth, offering a few books it has recently published. Red-blooded Husker fans – is there any Nebraska who isn’t one? – will surely want to purchase Unbeatable. It tells the story of Nebraska football during 1993-97, a golden era in which Tom Osborne’s teams went 60-3.

If you are a big spender – or aspire to become one – visit Signature Aviation on the east side of the Omaha airport between noon and 5:00 p.m. on Saturday. There we will have a fleet of NetJets aircraft that will get your pulse racing. Come by bus; leave by private jet. Live a little.

An attachment to the proxy material that is enclosed with this report explains how you can obtain the credential you will need for admission to the meeting and other events. Airlines have sometimes jacked up prices for the Berkshire weekend. If you are coming from far away, compare the cost of flying to Kansas City versus Omaha. The drive between the two cities is about $2\frac{1}{2}$ hours, and it may be that you can save significant money, particularly if you had planned to rent a car in Omaha. Spend the savings with us.

At Nebraska Furniture Mart, located on a 77-acre site on $72^{\text{nd}}$ Street between Dodge and Pacific, we will again be having “Berkshire Weekend” discount pricing. Last year the store did \$35.9 million of business during its annual meeting sale, an all-time record that makes other retailers turn green. To obtain the Berkshire discount, you must make your purchases between Tuesday, April $30^{\text{th}}$ and Monday, May $6^{\text{th}}$ inclusive, and also present your meeting credential. The period’s special pricing will even apply to the products of several prestigious manufacturers that normally have ironclad rules against discounting but which, in the spirit of our shareholder weekend, have made an exception for you. We appreciate their cooperation. NFM is open from 10 a.m. to 9 p.m. Monday through Saturday, and 10 a.m. to 6 p.m. on Sunday. On Saturday this year, from 5:30 p.m. to 8 p.m., NFM is having a picnic to which you are all invited.

At Borsheims, we will again have two shareholder-only events. The first will be a cocktail reception from 6 p.m. to 9 p.m. on Friday, May $3^{\text{rd}}$ . The second, the main gala, will be held on Sunday, May $5^{\text{th}}$ , from 9 a.m. to 4 p.m. On Saturday, we will be open until 6 p.m. In recent years, our three-day volume has far exceeded sales in all of December, normally a jeweler's best month.

Around 1 p.m. on Sunday, I will begin clerking at Borsheims. Last year my sales totaled \$1.5 million. This year I won’t quit until I hit \$2 million. Because I need to leave well before sundown, I will be desperate to do business. Come take advantage of me. Ask for my “Crazy Warren” price.

We will have huge crowds at Borsheims throughout the weekend. For your convenience, therefore, shareholder prices will be available from Monday, April 29 $^{th}$ through Saturday, May 11 $^{th}$ . During that period, please identify yourself as a shareholder by presenting your meeting credentials or a brokerage statement that shows you are a Berkshire holder.

On Sunday, in the mall outside of Borsheims, a blindfolded Patrick Wolff, twice U.S. chess champion, will take on all comers – who will have their eyes wide open – in groups of six. Nearby, Norman Beck, a remarkable magician from Dallas, will bewilder onlookers. Additionally, we will have Bob Hamman and Sharon Osberg, two of the world’s top bridge experts, available to play bridge with our shareholders on Sunday afternoon. Don’t play them for money.

Gorat's and Piccolo's will again be open exclusively for Berkshire shareholders on Sunday, May $5^{\text{th}}$ . Both will be serving until 10 p.m., with Gorat's opening at 1 p.m. and Piccolo's opening at 4 p.m. These restaurants are my favorites, and I will eat at both of them on Sunday evening. Remember: To make a reservation at Gorat's, call 402-551-3733 on April $1^{\text{st}}$ (but not before) and at Piccolo's call 402-342-9038. At Piccolo's, order a giant root beer float for dessert. Only sissies get the small one. (I once saw Bill Gates polish off two of the giant variety after a full-course dinner; that's when I knew he would make a great director.)

We will again have the same three financial journalists lead the question-and-answer period at the meeting, asking Charlie and me questions that shareholders have submitted to them by e-mail. The journalists and their e-mail addresses are: Carol Loomis, of Fortune, who may be emailed at cloomis@fortunemail.com; Becky Quick, of CNBC, at BerkshireQuestions@cnbc.com, and Andrew Ross Sorkin, of The New York Times, at arsorkin@nytimes.com.

From the questions submitted, each journalist will choose the six he or she decides are the most interesting and important. The journalists have told me your question has the best chance of being selected if you keep it concise, avoid sending it in at the last moment, make it Berkshire-related and include no more than two questions in any email you send them. (In your email, let the journalist know if you would like your name mentioned if your question is selected.)

Last year we had a second panel of three analysts who follow Berkshire. All were insurance specialists, and shareholders subsequently indicated they wanted a little more variety. Therefore, this year we will have one insurance analyst, Cliff Gallant of Nomura Securities. Jonathan Brandt of Ruane, Cunniff & Goldfarb will join the analyst panel to ask questions that deal with our non-insurance operations.

Finally – to spice things up – we would like to add to the panel a credentialed bear on Berkshire, preferably one who is short the stock. Not yet having a bear identified, we would like to hear from applicants. The only requirement is that you be an investment professional and negative on Berkshire. The three analysts will bring their own Berkshire-specific questions and alternate with the journalists and the audience in asking them.

Charlie and I believe that all shareholders should have access to new Berkshire information simultaneously and should also have adequate time to analyze it, which is why we try to issue financial information after the market close on a Friday and why our annual meeting is held on Saturdays. We do not talk one-on-one to large institutional investors or analysts. Our hope is that the journalists and analysts will ask questions that will further educate shareholders about their investment.

Neither Charlie nor I will get so much as a clue about the questions to be asked. We know the journalists and analysts will come up with some tough ones, and that's the way we like it. All told, we expect at least 54 questions, which will allow for six from each analyst and journalist and 18 from the audience. If there is some extra time, we will take more from the audience. Audience questioners will be determined by drawings that will take place at 8:15 a.m. at each of the 11 microphones located in the arena and main overflow room.

* * * * * * * * * * * *

For good reason, I regularly extol the accomplishments of our operating managers. They are truly All-Stars, who run their businesses as if they were the only asset owned by their families. I believe their mindset to be as shareholder-oriented as can be found in the universe of large publicly-owned companies. Most have no financial need to work; the joy of hitting business “home runs” means as much to them as their paycheck.

Equally important, however, are the 23 men and women who work with me at our corporate office (all on one floor, which is the way we intend to keep it!).

This group efficiently deals with a multitude of SEC and other regulatory requirements, files a 21,500-page Federal income tax return as well as state and foreign returns, responds to countless shareholder and media inquiries, gets out the annual report, prepares for the country's largest annual meeting, coordinates the Board's activities – and the list goes on and on.

They handle all of these business tasks cheerfully and with unbelievable efficiency, making my life easy and pleasant. Their efforts go beyond activities strictly related to Berkshire: Last year they dealt with 48 universities (selected from 200 applicants) who sent students to Omaha for a Q&A day with me. They also handle all kinds of requests that I receive, arrange my travel, and even get me hamburgers for lunch. No CEO has it better; I truly do feel like tap dancing to work every day.

This home office crew, along with our operating managers, has my deepest thanks and deserves yours as well. Come to Omaha – the cradle of capitalism – on May 4 $^{th}$ and chime in.

March 1, 2013

Warren E. Buffett

Chairman of the Board

年份	伯克希尔每股账面价值年度变化百分比 (1)	标普500指数（含股息）年度变化百分比 (2)	相对结果 (1)-(2)
1965	23.8	10.0	13.8
1966	20.3	(11.7)	32.0
1967	11.0	30.9	(19.9)
1968	19.0	11.0	8.0
1969	16.2	(8.4)	24.6
1970	12.0	3.9	8.1
1971	16.4	14.6	1.8
1972	21.7	18.9	2.8
1973	4.7	(14.8)	19.5
1974	5.5	(26.4)	31.9
1975	21.9	37.2	(15.3)
1976	59.3	23.6	35.7
1977	31.9	(7.4)	39.3
1978	24.0	6.4	17.6
1979	35.7	18.2	17.5
1980	19.3	32.3	(13.0)
1981	31.4	(5.0)	36.4
1982	40.0	21.4	18.6
1983	32.3	22.4	9.9
1984	13.6	6.1	7.5
1985	48.2	31.6	16.6
1986	26.1	18.6	7.5
1987	19.5	5.1	14.4
1988	20.1	16.6	3.5
1989	44.4	31.7	12.7
1990	7.4	(3.1)	10.5
1991	39.6	30.5	9.1
1992	20.3	7.6	12.7
1993	14.3	10.1	4.2
1994	13.9	1.3	12.6
1995	43.1	37.6	5.5
1996	31.8	23.0	8.8
1997	34.1	33.4	0.7
1998	48.3	28.6	19.7
1999	0.5	21.0	(20.5)
2000	6.5	(9.1)	15.6
2001	(6.2)	(11.9)	5.7
2002	10.0	(22.1)	32.1
2003	21.0	28.7	(7.7)
2004	10.5	10.9	(0.4)
2005	6.4	4.9	1.5
2006	18.4	15.8	2.6
2007	11.0	5.5	5.5
2008	(9.6)	(37.0)	27.4
2009	19.8	26.5	(6.7)
2010	13.0	15.1	(2.1)
2011	4.6	2.1	2.5
2012	14.4	16.0	(1.6)
年化复合增长率 – 1965-2012	19.7%	9.4%	10.3
累计总收益率 – 1964-2012	586,817%	7,433%
注释：数据按日历年列示，但以下年份除外：1965年和1966年，截至9月30日；1967年，截至12月31日的15个月。自1979年起，会计规则要求保险公司按市价而非之前要求的成本与市价孰低法来估值其持有的权益证券。在本表中，伯克希尔截至1978年的业绩已按变更后的规则重新列示。其他所有方面，结果均按最初报告的数字计算。标普500数据为税前，而伯克希尔数据为税后。如果像伯克希尔这样的公司仅仅持有标普500并计提相应税款，那么在该指数正回报的年份，其业绩会落后于标普500；但在该指数负回报的年份，其业绩会超过标普500。多年来，税收成本将导致累计落后幅度相当大。

