(Bloomberg) -- Warren Buffett’s Berkshire Hathaway Inc. said fourth-quarterprofit rose 15 percent, fueled by a gain on an investment in DowChemical Co.

Net income increased to $6.29 billion, or $3,823 a share, from$5.48 billion, or $3,333, a year earlier, the Omaha, Nebraska-basedcompany said Saturday in a statement. Operating earnings, whichexclude some investment results, were $2,665 a share, missing theaverage $2,717 estimate of three analysts surveyed byBloomberg.

While Buffett is widely known as a gifted stock picker,Berkshire derives most of its income from the businesses he’sbought during his five decades running the firm. Its dozens ofsubsidiaries include auto insurer Geico, railroad BNSF,a network of auto dealerships, retailers and electricutilities.

The 86-year-old billionaire keeps adding to the mix. Last year,he completed deals for battery maker Duracell and PrecisionCastparts, a supplier to the aerospace industry, helping to boostprofit in his company’s manufacturing segment.

Full-year net income was $24.1 billion, little changed from therecord in 2015. Book value, a measure of assets minus liabilities,climbed to $172,108 per share at the end of December from $163,783three months earlier. Buffett’s stock picks and takeovers havehelped build the figure more than 8,000-fold since he took controlof Berkshire in 1965.

Insurance, railroad

The insurance businesses had a fourth-quarter underwriting gain of$548 million, driven by results at Berkshire Hathaway ReinsuranceGroup. That compares with $306 million a year earlier. Investmentincome from the units fell to $889 million from $1.03 billionduring the same period in 2015.

The railroad, BNSF, contributed $993 million to quarterlyearnings, compared with $1.08 billion a year earlier. Fallingdemand for hauling energy-related good hurt results in 2016.

“Coal had the largest decline, driven by structural changes inthat business as well as competition from low natural gas prices,”Berkshire said in its annual report. “While natural gas prices andthe amount of electricity burn will affect the demand for coal in2017, our long-term demand outlook for U.S. and global coalconsumption is lower.”

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Energy, manufacturing

Berkshire Hathaway Energy’s profit rose to $432 million from $423million a year earlier. The business operates electric grids in theU.K., natural gas pipelines that stretch from the Great Lakes toTexas and power companies in states including Iowa and Nevada.

The manufacturing, service and retail segment, which includestoolmaker Iscar and chemical company Lubrizol, added $1.17 billionto earnings, compared with $1.07 billion a year earlier. Somefourth-quarter results were calculated by subtracting figures forthe first nine months from the full-year data providedSaturday.

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Buffett tells investors to focus on the earnings from his stableof operating businesses, rather than one-time gains or losses onBerkshire’s securities portfolio. That’s because results canfluctuate widely on investments and derivatives contracts that heentered years ago.

In the fourth quarter, Dow converted Berkshire’s $3 billionpreferred stake to more than $4 billion of common stock, resultingin a gain of about $1.2 billion. The investment dates to thechemical maker’s 2009 takeover of Rohm & Haas, a transactionthat Buffett helped finance. Berkshire said in its annual reportthat it sold the Dow common stock by Dec. 31.

Cash, stocks

Berkshire changed how it lists some holdings on its balance sheet.As of Dec. 31, the firm had about $28 billion of cash and cashequivalents, as well as more than $58 billion of U.S. Treasurybills for a total of about $86 billion. A filing showing Sept. 30data, which didn’t break out Treasury bills, showed $84.8 billionin cash.

The billionaire accelerated his purchases of stock after theU.S. election. The equity portfolio was valued at $122 billion atthe end of the fourth quarter, up from $102.5 billion on Sept. 30.Two of Buffett’s largest holdings, Wells Fargo & Co. andAmerican Express Co., rallied in the last three months of the year.Berkshire also disclosed this month that it sharply increased itsstake in Apple Inc. and the four largest U.S. airlines during theperiod.

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Berkshire had a gain of about $1.9 billion on derivatives andinvestments, helped by Dow Chemical. That compares to a gain of$805 million a year earlier. Buffett has been working to simplifyhis company’s stockpile of derivatives. In July, he wound down thelast contract that provided protection against losses on bonds.Berkshire still has derivatives related to the performance of stockmarket indexes.

Berkshire increased its headcount by about 1.8 percent in theyear to 367,671 employees.

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