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Exhibit 10 Warren E. Buffett, 2005 Valuation Multiples for Comparable Regulated Energy Firms MV Equity as Multiple (dollars in millions) Enterprise Value as Multiple of: of: MV Enterprise Book Book Equity Value Value EPS Rev EBIT EBITDA Net Income EPS Value Alliant Energy Corp. $ 3,333 $ 5,600 $ 2,805 1.42 1.89x 13.33x 7.45x 34.15x 20.33x 1.19x Cinergy Corp. $ 7,989 $ 13,231 $ 4,178 $ 2.15 2.82x 17.93x NA 32.75x 19.77x 1.91x NSTAR $ 2,898 $ 5,287 $ 1,484 $ 1.78 1.79x 11.62x 7.53x 27.83X 15.25x 1.95x SCANA Corp. $ 4,486 $ 7.967 $ 2,566 $ 2.34 2.05x 13.37x 9.25x 30.18x 16.99x 1.75x Wisconsin Energy Corp. $ $ 7.691 $ 2,522 $ 2.62 2.24x 14.51x 8.97x 25.13x 13.23x 1.61x Median 4.048 $ 7.691 $ 2,566 $ 2.15 2.05x 13.37x 8.25x 30.18x 16.99x 1.75x Mean 4,551 S 7.955 $ 2,711 2.06 2.16x 14.15x 8.30x 30.01x 17.11x 1.68x Implied Value of $ 3,377 $ 0.81 $ 6,252 $ 8,775 $ 9,023 $ 7.596 $ 4,277 $ 5,904 Pacificorp $ 6.584 $ 9,289 $ 9,076 $ 7.553 4,308 $ 5,678Exhibit 2 Warren E. Buffett, 2005 Business Segment Information for Berkshire Hathaway Inc. (dollars in millions) Earnings (loss) Capital Segment Revenues before Taxes Expenditures Depreciation Identifiable Assets 2004 2003 2004 2003 2004 2003 2004 2003 2004 2003 Insurance $ 23,927 $ 24,731 $ 4,375 $ 4,941 $ 52 $ 55 $ 52 63 $ 114,759 $ 109,004 Apparel 2,200 2,075 325 289 51 71 52 51 1,582 1,523 Building products 4,337 3,846 643 559 219 170 172 174 2,803 2,593 Financial products 3,774 3,045 584 619 296 232 183 161 30,086 28,338 Flight services 3,244 2,431 191 72 155 150 146 136 2,823 2,875 Grocery distribution 23,373 13,743 228 150 136 51 107 59 2,349 2,243 Retail 2,601 2,311 163 165 126 106 56 51 1,669 1,495 Carpet & floor coverings 5,174 4,660 466 436 125 120 99 91 2,153 1,999 Other businesses 3,213 3,040 465 486 41 47 44 43 1,875 1,813 Total $ 71,843 $ 59,882 $ 7,440 $ 7,717 $ 1,201 $ 1,002 $ 911 $ 829 $ 160,099 $ 151,883 Excludes capital expenditures that were part of business acquistions. Source of data: Berkshire Hathaway Inc., 2004 Annual ReportExhibit 3 Warren E. Buffett, 2005 Major Investees of Berkshire Hathaway (dollars in millions) % of Co. Cost' Market Company Shares Owned (Smm) (Smm) American Express Company 151,610,700 12.1 $ 1,470 $ 8,546 17% The Coca-Cola Company 200,000,000 8.3 1,299 8,328 16% The Gillette Company 96,000,000 9.7 600 4,299 14% H&R Block, Inc. 14,350,600 8. 1 223 703 32% M&T Bank Corporation 6,708,760 5.8 103 723 14% Moody's Corporation 24,000,000 16.2 499 2,084 24% PetroChina "H" shares 2,338,961,000 1.3 488 1,249 39% The Washington Post Company 1,727,765 18.1 11 1,698 1% Wells Fargo & Company 56,448,380 3.3 463 3,508 13% White Mountain Insurance 1,724,200 16.0 369 1,114 33% Others 3,531 5,465 65% Total Common Stocks $ 9,056 $ 37,717 `This was both Berkshire's actual purchase price and tax basis; GAAP "cost" differed in a few cases because of write-ups or write-downs that had been required. Buffett referred to this group of companies as Berkshire Hathaway's "Big Four." Berkshire invested $3.83 billion in the four through multiple transactions between May 1988 and October 2003; on a composite basis, Berkshire's dollar-weighted purchase date was July 1992. By year-end 2004, Berkshire held these interests, on a weighted basis, for about 12.5 years. Source of data: Berkshire Hathaway Inc., 2004 Annual Report, 16.Exhibit 4 Warren E. Buffett, 2005 Hypothetical Example of Value Creation Assume: 5-year