伯克希尔·哈撒韦公司

致伯克希尔·哈撒韦公司股东：

2012年，伯克希尔为股东实现了241亿美元的总收益。我们用了其中13亿美元回购股票，这使得当年净资产增加了228亿美元。我们的A类股和B类股每股账面价值均增长了14.4%。过去48年（即自现任管理层接手以来），账面价值从19美元增至114,214美元，年复合增长率为19.7%。*

去年伯克希尔发生了许多好事，但让我们先说说坏消息。

——当1965年我管理的合伙企业接管伯克希尔时，我从未想过，我们取得241亿美元收益的一年，在对页所示的比较中竟会低于平均水平。

但事实确实低于平均水平。在48年中，这是第9次伯克希尔账面价值的百分比增幅低于标普500的百分比涨幅（该计算包含股息和价格增值）。值得注意的是，在这9年中有8年，标普500的涨幅达到15%或以上。当逆风来袭时，我们表现更好。

迄今为止，我们从未有过五年期表现不佳的情况，在43次这样的跨度中我们超越了标普500。（记录见第103页。）但标普500在过去四年中每年都在上涨，超过了我们。如果市场在2013年继续上涨，我们连续五年获胜的记录将会终结。

有一点你可以确信：无论伯克希尔的业绩如何，我的合伙人查理·芒格（公司副董事长）和我都不会改变衡量标准。我们的工作是以比标普500市场涨幅更快的速度增加内在商业价值——我们使用账面价值作为其严重低估的替代指标。如果我们做到了，尽管伯克希尔股价每年不可预测，但长期来看其本身将超越标普500。然而，如果我们失败了，我们的管理就不会为投资者带来价值，而他们自己可以通过购买低成本指数基金获得标普500的回报。

查理和我相信，长期来看，伯克希尔内在价值的增长很可能以微弱优势超越标普500的回报。我们对此有信心，因为我们拥有一些杰出的企业、一群出色的运营经理以及以股东为导向的文化。然而，当市场下跌或持平的时候，我们的相对表现几乎肯定会更好。在市场尤其强劲的年份，预计我们会落后。

——2012年的第二个失望是我未能完成一笔重大收购。我追逐了几头大象，但空手而归。

不过，今年年初我们的运气变了。2月，我们同意收购一家控股公司50%的股份，这家公司将拥有H. J. Heinz（亨氏）的全部股权。另一半将由以巴西著名商人和慈善家Jorge Paulo Lemann为首的一小群投资者持有。
我们身边不乏杰出伙伴。豪尔赫·保罗是我的老朋友，也是一位出色的管理者。他的集团和伯克希尔将各自向控股公司投入约40亿美元作为普通股。伯克希尔还将投资80亿美元购买股息率为9%的优先股。这份优先股还有两个显著提升价值的特性：未来将以大幅溢价被赎回，并且附带认股权证，允许我们以象征性价格购买控股公司5%的普通股。

我们总计约120亿美元的投资，用掉了伯克希尔去年的大部分盈利。但我们仍持有大量现金，并且还在以不错的速度继续创收。所以，继续开工吧；查理和我再次穿上狩猎装备，重新踏上寻找大象的征途。

接下来，说说2012年的一些好消息：

• 去年我告诉过你们，伯克希尔利润最高的五家非保险子公司——BNSF、伊斯卡、路博润、玛蒙集团和中美能源——2012年税前利润有望超过100亿美元。它们做到了。尽管美国经济增长乏力，全球多数地区经济疲软，我们的"五巨头"总盈利达101亿美元，比2011年增加约6亿美元。

在这五家公司中，只有中美能源在八年前被伯克希尔收购，当时其税前利润为3.93亿美元。随后，我们通过全现金方式又收购了其中三家。在收购第五家BNSF时，我们支付了约70%的现金，剩余部分发行了股票，使总股本增加了6.1%。因此，这五家公司带来的年度盈利增长97亿美元，仅伴随轻微的股本稀释。这符合我们的目标：不仅追求增长，更要提升每股业绩。

除非美国经济崩盘（我们预计不会），我们的五巨头在2013年应该会继续实现更高的盈利。领导它们的五位杰出CEO会确保这一点。

• 虽然我在2012年没能谈成什么大收购，但我们子公司的经理们做得远比我好。"补充收购"创下了纪录，我们花费约23亿美元收购了26家公司，并入现有业务。这些交易没有让伯克希尔增发任何股票。

查理和我喜欢这类收购：它们通常风险低，完全不给总部添麻烦，还能扩大我们经过验证的经理们的业务版图。

• 我们的保险业务去年大放异彩。在给伯克希尔提供730亿美元免息资金用于投资的同时，还贡献了16亿美元的承保利润，连续第十年实现承保盈利。这真是鱼与熊掌兼得。

GEICO一马当先，持续抢占市场份额，同时坚守承保纪律。自1995年我们获得控股权以来，GEICO在个人车险市场的份额从2.5%增长到9.7%。同期保费收入从28亿美元增至167亿美元。未来还有更大的增长空间。

GEICO非凡业绩的功劳属于Tony Nicely和他的27,000名同事。此外，我们还得加上我们的壁虎代言人。雨雪风霜暗夜都无法阻挡它；这只小蜥蜴坚持不懈地告诉美国人，去GEICO.com可以省一大笔钱。

当我细数自己的福气时，我要把GEICO数上两遍。

• Todd Combs和Ted Weschler，我们新的投资经理，已证明他们聪明、正直，不仅在投资组合管理上对伯克希尔多有助益，而且在文化上完美契合。我们押对了宝。2012年，他们两人的业绩都以两位数百分点跑赢标普500指数。他们同样也把我甩在了身后。
  因此，我们将他们各自管理的资金提高到了近50亿美元（其中一部分来自我们子公司的养老金）。Todd和Ted还很年轻，在查理和我离开之后，他们将继续管理伯克希尔庞大的投资组合。他们接手后，你们可以高枕无忧。

• 伯克希尔年末员工总数创纪录地达到288,462人（详见第106页），比去年增加17,604人。但我们总部团队依旧保持24人不变。没必要发疯。

• 伯克希尔的"四大"投资——美国运通、可口可乐、IBM和富国银行——都度过了好年景。我们在这些公司的持股比例在这一年中有所增加。我们增持了富国银行（目前持股8.7%，而2011年末为7.6%）和IBM（6.0% vs 5.5%）。与此同时，可口可乐和美国运通的股份回购提高了我们的持股比例。我们在可口可乐的权益从8.8%增至8.9%，在美国运通的权益从13.0%增至13.7%。

未来，伯克希尔在这四家公司的持股比例很可能会继续增加。梅·韦斯特说得对："好东西再多也不嫌多。"

这四家公司拥有出色的业务，其管理者既才华横溢又心系股东。在伯克希尔，我们更倾向于拥有一家优秀公司的非控股但重要的一部分，而不是100%拥有一家平庸的公司。我们在资本配置上的灵活性，使我们比那些只局限于自己能够运营的收购的公司拥有显著优势。

按照我们年末的股份数计算，我们在这"四大"公司2012年盈利中所占份额达到了39亿美元。然而，在我们向你们报告的盈利中，我们只包含了我们收到的股息——约11亿美元。但别搞错了：我们没有报告的这28亿美元的盈利，对我们而言，与我们记录在案的盈利一样有价值。

这四家公司留存的收益通常用于回购——这增加了我们在未来盈利中的份额——以及用于资助通常有利可图的商业机会。随着时间的推移，我们预计从这四家被投资公司获得的盈利将大幅增加。如果我们判断正确，伯克希尔收到的股息将增加，更重要的是，我们未实现的资本利得也将增加（年末这四家公司的未实现资本利得总额为267亿美元）。

去年，许多CEO在面临资本配置决策时（尽管他们许多企业的盈利和现金都达到了创纪录水平）焦虑不安地大谈"不确定性"。在伯克希尔，我们并不认同他们的担忧，反而在2012年创纪录地投入了98亿美元用于厂房和设备，其中约88%在美国。这比我们2011年（此前最高水平）的投入增加了19%。不管专家们怎么说，查理和我都喜欢在值得的项目上大笔投资。我们更愿意听从Gary Allan的新乡村歌曲中的歌词："Every Storm Runs Out of Rain。"

我们将继续踩足油门，几乎可以肯定2013年的资本支出将再创纪录。美国到处都是机会。

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给我的CEO同行们的一点想法：当然，眼前的未来是不确定的；自1776年以来，美国一直在面对未知。只是有时候人们专注于始终存在的无数不确定性，而另一些时候他们却对它们视而不见（通常是因为最近风平浪静）。
美国企业长期来看会表现良好。股票也必将表现不错，因为它们的命运与商业业绩紧密相连。周期性挫折确实会发生，但投资者和经理人参与的游戏极其偏向于他们。（道指在20世纪从66点涨至11,497点，实现了惊人的17,320%的涨幅——尽管经历了四次代价高昂的战争、一次大萧条和多次经济衰退。别忘了，在整个世纪里，股东还获得了可观的股息。）

既然基本游戏如此有利，查理和我认为，试图根据塔罗牌的翻转、"专家"的预测或商业活动的起落而跳进跳出是一个可怕的错误。离开游戏的风险远比留在游戏中的风险大。

我本人的经历提供了一个生动的例子：1942年春天，我做了第一笔股票买入，当时美国在太平洋战区正遭受重大损失。每天的报纸头条都在报道更多的挫折。即便如此，没有人谈论不确定性；我认识的每个美国人都相信我们会赢。

自那个危险时期以来，这个国家的成功令人难以置信：按通胀调整后的计算，1941年至2012年间人均GDP增长了四倍多。在那段时期里，每个明天都是不确定的。然而，美国的命运始终清晰：日益增长的富足。

