RICHMOND, Va., Feb. 4,
2020 /PRNewswire/ -- Markel Corporation (NYSE: MKL) reported
operating revenues of $9.5 billion
for the year ended December 31, 2019 compared to $6.8 billion in 2018. Comprehensive income to
shareholders was $2.1 billion for the
year ended December 31, 2019 compared to comprehensive loss to
shareholders of $375.8 million in
2018. Diluted net income per share was $129.07 for the year ended December 31, 2019
compared to diluted net loss per share of $9.55 in 2018. The combined ratio was 94% in 2019
compared to 98% in 2018. Book value per common share outstanding
was $802.59 at December 31, 2019
compared to $653.85 at
December 31, 2018. Over the five-year period ended
December 31, 2019, the compound annual growth in book value
per common share outstanding was 8%. Over the five-year period
ended December 31, 2019, our share price increased at a
compound annual rate of 11%.
Thomas S. Gayner and Richard R. Whitt, Co-Chief Executive Officers,
commented, "Following continued growth in our insurance and Markel
Ventures operations, 2019 was a record-setting year for Markel.
Gross written premiums from our underwriting operations surpassed
$6 billion, and we are excited about
the synergies we are achieving between our underwriting and other
insurance platforms. Within our Markel Ventures operations,
revenues surpassed $2 billion and we
continued to expand through our fourth quarter acquisition of VSC
Fire & Security. Gains on our investment portfolio were just
under $2 billion, driving record
comprehensive income and book value per share. We are proud of what
we accomplished in 2019 and want to thank our dedicated associates
for their significant contributions, which support our aspiration
to become one of the world's great companies."
The following tables present selected financial data from 2019
and 2018.
|
Years Ended December
31,
|
(in thousands,
except per share amounts)
|
2019
|
|
2018
|
Operating
revenues
|
$
|
9,526,191
|
|
|
$
|
6,841,285
|
|
Income (loss) before
income taxes
|
$
|
2,285,808
|
|
|
$
|
(7,855)
|
|
Net income (loss) to
shareholders
|
$
|
1,790,466
|
|
|
$
|
(128,180)
|
|
Comprehensive income
(loss) to shareholders
|
$
|
2,093,888
|
|
|
$
|
(375,770)
|
|
Weighted average
diluted shares outstanding
|
13,881
|
|
|
13,923
|
|
Diluted net income
(loss) per share
|
$
|
129.07
|
|
|
$
|
(9.55)
|
|
|
|
|
|
|
|
|
|
(in thousands,
except per share amounts)
|
December 31,
2019
|
|
December 31,
2018
|
Book value per common
share outstanding
|
$
|
802.59
|
|
|
$
|
653.85
|
|
Common shares
outstanding
|
13,794
|
|
|
13,888
|
|
The change in comprehensive income (loss) to shareholders from
2018 to 2019 was primarily due to net investment gains of
$1.6 billion in 2019 compared to net
investment losses of $437.6 million
in 2018. We also experienced an increase in net unrealized gains on
available-for-sale investments, net of taxes, of $298.0 million in 2019 compared to a decrease in
net unrealized gains on available-for-sale investments, net of
taxes, of $233.5 million in 2018.
In November 2019, we acquired VSC
Fire & Security, Inc. (VSC), a Virginia-based privately held provider of
comprehensive fire protection, life safety and low voltage
solutions. Results attributable to VSC will be included in our
Markel Ventures segment.
Underwriting Results
|
Combined Ratio
Analysis
|
|
Years Ended December
31,
|
|
2019
|
|
2018
|
Insurance
|
93%
|
|
94%
|
Reinsurance
|
104%
|
|
113%
|
Consolidated
|
94%
|
|
98%
|
The consolidated combined ratio was 94% in 2019 compared to 98%
in 2018. The decrease in the consolidated combined ratio was
attributable to lower catastrophe losses in 2019 compared to 2018.
Underwriting results in 2019 included $100.4
million, or two points, of underwriting loss from Hurricane
Dorian and Typhoons Faxai and Hagibis (2019 Catastrophes).
Underwriting results in 2018 included $287.3
million, or six points, of underwriting loss from Hurricanes
Florence and Michael, Typhoon Jebi and wildfires in California (2018 Catastrophes). Excluding the
impact of the 2019 and 2018 Catastrophes, the 2019 combined ratio
was flat compared to 2018. Higher earned premiums in 2019 had a
favorable impact on our expense ratio and an unfavorable impact on
the prior accident years' loss ratio.
The following table summarizes, by segment, the components of
the underwriting losses related to the 2019 and 2018
Catastrophes.
|
Years Ended
December 31,
|
|
2019
|
|
2018
|
|
2019
Catastrophes
|
|
2018
Catastrophes
|
(dollars in
thousands)
|
Insurance
|
|
Reinsurance
|
|
Consolidated
|
|
Insurance
|
|
Reinsurance
|
|
Consolidated
|
Losses and loss
adjustment expenses, net
|
$
|
8,317
|
|
|
$
|
105,644
|
|
|
$
|
113,961
|
|
|
$
|
105,265
|
|
|
$
|
187,490
|
|
|
$
|
292,755
|
|
Ceded (assumed)
reinstatement premiums
|
—
|
|
|
(13,552)
|
|
|
(13,552)
|
|
|
5,142
|
|
|
(10,583)
|
|
|
(5,441)
|
|
Underwriting
loss
|
$
|
8,317
|
|
|
$
|
92,092
|
|
|
$
|
100,409
|
|
|
$
|
110,407
|
|
|
$
|
176,907
|
|
|
$
|
287,314
|
|
Impact on combined
ratio
|
—%
|
|
|
10%
|
|
|
2%
|
|
|
3%
|
|
|
19%
|
|
|
6%
|
|
The net losses and loss adjustment expenses on the 2019 and 2018
Catastrophes were net of ceded losses of $62.5 million and $244.1
million, respectively. Both the gross and net losses on the
2019 and 2018 Catastrophes as of December 31, 2019 represent
our best estimates based upon information currently available. Our
estimates for these losses are based on claims received to date,
detailed policy and reinsurance contract level reviews, industry
loss estimates and output from both industry and proprietary
models. For the 2019 Catastrophes, these estimates are still
dependent on broad assumptions about coverage, liability and
reinsurance. While we believe our reserves for the 2019 and 2018
Catastrophes as of December 31, 2019 are adequate, we continue
to closely monitor reported claims and will adjust our estimates of
gross and net losses as new information becomes available. The net
losses and loss adjustment expenses for the 2019 and 2018
Catastrophes were within our risk tolerance for events of this
magnitude.
