Warren Buffett published his annual investment letter Saturday, offering a glimpse into Berkshire Hathaway's portfolio and internal finances.

Buffett offered insight into Berkshire's Coca-Cola stock purchase, which it completed in 1994.

"In August 1994 – yes, 1994 – Berkshire completed its seven-year purchase of the 400 million shares of Coca-Cola we now own. The total cost was $1.3 billion – then a very meaningful sum at Berkshire," Buffett wrote. "The cash dividend we received from Coke in 1994 was $75 million."

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He continued, "By 2022, the dividend had increased to $704 million. Growth occurred every year, just as certain as birthdays. All Charlie and I were required to do was cash Coke’s quarterly dividend checks. We expect that those checks are highly likely to grow."

Buffett described this purchase of Coca-Cola stock as an example of the firm's "flowers" that "bloom" over time into higher-value assets than originally expected.

Many investors follow the company's moves closely because of Buffett's remarkably successful investing record over the decades.

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American Express played a similar role in the firm's portfolio.

Buffett said, "Berkshire’s purchases of Amex were essentially completed in 1995 and, coincidentally, also cost $1.3 billion. Annual dividends received from this investment have grown from $41 million to $302 million. Those checks, too, seem highly likely to increase."

"These dividend gains, though pleasing, are far from spectacular. But they bring with them important gains in stock prices," the billionaire continued. "At year-end, our Coke investment was valued at $25 billion while Amex was recorded at $22 billion. Each holding now accounts for roughly 5% of Berkshire’s net worth, akin to its weighting long ago." 

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This, Buffett asserts, makes up Berkshire Hathaway's "secret sauce."

"Assume, for a moment, I had made a similarly-sized investment mistake in the 1990s, one that flat-lined and simply retained its $1.3 billion value in 2022. (An example would be a high-grade 30-year bond)," Buffett wrote. "That disappointing investment would now represent an insignificant 0.3% of Berkshire’s net worth and would be delivering to us an unchanged $80 million or so of annual income."

The billionaire summarized, "The lesson for investors: The weeds wither away in significance as the flowers bloom. Over time, it takes just a few winners to work wonders. And, yes, it helps to start early and live into your 90s as well."