如果你是一位CEO，手中有一个大型、盈利的项目，却因为短期担忧而搁置，那就打电话给伯克希尔。让我们为你卸下重担。

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总之，查理和我的目标是（1）通过改善众多子公司的盈利能力来提升每股内在价值；（2）通过补强型收购进一步提高它们的盈利；（3）参与被投资公司的增长；（4）在伯克希尔股票价格较内在价值有重大折扣时进行回购；（5）偶尔进行大型收购。我们还会努力为你们创造最大价值，方法之一是几乎从不增发伯克希尔股票。

这些基石建立在坚如磐石的基础上。一个世纪后，伯灵顿北方圣太菲铁路（BNSF）和中美能源（MidAmerican Energy）仍将在美国经济中扮演重要角色。此外，保险对于企业和个人始终是必不可少的——没有哪家公司能像伯克希尔那样为这个领域带来更丰富的资源。当我们审视这些及其他优势时，查理和我觉得你们公司前景不错。

内在商业价值

尽管查理和我经常谈论内在商业价值，但我们无法精确告诉你伯克希尔股票（或者就此而言，任何其他股票）的内在价值数字是多少。不过，在2010年的年报中，我们列出了三个要素——其中一个定性的——我们认为这是对伯克希尔内在价值进行合理估算的关键。那段讨论全文重印在第104-105页。

以下是两个定量因素的最新数据：2012年，我们的每股投资额增长了15.7%，达到113,786美元；来自保险和投资以外业务的每股税前利润也增长了15.7%，达到8,085美元。

自1970年以来，我们的每股投资额以每年19.4%的复合增长率增长，每股利润数字则以每年20.8%的速度增长。伯克希尔股票在这42年间的价格增长速度与我们的这两个价值衡量指标非常相似，这绝非巧合。查理和我喜欢看到这两个领域都取得增长，但我们始终会高度重视经营利润的增长。

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现在，让我们审视我们业务的四个主要板块。每个板块的资产负债表和利润表特征都与其他板块截然不同。因此，把它们混为一谈会妨碍分析。所以我们将把它们作为四项独立的业务来呈现，这也是查理和我的看法。

保险

先来看看保险业务，这是伯克希尔的核心运营板块，也是多年来推动我们扩张的引擎。

财产-意外险（P/C）保险公司提前收取保费，之后才支付理赔款。在极端情况下，比如某些工人工伤事故，赔付可能会延续数十年。这种"先收后付"的模式让我们手握大量资金——我们称之为"浮存金"——这些钱最终要赔付给他人。与此同时，我们可以用这些浮存金为伯克希尔投资获利。尽管单个保单和理赔有来有去，但我们持有的浮存金总额相对于保费规模一直相当稳定。因此，随着业务增长，我们的浮存金也在增长。看看我们增长了多少，下表所示：

年份	浮存金（百万美元）
1970	$ 39
1980	237
1990	1,632
2000	27,871
2010	65,832
2012	73,125

去年我曾告诉你们，我们的浮存金未来可能会趋于平稳甚至略有下降。我们的保险CEO们立志要证明我错了，而且确实做到了——去年浮存金增加了25亿美元。我现在预计2013年浮存金还会进一步增加。但再往后增长会很难。好消息是，GEICO的浮存金几乎肯定会增长。然而，在国家赔保的再保险部门，我们有一些已停止承保的合同，其浮存金正在逐渐下降。如果未来我们真的遭遇浮存金下降，那也会非常缓慢——最多每年不超过2%。

如果我们的保费超过了费用与最终赔付的总和，我们就会实现承销利润，这笔利润会加在浮存金产生的投资收益之上。当实现这种利润时，我们就相当于享受了免费资金的使用权——更妙的是，我们持有它还能获得报酬。这就好比你去贷款，银行反过来给你付利息。

不幸的是，所有保险公司都渴望实现这种美好结果，这带来了激烈竞争，在多数年份这种竞争如此激烈，以至于整个财产-意外险行业总体上承受着显著的承销亏损。这个亏损，实际上就是该行业为持有浮存金所付出的代价。例如，State Farm（州立农业）——全美最大的保险公司，同时也是管理有方的公司——在截至2011年的11年间有8年出现了承销亏损（其2012年财务数据尚未公布）。在保险业亏钱的方法多得很，而且这个行业从没停止过寻找新的亏钱方法。

正如本报告第一部分所述，我们已经连续十年实现承销盈利，期间税前利润总计186亿美元。展望未来，我相信我们在多数年份仍能保持承销盈利。如果做到这一点，我们的浮存金将比免费资金还要好。

那么，我们诱人的浮存金如何影响内在价值的计算呢？在计算伯克希尔的账面价值时，我们的全部浮存金是作为负债扣除的，就好像我们明天就要全部赔付、且无法补充一样。但这样看待浮存金是不对的，它应该被视为一只循环基金。如果浮存金既无成本又长期存在（我相信伯克希尔的浮存金就是这样），那么这项负债的真实价值就远低于会计上的负债。

部分抵消这项被高估的负债的是155亿美元的"商誉"，这笔商誉归属于我们的保险公司，并被计入账面价值作为一项资产。实际上，这笔商誉代表了为我们保险业务的浮存金生成能力所支付的价格。然而，商誉的成本与其真实价值并无关联。例如，如果一家保险业务持续承受巨额且长期的承销亏损，那么账面所载的任何商誉资产都应被视为毫无价值，无论其原始成本是多少。
幸运的是，伯克希尔的情况并非如此。查理和我认为，我们保险商誉的真实经济价值——即我们愿意为收购一家能产生同等质量浮存金的保险业务所支付的价格——远高于其历史账面价值。浮存金的价值是我们认为伯克希尔内在业务价值大幅超过其账面价值的原因之一——一个重要的原因。

请允许我再次强调，零成本的浮存金并非整个财产/意外险行业可期待的结果：保险世界中几乎没有“伯克希尔品质”的浮存金。在截至2011年的45年中，有37年该行业的保费不足以覆盖理赔和费用。因此，数十年来，该行业有形净资产的整体回报率远低于美国工业的平均回报率，这种糟糕的表现几乎肯定会持续下去。

另一个令人不快的现实加剧了该行业黯淡的前景：保险收益目前受益于“遗留”债券组合，这些组合提供的收益率远高于未来几年（甚至可能更长时间）资金再投资时所能获得的水平。实际上，今天的债券组合是不断贬值的资产。随着债券到期和再投资，保险公司的收益将遭受显著打击。

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伯克希尔的卓越经济学之所以存在，只是因为我们拥有一些出色的经理人管理着一些非凡的保险业务。让我为您介绍主要部门。

按浮存金规模排在第一的是伯克希尔·哈撒韦再保险集团，由 Ajit Jain 管理。Ajit 承保那些其他公司既无意愿也无资本承担的风险。他的业务结合了承保能力、速度、果断力，以及最重要的——智慧，这在保险业中是独一无二的。但他从未让伯克希尔暴露于与我们的资源不相称的风险之下。事实上，我们在规避风险方面比大多数大型保险公司要保守得多。例如，如果保险业因某次超级巨灾而遭受2500亿美元的损失——这几乎是其历史上最大损失的三倍——伯克希尔整体当年仍可能录得可观的利润，因为它拥有如此多的盈利来源。而所有其他主要保险公司和再保险公司则将深陷亏损，其中一些将面临资不抵债。

从1985年白手起家，Ajit 创建了一个拥有350亿美元浮存金且累计承保利润可观的保险业务，这一成就没有任何其他保险公司的CEO能望其项背。因此，他为伯克希尔的价值增加了数十亿美元。如果您在年会上遇到 Ajit，请深深鞠躬。

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我们还有另一家再保险巨头——通用再保险，由 Tad Montross 管理。

归根结底，一家稳健的保险业务必须遵守四条纪律。它必须：（1）理解所有可能导致保单发生损失的风险敞口；（2）保守地评估任何风险敞口实际导致损失的可能性以及如果发生损失的潜在成本；（3）设定一个平均而言能在扣除预期损失成本和运营费用后产生利润的保费；（4）如果无法获得适当的保费，愿意放弃业务。

许多保险公司通过了前三项测试，却在第四项上栽了跟头。它们就是无法拒绝竞争对手正在积极承揽的业务。“别人都在做，所以我们也必须做”，这条老话在任何行业都会带来麻烦，但在保险业尤甚。
泰德严格遵守了保险业的四条戒律，他的业绩就是最好的证明。在他领导下，通用再保险的巨额浮存金成本不仅为零，甚至为负。我们预计，平均而言，这种情况将持续下去。我们尤其看好通用再保险的国际寿险再保险业务，自1998年收购该公司以来，该业务一直保持稳健增长。

* * * * * * * * * *

最后，说说GEICO——62年前，我正是在这家公司迈出了保险生涯的第一步。GEICO由托尼·奈斯利（Tony Nicely）掌舵，他18岁加入公司，到2012年已服务满51年。

看着托尼取得的成就，我简直不敢相信自己的眼睛。需要指出的是，他去年的业绩实际上比GEICO财报上显示的6.8亿美元承销利润要好得多。由于年初会计准则变更，我们记入了一笔4.1亿美元的费用，从GEICO的承销收益中扣除。这笔费用与2012年的经营业绩毫无关系，既不影响现金、收入、费用，也不影响税收。实际上，这笔减记只是进一步拉大了GEICO内在价值与我们账面价值之间已经存在的巨大差距。

此外，GEICO实现承销利润的这一年，还遭遇了其历史上最大的一笔单笔损失——“桑迪”飓风给GEICO造成的损失，是此前创纪录的“卡特里娜”飓风的三倍多。我们承保了46,906辆在这场风暴中损毁的车辆，这个惊人的数字反映了GEICO在纽约大都会地区的领先市场份额。

去年，GEICO现有保单持有人的续保率（“留存率”）和询价成交率（“成交率”）都实现了显著提升。这两个因素背后牵涉巨额资金：留存率哪怕仅持续提高一个百分点，内在价值就能增加超过10亿美元。GEICO在2012年的业绩有力地证明，当人们查询公司保费时，通常会发现自己能省下一大笔钱。（欢迎致电1-800-847-7536或访问GEICO.com试试。别忘了提及您是股东，这通常能享受折扣。）