Insurance Segment
The combined ratio for the Insurance segment in 2019 was 93%
compared to 94% (including three points for the underwriting loss
on the 2018 Catastrophes) in 2018. The decrease in the combined
ratio was driven by lower catastrophe losses in 2019 compared to
2018, which was largely offset by a less favorable prior accident
years' loss ratio. Higher earned premiums in 2019 had a favorable
impact on our expense ratio and an unfavorable impact on the prior
years' loss ratio. The expense ratio decreased compared to 2018,
primarily due to the favorable impact of higher earned premiums in
2019 compared to 2018, partially offset by higher variable
expenses. Higher variable expenses were largely driven by a lower
benefit from ceding commissions in 2019 compared to 2018 due to
recent changes in our outwards reinsurance treaty structures. In
late 2018, we shifted from buying proportional reinsurance
coverages towards excess of loss coverages for our general
liability and professional liability product lines.
The Insurance segment's 2019 combined ratio included
$462.1 million of favorable
development on prior years' loss reserves compared to $502.3 million in 2018. The decrease in favorable
development was primarily due to less favorable development on our
marine and energy product lines in 2019 compared to 2018 and
adverse development on our property product lines in 2019 compared
to favorable development in 2018. These unfavorable changes were
partially offset by more favorable development on our general
liability product lines in 2019 compared to 2018. The adverse
development on our property product lines in 2019 was due to
adverse development on our brokerage property product lines
resulting from higher than expected attritional losses as well as
modest adverse development on prior year catastrophes. In both 2019
and 2018, favorable development was most significant on our general
liability, workers' compensation, professional liability and marine
and energy product lines.
Reinsurance Segment
The combined ratio for the Reinsurance segment in 2019 was 104%
(including 10 points for the underwriting loss on the 2019
Catastrophes) compared to 113% (including 19 points for the
underwriting loss on the 2018 Catastrophes) in 2018. The decrease
in the combined ratio was primarily driven by lower catastrophe
losses, as well as more favorable development on prior accident
years' loss reserves in 2019 compared to 2018. Excluding the impact
of the 2019 and 2018 Catastrophes, the current accident year loss
ratio increased due to higher attritional losses on our property
product lines arising from recent changes in our outwards property
reinsurance treaty structures. In 2019 we eliminated our
proportional property reinsurance treaty and purchased additional
excess of loss property and catastrophe reinsurance coverage. We
also experienced higher attritional losses across most of our other
product lines in 2019 compared to 2018. These unfavorable impacts
on the current accident year loss ratio in 2019 were partially
offset by net favorable premium adjustments in 2019, primarily on
our professional liability product lines, compared to net
unfavorable premium adjustments 2018.
The Reinsurance segment's 2019 combined ratio included
$64.8 million of favorable
development on prior years' loss reserves compared to $43.0 million in 2018. The increase in favorable
development was primarily due to more favorable development on our
property product lines in 2019 compared to 2018, which included
favorable development on prior year catastrophes in 2019 compared
to adverse development on prior year catastrophes in 2018. We also
experienced favorable development on our general liability product
lines in 2019 compared to adverse development in 2018. These
favorable changes were partially offset by less favorable
development on our credit and surety product lines in 2019 compared
to 2018. In 2019, favorable development was most significant on our
property and whole account product lines. In 2018, favorable
development was most significant on our credit and surety and
marine and energy product lines, which was partially offset by
adverse development on our professional liability product
lines.
Premiums and Net Retentions
|
Years Ended December
31,
|
|
Gross Written
Premiums
|
|
Earned
Premiums
|
(dollars in
thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Insurance
|
$
|
5,320,253
|
|
|
$
|
4,749,166
|
|
|
$
|
4,144,073
|
|
|
$
|
3,783,939
|
|
Reinsurance
|
1,114,153
|
|
|
1,050,870
|
|
|
903,587
|
|
|
928,574
|
|
Other
underwriting
|
(79)
|
|
|
(1,040)
|
|
|
581
|
|
|
(1,468)
|
|
Total
Underwriting
|
6,434,327
|
|
|
5,798,996
|
|
|
5,048,241
|
|
|
4,711,045
|
|
Program services and
other
|
2,345,644
|
|
|
2,065,473
|
|
|
1,552
|
|
|
1,015
|
|
Total
|
$
|
8,779,971
|
|
|
$
|
7,864,469
|
|
|
$
|
5,049,793
|
|
|
$
|
4,712,060
|
|
Gross Premium Volume
Gross premium volume in our underwriting segments increased 11%
in 2019 compared to 2018. The increase in gross premium volume
arose from both our Insurance and Reinsurance segments. Also
impacting consolidated gross premium volume were gross premiums
written from our program services business and other fronting
arrangements, which increased 14% in 2019. Substantially all gross
premiums from our program services business and other fronting
arrangements were ceded to third parties in 2019 and 2018.
Gross premium volume in our Insurance segment increased 12% in
2019 compared to 2018. The increase was primarily driven by growth
within our general liability, professional liability and personal
lines product lines.
Gross premium volume in our Reinsurance segment increased 6% in
2019 compared to 2018. The increase was driven by higher gross
premiums within our general liability product lines, primarily due
to a favorable impact from the timing of renewals, higher premium
volume within our workers' compensation product line and favorable
premium adjustments on our professional liability product lines.
These increases were partially offset by lower gross premiums in
our property product lines, primarily due to non-renewals.
Significant variability in gross premium volume can be expected in
our Reinsurance segment due to individually significant contracts
and multi-year contracts.
Net Retention
Net retention of gross premium volume for our underwriting
operations was 84% in 2019 and 83% in 2018. The increase in net
retention in 2019 was driven by an increase in net retention in our
Insurance segment resulting from recent changes in our outwards
reinsurance treaty structures. In late 2018, we shifted from buying
proportional reinsurance coverages towards excess of loss coverages
for our general liability and professional liability product lines,
which resulted in higher retentions. These increases in net
retention were partially offset by lower retention on our personal
lines product lines. Within our underwriting operations, we
purchase reinsurance and retrocessional reinsurance in order to
manage our net retention on individual risks and overall exposure
to losses, and enable us to write policies with sufficient limits
to meet policyholder needs.
