校对：Catherine

致伯克希尔-哈撒韦的全体股东：

 

Last year, when discussing the prospects for 1975, we stated "the outlook for 1975 is not

encouraging." This forecast proved to be distressingly accurate. Our operating earnings for 1975

were $6,713,592, or $6.85 per share, producing a return on beginning shareholders' equity of

7.6%. This is the lowest return on equity experienced since 1967. Furthermore, as explained later

in this letter, a large segment of these earnings resulted from Federal income tax refunds which

will not be available to assist performance in 1976.

 

去年讨论公司1975年的前景时，我们预测今年的前景不是那么令人满意。不幸的是，这个预言成真了。

 

1975年我们的营业利润为6,713,592美元，也就是每股收益6.85美元，初始股东权益回报率为7.6%。这是自1976年以来最低的回报率。

 

然而，正如这封信后面分析的那样，营业利润中相当大的一部分来自联邦所得税退税，这并不能使1976年的业绩有所改善。

 

 

On balance, however, current trends indicate a somewhat brighter 1976. Operations and prospects will be discussed in greater detail below, under specific industry titles. Our expectation  is that significantly better results in textiles, earnings added from recent acquisitions, an increase  in equity in earnings of Blue Chip Stamps resulting from an enlarged ownership interest, and at  least a moderate improvement in insurance underwriting results will more than offset other  possible negatives to produce greater earnings in 1976. The major variable²and by far the most difficult to predict with any feeling of confidence²is the insurance underwriting result. Present very tentative indications are that underwriting improvement is in prospect. If such improvement is moderate, our overall gain in earnings in 1976 likewise will prove moderate. More significant   underwriting improvement could give us a major gain in earnings.

 

但是，权衡比较之下，目前的局势表明1976年有些事情会有所好转。下面几个具体的行业中会有关于运营和前景的进一步分析讨论。

 

我们的预计是：纺织业的业绩会有明显改善，近期的收购会使得收益增加，蓝筹股的权益回报率会因所有权的扩大而提高，并且保险承保利润的增加至少可以抵消其他的不利影响，使1976年产生可观的利润。

 

目前最善变并且完全没有把握、难以预测的是保险承保业绩。现在初步迹象表明，承保的前景会有所改善。如果这方面的改善是缓慢的，那我们整体盈利的增加也会很缓慢。保险承保业务如果可以大幅提高，那么我们的营业利润也会大量增加。

 

Textile Operations

纺织业务

 

During the first half of 1975 sales of textile products were extremely depressed, resulting in

major production curtailments. Operations ran at a significant loss, with employment down as

much as 53% from a year earlier.

 

1975年上半年纺织品的销售下降，导致主要产品的生产缩减了。经营损失显著，资产使用率比去年同期下降了53%。

 

In contrast with previous cyclical slumps, however, most textile producers quickly reduced

production to match incoming orders, thus preventing massive industry-wide accumulation of

inventories. Such cutbacks caused quite prompt reflection at the mill operating level when

demand revived at retail. As a result, beginning about midyear business rebounded at a fairly

rapid rate. This "V" shaped textile depression, while one of the sharpest on record, also became

one of the shortest ones in our experience. The fourth quarter produced an excellent profit for our

textile division, bringing results for the year into the black.

 

然而，与以往的周期性衰退相比，多数纺织品生产商根据订单迅速减少了产量，因此，防止了全行业的大规模存货累积。当零售恢复正常需求时，这种消减对工厂经营水平的影响也就显而易见了。

 

结果是，年中业务开始以以较快的速度回升。这“V”字形的纺织业的衰退，是记录中最明显的一次，同时也是我们最短的遇到的时间最短的一次。第四季度我们的纺织部门获得了极好的利润，使全年业绩扭亏为盈。

 

 

On April 28, 1975 we acquired Waumbec Mills Incorporated and Waumbec Dyeing and

Finishing Co., Inc. located in Manchester, New Hampshire. These companies have long sold

woven goods into the drapery and apparel trade. Such drapery materials complement and extend

the line already marketed through the Home Fabrics Division of Berkshire Hathaway. In the

period prior to our acquisition, the company had run at a very substantial loss, with only about

55% of looms in operation and the finishing plant operating at about 50% of capacity. Losses

continued on a reduced basis for a few months after acquisition. Outstanding efforts by our manufacturing, administrative and sales people now have produced major improvements, which, coupled with the general revival in textiles, have moved Waumbec into a significant profit position.