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除了三大保险业务，我们还拥有一批规模较小的公司，它们大多在保险领域的某些细分市场经营。总体来看，这些公司始终维持着承销利润。此外，如下表所示，它们还为我们提供了可观的浮存金。查理和我珍视这些公司及其管理者。

2012年底，我们收购了Guard Insurance，扩大了这一业务板块。这家总部位于威尔克斯-巴里的公司主要承保工人赔偿保险，客户以中小企业为主。Guard的年保费总额约为3亿美元。公司在传统业务和新拓展业务两方面都有极好的增长前景。

	承销利润		年末浮存金
	（单位：百万美元）
保险业务	2012年	2011年	2012年	2011年
伯克希尔哈撒韦再保险	$ 304	$(714)	$34,821	$33,728
通用再保险	355	144	20,128	19,714
GEICO	680*	576	11,578	11,169
其他主要保险	286	242	6,598	5,960
	$1,625	$ 248	$73,125	$70,571

*该数字已扣除因行业会计准则变更而产生的4.1亿美元费用。

在大型保险业务中，伯克希尔的表现让我认为它堪称全球最佳。1967年3月，杰克·林沃特（Jack Ringwalt）以860万美元将其两家财产意外险公司卖给我们，那是我们的幸运日。

受监管的资本密集型业务

我们有两项主要业务——BNSF（伯灵顿北方圣太菲铁路公司）和MidAmerican Energy（中美能源），它们具有重要的共同特征，使其区别于我们的其他业务。因此，在这封信中我们为它们单独辟出一节，并在美国通用会计准则的资产负债表和利润表中将其合并财务数据单独列出。

这两家公司的关键特征是，它们对寿命极长的受监管资产进行了巨额投资，而这些投资部分由伯克希尔未提供担保的大额长期债务提供资金。事实上，我们的信用并非必需，因为每项业务即使在极端恶劣的条件下，其盈利能力也足以轻松覆盖利息支出。例如，在去年经济低迷的情况下，BNSF的利息覆盖倍数为9.6倍。（我们对覆盖倍数的定义是税前利润/利息，而非EBITDA/利息——后者是一种常用指标，但我们认为它存在严重缺陷。）与此同时，在MidAmerican，有两个关键因素确保了其在任何情况下都有能力偿还债务：一是公司具备抗衰退的盈利能力，这源于我们独家提供一项基础服务；二是其盈利来源高度多元化，使其不会因任何一个监管机构的决定而受到严重损害。

每一天，我们的这两家子公司都在以重大方式推动美国经济：

• BNSF运输了全美城际货运总量的约15%（按吨英里计），无论这些货物是通过卡车、铁路、水运、空运还是管道运输。事实上，我们运输的货物吨英里数超过任何其他公司，这一事实使BNSF成为我国经济循环系统中最重要的动脉。
  BNSF还在极其节能和环保的方式下运输货物，每加仑柴油可将一吨货物运送约500英里。而如果由卡车承担同样的任务，油耗大约是我们的四倍。

• MidAmerican的电力公司在十个州为受监管的零售客户提供服务。只有一家公用事业控股公司服务的州比我们更多。此外，我们是可再生能源领域的领导者：首先，从九年前白手起家，现在我们已占全国风力发电装机容量的6%。其次，当我们目前正在建设的三个项目完工后，我们将拥有美国太阳能发电装机容量的约14%。

这类项目需要巨额资本投入。事实上，完工后，我们的可再生能源组合将耗资130亿美元。如果这些投资能带来合理的回报，我们很乐意做出这样的承诺——而在这一点上，我们对未来的监管寄予厚望。

我们的信心既源于过去的经验，也源于我们深知社会将永远需要对运输和能源进行大规模投资。政府从自身利益出发，也会以确保持续资金流向关键项目的方式来对待资本提供者。而我们从自身利益出发，也会以赢得监管机构及其所代表的人民认可的方式来运营我们的业务。

我们的管理者今天就必须思考国家在遥远的未来需要什么。能源和运输项目可能需要多年才能建成；一个成长中的国家根本承受不起落后于发展曲线的代价。

我们一直在尽自己的一份力量，确保这种情况不会发生。无论你听说过多少关于美国基础设施破败的说法，这绝不适用于BNSF或铁路行业整体。美国的铁路系统从未像现在这样良好，这是行业大量投资的结果。不过，我们并未满足于现状：BNSF在2013年将在铁路上投入约40亿美元，大约是年折旧费用的两倍，也超过了任何铁路公司单一年度的投资额。

在BNSF的Matt Rose和MidAmerican的Greg Abel身上，我们拥有两位杰出的CEO。他们是卓越的管理者，打造了既能服务客户又能服务所有者的业务。我感激他们，你也应该感激他们。以下是他们业务的关键数据：

中美能源（MidAmerican，持股89.8%）	盈利（单位：百万美元）
	2012	2011
英国电力事业	$429	$469
爱荷华电力事业	$236	$279
西部电力事业	$737	$771
管道业务	$383	$388
住宅服务（HomeServices）	$82	$39
其他（净）	$91	$36
企业利息和税前营业利润	$1,958	$1,982
利息	$314	$336
所得税	$172	$315
净利润	$1,472	$1,331
归属伯克希尔的净利润	$1,323	$1,204

眼尖的读者会注意到中美能源盈利表里有一个不协调之处。HomeServices（住宅服务公司）——一家房地产经纪公司——怎么会出现在名为"受监管的资本密集型业务"这一栏里？

嗯，它是在2000年我们收购中美能源控股权时一并带来的。当时我关注的是中美能源的公用事业业务，几乎没有注意到HomeServices（住宅服务公司），那时它只拥有少数几家房地产经纪公司。

不过从那以后，这家公司持续收购住宅经纪公司——2012年就收购了三家——如今已在全美多个主要城市拥有约16,000名经纪人。（我们的房地产经纪公司列在第107页。）2012年，我们的经纪人参与成交了420亿美元的房屋销售，比2011年增长了33%。

此外，HomeServices（住宅服务公司）去年收购了Prudential（保德信）和Real Living（真实生活）特许经营业务67%的股权，这两家在全美共授权了544家经纪公司，并从其销售中收取少量特许权使用费。我们已经达成协议，在五年内收购这些业务的剩余部分。未来几年，我们将逐步把我们拥有的特许经营商和特许经营公司重新命名为Berkshire Hathaway HomeServices（伯克希尔·哈撒韦住宅服务公司）。

Ron Peltier在低迷时期管理HomeServices（住宅服务公司）业绩斐然。如今随着住房市场持续走强，我们预计盈利将显著增长。

制造、服务和零售业务

不过，我们先来看看整个集团的汇总资产负债表和利润表。

资产负债表 2012年12月31日（单位：百万美元）

资产		负债和权益	$1,454
现金及现金等价物	$5,338			其他流动负债	$8,527
应收款项和应收票据	$7,382	流动负债合计	$9,981
存货	$9,675
其他流动资产	$734	递延税项	$4,907
流动资产合计	$23,129	长期债务及其他负债	$5,826
		非控制性权益	$2,062
商誉及其他无形资产	$26,017	伯克希尔权益	$48,657
固定资产	$18,871
其他资产	$3,416
	$71,433		$71,433

利润表（单位：百万美元）

	2012年	2011年*	2010年
收入	832.55亿美元	724.06亿美元	666.10亿美元
经营费用	769.78亿美元	672.39亿美元	622.25亿美元
利息支出	1.46亿美元	1.30亿美元	1.11亿美元
税前利润	61.31亿美元	50.37亿美元	42.74亿美元
所得税及非控制权益	24.32亿美元	19.98亿美元	18.12亿美元
净利润	36.99亿美元	30.39亿美元	24.62亿美元

*包含路博润（Lubrizol）自9月16日起的利润。

我们的收入与支出数据符合美国通用会计准则（"GAAP"），详见第29页。相比之下，上表中的经营费用数据则属于非GAAP口径。具体来说，这些数据排除了某些购买会计调整项，主要是部分无形资产的摊销。我们之所以这样呈现数据，是因为查理和我认为，调整后的数字能更准确地反映表中各企业合并后的真实费用和利润。

我不会逐一解释所有调整——有些调整数额小且晦涩难懂——但认真的投资者应当理解无形资产的不同性质：有些确实会随时间消耗殆尽，而有些则永远不会贬值。例如，软件相关的摊销费用是实实在在的支出。而其他无形资产（如客户关系的摊销）则源自购买会计规则，显然不是真实费用。GAAP会计对这两类支出不作区分。也就是说，在计算利润时，两者均被记为费用——尽管从投资者角度看，它们天差地别。

在第29页的GAAP合规数据中，本节所涉企业的摊销费用约6亿美元被列为支出。我们估计其中约20%是"真实的"——事实上，上表中已包含这部分的费用——其余则不是。由于我们进行了大量收购，这种差异变得显著。

"非真实"摊销费用同样对我们持有的一些重要投资标的构成重大影响。IBM近年进行了许多小型收购，现定期报告"调整后经营利润"这一非GAAP数据，刨除了某些购买会计调整。分析师关注这一数字是理所当然的。

然而，富国银行的"非真实"摊销费用并未被该公司特别强调，据我所知，也从未在分析师的报告中被提及。富国银行报告的利润深受"核心存款摊销"费用之累，仿佛这些存款正在以相当快的速度消失。但事实上，核心存款却在持续增长。去年的这项摊销费用约为15亿美元。除了GAAP会计之外，这笔巨额费用无论如何都不是一项开支。

今天的会计课到此为止。为什么没人高喊"再来点，再来点？"

* * * * * * * * * * * *

本节所汇集的企业销售从棒棒糖到喷气式飞机等各种产品。有些生意拥有极佳的经济特性，以无杠杆有形净资产收益率衡量，税后可达25%甚至100%以上。另一些则能产生12%-20%的不错回报。然而，有少数企业回报极低，这是我在资本配置工作中犯下的一些严重错误所致。