Earned Premiums
Earned premiums for 2019 increased 7% compared to 2018. The
increase in earned premiums was attributable to an increase in
earned premiums in our Insurance segment, partially offset by a
decrease in our Reinsurance segment. The increase in earned
premiums in our Insurance segment was primarily due to the increase
in gross premium volume within our general liability and
professional liability product lines, as described above. The
decrease in earned premiums in our Reinsurance segment was
primarily driven by the non-renewal of two large specialty quota
share treaties and lower premium volume in our property product
lines, as described above. These decreases were partially offset by
an increase in gross premium volume within our workers'
compensation and professional liability product lines, as described
above.
Investing Results
Net investment gains for 2019 were $1.6
billion compared to net investment losses of $437.6 million in 2018. Net investment gains in
2019 were attributable to an increase in the fair value of equity
securities in 2019, which was driven by favorable market value
movements. Net investment losses in 2018 were primarily
attributable to a decrease in the fair value of equity securities
in 2018, which was driven by unfavorable market value movements and
a $124.6 million decline in the fair
value of our investments in insurance-linked securities funds (ILS
Funds) due to the impact of adverse development on catastrophes
that occurred in 2017 on the underlying reinsurance contracts in
which the ILS Funds are invested.
Markel Ventures
We report the results of our Markel Ventures operations in our
Markel Ventures segment. This segment includes a diverse portfolio
of businesses from different industries that offer various types of
products and services to businesses and consumers. The following
table summarizes the results from our Markel Ventures segment.
|
Years Ended December 31,
|
(dollars in
thousands)
|
2019
|
|
2018
|
Operating
revenues
|
$
|
2,055,020
|
|
|
$
|
1,912,065
|
|
Operating
income
|
$
|
168,417
|
|
|
$
|
77,479
|
|
EBITDA
|
$
|
263,944
|
|
|
$
|
169,894
|
|
Net income to
shareholders
|
$
|
92,901
|
|
|
$
|
35,258
|
|
See below for a reconciliation of Markel Ventures operating
income to Markel Ventures earnings before interest, income taxes,
depreciation and amortization (EBITDA).
Operating revenues from our Markel Ventures operations increased
in 2019 compared to 2018 driven by higher revenues in our products
businesses, primarily due to the contribution of revenues from
Brahmin, which was acquired in the fourth quarter of 2018. The
increase was also attributable to higher sales volumes and selling
prices at our transportation-related businesses and growth within
one of our consulting services businesses. These increases were
partially offset by lower sales volumes at one of our equipment
manufacturing businesses.
Operating income and EBITDA from our Markel Ventures operations
increased in 2019 compared to 2018 due in part to $33.5 million of expenses incurred in 2018
related to an investigation and remediation accrual associated with
the manufacture of products at one of our businesses and an
impairment charge of $14.9 million
related to intangible assets at this reporting unit in 2018.
Excluding these charges, the increase in operating income and
EBITDA in 2019 was primarily attributable to improved operating
results at one of our consumer and building products businesses,
higher revenues from our transportation-related businesses, as
described above, and the contribution of a full year of operations
at Brahmin, partially offset by the impact of lower revenues at one
of our equipment manufacturing businesses, as described above, and
losses in 2019 related to the disposition of certain components of
one of our equipment manufacturing businesses.
Net income to shareholders from our Markel Ventures operations
increased in 2019 compared to 2018, primarily due to higher
operating income, partially offset by higher income tax and
interest expenses.
Other Operations
The following table presents the components of operating
revenues and operating expenses that are not included in a
reportable segment.
|
Years Ended December
31,
|
|
2019
|
|
2018
|
(dollars in
thousands)
|
Services and
other
revenues
|
|
Services and
other
expenses
|
|
Amortization
of intangible
assets
|
|
Impairment
of goodwill
and
intangible
assets
|
|
Services and
other
revenues
|
|
Services and
other
expenses
|
|
Amortization
of intangible
assets
|
|
Impairment
of goodwill
and
intangible
assets
|
Other
operations:
|
Insurance-linked securities
|
$
|
225,604
|
|
|
$
|
217,412
|
|
|
$
|
43,360
|
|
|
$
|
—
|
|
|
$
|
91,527
|
|
|
$
|
21,417
|
|
|
$
|
7,964
|
|
|
$
|
179,017
|
|
Program services
|
108,813
|
|
|
19,556
|
|
|
20,938
|
|
|
—
|
|
|
95,688
|
|
|
24,298
|
|
|
20,776
|
|
|
—
|
|
Life and annuity
|
1,507
|
|
|
21,062
|
|
|
—
|
|
|
—
|
|
|
1,660
|
|
|
27,855
|
|
|
—
|
|
|
—
|
|
Other
|
32,580
|
|
|
28,264
|
|
|
2,700
|
|
|
—
|
|
|
31,666
|
|
|
34,615
|
|
|
2,518
|
|
|
846
|
|
|
368,504
|
|
|
286,294
|
|
|
66,998
|
|
|
—
|
|
|
220,541
|
|
|
108,185
|
|
|
31,258
|
|
|
179,863
|
|
Underwriting
operations
|
|
|
|
|
39,667
|
|
|
—
|
|
|
|
|
|
|
44,464
|
|
|
4,431
|
|
Total
|
$
|
368,504
|
|
|
$
|
286,294
|
|
|
$
|
106,665
|
|
|
$
|
—
|
|
|
$
|
220,541
|
|
|
$
|
108,185
|
|
|
$
|
75,722
|
|
|
$
|
184,294
|
|
Insurance-Linked Securities
The increase in operating revenues in our insurance-linked
securities operations in 2019 compared to 2018 reflects the full
year contribution of revenues from Nephila Holdings Ltd. (Nephila)
in 2019, which was acquired in the fourth quarter of 2018. The
contribution of revenues from Nephila was partially offset by lower
revenues from Markel CATCo Investment Management, Ltd. (Markel
CATCo) due to lower assets under management during 2019 compared to
2018 and a reduction in management fees charged on sidepocket
shares.
