Berkshire Hathaway said first- quarter profit doubled as insurance units and Chairman Warren Buffett's derivative bets posted better results.
Net income climbed to $3.25 billion, or $1,966 a share, from $1.51 billion, or $917, a year earlier, when the company faced claims from an earthquake and tsunami in Japan, Berkshire said Friday in a statement. Operating earnings, which exclude some investment results, were $1,615 a share, missing the average $1,780 estimate of three analysts surveyed by Bloomberg.
Buffett increases the volatility of results by guarding companies against losses from the largest natural disasters, a risk he is willing to take because insurance units give him funds to invest, especially when catastrophes are less severe. Omaha, Neb.-based Berkshire's profits also fluctuate based on the performance of stock indexes including the Standard & Poor's 500 after Buffett used derivatives to bet on equities gaining.
There weren't "any catastrophe losses that were of note, outside of some tornado activity" in the first quarter, Tom Lewandowski, an analyst with Edward Jones & Co. in St. Louis, said in a phone interview before results were announced. Worldwide, claims from natural disasters were "nothing like we had last year with Japan," he said.
The insurance segment posted an underwriting profit of $54 million compared with a loss of $821 million a year earlier, Berkshire said. The company had "no significant losses" from catastrophes in the three months ended March 31, compared with $1.1 billion after tax a year earlier, according to a regulatory filing on Friday.
Book value, a measure of assets minus liabilities, rose in the quarter to $176 billion from $164.9 billion at the end of last year. The value of the equity portfolio climbed to $89.1 billion from $77 billion on Dec. 31 as American Express Co., Wells Fargo & Co., International Business Machines Corp. and Munich Re rallied.
Berkshire owns The Buffalo News, and Buffett is the newspaper's chairman.
Berkshire's Class A shares have risen 6.3 percent this year in New York, trailing the 8.9 percent gain in the S&P 500.
The company's annual meeting is scheduled for today in Omaha.