50多年前，查理就告诉我，以合理价格买入一家优秀的企业，远胜于以美妙价格买入一家平庸的企业。尽管他的观点逻辑无可辩驳，但我有时仍会重拾捡便宜货的老习惯，结果从尚可到糟糕不一而足。幸运的是，我的错误通常发生在小规模收购中。我们的重大收购大多结果不错，少数案例甚至远超预期。
因此，将这些公司看作一个整体，它们是一门出色的生意。它们运用了226亿美元的净有形资产，并在此基础上获得了16.3%的税后回报。

当然，一家经济特质出色的企业，如果买入价格过高，也可能成为一项糟糕的投资。我们为大多数企业支付了相对于净有形资产的大幅溢价，这一成本体现在我们账面上庞大的无形资产数字中。但总体而言，我们从这个领域投入的资本中获得了不错的回报。此外，这些企业的内在价值总和，远远超过了它们的账面价值。即便如此，在保险和受监管行业板块中，内在价值与账面价值之间的差距要大得多。那里才是我们真正的巨大赢家所在。

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Marmon（马蒙）就是一个很好的例子，展示了账面价值与内在价值之间存在的明显且巨大的差距。让我来解释一下这个差异的奇特来源。

去年我告诉过各位，我们增持了Marmon的股份，持股比例从2008年获得的64%提高到80%。我还告诉各位，美国通用会计准则要求我们立即将2011年的这笔收购在账面上记录为远低于我们实际支付的价格。现在我已经花了一整年来思考这个古怪的会计准则，但我还没找到任何说得通的解释——查理和我们的首席财务官马克·汉堡（Marc Hamburg）也想不出来。当我被告知，如果我们之前没有持有64%，那么2011年购买的这16%本应按照我们的成本入账时，我更加困惑了。

2012年（以及2013年初，追溯调整至2012年底），我们又收购了Marmon额外的10%股份，同样的怪异会计处理再次被要求。我们立即产生的7亿美元冲销对盈利没有影响，但确实减少了账面价值，因此也减少了2012年的净资产增长。

我们最近这次10%收购的成本，意味着我们现在持有的Marmon 90%股份价值126亿美元。然而，我们资产负债表上这90%的账面价值只有80亿美元。查理和我认为我们目前的收购代表极好的价值。如果我们是对的，那么我们的Marmon持股至少比其账面价值高出46亿美元。

Marmon是一家多元化的企业，由约150家在不同行业运营的公司组成。其最大的业务涉及拥有罐车，这些罐车租赁给各种托运人，如石油和化工公司。Marmon通过两家子公司开展这项业务：美国的Union Tank Car（联合罐车）和加拿大的Procor（普罗科）。

Union Tank Car历史悠久，曾属于标准石油托拉斯（Standard Oil Trust），直到1911年那个帝国被拆分。当你看到火车驶过时，请留意罐车上的UTLX标志。作为伯克希尔的股东，你拥有带有那个标志的罐车。当你发现一辆UTLX罐车时，稍微挺起胸膛，享受与一个世纪前约翰·D·洛克菲勒（John D. Rockefeller）检视他的车队时无疑曾体验过的同样满足感。

罐车要么由托运人所有，要么由出租人所有，而不是铁路公司。截至年底，Union Tank Car和Procor共拥有97,000辆罐车，净账面价值为40亿美元。值得注意的是，一辆新罐车造价高达10万美元以上。Union Tank Car也是一家主要的罐车制造商——其中一些用于销售，但大部分自持并出租。如今，其订单簿已排到2014年之后。

我们在BNSF（北伯林顿铁路公司）和Marmon都受益于美国石油生产的复苏。事实上，我们的铁路现在每天运输约50万桶石油，大约占"本土48州"（即不包括阿拉斯加和海上）总产量的10%。所有迹象都表明，未来几年BNSF的石油运量将大幅增长。

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篇幅所限，我们无法逐一详述该板块的其他众多业务。关于部分较大子公司在2012年的经营情况，请见第76至79页的公司特写。

金融与金融产品

这个板块是我们最小的一个，包含两家租赁公司——XTRA（拖车租赁）和CORT（家具租赁），以及全美领先的活动房屋生产商和融资商克莱顿房屋（Clayton Homes）。除这些100%控股的子公司外，该类别还包括一组金融资产以及我们在Berkadia商业按揭（Berkadia Commercial Mortgage）公司持有的50%权益。

我们将克莱顿归入该板块，是因为它持有并管理着33.2万笔按揭贷款，总额达137亿美元。这些贷款大部分发放给了中低收入家庭。然而，在整个房市崩盘期间，这些贷款表现良好，从而验证了我们的信念：即便在压力时期，合理的首付比例和合理的收入还贷比也能抵御大规模的止赎损失。

克莱顿去年还生产了25,872套活动房屋，较2011年增长13.5%。这一产量约占全美独栋住宅建造量的4.8%，使克莱顿成为美国第一大住宅建造商。

CORT和XTRA也分别是各自行业的领军者。2012年，我们在XTRA的新租赁设备支出总计2.56亿美元，是其折旧费用的两倍多。当竞争对手为当前的不确定性而焦虑时，XTRA正在为明天做准备。

Berkadia持续表现良好。我们的合作伙伴Leucadia承担了这家合资企业的大部分工作，查理和我对此安排欣然接受。

以下是该板块的税前收益总结：

	2012	2011
	（单位：百万美元）
Berkadia	$ 35	$ 25
克莱顿	255	154
CORT	42	29
XTRA	106	126
净金融收益*	410	440
	$848	$774

*不包括资本利得或损失

投资

下面列出我们年末市值超过10亿美元的普通股投资。

股数	公司	持股比例	2012年12月31日
			成本*	市价
			（单位：百万美元）
151,610,700	American Express Company（美国运通）	13.7%	$1,287	$8,715
400,000,000	The Coca-Cola Company（可口可乐）	8.9%	1,299	14,500
24,123,911	ConocoPhillips（康菲石油）	2.0%	1,219	1,399
22,999,600	DIRECTV（直播电视）	3.8%	1,057	1,154
68,115,484	International Business Machines Corp.（IBM）	6.0%	11,680	13,048
28,415,250	Moody's Corporation（穆迪）	12.7%	287	1,430
20,060,390	Munich Re（慕尼黑再保险）	11.3%	2,990	3,599
20,668,118	Phillips 66（菲利普斯66）	3.3%	660	1,097
3,947,555	POSCO（浦项制铁）	5.1%	768	1,295
52,477,678	The Procter & Gamble Company（宝洁）	1.9%	336	3,563
25,848,838	Sanofi（赛诺菲）	2.0%	2,073	2,438
415,510,889	Tesco plc（乐购）	5.2%	2,350	2,268
78,060,769	U.S. Bancorp（美国合众银行）	4.2%	2,401	2,493
54,823,433	Wal-Mart Stores, Inc.（沃尔玛）	1.6%	2,837	3,741
456,170,061	Wells Fargo & Company（富国银行）	8.7%	10,906	15,592
	其他		7,646	11,330
	按市价计普通股合计		$49,796	$87,662

*这是我们实际买入价，也是计税基础；美国通用会计准则下的"成本"在少数情况下因必要的增记或减记而有所不同。

关于这份列表的构成，有一点值得说明。在伯克希尔过去的年报中，这一栏列出的每一只股票都是我买入的——也就是说，是我决定为伯克希尔买入的。但从这份列表开始，任何由Todd Combs或Ted Weschler做出的投资——或两人联合买入的投资——只要达到本列表的金额门槛（今年为10亿美元），都将被纳入。上面列出的第一只这样的股票就是DIRECTV，Todd和Ted的持仓中都持有它，两人合计持仓在2012年底的市值为11.5亿美元，如上所示。

Todd和Ted还管理着伯克希尔某些子公司的养老基金，而其他一些基金出于监管原因由外部顾问管理。我们不将这些养老基金的持仓纳入年报列表，尽管它们的投资组合往往与伯克希尔的组合存在重叠。

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我们正在逐步清理衍生品组合中涉及伯克希尔承担类保险风险的部分。（不过，我们的电力燃气公用事业业务将继续为运营目的使用衍生品。）新增此类头寸需要提供抵押品，除了极少数例外情况，我们不愿意这样做。市场可能出现极端情况，我们无意让伯克希尔暴露于金融世界某个突发意外事件之下——这个事件可能要求我们在一瞬间拿出堆积如山的现金。

查理和我坚信要保留多道冗余流动性，我们避免任何可能大幅消耗现金的义务。这在100年里会有99年降低我们的回报。但到了第100年，当其他许多人倒下时，我们却能活下来。而且在这100年里，我们每一年都睡得安稳。
我们卖出的为公司债提供信用保护的衍生品合约，将在未来一年内全部到期。现在几乎可以肯定，这些合约将为我们带来约10亿美元的税前利润。这些衍生品在签订时我们还获得了一大笔前期收入，在其五年存续期内，归属于它们的“浮存金”平均约为20亿美元。总体而言，这些衍生品带来了非常令人满意的结果，尤其是考虑到我们在金融恐慌及随后的衰退期间，一直为高收益品种为主的公司信用提供担保。

关于另一项主要的衍生品承诺，我们卖出了基于美国、英国、欧洲及日本四大股指的长期看跌期权。这些合约始于2004年至2008年，即便在最坏的情况下，其保证金要求也很低。2010年，我们解除了约10%的风险敞口，获利2.22亿美元。剩余合约将在2018年至2026年间到期。只有到期日的指数值才算数；我们的交易对手方无权提前终止。

伯克希尔在签订这些尚未到期的合约时，收到了42亿美元的保费。如果所有合约在2011年底到期，我们必须支付62亿美元；而2012年底的对应数字是39亿美元。随着即期结算负债大幅下降，我们在2012年底将美国通用会计准则下的负债从2011年底的85亿美元降至75亿美元。虽然这并非板上钉钉，但Charlie和我认为，最终的负债很可能远低于我们目前账面上的金额。与此同时，我们可以按照自己的意愿，投资使用这42亿美元来自这些合约的浮存金。

