2014: What is Heinz’s normalized earning power?

JAY GELB: This question is on the Heinz transaction.

Berkshire’s 50 percent ownership in Heinz is included in Berkshire’s results, which can be meaningful to its earnings over time.

What is Heinz’s current normalized earning power, after the substantial restructuring of the business, and what do you anticipate Heinz could earn within a few years?

WARREN BUFFETT: Yeah. Well, Heinz will be filing its own 10-Qs. In fact, I guess its first quarter would be — they went to a calendar year now — first quarter would be about due now. So you’ll get to see Heinz’s figures.

And I will say this, that Heinz was actually a very reasonably run food company with about 15 percent pre-tax margins for many years, and that’s not an unusual operating margin in the food business.

And I would just invite you to look quarter by quarter and maybe next year, too, I think the margins of Heinz will be significantly improved from those historical figures. What Bernardo Hees and his associates have done there is — they’ve just restructured the business model.

And I think that the brands, which are all-important, are as strong as ever. And I think the cost structure is going to be significantly improved without cutting into marketing expenditures.

So I think you’ll see a significant improvement, but I don’t want to name a number on that. You’ll find it out soon enough.