 

1975年4月28日，我们收购了位于曼彻斯特 New Hampshire的 Waumbec Mills Incorporated and Waumbec Dyeing and Finishing Co.公司。这些公司由销售编织品发展到衣饰和服装贸易。这种帐幔材料通过伯克希尔的家庭纺织品部门销售，补充和延伸了已有的产品线市场。

 

在收购之前，这家公司经营损失很严重，差不多只有55%的织布机在投入生产，染制厂只以50%的生产能力在运营。收购之后的几个月内亏损仍在继续，但是稍有减少。通过我们的制造商、管理人员和销售人员的杰出努力，情况已经有了很大的改进，同时也伴随着整个纺织业的复苏，Waumbec公司现在已扭亏为盈了。

 

We expect a good level of profits from textiles in 1976. Continued progress is being made in the

movement of Waumbec goods into areas of traditional marketing strength of Berkshire Hathaway, productivity should improve in both the weaving and finishing areas at Manchester, and textile demand continues to firm at decent prices.

 

我们预计1976年纺织业会有良好的盈利水平。持续性的项目已取得进展，这些项目的目的是把Waumbec公司的商品转变到伯克希尔公司具有传统的营销优势的领域中，曼彻斯特的织造和染整领域的生产能力仍需有待提升，纺织需求品继续稳定在合适的价格。

 

We have great confidence in the ability of Ken Chace and his team to maximize our strengths in

textiles. Therefore, we continue to look for ways to increase further our scale of operations while avoiding major capital investment in new fixed assets which we consider unwise, considering the relatively low returns historically earned on large scale investment in new textile equipment.

 

对于Ken Chace的能力以及他的团队能否最大程度的发挥我们在纺织业的优势，我们很有信心。因此，我们将继续寻找办法以壮大经营规模，同时也避免对新的固定资产的资本投资（我们认为这是不合理的，因为考虑到它的低回报率以及在新的纺织机器上的巨额投资）。

 

 

Insurance Underwriting

保险承保业务

 

The property and casualty insurance industry had its worst year in history during 1975. We did our share²unfortunately, even somewhat more. Really disastrous results were concentrated in auto and long-tail (contracts where settlement of loss usually occurs long after the loss event) lines.

 

1975年是有史以来财产和伤亡保险行业表现最差的一年。我们不幸地拥有了份额，甚至很多。真正灾难性的结果都集中在汽车和长尾巴线上（合同结算损失通常发生在长期亏损事件后）。

 

Economic inflation, with the increase in cost of repairing humans and property far outstripping

the general rate of inflation, produced ultimate loss costs which soared beyond premium levels

established in a different cost environment. "Social" inflation caused the liability concept to be

expanded continuously, far beyond limits contemplated when rates were established²in effect,

adding coverage beyond what was paid for. Such social inflation increased significantly both the

propensity to sue and the possibility of collecting mammoth jury awards for events not previously considered statistically significant in the establishment of rates. Furthermore, losses to  policyholders which otherwise would result from mushrooming insolvencies of companies

inadequately reacting to these problems are divided through Guaranty Funds among remaining

solvent insurers. These trends will continue, and should moderate any optimism which otherwise

might be justified by the sharply increased rates now taking effect.

 

这次的通货膨胀使弥补人类和财产的成本大大超过了一般水平的膨胀，从而使我们最终的成本损失超过了在另一个成本环境中的保费收入的增加。

 

“社会性”的通货膨胀导致赔偿范围不断扩大，远远超过了最初实际比率拟定的上限，增加了超过我们赔偿范围的保险项目。

 

这样的社会性通货膨胀导致投诉的可能性以及支付庞大的陪审团的奖金（这些原来都没有在统计范围之内）都显著增加。

 

此外，投保人的损失（是因为越来越多的公司倒闭，因为他们对上述问题反应不够灵敏）将由担保基金和剩余的有偿付能力的保险公司承担。

 

这种悲观的局势会一直持续，应对任何一种乐观主义（现在这种情绪已被证实在急剧增加）加以抑制，现在已经稍有成效。

 

Berkshire Hathaway's insurance subsidiaries have a disproportionate concentration of business

in precisely the lines which produced the worst underwriting results in 1975. Such lines produce

unusually high investment income and, therefore, have been particularly attractive to us under

previous underwriting conditions. However, our "mix" has been very disadvantageous during the

past two years and it well may be that we will remain positioned in the more difficult part of the

insurance spectrum during the inflationary years ahead.