investment horizon, when you liquidate at "book" or accumulated investment value initial investment is $50 million no dividends are paid, all cash flows are reinvested return on equity = 20% cost of equity = 15% Year 0 1 2 4 5 Investment or book equity value 50 60 72 86 104 124 Market value (or intrinsic value) Present value @ 15% of 124 = $61.65 Market/book $61.65/50.00 = $1.23 Value created: $1.00 invested becomes $1.23 in market value.Exhibit 5 Warren E. Buffett, 2005 Hypothetical Example of Value Destruction Assume: . 5-year investment horizon, when you liquidate at "book" or accumulated investment value initial investment of $50 million no dividends are paid, all cash flows are reinvested return on equity = 10% . cost of equity = 15% Year 0 1 2 3 4 un Investment or book equity value 50 55 60 67 73 81 Market value (or intrinsic value) = Present value @ 15% of $81 = $40.30 Market/book $40.30/50.00 = $0.80 Value destroyed: $1.00 invested becomes $0.80 in market value.Exhibit G Warren E. Buffett, 2005 MidAmerican Energy Holdings Co. Condensed Consolidated Financial Statements (dollars in millions) Balance sheets 2000 2001 2002 2003 2004 Assets: Properties, plants, and equipment, net $ 5,349 $ 6,537 $ 10,285 $ 11,181 $ 11,607 Goodwill 3,673 3,639 4,258 4,306 4,307 Other assets 2,659 2,450 3,892 3,658 3,990 $ 11,681 $ 12,626 $ 18,435 $ 19,145 $ 19,904 Liabilities and shareholders' equity: Debt, except debt owed to Berkshire $ 5,919 $ 7,163 $ 10,286 $ 10,296 $ 10,528 Debt owed to Berkshire 1,032 455 1,728 1,578 1,478 Other liabilities and minority interest 3,154 3,300 4,127 4,500 4,927 10,105 10,918 16,141 16,374 16,933 Shareholders' equity 1,576 1,708 2,294 2,771 2,971 $ 11,681 $ 12,626 $ 18,435 $ 19,145 $ 19,904 Income statements Operating revenue and other income $ 4,013 $ 4,973 $ 4,903 $ 6,143 $ 6,727 Costs and expenses: Cost of sales and operating expenses 3,100 3,522 3,092 3,913 4.390 Depreciation and amortization 383 539 DES 603 638 Interest expense - debt held by Berkshire 40 50 118 184 170 Other interest expense 336 443 640 716 713 3,859 4.554 4,380 5,416 5,911 Earnings before taxes 154 419 523 727 816 Income taxes and minority interests 73 276 126 284 278 Earnings from continuing operations 81 143 397 443 538 Loss on discontinued operations (17) (27) (368) Net earnings 81 143 $ 380 $ 416 $ 170 Source of dina: Berkshire Hathaway regulatory filings.Exhibit 7 Warren E. Buffett, 2005 PacificCorp Consolidated Financial Statements (millions of dollars) Year Ended March 31, Balance sheets 2004 2005 Assets: Current assets $ 756.4 $ 1,214.3 Properties, plants, and equipment, net 9,036.5 9,490.6 Other assets 1,884.2 1,816.0 $ 11,677.1 $ 12,520.9 Liabilities and shareholders' equity: Current liabilities $ 1,074.3 $ 1,597.7 Deferred credits $ 3,706.3 $ 3,868.3 Long-term debt and capital lease obligations 3,520.2 3,629.0 Preferred stock subject to mandatory redemption 56.3 48.8 8,357.1 9,143.8 Shareholders' equity 3.320.0 3,377.1 $ 11,677.1 $ 12,520.9 Income statements Operating revenue and other income $ 3,194.5 $ 3,048.8 Costs and expenses: Operating expenses 2,147.8 1,955.5 Depreciation and amortization 428.8 436.9 Income from operations 617.9 656.4 Interest expense 224.4 236.2 Income from operations before income tax expense 393.5 420.2 Cumulative effect of accounting change (0.9) Income tax expense 144.5 168.5 Net income S 248.1 $ 251.7 Source of data: Pacificorp 10-K regulatory filingExhibit 8 Warren E. Buffett, 2005 Berkshire Hathaway Acquisition Criteria We are eager to hear frow principals or their represenatives about businesses that meet all of the following criteria: 1. large purchases (at least $75 million of pretax carnings unless the business will fit into one of our existing units) 2. consistent carning power demonstrated (Future projections are of no interest to us, not are turnaround situations. 