我们买了些报纸……报纸？

在过去15个月里，我们以3.44亿美元收购了28家日报。这可能让你费解，原因有二。第一，我长期以来在这些信函及年度股东大会上告诉你们，报业整体的发行量、广告和利润注定会下滑。这一预测仍然成立。第二，我们收购的这些资产远未达到我们反复强调的收购规模门槛。

第二点很容易解释。Charlie和我热爱报纸，只要其经济效益说得过去，即使它们远低于我们购买比如一个小配件公司所要求的规模门槛，我们也会买。解释第一点则需要我进行更详尽的说明，这要追溯一些历史。

简而言之，新闻就是人们不知道但想知道的东西。人们会从那些在即时性、易获取性、可靠性、全面性和低成本方面结合得最好的渠道，去寻求他们的新闻——那些对他们重要的新闻。这些因素的相对重要性，取决于新闻的性质及寻求新闻的人。

在电视和互联网出现之前，报纸是各类新闻的主要来源，这一事实使它们对绝大多数人来说不可或缺。无论你的兴趣是国际、国内、本地、体育还是金融行情，报纸通常都是最先告诉你最新消息的。事实上，报纸包含了如此多你想了解的内容，以至于即使只有少数几页涉及你的特定兴趣，你也会觉得物有所值。更好的是，广告主通常承担了产品几乎全部的成本，而读者则顺带沾了光。
另外，广告本身也为大量读者提供了至关重要的信息，实际上相当于提供了更多的“新闻”。编辑们可能会对此皱眉头，但对许多读者来说，了解哪里有工作或公寓出租、哪些超市有周末特价、或者哪家影院在何时放映哪部电影，远比社论版上的观点重要得多。

反过来，地方报纸对广告商来说也必不可少。如果西尔斯（Sears）或西夫韦（Safeway）在奥马哈开店，它们需要一个“扩音器”来告诉市民为什么今天应该光顾它们的商店。事实上，大型百货商店和杂货店会用多页广告来压倒竞争对手，因为他们知道广告里的商品会迅速被抢购一空。由于没有其他任何扩音器能与报纸相提并论，广告自己就卖得出去。

只要一份报纸在其社区是唯一的，它的利润就必然高得惊人；经营得好坏几乎无关紧要。（正如一位南方出版商的名言：“我之所以能拥有今天的高位，全靠美国两大伟大制度——裙带关系和垄断。”）

多年来，几乎所有城市都变成了“一城一报”（或者两家竞争报纸合并成一个经济实体）。这种收缩不可避免，因为大多数人只愿意阅读并付费购买一份报纸。当存在竞争时，发行量领先的报纸几乎自动获得最多的广告。这就形成了广告吸引读者、读者吸引广告的循环。这种共生关系注定了较弱报纸的灭亡，也被称为“最肥者生存”。

如今世界变了。股票报价和全国体育赛事的细节，在印刷机开动之前就已经是旧闻了。互联网提供了关于工作和住房的广泛信息。电视向观众轰炸政治、国家和国际新闻。在一个又一个兴趣领域，报纸已经失去了“主导地位”。随着读者数量下降，广告也随之减少。（“招聘”分类广告——长期是报纸的一大收入来源——在过去12年里暴跌了超过90%。）

然而，在提供本地新闻方面，报纸仍然占据统治地位。如果你想了解自己城镇里发生了什么——无论是关于市长、税收还是高中橄榄球——没有哪家本地报纸能替代它的工作。读者在看了几段关于加拿大关税或巴基斯坦政治发展的报道后，眼神可能变得呆滞；但一篇关于他本人或邻居的报道，他会读到结尾。只要存在深厚的社区意识，满足该社区特殊信息需求的报纸，对相当一部分居民来说就仍然不可或缺。

然而，即使是有价值的产品，也可能因错误的业务战略而自我毁灭。过去十年里，几乎所有大型报纸都走上了这条路。出版商们——包括伯克希尔在布法罗的报纸——都在互联网上免费提供报纸，同时对其纸质版收取不菲的费用。除了导致纸质版销量急剧、持续下滑之外，还能有什么别的结果呢？更何况，发行量下降又会使报纸对广告商的重要性降低。在这种情况下，过去的“良性循环”就逆转了。
《华尔街日报》很早就转向了付费模式。但地方报纸的主要典范是沃尔特·赫斯曼（Walter Hussman, Jr.）出版的《阿肯色民主党人公报》。沃尔特也早早采用了付费模式，过去十年来，他的报纸发行量保持得远比国内任何其他大报都要好。尽管有沃尔特这个强有力的榜样，但直到最近一两年，包括伯克希尔在内的其他报纸才开始探索付费安排。不管哪种模式效果最好——现在答案还不明朗——都会引来广泛效仿。

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查理和我认为，那些为紧密联系的社区提供全面可靠信息、并拥有明智互联网策略的报纸，将能在很长一段时间内保持活力。我们不相信通过削减新闻内容或减少出版频率就能成功。事实上，单薄的新闻报道几乎必然导致读者数量缩水。而目前在部分大城镇或城市尝试的非日报出版模式——虽然短期内可能改善利润——似乎必然会逐渐削弱报纸的相关性。我们的目标是让报纸充满读者感兴趣的内容，并从那些认为我们有用的读者那里获得合理回报，无论他们是通过纸质版还是互联网阅读。

我们的信心得到了奥马哈世界先驱报社泰瑞·克勒格（Terry Kroeger）卓越管理团队的支持，这个团队有能力管理一大批报纸。但各家报纸在新闻报道和社论观点上保持独立。（我投了奥巴马的票；但我们支持总统候选人的12家日报中，有10家选择了罗姆尼。）

我们的报纸当然也无法幸免于那些导致收入下滑的力量。尽管如此，我们全年持有的六家小型日报在2012年收入持平，这一结果远好于大城市日报的表现。此外，我们全年运营的两家大型报纸——《布法罗新闻报》和《奥马哈世界先驱报》——将收入降幅控制在3%以内，这也是高于平均水平的成绩。在美国50大都市区的报纸中，我们在布法罗和奥马哈的报纸在其本土市场的发行渗透率名列前茅。

这种受欢迎程度绝非偶然：功劳归于这些报纸的编辑们——《新闻报》的玛格丽特·沙利文（Margaret Sullivan）和《世界先驱报》的迈克·赖利（Mike Reilly）——他们为社区感兴趣的读者提供了不可或缺的信息。（玛格丽特，我遗憾地说，最近离开了我们，加入了《纽约时报》；该报的聘约让人难以拒绝。那家报纸做了笔好买卖，我们祝她一切顺利。）

伯克希尔从报纸获得的现金收益几乎肯定会随时间推移而趋势性下降。即便是明智的互联网策略也无法阻止一定程度的侵蚀。不过以我们的买入成本来看，我相信这些报纸将会达到或超过我们收购的经济测试标准。迄今为止的经营结果支持了这一信念。

然而，查理和我仍然遵循经济原则11（详见第99页），不会继续经营任何注定会持续亏损的业务。我们从媒体通用公司（Media General）批量收购的一家日报，在该公司旗下时严重亏损。在分析该报的经营结果后，我们看不到弥补亏损的办法，于是不情愿地将其关停。不过，我们其余所有的日报在未来很长一段时间内都应该能够盈利。（它们列在第108页。）在合适的价格下——这意味着以当前盈利的极低倍数——我们会收购更多我们喜欢类型的报纸。

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伯克希尔报纸业务的一个里程碑事件发生在年底，斯坦·利普西（Stan Lipsey）从《布法罗新闻报》发行人职位上退休。对我来说，毫不夸张地说，如果没有斯坦，《新闻报》现在可能已经不复存在了。
查理和我于1977年4月收购了《布法罗新闻报》。这是一家晚报，在平日占据主导地位，但没有周日版。在全国范围内，发行趋势正转向早报。而且，周日版对于大都市日报的盈利能力正变得日益关键。没有周日版，《新闻报》注定会输给它的早间竞争对手，后者拥有一份内容充实且根基稳固的周日产品。

因此，我们在1977年底开始印刷周日版。然后，一切都乱套了。我们的竞争对手将我们告上法庭，地方法院法官查尔斯·布里安特二世作出了一项严厉的裁决，严重阻碍了我们报纸的推出。他的裁决后来被推翻——在漫长的17个月之后——第二巡回上诉法院以3比0的票数严厉驳回了原判。在上诉待决期间，我们发行量下滑，资金大量流失，并始终面临倒闭的危险。

这时，斯坦·利普西登场了，他是我上世纪60年代的朋友，曾和他妻子将奥马哈一家小型周报卖给了伯克希尔。我发现斯坦是一位杰出的报人，通晓发行、生产、销售和编辑的方方面面。（他是那家小周报在1973年获得普利策奖的关键人物。）所以，当我在《新闻报》陷入大麻烦时，我请斯坦离开他在奥马哈舒适的生活，接管布法罗的业务。

他毫不犹豫。与我们的编辑默里·莱特一起，斯坦在非常黑暗的日子里坚持了四年，直到1982年《新闻报》赢得竞争胜利。从那时起，尽管布法罗经济不景气，《新闻报》的表现一直非常出色。作为朋友和经理人，斯坦都是最棒的。

股息

不少伯克希尔股东——包括我的一些好友——希望伯克希尔派发现金股息。让他们困惑的是，我们喜欢伯克希尔持有的大多数股票派发的股息，但自己却分文不出。那么，我们来探讨一下，股息何时对股东有意义，何时没有意义。

一家盈利公司可以以多种方式（并非互斥）分配其收益。公司管理层应首先审视当前业务提供的再投资可能性——那些旨在提高效率、拓展地域、延伸和改善产品线，或以其他方式拓宽公司与其竞争对手之间经济护城河的项目。

我要求我们子公司的经理们持续关注拓宽护城河的机会，他们也发现许多在经济上合理的机会。但有时我们的经理也会判断失误。失败的常见原因是，他们从想要的答案出发，然后反向寻找支持的理由。当然，这个过程是潜意识的；这正是它如此危险的原因。

