Berkshire Hathaway (BRK.A, BRK.B), the conglomerate built by legendary investor Warren Buffett, reported its earnings after market close on Friday. Operating earnings of $1.78 billion were down 21.6 percent from the comparable quarter in 2008, although reported GAAP earnings per share were aided by a reversal in the mark-to-market effect of derivatives contracts written on major stock indices. On the quarter, derivatives gains of more than $1.5 billion helped push GAAP net income to $3.3 billion, although Buffett has publicly stated that he overlooks such fluctuations in assessing results.
With Berkshire's diversified ownership of firms in numerous industries, the company is often assessed in three parts: insurance (including GEICO and Gen Re), investments, and other operations. The non-insurance business saw operating earnings nearly cut in half, and insurance underwriting results suffered as well, falling 77 percent from last year. The downbeat insurance earnings were offset by a jump in investment income, as Berkshire's sizable float benefited from the rally in global risk assets.