BERKSHIRE HATHAWAY INC.

1 REPORTB usiness ActivitiesBerkshire HATHAWAY a holding company owning subsidiaries that engage in a number of diversebusiness activities including insurance and reinsurance, freight rail transportation, utilities and energy, finance,manufacturing, services and retailing. Included in the group of subsidiaries that underwrite insurance andreinsurance is GEICO, the third largest private passenger auto insurer in the United States and two of the largestreinsurers in the world, General Re and the BERKSHIRE HATHAWAY Reinsurance Group. Other subsidiaries thatunderwrite property and casualty insurance include: National Indemnity Company, BERKSHIRE HathawayHomestate Insurance Company, Medical Protective Company, Applied Underwriters, Liability InsuranceCompany, Central States Indemnity Company, Kansas Bankers Surety, Cypress Insurance Company, the Guard Insurance Northern Santa Fe ( BNSF ) operates one of the largest railroad systems in North America.

2 Inserving the Midwest, Pacific Northwest and the Western, Southwestern and Southeastern regions and ports of , BNSF transports a range of products and commodities derived from manufacturing, agricultural and naturalresource industries. MidAmerican Energy Holdings Company ( MidAmerican ) is an international energyholding company owning a wide variety of operating companies engaged in the generation, transmission anddistribution of energy. MidAmerican s principal operating energy companies are: MidAmerican EnergyCompany, Pacific Energy, Pacific Power and Rocky Mountain Power, Northern Powergrid, and Kern River GasTransmission Company and Northern Natural Gas. In addition, MidAmerican owns HomeServices of America, areal estate brokerage business activities are conducted through BERKSHIRE s manufacturing services, retailing andfinance Marmon Groupis an international association of approximately 150 manufacturing andservice businesses that operate independently within diverse business Lubrizol Corporationis aspecialty chemical company that produces and supplies chemical products for transportation, industrial andconsumer International Metalworking Companies (Iscar)is an industry leader in the metal cuttingtools Companyis a wholesale distributor of groceries and nonfood items to discount retailers,convenience stores, quick service restaurants and others.

3 BERKSHIRE s finance and financial products businessesprimarily engage in proprietary investing strategies, consumer lending(Clayton Homes)and transportationequipment and furniture leasing(XTRAandCORT).Shaw Industriesis the world s largest manufacturer of tufted broadloom Mooreis aformulator, manufacturer and retailer of architectural and industrial Manvilleis a leadingmanufacturer of insulation and building Brickis a manufacturer of face brick and concretemasonry steel connector products and engineering software for the buildingcomponents of the Loom, Russell, Vanity Fair, Garan, Fechheimer, Brown Shoe Group,Justin BrandsandBrooks Sportsmanufacture, license and distribute apparel and footwear under a variety ofbrand Internationalprovides training to aircraft fractionalownership programs for general aviation Furniture Mart, Willey Home Furnishings, StarFurnitureandJordan s Furnitureare retailers of home , Helzberg Diamond ShopsandBen Bridge Jewelerare retailers of fine addition, other manufacturing, service and retail businesses include.

4 The Buffalo NewsandBH MediaGroup(publisher ofThe Omaha World-Heraldand 26 other daily newspapers);See s Candies,a manufacturerand seller of boxed chocolates and other confectionery products;Scott Fetzer,a diversified manufacturer anddistributor of commercial and industrial products;Larson-Juhl,a designer, manufacturer and distributor of high-quality picture framing products;CTB,a manufacturer of equipment for the livestock and agricultural industries;International Dairy Queen,a licensor and service provider to over 6,200 stores that offer prepared dairy treatsand food;The Pampered Chef,the premier direct seller of kitchen tools in the ;Forest River,a leadingmanufacturer of leisure vehicles in the ;Business Wire,the leading global distributor of corporate news,multimedia and regulatory filings;TTI, Inc.,a leading distributor of electronic components;Richline Group,aleading jewelry manufacturer; andOriental Trading Company, a direct retailer of party supplies, school suppliesand toys and decisions for the various BERKSHIRE businesses are made by managers of the business decisions and all other capital allocation decisions are made for BERKSHIRE and its subsidiaries byWarren E.

5 Buffett, in consultation with Charles T. Munger. Mr. Buffett is Chairman and Mr. Munger is ViceChairmanof BERKSHIRE s Board of Directors.** BERKSHIRE HATHAWAY ANNUAL REPORTTABLE OF CONTENTSB usiness Front CoverCorporate Performance vs. the S&P 2 Chairman s Letter*.. 3 Acquisition 25 Management s Report on Internal Control Over Financial 25 Selected Financial Data for the Past Five 26 Report of Independent Registered Public Accounting 27 Consolidated Financial 28 Management s 65 Owner s 97 Corporate Performance vs. the S&P 500 by Five-Year 103 Intrinsic 104 Common Stock 105 Operating 106 Real Estate Brokerage 107 Daily 108 Directors and Officers of the Back Cover*Copyright 2013 By Warren E. BuffettAll Rights ReservedBerkshire s Corporate Performance vs. the S&P 500 Annual Percentage ChangeYearin Per-ShareBook Value ofBerkshire(1)in S&P 500with DividendsIncluded(2)RelativeResults(1)-( 2) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( )( ) ( ) ( ) ( ) ( )( ) ( ) ( ) ( )Compounded Annual Gain Gain ,817%7,433%Notes:Data are for calendar years with these exceptions: 1965 and 1966, year ended 9/30; 1967, 15 months ended12/31.