 

伯克希尔的保险子公司业务与正确的产品线之间产生了偏差，导致1975年的承保利润有史以来最差。这种产品线会带来非凡的投资收入，因此，根据以往的承保条件，它对我们有很特别的吸引力。但是，我们的“组合”在过去的两年中一直处于不利状态，在未来的通货膨胀时期，我们将继续在保险部门最困难的领域坚持这种产品线定位。

 

The only segment to show improved results for us during 1975 was the "home state" operation,

which has made continuous progress under the leadership of John Ringwalt. Although still

operating at a significant underwriting loss, the combined ratio improved from 1974. Adjusted

for excess costs attributable to operations still in the start-up phase, underwriting results are

satisfactory. Texas United Insurance Company, a major problem a few years ago, has made

outstanding progress since George Billing has assumed command. With an almost totally new

agency force, Texas United was the winner of the "Chairman's Cup" for achievement of the

lowest loss ratio among the home state companies. Cornhusker Casualty Company, oldest and

largest of the home state companies, continues its outstanding operation with major gains in

premium volume and a combined ratio slightly under 100. Substantial premium growth is expected at the home state operation during 1976; the measurement of success, however, will

continue to be the achievement of a low combined ratio.

 

1975年保险业唯一值得一提的部分是本土化业务，在John Ringwalt的领导下取得了持续的进展。尽管承保利润损失很大，但是综合利率还是比1974年有所增加。对于营业超额成本的调整正处于初步阶段，但承保业绩还是很令人满意的。

 

德克萨斯联合保险公司，几年前这家公司还是一个棘手的难题，自从George Billing上任后就取得了优异的进展。在几乎是全新的机构力量下的情况下，得克萨斯联合保险公司是“主席杯”的冠军，因为它在这些本土化公司中的损失率最低。

 

Cornhusker Casualty Company ，历史最久规模最大的本土化  公司，继续以它优良的运营能力获得了大量的保费收益，综合利率稍低于100。

 

1976年本土化业务的保费收入预计还是可以大量增加的，然而，成功的关键还是在于能否取得较低的综合利率。

 

Our traditional business at National Indemnity Company, representing well over half of our

insurance volume, had an extraordinarily bad underwriting year in 1975. Although rates were

increased frequently and significantly, they continually lagged loss experience throughout the

year. Several special programs instituted in the early 1970s have caused significant losses, as

well as a heavy drain on managerial time and energies. Present indications are that premium

volume will show a major increase in 1976, and we hope that underwriting results will improve.

 

我们传统的业务是在全国保险公司，通常这家公司的业绩很好，能获得过半的总保险营业额，但是1975年保险承销结果却很糟糕。尽管利率经常性地大量提升，但是他们全年仍在持续地亏损。

 

70年代早期设立的几个特殊的项目已产生了明显的亏损，同时也消耗了我们大量的管理时间和精力。目前迹象表明保费营业额在1976年会有增加，我们希望承保业绩也能有所改善。

 

Reinsurance suffered the same problems as our direct business during 1975. The same remedial

efforts were attempted. Because reinsurance contract settlements lag those of direct business, it

well may be that any upturn in results from our direct insurance business will precede those of

the reinsurance segment.

 

1975年再保险业务正如我们预计的那样，遭遇着同样的难题。同样的弥补措施已经付诸行动。由于再保险合同的清算滞后于那些直接的业务合同，这可能导致任何由直接保险业务引起的好转将会优先于再保险业务部门。

 

At our Home and Automobile Insurance Company subsidiary, now writing auto business only in

the Cook County area of Illinois, experience continued very bad in 1975 resulting in a

management change in October. John Seward was made President at that time, and has

energetically and imaginatively implemented a completely revamped underwriting approach.