你们的董事长也未能幸免于这种错误。在伯克希尔1986年的年报中，我描述了我们在最初纺织业务上长达20年的管理努力和资本改进是多么徒劳无功。我希望这项业务成功，并一厢情愿地做出了一系列糟糕的决策。（我甚至又收购了一家新英格兰纺织公司。）但一厢情愿只会在迪士尼电影中让梦想成真；它在商业中却是毒药。

尽管有过去这些失误，但我们对可用资金的首要任务始终是审视能否将其明智地投入到我们的各项业务中。2012年，我们对固定资产进行了创纪录的121亿美元投资和补强型收购，这表明在伯克希尔，这是一个富有成效的资本配置领域。而我们在这方面有一个优势：由于我们在经济的众多领域开展业务，我们拥有的选择范围比大多数公司要广泛得多。在决定做什么时，我们可以浇灌鲜花，而跳过杂草。
即使我们在现有业务中投入了大量资金，伯克希尔仍会定期产生大量额外现金。因此，我们的下一步是寻找与现有业务无关的收购。在这里，我们的测试很简单：Charlie和我是否认为，我们能够完成一笔交易，使股东每股财富比收购前更丰厚？

我在收购中犯过许多错误，将来还会犯更多。但总体而言，我们的记录还是令人满意的，这意味着，比起将这些收购资金用于股份回购或股息，今天的股东们要富裕得多。

但是，用标准免责声明来说，过往业绩不能保证未来表现。这在伯克希尔尤为如此：由于我们目前的规模，做出既有意义又明智的收购，现在比我们过去大多数年份都更困难。

尽管如此，一笔大交易仍为我们提供了大幅增加每股内在价值的可能性。BNSF（伯灵顿北方圣塔菲铁路公司）就是一个例子：它现在的价值远高于我们的账面价值。如果我们当初将购买所需资金用于股息或回购，你和我的境况会更糟。虽然像BNSF这样的大交易将很少见，但海洋中仍有鲸鱼。

资金的第三种用途——股份回购——对于一家股价相对于保守计算的内在价值有显著折价的公司来说是合理的。事实上，纪律严明的回购是最明智的资金运用方式：当你以80美分或更低价格购买1美元钞票时，很难出错。我们在去年的报告中解释了回购的标准，如果机会出现，我们将大量购买我们的股票。我们最初说不会支付超过账面价值的110%，但事实证明这不现实。因此，我们在12月将上限提高到120%，当时一大宗股票以约账面价值的116%的价格出现。

但永远不要忘记：在回购决策中，价格至关重要。当购买价格高于内在价值时，价值就会被摧毁。董事们和我认为，在不超过120%上限的情况下进行回购，将会对持续股东产生实质性的利益。

这就引出了股息问题。这里我们需要做一些假设，并运用一些数学。数字需要仔细阅读，但它们对于理解支持和反对股息的理由至关重要。所以请耐心听我讲。

我们先假设你和我是一家净资产200万美元企业的平等所有者。该企业有形净资产收益率为12%——24万美元——并且可以合理预期留存收益也能获得同样的12%收益率。此外，总有外部人士希望以净资产125%的价格买入我们的企业。因此，我们每人拥有的现在价值是125万美元。

你希望我们两位股东获得公司年利润的三分之一，其余三分之二进行再投资。你觉得这个计划能很好地平衡你对当前收入和资本增长的需求。因此，你建议我们从当前利润中支付80,000美元，留存160,000美元用于增加企业未来利润。第一年，你的股息将是40,000美元，随着利润增长并保持三分之一支付率，你的股息也会增长。总体而言，股息和股票价值每年增长8%（净资产收益12%减去支付的4%净资产）。

十年后，我们的公司将拥有净资产4,317,850美元（原始200万美元按8%复利计算），你下一年的股息将是86,357美元。我们每人将持有价值2,698,656美元的股票（为我们各自一半公司净资产的125%）。从此我们将幸福地生活——股息和股票价值继续以每年8%的速度增长。
还有一种替代方案，能让我们更加愉悦。在这种情景下，我们将所有收益留在公司，每年各自减持3.2%的股份。由于股份以账面价值的125%出售，这一方案最初同样能产生40,000美元现金，且该金额每年还会增长。称此选项为“减持方案”。

在减持方案下，十年后公司净资产增至6,211,696美元（200万美元按12%复利）。由于我们每年会出售股份，各自的持股比例将下降；十年后，我们每人将持有公司36.12%的股份。即便如此，届时您在公司净资产中的份额仍为2,243,540美元。请记住，我们每人所对应的每一美元净资产都可以1.25美元卖出。因此，您剩余股份的市值将是2,804,425美元，比我们采用股息方案时您的股份价值高出约4%。

此外，根据减持政策，您每年收到的现金此时也会比股息方案高出4%。瞧！——您每年可花费的现金更多，资本价值也更高。

当然，这一计算假设我们这家假设的公司年均净资产收益率为12%，且股东能以账面价值125%的平均价格出售股份。就这一点而言，标普500公司的净资产收益率远高于12%，售价也远高于账面价值的125%。这两个假设对伯克希尔来说似乎也合理，尽管当然不能保证。

而且，从有利方面看，也存在假设被超越的可能性。如果真是如此，减持政策的论据就更加有力了。以伯克希尔的历史（诚然，这段历史不太可能重现）来看，减持政策给股东带来的结果会远远优于股息政策。

除了有利的数学计算外，减持政策还有两个重要理由。第一，股息政策对所有股东强加了特定的现金提取规则。比如说，如果公司规定支付40%的收益，那么希望提取30%或50%的股东就会受挫。我们的60万股东在现金需求上各不相同。但可以肯定地说，其中有很大一部分——也许甚至是大多数——处于净储蓄模式，逻辑上应倾向于完全不拿现金。

而减持方案则让每位股东在现金收入和资本积累之间自行选择。一位股东可以选择兑现，比如60%的年度收益，而其他股东可以选择20%或完全不兑现。当然，在我们股息方案下的股东可以反过来用股息买入更多股份。但这样做他会遭受双重打击：既要缴税，还要支付25%的溢价才能将股息再投资（记住，在公开市场买入股票是以账面价值125%的价格进行的）。

股息方案的第二个缺点同样重要：对所有纳税股东来说，其税收后果都比减持方案差——通常要差得多。在股息方案下，股东每年收到的所有现金都要缴税；而在减持方案下，只有现金收入中的收益部分需要纳税。
让我用我自己的例子来收尾这段数学练习——我听得见你们在欢呼我放下牙医钻头了——说明股东定期卖出股票的同时，如何还能增加对企业的投资。过去七年里，我每年捐出约4¼%的伯克希尔股票。通过这个过程，我最初的712,497,000股B类等价股（经拆股调整）已减少到528,525,623股。显然，我对公司的持股比例大幅下降了。

然而，我对企业的投资实际上增加了：我现在所持伯克希尔股权的账面价值，远高于七年前对应持股的账面价值。（具体数字是：2005年282亿美元，2012年402亿美元。）换句话说，即使我对公司的所有权大幅减少，我在伯克希尔投入的资金却比以前多得多。同样，我在伯克希尔内在商业价值以及公司正常盈利能力中所占的份额，也比2005年大得多。随着时间的推移，我预期这种价值的积累会持续下去——尽管方式极不规律——即便我每年捐出的股票现在超过4½%（比例上升是因为我最近将某些基金会的终身捐赠承诺翻了一番）。

* * * * * * * * * * * *

归根结底，股利政策应当始终清晰、一致且理性。反复无常的政策会令所有者困惑，并吓跑潜在投资者。Phil Fisher 在54年前于《普通股与非凡利润》第七章中精彩地阐释了这一点——这本书在严肃投资者的史上最佳书单中，仅次于《聪明的投资者》和1940年版的《证券分析》。Phil解释说，你可以成功经营一家卖汉堡的餐馆，或者一家主打中餐的餐馆，但你不能在两者间反复切换，还想留住各自的粉丝。

大多数公司发放稳定的股利，通常每年尝试提高，极不情愿地削减。我们的"四大"持仓公司遵循这一明智且易懂的做法，在某些情况下还相当积极地回购股份。

我们赞赏它们的行动，并希望它们继续沿着当前道路前进。我们喜欢增加股利，也热爱在合适价格下进行的回购。

然而，在伯克希尔，我们一直奉行不同的做法，我们知道这是明智的，也希望你通过刚才读到的段落能理解它。我们会坚持这一政策，只要我们认为关于账面价值积累和市价溢价的假设看起来合理。如果这两个因素的前景发生重大恶化，我们将重新审视我们的行动。

股东大会

股东大会将于5月4日星期六在世纪互联中心 (CenturyLink Center) 举行。Carrie Sova 将负责统筹。（虽然名字变了，但她还是去年那位优秀的 Carrie；她在六月嫁给了一位非常幸运的男士。）我们总部团队的所有人都协助她；整场活动是自家制作的，我为参与筹备的同事感到无比骄傲。

大门将在早上7点打开，7点半我们将举办第二届国际投报纸挑战赛。目标是一个Clayton Home的门廊，距离投掷线正好35英尺。去年我成功击败了所有挑战者。但现在伯克希尔收购了大量报纸，随之也带来了很多投掷天赋（或者投掷者这么声称）。来看看他们的天赋是否配得上他们的豪言。更好的是，亲自加入。报纸将有36到42页，你必须自己折叠（不准用橡皮筋）。
上午8:30，伯克希尔的新影片将上映。一小时后，问答环节开始（午餐休息时间可到CenturyLink的摊位用餐），一直持续到下午3:30。短暂休会后，我和查理将于3:45召开年度股东大会。如果你决定在白天问答环节中途离场，请在查理发言时行动。

当然，离场的最佳理由是去购物。我们会帮你实现——在紧邻会场的194,300平方英尺展厅里，摆满伯克希尔几十家子公司的产品。去年你们表现不俗，大多数展位都创下销售纪录。在九小时内，我们卖出了1,090双Justin靴子（每30秒一双）、10,010磅See's糖果、12,879把Quikut刀具（每分钟24把）、以及5,784双Wells Lamont手套——它一直是热销品。但你们还能做得更好。记住：那些说钱买不到快乐的人，只是没在我们年会上购过物。

