NU Online News Service, Aug. 9, 1:35 p.m. EDT
Warren Buffett's Berkshire Hathaway Inc. reported a 40 percent drop in second-quarter profit to $1.97 billion.
Omaha, Neb.-based Berkshire recorded $3.3 billion in second-quarter earnings last year.
Results in 2010 were affected by $1.41 billion in derivative losses compared with $1.53 billion in derivative gains the prior year.
Insurance operations in the quarter soared to an underwriting profit of $462 million compared to $66 million in 2009 second-quarter results.
Berkshire's auto insurance company, GEICO, posted $329 million in underwriting profit, up from $111 million at the 2009 second-quarter mark. For the first six months of 2010 GEICO's underwriting profit was $628 million compared to $259 million after six months last year.
Premiums earned for Geico jumped 4.7 percent to $3.55 billion in the second quarter.
Berkshire's General Reinsurance Corp. reported a 2010 second-quarter underwriting gain of $222 million, down from $276 million a year ago, and its Berkshire Hathaway Reinsurance Group posted a profit of $117 million versus a loss of $318 in the 2009 second quarter.
Results for Berkshire Hathaway Re included $216 million in losses from the Deepwater Horizon oil rig explosion and Chilean earthquake.
Operating earnings for the second quarter increased nearly 73 percent to $3.07 billion from $1.78 billion last year for the same period. Berkshire acquired railroad operator Burlington Northern Santa Fe in February, which added $603 million in net earnings.
For the first six months net income is $5.6 billion compared with $1.76 billion a year ago.
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