 

家庭与汽车保险子公司现在只在伊利诺斯的库克县经营汽车保险业务，1975年的业绩持续恶化，因此导致了10月份管理层的变动。当时John Seward被选为董事长，他很努力并且很有创造性地改良原有的承销方式。

 

Overall, our insurance operation will produce a substantial gain in premium volume during 1976.

Much of this will reflect increased rates rather than more policies. Under normal circumstances

such a gain in volume would be welcome, but our emotions are mixed at present. Underwriting

experience should improve²and we expect it to²but our confidence level is not high. While our efforts will be devoted to obtaining a combined ratio below 100, it is unlikely to be attained during 1976.

 

总体来讲，1976年我们的保险营业额收入会增加很多。这是因为利率的提高而不是政策的改变。在正常的情况下，如此的收益很令人欣慰，但是我们现在的情绪却很复杂。保险承销业绩仍需改善，并且我们希望是这样，但是我们的信心不足。

 

尽管我们会尽力使综合利率达到100一下，但这在1976年几乎是不可能的。

 

Insurance Investments

保险投资业务

 

Gains in investment income were moderate during 1975 because premium volume remained flat

and underwriting losses reduced funds available for investment. Invested assets, measured at cost

at yearend, were close to identical with the level at the beginning of the year.

 

1975年保险投资的收益不是很多，因为保费收入不多并且承保损失导致投资资金不足。投资资产，以年底的成本衡量，大概与年初的水平一致。

 

At the end of 1974 the net unrealized loss in the stock section of our portfolio amounted to about

$17 million, but we expressed the opinion, nevertheless, that this portfolio overall represented

good value at its carrying value of cost. During 1975 a net capital loss of $2,888,000 before tax

credits was realized, but our present expectation is that 1976 will be a year of realized capital

gain. On March 31, 1976 our net unrealized gains applicable to equities amounted to about $15

million. Our equity investments are heavily concentrated in a few companies which are selected

based on favorable economic characteristics, competent and honest management, and a purchase

price attractive when measured against the yardstick of value to a private owner.

 

1974年年底在股票部分我们的投资组合未变现净损失达1700万美元，但是我们坚信，不论如何，这个组合整体相对于其账面价值的成本而言，还是有着良好的投资价值的。

 

1975年税收抵免前的资本净损失是2,888,000美元，但是目前我们预计1976年会实现资本盈利。

 

1976年3月31日，我们未变现的普通股盈利总计约1500万美元。我们股权投资主要集中于这些公司：有着良好的经济基础，有上进心并且很诚实的管理层，并且以一个私营业主的价值尺度来衡量，购买价格很有吸引力（以一个私营业主的价值尺度来衡量）。

 

When such criteria are maintained, our intention is to hold for a long time; indeed, our largest

equity investment is 467,150 shares of Washington Post "B" stock with a cost of $10.6 million,

which we expect to hold permanently.

 

当这些要素都具备了，我们就打算长期持有；

 

实际上，我们最大的股权投资是“华盛顿邮报”的467,150股B股，花费大约1060万美元，并且我们期望永久持有。

 

 

With this approach, stock market fluctuations are of little importance to us²except as they may

provide buying opportunities²but business performance is of major importance. On this score

we have been delighted with progress made by practically all of the companies in which we now

have significant investments.

 

用这种方法，股市的波动（可能会产生有利的购买机会）对我们的影响就很小了，但是经营业绩仍旧很重要。在这方面，我们很高兴地看到，我们所有重大投资的公司均取得了进展。

 

We have continued to maintain a strong liquid position in our insurance companies. In last year's

annual report we explained how variations of 1/10 of 1% in interest rates result in million dollar

swings in market value of our bonds. We consider such market fluctuation of minor importance

as our liquidity and general financial strength make it highly improbable that bonds will have to

be sold at times other than those of our choice.

 

我们将在保险公司里保持强大的资本流动性。去年的年报我们解释过利率仅仅变化了1/10却使我们的债券收入增加了百万美元。我们认为这种波动性和我们强大的资本流动以及健康的财务优势联合在一起，使不得不卖出债券的可能性几乎为零.