The increase in operating expenses in our insurance-linked
securities operations in 2019 compared to 2018 is attributable to a
full year of operating expenses for Nephila in 2019, the impact of
the reversal of accrued incentive and retention compensation for
two former Markel CATCo senior executives totaling $34.9 million in 2018, which was reflected as a
reduction to services and other expenses in 2018. Additionally,
2019 included costs associated with the internal review of matters
at our Markel CATCo operations, as previously reported, and related
litigation costs. These increases were partially offset by the
impact of the impairment of goodwill and intangible assets at the
Markel CATCo reporting unit in 2018.
Program Services
Operating revenues in our program services operations increased
14% compared to 2018 due to higher premium volume. Operating
expenses in our program services operations decreased in 2019
compared to 2018 due to higher acquisition-related expenses in
2018.
Interest Expense, Loss on Early Extinguishment of Debt and
Income
Taxes
Interest Expense and Loss on Early Extinguishment of
Debt
Interest expense was $171.7
million in 2019 compared to $154.2
million in 2018. The increase in interest expense in 2019
compared to 2018 was primarily due to a $565.2 million net increase in principal
outstanding on our senior long-term debt during 2019. Interest
expense in 2019 included interest expense associated with our 5.0%
unsecured senior notes issued in the second quarter of 2019 and our
3.35% and 4.15% unsecured senior notes issued in the third quarter
of 2019. These increases were partially offset by lower interest
expense resulting from the repayment of our 7.125% unsecured senior
notes in the third quarter of 2019 as well as the purchase and
redemption of our 6.25% and 5.35% unsecured senior notes in the
third and fourth quarters of 2019.
In September 2019, we purchased
$125.2 million of principal on our
6.25% unsecured senior notes due September 30, 2020 and
$97.8 million of principal on our
5.35% unsecured senior notes due June 1, 2021 through a tender
offer at a total purchase price of $130.1
million and $103.0 million,
respectively. In October 2019, we
redeemed the remaining outstanding balance of $224.8 million on our 6.25% unsecured senior
notes due September 30, 2020 and $152.2
million on our 5.35% unsecured senior notes due June 1,
2021 for a total purchase price of $233.4
million and $160.2 million,
respectively. In connection with the September 2019 tender offer and purchase and the
October 2019 redemption, we
recognized losses on early extinguishment of debt of $17.6 million during 2019.
Income Taxes
The effective tax rate for 2019 was 21%. The effective tax rate
for 2018 was not meaningful due to a small pre-tax loss for the
year and a one-time deferred tax charge, described below.
In 2018, we decided to elect to treat our two most significant
United Kingdom subsidiaries as
domestic corporations for U.S. tax purposes. As a result, the
earnings and profits from those subsidiaries are no longer
considered to be indefinitely reinvested, and during 2018, we
recorded a one-time deferred tax charge of $103.3 million related to the book and tax basis
differences attributable to those subsidiaries. In addition to this
one-time deferred tax charge, our effective tax rate in 2018
differed from the statutory rate of 21% primarily as a result of
nondeductible losses on our investments in the ILS Funds in 2018,
partially offset by the impact of tax-exempt investment income.
Financial
Condition
Investments, cash and cash equivalents and restricted cash and
cash equivalents (invested assets) were $22.3 billion at December 31, 2019 compared
to $19.2 billion at December 31,
2018. The increase was primarily attributable to an increase in the
fair value of our equity securities, driven by favorable market
value movements. Equity securities comprised 34% of invested
assets, at December 31, 2019 compared to 30% of invested
assets, at December 31, 2018.
At December 31, 2019, our holding company held $4.0 billion of invested assets compared to
$2.6 billion of invested assets at
December 31, 2018. The increase in holding company invested
assets is primarily due to the net proceeds from the issuance of
unsecured senior notes in 2019 and dividends received from our
subsidiaries, partially offset by the repayment and purchase of
certain unsecured senior notes in 2019.
Net cash provided by operating activities was $1.3 billion in 2019 compared to $892.9 million in 2018. The increase in net cash
flows from operating activities for the year ended
December 31, 2019 was primarily driven by higher net premiums
collections in our Insurance segment compared to 2018.
Safe Harbor and Cautionary
Statement
This release contains statements concerning or incorporating our
expectations, assumptions, plans, objectives, future financial or
operating performance and other statements that are not historical
facts. These statements are "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
Such statements may use words such as "anticipate," "believe,"
"estimate," "expect," "intend," "predict," "project" and similar
expressions as they relate to us or our management.
There are risks and uncertainties that may cause actual results
to differ materially from predicted results in forward-looking
statements. Factors that may cause actual results to differ are
often presented with the forward-looking statements themselves.