6 Starting in 1979, accounting rules required insurance companies to value the equity securities they hold atmarket rather than at the lower of cost or market, which was previously the requirement. In this table, BERKSHIRE sresults through 1978 have been restated to conform to the changed rules. In all other respects, the results are calculatedusing the numbers originally reported. The S&P 500 numbers arepre-taxwhereas the BERKSHIRE numbers areafter-tax. If a corporation such as BERKSHIRE were simply to have owned the S&P 500 and accrued the appropriate taxes, itsresults would have lagged the S&P 500 in years when that index showed a positive return, but would have exceeded theS&P 500 in years when the index showed a negative return. Over the years, the tax costs would have caused theaggregate lag to be HATHAWAY the Shareholders of BERKSHIRE HATHAWAY Inc.:In 2012 , BERKSHIRE achieved a total gain for its shareholders of $ billion. We used $ billion of thatto repurchase our stock, which left us with an increase in net worth of $ billion for the year.

7 The per-share bookvalue of both our Class A and Class B stock increased by Over the last 48 years (that is, since presentmanagement took over), book value has grown from $19 to $114,214, a rate of compounded annually.*A number of good things happened at BERKSHIRE last year, but let s first get the bad news out of the way. When the partnership I ran took control of BERKSHIRE in 1965, I could never have dreamed that a year inwhich we had a gain of $ billion would be subpar, in terms of the comparison we present on the subpar it was. For the ninth time in 48 years, BERKSHIRE s percentage increase in book value was lessthan the S&P s percentage gain (a calculation that includes dividends as well as price appreciation). Ineight of those nine years, it should be noted, the S&P had a gain of 15% or more. We do better when thewind is in our date, we ve never had a five-year period of underperformance, having managed 43 times to surpass theS&P over such a stretch.

8 (The record is on page 103.) But the S&P has now had gains in each of the lastfour years, outpacing us over that period. If the market continues to advance in 2013, our streak of five-year wins will thing of which you can be certain: Whatever BERKSHIRE s results, my partner Charlie Munger, thecompany s Vice Chairman, and I will not change yardsticks. It s ourjobto increase intrinsic businessvalue for which we use book value as asignificantly understatedproxy at a faster rate than the marketgains of the S&P. If we do so, BERKSHIRE s share price, though unpredictable from year to year, will itselfoutpace the S&P over time. If we fail, however, our management will bring no value to our investors, whothemselves can earn S&P returns by buying a low-cost index and I believe the gain in BERKSHIRE s intrinsic value will over time likely surpass the S&P returns bya small margin. We re confident of that because we have some outstanding businesses, a cadre of terrificoperating managers and a shareholder-oriented culture.

9 Our relative performance, however, is almostcertain to be better when the market is down or flat. In years when the market is particularly strong, expectus to fall short. The second disappointment in 2012 was my inability to make a major acquisition. I pursued a couple ofelephants, but came up empty-handed.* All per-share figures used in this report apply to BERKSHIRE s A shares. Figures for the B shares are1/1500thof those shown for luck, however, changed early this year. In February, we agreed to buy 50% of a holding company thatwill own all of H. J. Heinz. The other half will be owned by a small group of investors led by Jorge PauloLemann, a renowned Brazilian businessman and couldn t be in better company. Jorge Paulo is a long-time friend of mine and an extraordinarymanager. His group and BERKSHIRE will each contribute about $4 billion for common equity in the holdingcompany. BERKSHIRE will also invest $8 billion in preferred shares that pay a 9% dividend.

10 The preferredhas two other features that materially increase its value: at some point it will be redeemed at a significantpremium price and the preferred also comes with warrants permitting us to buy 5% of the holdingcompany s common stock for a nominal total investment of about $12 billion soaks up much of what BERKSHIRE earned last year. But we stillhave plenty of cash and are generating more at a good clip. So it s back to work; Charlie and I have againdonned our safari outfits and resumed our search for to some good news from 2012 : Last year I told you that BNSF, Iscar, Lubrizol, Marmon Group and MidAmerican Energy our five mostprofitable non-insurance companies were likely to earn more than $10 billion pre-tax in 2012 . Theydelivered. Despite tepid growth and weakening economies throughout much of the world, our powerhouse five had aggregate earnings of $ billion, about $600 million more than in this group, only MidAmerican, then earning $393 million pre-tax, was owned by BERKSHIRE eight yearsago.