 

 

Banking

银行业

 

It is difficult to find adjectives to describe the performance of Eugene Abegg, Chief Executive of

Illinois National Bank and Trust of Rockford, Illinois, our banking subsidiary. In a year when many banking operations experienced major troubles, Illinois National continued its outstanding record. Against average loans of about $65 million, net loan losses were $24,000, or .04%. Unusually high liquidity is maintained with obligations of the U. S. Government and its agencies, all due within one year, at yearend amounting to about 75% of demand deposits. Maximum rates of interest are paid on all consumer savings instruments which make up more than $2 million, it consistently has generated favorable earnings. Positioned as we now are with respect to income taxes, the addition of a solid source of taxable income is particularly welcome.

 

任何言辞都难以赞扬Eugene Abegg （我们的银行子公司：伊利诺伊州国家银行和信托公司的首席执行官）的卓越表现。在许多银行经营出现困难的这一年，伊利诺斯仍旧保持着它优异的业绩水平。

 

相对于6500万美元的平均贷款，净贷款损失达24000美元，即约有0.04%的损失。在美国政府和他的机构的要求下，它保持着极高的资本流动性，年底时所有一年内到期的定期存款占了75%。大量的利率是靠消费者储蓄投资收入（总计超过了200万美元）来支付的，当然也获得了可观的利润。

 

作为现在我们应纳的收入所得税，应纳税所得额主要来源的增加还是值得考虑的。

 

General Review

整体回顾

 

Your present management assumed responsibility at Berkshire Hathaway in May, 1965. At the

end of the prior fiscal year (September, 1964) the net worth of the Company was $22.1 million,

and 1,137,778 common shares were outstanding, with a resulting book value of $19.46 per share.

Ten years earlier, Berkshire Hathaway's net worth had been $53.4 million. Dividends and stock

repurchases accounted for over $21 million of the decline in company net worth, but aggregate

net losses of $9.8 million had been incurred on sales of $595 million during the decade. In 1965, two New England textile mills were the company's only sources of earning power and, before Ken Chace assumed responsibility for the operation, textile earnings had been erratic and, cumulatively, something less than zero subsequent to the merger of Berkshire Fine Spinning and Hathaway Manufacturing. Since 1964, net worth has been built to $92.9 million, or $94.92 per share. We have acquired total, or virtually total ownership of six businesses through negotiated purchases for cash (or cash and notes) from private owners, started four others, purchased a 31.5% interest in a large affiliate enterprise and reduced the number of outstanding shares of Berkshire Hathaway to 979,569. Overall, equity per share has compounded at an annual rate of slightly over 15%.

 

目前的管理层是于1965年五月接管伯克希尔-哈撒韦的。在1964年9月之前，财政年度结束时，公司的净资产是2210万美元，流通在外的普通股有1,137,778股，每股账面价值是19.46美元。

 

十年之前，伯克希尔-哈撒韦的净资产已是5340万美元。股息和股票回购占资本净值减少额的2100万美元，但是十年期间，5.95亿美元的销售导致了980万美元的净损失。1965年，新西兰的两个纺织厂是公司的唯一盈利来源，在Ken Chace 接管这项业务之前，纺织利润是不稳定渐增的，在伯克希尔纺纱和哈撒韦制造业合并之后有时甚至会出现亏损。自从1964年之后，资本净值达到了9290万美元，即股本是9492万美元。

 

我们通过谈判从私营业主那用现金收购（或者是现金和支票）六家公司，也可以说是拥有了对他们的所有权，又开始收购另外四家，购买了一个大公司的约31.5%的股份，使伯克希尔哈撒韦公司的在外流通股减少至979,569股。整体而言，每股收益大概以稍高于15%的年增长率而提高了。

 

While 1975 was a major disappointment, efforts will continue to develop growing and

diversified sources of earnings. Our objective is a conservatively financed and highly liquid

business²possessing extra margins of balance sheet strength consistent with the fiduciary

obligations inherent in the banking and insurance industries²which will produce a long term

rate of return on equity capital exceeding that of American industry as a whole.

 

Warren E. Buffett, Chairman

 

尽管1975年的业绩令人大失所望，但是我们会继续致力于壮大公司规模并使得盈利来源多元化。我们的目标是维持保守的融资和资本的高流动性，保持资产负债表的额外盈利优势，同时坚守银行及保险行业固有的信用责任，这样会使得我们长期的股权资本回报率高于美国整体行业的水平。

 

                                           沃伦.E.巴菲特    董事会主席