Along with reporting nice profits in the last year, Warren Buffett wrote about hurricanes and railroads--but he did not provide much guidance on his successor in his annual letter to shareholders. 

Berkshire Hathaway Inc. (BRK-A) reported 2015 net earnings attributable to Berkshire Hathaway shareholders in the amount of $24.08 billion, an increase of 21.2% from the previous year. The company also reported a 6.4% gain in per-share book value. Still, the market hasn't seemed too impressed with the them, with the company's shares down over 12% in 2015 from the previous year. 

As usual, Buffett touched upon a broad variety of themes in his annual letter. 

He singled out BNSF railroad's customer service improvements as the most important development at Berkshire. The company invested a record $5.8 billion in capital expenditures. However, its revenues were hit by low energy prices as freight revenues for industrial products declined by 11% from the previous year, to $5.6 billion. "The decrease reflected lower volumes for petroleum products, frac sands, and steel products and lower average revenue per car/unit," according to the letter (p.85). Berkshire Hathaway further expects volumes to weaken in 2016 as compared to 2015. 

Buffett also wrote about climate change, the subject of a proxy proposal at this year's general meeting. "It seems highly likely to me that climate change poses a major problem for the planet," he wrote (p. 27). With climate change increasingly on the minds of businesses and homeowners, property prices are expected to take a hit in certain areas, such as  low-lying neighborhoods. On the other hand, he qualifies the statement: "...but when you are thinking only as a shareholder of a major insurer, climate change should not be on your list of worries."

Spoiler alert: Buffett did not provide any hint about his successor in his annual letter. In recent times, there has been much speculation about possible successors to the 85-year-old, after he was diagnosed with prostate cancer in 2011. For example, some media have fixated on Ajit Jain, who runs Berkshire's insurance business, and who, as Buffett wrote, "has created tens of billions of value for Berkshire shareholders." (p. 13) But, Buffett has also referred to Todd Combs and Ted Weschler as being better stock-pickers than himself in previous shareholder missives.   

The letter contained characteristic flashes of Buffett humor: "I now spend ten hours a week playing bridge online. And, as I write this letter, 'search' is invaluable to me. (I’m not ready for Tinder, however.)" (p. 10)

The Bottom Line 

Last year was not the best one for Berkshire Hathaway as a number of economic and market-related headwinds, such as low oil prices, weighed on its bottom line. Still, the firm managed to produce decent returns.