Additional factors that could cause actual results to differ from
those predicted are set forth under "Business Overview," "Risk
Factors," "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Safe Harbor and
Cautionary Statement" in our 2018 Annual Report on Form 10-K and
under "Risk Factors" and "Safe Harbor and Cautionary Statement" in
our most recent Quarterly Report on Form 10-Q or are included in
the items listed below:
- our expectations about future results of our underwriting,
investing, Markel Ventures and other operations are based on
current knowledge and assume no significant man-made or natural
catastrophes, no significant changes in products or personnel and
no adverse changes in market conditions;
- the effect of cyclical trends on our underwriting, investing,
Markel Ventures and other operations, including demand and pricing
in the insurance, reinsurance and other markets in which we
operate;
- actions by competitors, including the application of new or
"disruptive" technologies or business models and consolidation, and
the effect of competition on market trends and pricing;
- the frequency and severity of man-made and natural catastrophes
(including earthquakes, fires and weather-related catastrophes) may
exceed expectations, are unpredictable and, in the case of fires
and weather-related catastrophes, may be exacerbated if, as many
forecast, changing conditions in the oceans and atmosphere result
in increased hurricane, flood, drought or other adverse
weather-related activity;
- we offer insurance and reinsurance coverage against terrorist
acts in connection with some of our programs, and in other
instances we are legally required to offer terrorism insurance; in
both circumstances, we actively manage our exposure, but if there
is a covered terrorist attack, we could sustain material
losses;
- emerging claim and coverage issues, changing legal and social
trends, and inherent uncertainties in the loss estimation process
can adversely impact the adequacy of our loss reserves and our
allowance for reinsurance recoverables;
- reinsurance reserves are subject to greater uncertainty than
insurance reserves, primarily because of reliance upon the original
underwriting decisions made by ceding companies and the longer
lapse of time from the occurrence of loss events to their reporting
to the reinsurer for ultimate resolution;
- changes in the assumptions and estimates used in establishing
reserves for our life and annuity reinsurance book (which is in
runoff), for example, changes in assumptions and estimates of
mortality, longevity, morbidity and interest rates, could result in
material increases in our estimated loss reserves for such
business;
- adverse developments in insurance coverage litigation or other
legal or administrative proceedings could result in material
increases in our estimates of loss reserves;
- initial estimates for catastrophe losses are often based on
limited information, are dependent on broad assumptions about the
nature and extent of losses, coverage, liability and reinsurance,
and those losses may ultimately differ materially from our
expectations;
- changes in the availability, costs and quality of reinsurance
coverage, which may impact our ability to write or continue to
write certain lines of business;
- the ability or willingness of reinsurers to pay balances due
may be adversely affected by industry and economic conditions,
deterioration in reinsurer credit quality and coverage disputes,
and collateral we hold, if any, may not be sufficient to cover a
reinsurer's obligation to us;
- after the commutation of ceded reinsurance contracts, any
subsequent adverse development in the re-assumed loss reserves will
result in a charge to earnings;
- regulatory actions can impede our ability to charge adequate
rates and efficiently allocate capital;
- general economic and market conditions and industry specific
conditions, including extended economic recessions or expansions;
prolonged periods of slow economic growth; inflation or deflation;
fluctuations in foreign currency exchange rates, commodity and
energy prices and interest rates; volatility in the credit and
capital markets; and other factors;
- economic conditions, actual or potential defaults in municipal
bonds or sovereign debt obligations, volatility in interest and
foreign currency exchange rates and changes in market value of
concentrated investments can have a significant impact on the fair
value of our fixed maturity and equity securities, as well as the
carrying value of our other assets and liabilities, and this impact
may be heightened by market volatility;
- economic conditions may adversely affect our access to capital
and credit markets;
- the effects of government intervention, including material
changes in the monetary policies of central banks, to address
financial downturns and economic and currency concerns;
- the impacts that political and civil unrest and regional
conflicts may have on our businesses and the markets they serve or
that any disruptions in regional or worldwide economic conditions
generally arising from these situations may have on our businesses,
industries or investments;
- the impacts that health epidemics and pandemics may have on our
business operations and claims activity;
- the impact on our businesses in the event of a repeal, in part
or in whole, or modification of U.S. health care reform legislation
and regulations;
- changes in U.S. tax laws, regulations or interpretations, or in
the tax laws, regulations or interpretations of other jurisdictions
in which we operate, and adjustments we may make in our operations
or tax strategies in response to those changes;
- a failure of our enterprise information technology systems and
those maintained by third parties upon which we may rely, or a
failure to comply with data protection or privacy regulations;
- our acquisitions may increase our operational and control risks
for a period of time;
- we may not realize the contemplated benefits, including cost
savings and synergies, of our acquisitions;
- any determination requiring the write-off of a significant
portion of our goodwill and intangible assets;
- the failure or inadequacy of any loss limitation methods we
employ;
- the loss of services of any executive officer or other key
personnel could adversely impact one or more of our
operations;
- our substantial international operations and investments expose
us to increased political, operational and economic risks,
including foreign currency exchange rate and credit risk;
- the political, legal, regulatory, financial, tax and general
economic impacts, and other impacts we cannot anticipate, related
to the United Kingdom's withdrawal
from the European Union (Brexit), which could have adverse
consequences for our businesses, particularly our London-based international insurance
operations;
- our ability to obtain additional capital for our operations on
terms favorable to us;
- our compliance, or failure to comply, with covenants and other
requirements under our revolving credit facility, senior debt and
other indebtedness;
- our ability to maintain or raise third party capital for
existing or new investment vehicles and risks related to our
management of third party capital;
- the effectiveness of our procedures for compliance with
existing and future guidelines, policies and legal and regulatory
standards, rules, laws and regulations;
- the impact of economic and trade sanctions and embargo programs
on our businesses, including instances in which the requirements
and limitations applicable to the global operations of U.S.
companies and their affiliates are more restrictive than, or
conflict with, those applicable to non-U.S. companies and their
affiliates;
- regulatory changes, or challenges by regulators, regarding the
use of certain issuing carrier or fronting arrangements;
- our dependence on a limited number of brokers for a large
portion of our revenues and third-party capital;
- adverse changes in our assigned financial strength or debt
ratings could adversely impact us, including our ability to attract
and retain business, the amount of capital our insurance
subsidiaries must hold and the availability and cost of
capital;
- changes in the amount of statutory capital our insurance
subsidiaries are required to hold, which can vary significantly and
is based on many factors outside our control;
- losses from litigation and regulatory investigations and
actions; and
- a number of additional factors may adversely affect our Markel
Ventures operations, and the markets they serve, and negatively
impact their revenues and profitability, including, among others:
adverse weather conditions, plant disease and other contaminants;
changes in government support for education, healthcare and
infrastructure projects; changes in capital spending levels;
changes in the housing market; liability for environmental matters;
volatility in the market prices for their products; and volatility
in commodity prices and interest and foreign currency exchange
rates.
Our premium volume, underwriting and investment results and
results from our other operations have been and will continue to be
potentially materially affected by these factors. In addition, with
respect to previously reported developments at Markel CATCo and the
decision to place both the Markel CATCo Reinsurance Fund Ltd., a
Bermuda exempted mutual fund
company comprised of multiple segregated accounts, and Markel CATCo
Re Ltd. (Markel CATCo Re) into run-off:
- the inquiries by the U.S. Department of Justice, U.S.
Securities and Exchange Commission and Bermuda Monetary Authority
into loss reserves recorded in late 2017 and early 2018 at Markel
CATCo Re (the Markel CATCo Inquiries) may result in adverse
findings, reputational damage, the imposition of sanctions,
increased costs, litigation and other negative consequences;
and
- management time and resources may be diverted to address the
Markel CATCo Inquiries, as well as related litigation.
By making forward-looking statements, we do not intend to become
obligated to publicly update or revise any such statements whether
as a result of new information, future events or other changes.
Readers are cautioned not to place undue reliance on any
forward-looking statements, which speak only as at their dates.
