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Warren Buffett argues that Berkshire will still be a power as soon as he leaves



OMAHA, Neb –

Warren Buffett

At the Berkshire Hathaway Inc. annual meeting on Saturday, shareholders tried to reassure shareholders that the company's success would continue if it were no longer at the helm.

Berkshire promoted Mr. Buffett's two possible successors,

Greg Abel

and

Ajit Jain,

Vice Chairmen in January and gave them greater responsibility for overseeing the business of the company. The managers of Berkshire's more than 60 business units now either report to Abel or Mr. Jain and no longer to Mr. Buffett.

Their climbs have raised some concerns over one of Berkshire's hallmarks: its reputation as a buyer of choice for well-managed companies. Part of the appeal to these companies is Mr. Buffett's seal of approval, and some shareholders question whether Berkshire will succeed in acquiring trades under Mr. Abel or Mr. Jain.

"The call belongs to Berkshire now," Mr. Buffett said. "For someone looking after a business, we are absolutely the first call and will continue to be the first call."

Mr. Buffett repeatedly said at the meeting that Berkshire's success in acquiring businesses and finding attractive investments was due to the company's balance sheet and track record, not to his personal fame. While Mr. Buffett's lieutenants are well-known to supporters of the company, Mr. Jain and Mr. Abel are relatively shy and have not made any public statements at the annual meeting.

As for the day of "That really has not changed," Buffett said.

"Nothing has really changed that much," he said, joking that he had been halved for decades. Berkshire allows its managers to run their businesses relatively independently.

Mr. Buffett continues to monitor the company's capital allocation. His portfolio managers, Ted Weschler and

Todd combs,

He manages about $ 25 billion in equity investments, and Mr. Buffett manages the rest of the company's stock and bond holdings and cash reserves.

Men. Combs and Weschler have arranged some deals for Berkshire, Buffett said, and the bosses of the Berkshire affiliates have long been looking for "bolt-on acquisitions" themselves.

Follow-up questions were an important component on Saturday as Mr. Buffett and his business partner Berkshire Vice Chairman

Charles Munger,

answered questions from shareholders, analysts and journalists for hours.

The conglomerate operates a large insurance company as well as a railroad, utilities, industrial manufacturers and retailers. Its holdings include Dairy Queen, Duracell, Fruit of the Loom, Geico and Lake's Candies. This year, more than 40,000 people were expected to travel to Omaha for annual meetings.

In addition, Mr. Buffett defended again

Wells Fargo

& Co., one of Berkshire's largest stocks, despite a series of scandals in the bank. Some of Berkshire's best investments have seen scandals in the past, including American Express Co. and auto insurer Geico.

"All the big banks had problems in one form or another," he said. "And I see no reason why Wells Fargo, as a company, is inferior in any way, from both an investor standpoint and a moral point of view, to the other major banks it competes with."

Berkshire said on Saturday that it swung to a rare loss in the first quarter, hurt by the impact of a change in accounting rules on unrealized investment losses. It was the company's first quarterly loss in nine years.

Berkshire reported a net loss of $ 1

.14 billion or $ 692 per Class A equivalent for the first quarter, compared to $ 4.06 billion or $ 2,469 per share for the same period last year. Operating income, which excludes some investment income, increased from $ 3.56 billion a year ago to $ 5.29 billion

. Buffett warned shareholders in its annual letter, released in February, that Berkshire's earnings would appear more volatile from 2018 due to the new accounting rule that companies include unrealized gains or losses in their net income. Berkshire reported a $ 6.2 billion decline in capital income in the first quarter.

Berkshire also holds large investments, especially in the stock market. Mr. Buffett told CNBC on Thursday that Berkshire has a large stake in it

Apple
Inc.

by 75 million shares in the first quarter.

Berkshire's Class A shares closed Friday at $ 292,600, down 1.7% for the year.

87-year-old Mr. Buffett, whose clever investments have nicknamed him "The Oracle of Omaha," still has enough cash for future acquisitions to increase profits. Berkshire held $ 108.6 billion in cash at the end of the first quarter, down from $ 116 billion at the end of 2017.

Write to Nicole Friedman at nicole.friedman@wsj.com [19659022]
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