Lubrizol’s pre-tax earnings for 2023 were relatively unchanged from 2022, although Berkshire Hathaway noted that they improved last year if excluding the impacts of insurance recoveries from fires at company factories in 2021 and 2019.
Earnings included insurance recoveries of $11 million in 2023 and $242 million in 2022 in connection with fires at a Rockton, Illinois, plant in 2021 and at another in Rouen, France, in 2019.
“Excluding insurance recoveries, earnings in 2023 were higher due to the favorable impacts of higher selling prices, favorable changes in product mix and lower raw material costs,” Berkshire Hathaway said in annual report filed with the United States Securities and Exchange Commission.
A fire destroyed Lubrizol’s large Chemtool grease and lubricant additive factory in Rockton, Illinois in June 2021. In 2019, a Lubrizol lubricant additive manufacturing facility caught fire in Rouen, France. The blaze destroyed more than 5,200 metric tons of Lubrizol chemicals.
Lubrizol’s sales revenues decreased 4% to $6.4 billion in 2023, compared to 2022.
“The revenue decline was primarily due to a 7.9% decline in volumes and unfavorable foreign currency effects, partially offset by higher selling prices,” Berkshire Hathaway said in its filing. “The decline in sales volumes in 2023 was attributable to general market weakness and customer efforts to reduce their inventory levels.”
In the fourth quarter last year, Lubrizol’s sales revenue was $1.5 billion, a 6% decrease from $1.6 billion.
Headquartered in Wickliffe, Ohio, Lubrizol is one of the world’s largest lubricant additive suppliers. The company also supplies specialty chemicals to applications such as personal care items, textiles, coatings and consumer products. Omaha, Nebraska-based Berkshire Hathaway, a multinational conglomerate holding company, acquired Lubrizol in 2011 for $9.7 billion.