Warren Buffett’s annual letter offers insight into Berkshire Hathaway for new shareholders

Buffett letter gives Berkshire Hathaway 101 course

OMAHA, Neb. — Billionaire Warren Buffett devoted much of his annual letter to educating new Berkshire Hathaway shareholders about the company and why he believes the firm will have a profitable future.

Buffett’s letter released Saturday details Berkshire’s performance in 2009 and what was behind the company’s net income of $8.055 billion, or $5,193 per Class A share. That’s up 61 percent from last year’s $4.994 billion net income, or $3,224 per share.

Much of the reason for the big swing in profit has to do with the value of Berkshire’s investments and derivative contracts, some of which are tied to equity indexes.

Berkshire recorded a largely unrealized $787 million gain in investments in 2009 instead of the $7.5 billion loss it recorded in 2008.

On the Net:

Berkshire Hathaway Inc.: www.berkshirehathaway.com