BERKSHIRE HATHAWAY DROPS

Berkshire Hathaway’s second quarter operating profit fell 18 percent, with much of the loss attributed to deteriorating underwriting in its insurance operations, including GEICO and reinsurers General Re and National Indemnity. Second-quarter operating profit fell to $245 million or $161 per share, from $299 million or $197 per share. Underwriting results at General Re, though very unsatisfactory, improved from the preceding quarter. Absent a mega-catastrophe, Berkshire expects this trend to continue. Underwriting results also improved from the preceding quarter at GEICO. Unit growth slowed with policies-in-force at June 30, 2000, up 18 percent from last year. This slowing is expected to continue, though premium growth should continue to be strong due to higher prices.