Our previously announced conference call, which will involve
discussion of our financial results and business developments and
may include forward-looking information, will be held Wednesday, February 5, 2020, beginning at
9:30 a.m. (Eastern Time). Any person
interested in listening to the call should contact Markel's
Investor Relations Department at 804-747-0136 or
investorrelations@markel.com. Investors, analysts and the general
public also may listen to the call free over the Internet through
Markel Corporation's web site, www.markel.com/investor-relations. A
replay of the call will also be available on this web site from
approximately one hour after the conclusion of the call until
Monday, February 17, 2020.
* * * * * * * *
Markel Corporation is a diverse financial holding company
serving a variety of niche markets. The Company's principal
business markets and underwrites specialty insurance products. In
each of the Company's businesses, it seeks to provide quality
products and excellent customer service so that it can be a market
leader. The financial goals of the Company are to earn consistent
underwriting and operating profits and superior investment returns
to build shareholder value. Visit Markel Corporation on the web at
www.markel.com.
Markel Corporation
and Subsidiaries
|
Consolidated
Statements of Income (Loss) and Comprehensive Income
(Loss)
|
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(dollars in
thousands, except per share data)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
OPERATING
REVENUES
|
|
|
|
|
|
|
|
Earned
premiums
|
$
|
1,346,323
|
|
|
$
|
1,227,532
|
|
|
$
|
5,049,793
|
|
|
$
|
4,712,060
|
|
Net investment
income
|
112,493
|
|
|
114,505
|
|
|
451,888
|
|
|
434,215
|
|
Net investment gains
(losses):
|
|
|
|
|
|
|
|
Net realized
investment losses
|
(2,246)
|
|
|
(2,890)
|
|
|
(1,482)
|
|
|
(11,974)
|
|
Change in fair value
of equity securities
|
533,980
|
|
|
(843,032)
|
|
|
1,603,204
|
|
|
(425,622)
|
|
Net investment gains
(losses)
|
531,734
|
|
|
(845,922)
|
|
|
1,601,722
|
|
|
(437,596)
|
|
Products
revenues
|
372,408
|
|
|
368,487
|
|
|
1,609,586
|
|
|
1,497,523
|
|
Services and other
revenues
|
218,571
|
|
|
178,250
|
|
|
813,202
|
|
|
635,083
|
|
Total Operating
Revenues
|
2,581,529
|
|
|
1,042,852
|
|
|
9,526,191
|
|
|
6,841,285
|
|
OPERATING
EXPENSES
|
|
|
|
|
|
|
|
Losses and loss
adjustment expenses
|
773,190
|
|
|
869,573
|
|
|
2,891,190
|
|
|
2,820,715
|
|
Underwriting,
acquisition and insurance expenses
|
485,346
|
|
|
459,590
|
|
|
1,878,093
|
|
|
1,777,511
|
|
Products
expenses
|
356,277
|
|
|
351,243
|
|
|
1,455,245
|
|
|
1,413,248
|
|
Services and other
expenses
|
176,919
|
|
|
80,618
|
|
|
675,679
|
|
|
474,924
|
|
Amortization of
intangible assets
|
35,975
|
|
|
29,671
|
|
|
148,638
|
|
|
115,930
|
|
Impairment of
goodwill and intangible assets
|
—
|
|
|
184,294
|
|
|
—
|
|
|
199,198
|
|
Total Operating
Expenses
|
1,827,707
|
|
|
1,974,989
|
|
|
7,048,845
|
|
|
6,801,526
|
|
Operating Income
(Loss)
|
753,822
|
|
|
(932,137)
|
|
|
2,477,346
|
|
|
39,759
|
|
Interest
expense
|
(42,665)
|
|
|
(39,490)
|
|
|
(171,687)
|
|
|
(154,212)
|
|
Net foreign exchange
gains (losses)
|
(59,266)
|
|
|
41,171
|
|
|
(2,265)
|
|
|
106,598
|
|
Loss on early
extinguishment of debt
|
(10,881)
|
|
|
—
|
|
|
(17,586)
|
|
|
—
|
|
Income (Loss) Before
Income Taxes
|
641,010
|
|
|
(930,456)
|
|
|
2,285,808
|
|
|
(7,855)
|
|
Income tax (expense)
benefit
|
(129,497)
|
|
|
177,082
|
|
|
(486,346)
|
|
|
(122,498)
|
|
Net Income
(Loss)
|
511,513
|
|
|
(753,374)
|
|
|
1,799,462
|
|
|
(130,353)
|
|
Net (income) loss
attributable to noncontrolling interests
|
(409)
|
|
|
1,831
|
|
|
(8,996)
|
|
|
2,173
|
|
Net Income (Loss) to
Shareholders
|
$
|
511,104
|
|
|
$
|
(751,543)
|
|
|
$
|
1,790,466
|
|
|
$
|
(128,180)
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE
INCOME (LOSS)
|
|
|
|
|
|
|
|
Change in net
unrealized gains on available-for-sale investments, net of
taxes:
|
|
|
|
|
|
|
|
Net holding gains
(losses) arising during the period
|
$
|
(29,988)
|
|
|
$
|
64,744
|
|
|
$
|
299,125
|
|
|
$
|
(241,325)
|
|
Reclassification
adjustments for net gains (losses) included in net income
(loss)
|
(1,908)
|
|
|
2,353
|
|
|
(1,148)
|
|
|
7,849
|
|
Change in net
unrealized gains on available-for-sale investments, net of
taxes
|
(31,896)
|
|
|
67,097
|
|
|
297,977
|
|
|
(233,476)
|
|
Change in foreign
currency translation adjustments, net of taxes
|
6,360
|
|
|
3,473
|
|
|
382
|
|
|
(16,495)
|
|
Change in net
actuarial pension loss, net of taxes
|
2,704
|
|
|
600
|
|
|
5,042
|
|
|
2,341
|
|
Total Other
Comprehensive Income (Loss)
|
(22,832)
|
|
|
71,170
|
|