3. businesses earning good returns on equity while employing little or no debt 4. management in place (We can't supply it.) 5. simple businesses (If there's lots of technology, we won't understand it.) 6. offering price (We don't want to waste our time or that of the seller by talking, even preliminarily, about a transaction when price is unknown.) The larger the company, the greater will be our interest: We would like to make an acquisition in the $5 billion to $20 billion range. We are not interested, however, in meeting suggestions about purchases we might make in the general stock market. We will not engage in unfriendly takeovers. We can promise complete confidentiality and a very fast answer-customarily within five minutes-as to whether we're interested. We prefer to buy for cash, but will consider issuing stock when we receive as much in intrinsic business value as we give. We don't participate in Charlie and I frequently get approached about acquisitions that don't come close to meeting our tests: We've found that if you advertise an interest in buying collies, a lot of people will call hoping to sell you their cocker spaniels. A line from a country song expresses our feeling about new ventures, turnarounds, or auction- like sales: "When the phone don't ring, you'll know it's me" Source Berkshire Hathaway Inc. annail sepost, 2101.Exhibit 9 Warren E. Buffett, 2005 Comparable Regulated Energy Firms Price Per Share (dollars in millions) Shares O/S Div. Per S&P Total Total Cash and Net Beta (millions) Low High Share Rating Assets Liabilities equiv. ST Debt LT Debt Net Debt Rev EBITDA EBIT Income Alliant Energy Corp. 0.85 115.74 $ 23.50 $ 28.80 $ 1.01 na 8,275 $ 5,470 $ 276 $ 243 $ 2,300 $ 2,267 $ 2,959 $ 752 $ 420 $ 164 Cinergy Corp. 0.85 187.53 $ 34.90 $ 42.60 $ 1.88 BBB+ $ 14,982 $ 10,804 $ 165 $ 1,179 $ 4,228 $ 5,242 $ 4,688 $ 1,198 $ 738 $ 404 NSTAR 0.70 106.55 $ 22.70 $ 27.20 $ 1.13 A $ 7,117 $ 5,633 $ 23 $ 311 $ 2,101 $ 2,389 $ 2,954 $ 702 $ 455 $ 190 SCANA Corp. 0.75 113.00 $ 32.80 $ 39.70 $ 1.46 na $ 8,996 $ 6,430 $ 120 $ 415 $ 3,186 $ 3,481 $ 3,885 $ 861 $ 596 $ 264 Wisconsin Energy Corp. 0.70 116.99 $ 29.50 $ 34.60 $ 0.83 BBB+ $ 9,565 $ 7,043 $ 36 $ 439 $ 3,240 $ 3,643 $ 3,431 $ 857 $ 530 $ 306 Pacificorp na 312.18 na na na na $ 12,521 $ 9,144 $ 199 $ 270 $ 3,629 $ 3,700 $ 3,049 $ 1,093 $ 656 $ 252Choice of valuation methods: What do you think PacifiCorp is worth on its own before its acquisition by Berkshire? Which valuation method should you use to value PacifiCorp and why? Show clearly the steps to arrive at the following estimates in Exhibit 10 and assess whether the valuation process done in the case is reasonable. Create a football field graph summarizing all the valuation measures. Enterprise Value as Multiple of: MV Equity as Multiple of: Revenue EBIT EBITDA Net Income EPS Book Value Median 6,252 8,775 9,023 7,596 4,277 5,904 Mean 6,584 9,289 9,076 7,553 4,308 5,678 If you need to use a discount rate to discount cash flows then an appropriate discount rate estimate for PacifiCorp is approximately 9%