去年，我们的跑鞋公司Brooks首次参展，销售额达到15万美元。Brooks势头正劲：2012年销量增长34%，而此前2011年已有34%的增幅。公司管理层预计2013年还将再增长23%。今年年会上，我们还会推出特别纪念款跑鞋。

周日上午8点，我们将启动“伯克希尔5公里跑”，比赛从CenturyLink出发。参赛详情将附在《参会指南》中，与参会凭证一同发放。我们设置了丰富的组别，包括媒体组（报道他们的表现一定很有趣）。遗憾地是，我将放弃跑步——总得有人来发令枪。

我得提醒你，我们身边可有不少本土高手。Ted Weschler马拉松成绩3小时01分。Brooks那位活力四射的CEO Jim Weber也是个飞毛腿，最佳成绩3小时31分。Todd Combs专攻铁人三项，但5公里跑也跑出过22分钟的成绩。

但这只是开始：我们的董事们也脚步轻快——至少其中几位是。Steve Burke跑过惊人的波士顿马拉松2小时39分（这是家族传统；他妻子Gretchen纽约马拉松成绩3小时25分）。Charlotte Guyman最好成绩3小时37分，Sue Decker在纽约冲线成绩3小时36分。查理没交回问卷。

GEICO会在购物区设有展位，由来自全国各地的顶尖顾问坐镇。不妨过去询个价。多数情况下，GEICO能给你股东折扣（通常8%）。在我们运营的51个司法管辖区中，有44个允许这项优惠。（补充一点：如果你已符合其他折扣条件，比如特定团体的优惠，这项折扣不能叠加。）带上你现有保险的细节，瞧瞧我们能不能帮你省钱。我相信至少对一半的人，我们能。

一定要去Bookworm看看。那里会有大约35种图书和DVD，包括几本新书。自1977年以来一直帮我编辑这封信的Carol Loomis，最近出版了《跳着踢踏舞去上班：沃伦·巴菲特近乎一切事》。她和我共同签了500本，仅限年会上有售。

William Thorndike Jr.的《局外人》是一本关于那些擅长资本配置的CEO的杰出著作，其中有一章深入剖析了我们的董事Tom Murphy——他是我见过的最优秀的商业经理。我还推荐Jack Bogle的《文化的冲突》和Laura Rittenhouse的《字里行间投资》。如果你需要邮寄购买的书，附近有快递服务。
《奥马哈世界先驱报》今年将继续设立展位，出售该报近期出版的几本书。热血的内布拉斯加玉米壳队球迷——内布拉斯加人里有谁不是吗？——肯定会想买一本《不败之师》。这本书讲述了内布拉斯加橄榄球队在1993年至1997年间的辉煌岁月，那是一个黄金时代，汤姆·奥斯本执教的球队取得了60胜3负的战绩。

如果您是位大手笔消费者——或者立志成为这样的人——那么请于周六中午至下午5点间，前往奥马哈机场东侧的Signature Aviation。那里将停着一队NetJets飞机，保证让您心跳加速。坐巴士来，乘私人飞机走。尽情享受一番吧。

本报告所附的股东委托材料中有一份附件，说明了如何获取参加股东大会及其他活动所需的凭证。航空公司有时会在伯克希尔周末期间提高票价。如果您远道而来，不妨比较一下飞往堪萨斯城与飞往奥马哈的机票费用。两地之间车程约两个半小时，您也许能省下不少钱，特别是如果您本来计划在奥马哈租车的话。把省下的钱花在我们这儿吧。

在内布拉斯加家具城（位于第72街，Dodge街与Pacific街之间，占地77英亩），我们将再次推出“伯克希尔周末”折扣价。去年，该店在年会期间的销售额达到了3590万美元，创下历史新高，让其他零售商眼红不已。要享受伯克希尔折扣，您必须在4月30日周二至5月6日周一（含首尾两天）期间购物，并出示您的会议凭证。此期间的特别定价甚至适用于多个知名制造商的产品，这些厂商通常有铁一般的规则禁止打折，但本着我们股东周末的精神，破例为您提供了优惠。我们感谢他们的合作。内布拉斯加家具城周一至周六上午10点至晚上9点营业，周日上午10点至下午6点营业。今年周六下午5点30分至晚上8点，内布拉斯加家具城将举办一场野餐会，欢迎您参加。

在波仙珠宝店，我们将再次举办两场股东专属活动。第一场是5月3日周五下午6点至9点的鸡尾酒招待会。第二场，也是主要的盛会，将于5月5日周日上午9点至下午4点举行。周六我们营业至下午6点。近年来，我们三天的销售额已远超整个12月（通常是珠宝商的黄金月份）的业绩。

周日下午1点左右，我将在波仙珠宝店开始当店员。去年我的销售额总计150万美元。今年不达到200万美元我不罢休。因为我需要在日落前早早收工，所以我会拼命做生意。快来占我便宜吧。就冲我要的“疯狂的沃伦”价。

整个周末波仙珠宝店都会人山人海。为了方便您，股东优惠价将从4月29日周一持续到5月11日周六。在此期间，请出示您的会议凭证或显示您是伯克希尔股东的券商对账单，以表明身份。

周日，在波仙珠宝店外的商场里，两届美国国际象棋冠军帕特里克·沃尔夫将蒙上眼睛，同时与六位眼睛睁得大大的挑战者对弈。旁边，来自达拉斯的神奇魔术师诺曼·贝克将让围观者目瞪口呆。此外，我们还邀请了世界顶级桥牌高手鲍勃·哈曼和莎伦·奥斯伯格，在周日下午与我们的股东切磋牌技。可别跟他们赌钱。
Gorat's 和 Piccolo's 餐厅将在 5 月 5 日（周日）再次专为伯克希尔股东开放。两家餐厅都会营业到晚上 10 点，Gorat's 下午 1 点开门，Piccolo's 下午 4 点开门。这两家是我最喜欢的餐厅，周日晚上我会两家都去。提醒一下：预订 Gorat's 请在 4 月 1 日（当天及之后）拨打 402-551-3733，预订 Piccolo's 请拨打 402-342-9038。在 Piccolo's，记得点一份巨型根汁汽水漂浮作为甜点。只有怂包才点小份。（我有一次看到 Bill Gates 吃完一顿正餐后又干掉两个巨型份；从那一刻起我就知道他会成为一位出色的董事。）

我们今年仍将邀请三位财经记者主持大会的问答环节，由他们向查理和我提问股东通过电子邮件提交的问题。三位记者及其邮箱分别是：Carol Loomis，来自《财富》杂志，邮箱 cloomis@fortunemail.com；Becky Quick，来自 CNBC，邮箱 BerkshireQuestions@cnbc.com；以及 Andrew Ross Sorkin，来自《纽约时报》，邮箱 arsorkin@nytimes.com。

每位记者将从收到的提问中挑选他/她认为最有趣和最重要的六个问题。记者们告诉我，如果你的问题简洁、避免最后一刻发送、与伯克希尔相关，并且每封邮件中不超过两个问题，那么被选中的可能性最大。（如果你希望在问题被选中时被点名，请在邮件中告知记者。）

去年我们有第二组分析师，共三位，均跟踪伯克希尔。他们都是保险专家，但股东随后表示希望有更多多样性。因此，今年我们将会有一位保险分析师——野村证券的 Cliff Gallant。Ruane, Cunniff & Goldfarb 的 Jonathan Brandt 也将加入分析师小组，针对我们的非保险业务提问。

最后——为了加点料——我们想邀请一位有资质的伯克希尔空头加入小组，最好是做空该股的人。目前我们还没找到合适的空头，欢迎申请者联系我们。唯一要求是你是一名投资专业人士，且对伯克希尔持负面观点。三位分析师将带来他们自己关于伯克希尔的特定问题，并与记者和现场观众轮流提问。

查理和我认为，所有股东都应该同时获得伯克希尔的新信息，并有足够的时间进行分析，这就是为什么我们试图在周五收盘后发布财务信息，以及为什么我们的股东大会在周六举行。我们不会与大型机构投资者或分析师进行一对一的谈话。我们希望记者和分析师提出的问题能进一步教育股东了解自己的投资。

查理和我对于将要被问到的问题一无所知。我们知道记者和分析师会提出一些尖锐的问题，而这正是我们喜欢的。总的来说，我们预计至少有 54 个问题：每位分析师和记者各 6 个，现场观众 18 个。如果有额外时间，我们会多安排一些观众提问。观众提问者将通过抽签决定，抽签于上午 8:15 在体育馆和主溢流厅的 11 个麦克风处进行。

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我经常有充分理由赞扬我们的运营经理们的成就。他们是真的全明星，经营自己的业务就像那是他们家族拥有的唯一资产。我相信他们的心态是股东导向的，在全美大型上市公司中也难觅其右。他们中的大多数人并没有经济上的工作需求；打出商业"本垒打"的喜悦对他们来说和薪水一样重要。
然而，同样重要的是，与我一同在公司总部办公的23位同事（我们都在同一层楼办公，而且我们打算一直保持这样！）。

这个团队高效地处理着大量SEC（美国证券交易委员会）及其他监管要求，提交长达21,500页的联邦所得税申报表以及各州和海外申报表，回应无数股东和媒体的问询，编制年报，筹备美国规模最大的股东大会，协调董事会工作——这样的工作清单还长得很。

他们以令人难以置信的高效率和愉悦的心情处理所有这些业务，让我的生活轻松而愉快。他们的努力远不止于伯克希尔相关事务：去年，他们与48所大学（从200所申请者中选出）对接，安排学生们来奥马哈与我进行问答日。他们还处理我收到的各种请求，安排我的行程，甚至为我准备午餐汉堡。没有哪位CEO比我更幸福了；我确实感觉每天都是跳着踢踏舞去上班。

这支总部团队的成员，连同我们的运营经理们，得到了我最深切的感谢，也理应得到你们的感谢。5月4日，来奥马哈——资本主义的摇篮——加入我们吧。

2013年3月1日

沃伦·E·巴菲特

董事会主席