|
303,401
|
|
|
(247,630)
|
|
Comprehensive Income
(Loss)
|
488,681
|
|
|
(682,204)
|
|
|
2,102,863
|
|
|
(377,983)
|
|
Comprehensive
(income) loss attributable to noncontrolling interests
|
(437)
|
|
|
1,831
|
|
|
(8,975)
|
|
|
2,213
|
|
Comprehensive Income
(Loss) to Shareholders
|
$
|
488,244
|
|
|
$
|
(680,373)
|
|
|
$
|
2,093,888
|
|
|
$
|
(375,770)
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS) PER
SHARE
|
|
|
|
|
|
|
|
Basic
|
$
|
36.34
|
|
|
$
|
(53.88)
|
|
|
$
|
129.25
|
|
|
$
|
(9.55)
|
|
Diluted
|
$
|
36.26
|
|
|
$
|
(53.88)
|
|
|
$
|
129.07
|
|
|
$
|
(9.55)
|
|
|
|
|
|
|
|
|
|
Markel Corporation
and Subsidiaries
|
|
|
|
|
|
|
|
Selected
Data
|
|
|
|
|
December
31,
|
(in thousands,
except per share data)
|
|
|
|
|
2019
|
|
2018
|
Total investments,
cash and cash equivalents and restricted cash and cash
equivalents
|
|
|
|
|
$
|
22,258,265
|
|
|
$
|
19,238,261
|
|
Reinsurance
recoverables
|
|
|
|
|
5,432,712
|
|
|
5,221,947
|
|
Goodwill and
intangible assets
|
|
|
|
|
4,047,022
|
|
|
3,964,171
|
|
Total
assets
|
|
|
|
|
37,473,815
|
|
|
33,306,263
|
|
Unpaid losses and
loss adjustment expenses
|
|
|
|
|
14,728,676
|
|
|
14,276,479
|
|
Unearned
premiums
|
|
|
|
|
4,057,727
|
|
|
3,611,028
|
|
Senior long-term debt
and other debt
|
|
|
|
|
3,534,183
|
|
|
3,009,577
|
|
Total shareholders'
equity
|
|
|
|
|
11,070,867
|
|
|
9,080,653
|
|
Book value per common
share outstanding
|
|
|
|
|
$
|
802.59
|
|
|
$
|
653.85
|
|
Common shares
outstanding
|
|
|
|
|
13,794
|
|
|
13,888
|
|
Markel Corporation
and Subsidiaries
|
Supplemental
Financial Information
|
For the Quarters
and Years Ended December 31, 2019 and 2018
|
|
Gross Written
Premiums
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(dollars in
thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Insurance
|
$
|
1,340,694
|
|
|
$
|
1,173,826
|
|
|
$
|
5,320,253
|
|
|
$
|
4,749,166
|
|
Reinsurance
|
151,008
|
|
|
115,372
|
|
|
1,114,153
|
|
|
1,050,870
|
|
Other
underwriting
|
(91)
|
|
|
(1,039)
|
|
|
(79)
|
|
|
(1,040)
|
|
Total
Underwriting
|
1,491,611
|
|
|
1,288,159
|
|
|
6,434,327
|
|
|
5,798,996
|
|
Program services and
other
|
521,679
|
|
|
488,222
|
|
|
2,345,644
|
|
|
2,065,473
|
|
Total
|
$
|
2,013,290
|
|
|
$
|
1,776,381
|
|
|
$
|
8,779,971
|
|
|
$
|
7,864,469
|
|
|
|
|
|
|
|
|
|
Net Written
Premiums
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(dollars in
thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Insurance
|
$
|
1,138,255
|
|
|
$
|
968,984
|
|
|
$
|
4,444,702
|
|
|
$
|
3,904,773
|
|
Reinsurance
|
119,998
|
|
|
87,149
|
|
|
964,947
|
|
|
882,285
|
|
Other
underwriting
|
482
|
|
|
(254)
|
|
|
581
|
|
|
(1,468)
|
|
Total
Underwriting
|
1,258,735
|
|
|
1,055,879
|
|
|
5,410,230
|
|
|
4,785,590
|
|
Program services and
other
|
221
|
|
|
20
|
|
|
1,841
|
|
|
1,988
|
|
Total
|
$
|
1,258,956
|
|
|
$
|
1,055,899
|
|
|
$
|
5,412,071
|
|
|
$
|
4,787,578
|
|
|
|
|
|
|
|
|
|
Net Earned
Premiums
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(dollars in
thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Insurance
|
$
|
1,120,208
|
|
|
$
|
1,001,832
|
|
|
$
|
4,144,073
|
|
|
$
|
3,783,939
|
|
Reinsurance
|
225,205
|
|
|
225,720
|
|
|
903,587
|
|
|
928,574
|
|
Other
underwriting
|
482
|
|
|
(254)
|
|
|
581
|
|
|
(1,468)
|
|
Total
Underwriting
|
1,345,895
|
|
|
1,227,298
|
|
|
5,048,241
|
|
|
4,711,045
|
|
Program services and
other
|
428
|
|
|
234
|
|
|
1,552
|
|
|
1,015
|
|
Total
|
$
|
1,346,323
|
|
|
$
|
1,227,532
|
|
|
$
|
5,049,793
|
|
|
$
|
4,712,060
|
|
|
|
|
|
|
|
|
|
Combined
Ratios
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Insurance
|
89%
|
|
|
99%
|
|
|
93%
|
|
|
94%
|
|
Reinsurance
|
120%
|
|
|
151%
|
|
|
104%
|
|
|
113%
|
|
Consolidated
|
93%
|
|
|
108%
|
|
|
94%
|
|
|
98%
|
|
|
|
|
|
|
|
|
|
Components of
Consolidated Operating Income
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(dollars in
thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Insurance segment
underwriting profit (1)
|
128,833
|
|
|
9,505
|
|
|
309,778
|
|
|
228,773
|
|
Reinsurance segment
underwriting loss (1)
|
(45,696)
|
|
|
(115,347)
|
|
|
(39,999)
|
|
|
(118,287)
|
|
Investing segment
profit (loss) (2)
|
644,103
|
|
|
(731,473)
|
|
|
2,052,874
|
|
|
(3,894)
|
|
Markel Ventures
segment profit (3)
|
21,361
|
|
|
17,050
|
|
|
168,417
|
|
|
77,479
|
|
Other operations
(4)
|
5,221
|
|
|
(111,872)
|
|
|
(13,724)
|
|
|
(144,312)
|
|
Consolidated
Operating Income (Loss)
|
753,822
|
|
|
(932,137)
|
|
|
2,477,346
|
|
|
39,759
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Segment profit (loss)
for each of the Company's underwriting segments is measured by
underwriting profit (loss).
|
|
|
(2)
|
Net investment income
and net investment gains, if any, attributable to Markel Ventures
are included in segment profit for Markel Ventures. All other net
investment income and net investment gains are included in
investing segment profit (loss).
|
|
|
(3)
|
Segment profit for
the Markel Ventures segment includes amortization of intangible
assets attributable to Markel Ventures. Amortization of intangible
assets is not allocated to any other reportable
segments.
|
|
|
(4)
|
Other operations
represents the total profit (loss) attributable to the Company's
operations that are not included in a reportable segment as well as
any amortization of intangible assets that is not allocated to a
reportable segment.
|
|
Products, Services
and Other Revenues
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(dollars in
thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Products
revenues:
|
|
|
|
|
|
|
|
Markel
Ventures
|
$
|
372,408
|
|
|
$
|
368,487
|
|
|
$
|
1,609,586
|
|
|
$
|
1,497,523
|
|
Services and other
revenues:
|
|
|
|
|
|
|
|
Markel
Ventures
|
$
|
114,045
|
|
|
$
|
103,494
|
|
|
$
|
444,698
|
|
|
$
|
414,542
|
|
Insurance-linked
securities
|
67,034
|
|
|
38,562
|
|
|
225,604
|
|
|
91,527
|
|
Program
services
|
29,418
|
|
|
28,286
|
|
|
108,813
|
|
|
95,688
|
|
Life and
annuity
|
362
|
|
|
387
|
|
|
1,507
|
|
|
1,660
|
|
Other
|
7,712
|
|
|
7,521
|
|
|
32,580
|
|
|
31,666
|
|
Total services and
other revenues
|
$
|
218,571
|
|
|
$
|
178,250
|
|
|
$
|
813,202
|
|
|
$
|
635,083
|
|
|
|
Products, Services
and Other Expenses
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(dollars in
thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Products
expenses:
|
|
|
|
|
|
|
|
Markel
Ventures
|
$
|
356,277
|
|
|
$
|
351,243
|
|
|
$
|
1,455,245
|
|
|
$
|
1,413,248
|
|
Services and other
expenses:
|
|
|
|
|
|
|
|
Markel
Ventures
|
$
|
98,640
|
|
|
$
|
92,868
|
|
|
$
|
389,385
|
|
|
$
|
366,739
|
|
Insurance-linked
securities
|
58,406
|
|
|
(31,837)
|
|
|
217,412
|
|
|
21,417
|
|
Program
services
|
5,256
|
|
|
2,134
|
|
|
19,556
|
|
|
24,298
|
|
Life and
annuity
|
6,778
|
|
|
6,714
|
|
|
21,062
|
|
|
27,855
|
|
Other
|
7,839
|
|
|
10,739
|
|
|
28,264
|
|
|
34,615
|
|
Total services and
other expenses
|
$
|
176,919
|
|
|
$
|
80,618
|
|
|
$
|
675,679
|
|
|
$
|
474,924
|
|
|
|
Reconciliation of
Non-GAAP Financial Measure
|
|
The following table
reconciles Markel Ventures operating income to Markel Ventures
earnings before interest, income taxes, depreciation and
amortization (EBITDA).
|
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(dollars in
thousands)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Markel Ventures
operating income
|
$
|
21,361
|
|
|
$
|
17,050
|
|
|
$
|
168,417
|
|
|
$
|
77,479
|
|
Depreciation
expense
|
13,153
|
|
|
13,702
|
|
|
53,554
|
|
|
52,207
|
|
Amortization of intangible
assets
|
10,299
|
|
|
10,876
|
|
|
41,973
|
|
|
40,208
|
|
Markel Ventures
EBITDA
|
$
|
44,813
|
|
|
$
|
41,628
|
|
|
$
|
263,944
|
|
|
$
|
169,894
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Markel Ventures
EBITDA is a non-GAAP financial measure. We use Markel Ventures
EBITDA as an operating performance measure in conjunction with U.S.
GAAP measures, including operating revenues, operating income and
net income to shareholders, to monitor and evaluate the performance
of our Markel Ventures segment. Because EBITDA excludes interest,
income taxes, depreciation and amortization, it provides an
indicator of economic performance that is useful to both management
and investors in evaluating our Markel Ventures businesses as it is
not affected by levels of debt, interest rates, effective tax rates
or levels of depreciation or amortization resulting from purchase
accounting.
|
|
Net Income (Loss)
per Share
|
|
Net income (loss) per
share is determined by dividing adjusted net income to shareholders
by the applicable weighted average shares outstanding. Diluted net
income (loss) per share is computed by dividing adjusted net income
(loss) to shareholders by the weighted average number of common
shares and dilutive potential common shares outstanding during the
year.
|
|
|
Quarters Ended
December 31,
|
|
Years Ended December
31,
|
(in thousands,
except per share amounts)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net income (loss) to
shareholders
|
$
|
511,104
|
|
|
$
|
(751,543)
|
|
|
$
|
1,790,466
|
|
|
$
|
(128,180)
|
|
Adjustment of
redeemable noncontrolling interests
|
(8,359)
|
|
|
1,793
|
|
|
1,105
|
|
|
(4,828)
|
|
Adjusted net income
(loss) to shareholders
|
$
|
502,745
|
|
|
$
|
(749,750)
|
|
|
$
|
1,791,571
|
|
|
$
|
(133,008)
|
|
|
|
|
|
|
|
|
|
Basic common shares
outstanding
|
13,835
|
|
|
13,916
|
|
|
13,861
|
|
|
13,923
|
|
Dilutive potential
common shares from restricted stock units and restricted
stock
|
29
|
|
|
—
|
|
|
20
|
|
|
—
|
|
Diluted shares
outstanding
|
13,864
|
|
|
13,916
|
|
|
13,881
|
|
|
13,923
|
|
Basic net income
(loss) per share
|
$
|
36.34
|
|
|
$
|
(53.88)
|
|
|
$
|
129.25
|
|
|
$
|
(9.55)
|
|
Diluted net income
(loss) per share (1)
|
$
|
36.26
|
|
|
$
|
(53.88)
|
|
|
$
|
129.07
|
|
|
$
|
(9.55)
|
|
|
|
(1)
|
The impact of
restricted stock units and restricted stock of 25 thousand shares
was excluded from the computation of diluted earnings per share for
both the quarter and year ended December 31, 2018 because the
effect would have been anti-dilutive.
|
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SOURCE Markel Corporation