Markel (US:MKL)2026-02-04 21:40Financial Performance - Operating income for 2025 was $3.2 billion, with adjusted operating income exceeding $2.3 billion, reflecting contributions from all reportable segments [3]. - Operating revenues increased by 8% for the fourth quarter and 5% for the full year, reaching $15.5 billion for 2025 compared to $14.8 billion in 2024 [6]. - Adjusted operating income rose by 19% for the fourth quarter and 10% for the year, totaling $2.3 billion for 2025 [6]. - Comprehensive income to shareholders was $2.6 billion for the year, with operating cash flows of $2.8 billion [6]. - Net income attributable to shareholders for the year was $2,107,010, compared to $2,747,022 in 2024, reflecting a decrease [42]. - The net income per common share for 2025 was $169.74, a decrease from $199.69 in 2024 [42]. - Adjusted operating income for the total company rose to $625,894, a 19% increase from $524,536 in the fourth quarter of 2024 [44]. - Adjusted earnings for 2025 are reported at $1,919,489, up from $1,658,385 in 2024 [62]. Insurance Segment Performance - The combined ratio for Markel Insurance improved to 93% for the fourth quarter and 95% for the full year, a three-point and one-point improvement respectively [6]. - The underwriting profit for Markel Insurance increased by 24% to $455.7 million, with a combined ratio of 94.6% [13]. - Earned premiums in the Markel Insurance segment increased to $2,193,514, reflecting a 7% growth from $2,044,294 in the previous year [45]. - The combined ratio for the Markel Insurance segment improved to 92.9% from 95.9% year-over-year, indicating better underwriting performance [45]. - The underwriting profit for Markel Insurance in 2025 is $455,671, an increase from $366,976 in 2024 [69]. - The current accident year loss ratio improved to 61.9%, down from 64.1% in the previous year, indicating better loss management [72]. - The combined ratio improved to 94.6% in 2025 from 95.5% in 2024, demonstrating enhanced underwriting performance [73]. Investment Performance - Net investment income for Markel Insurance rose by 9% to $871.5 million, contributing to overall financial performance [10]. - Net investment income for the year ended December 31, 2025, was $970,427, up from $920,496 in 2024 [42]. - The yield on fixed maturity securities improved to 3.5%, compared to 3.2% in the previous year [28]. - The one-year annual return on equity securities was 10.5%, down from 20.1% in the prior year [28]. - The company reported net investment gains of $1,076,081 for the year, down from $1,807,219 in the previous year [42]. - Net investment income for Markel Insurance was $970,427, up from $920,496 in 2024, marking an increase of about 5.4% [77]. Revenue Growth by Segment - Markel Insurance's gross premium volume increased by 4% to $10.6 billion, driven by growth in personal lines and international professional liability [10]. - Operating revenues for the Industrial segment increased by 4% to $3,928,249, driven by organic growth and a full-year contribution from the Valor Environmental acquisition [20]. - The Financial segment saw a 24% increase in operating revenues to $736,964, with organic revenue growth of 17% attributed to performance fees and higher management fees [23][24]. - Adjusted operating income for the Financial segment rose by 25% to $326,572, benefiting from higher revenues and a minority investment in Velocity Holdco LLC [25]. - The Consumer and Other segment reported a 4% increase in operating revenues to $1,382,912, with organic revenue growth of 1% driven by higher sales volume of ornamental plants [26]. Asset and Capital Management - Total invested assets reached $37.4 billion, up from $34.2 billion, driven by $2.8 billion in operating cash flows and a $1.7 billion increase in the fair value of the investment portfolio [30]. - The company deployed $1.4 billion into net fixed maturity securities purchases and $206.9 million in capital expenditures in 2025 [30]. - Total assets increased to $68,905,000,000 in 2025 from $61,898,000,000 in 2024, reflecting a growth of 12% [52]. - The debt to capital ratio improved to 19% in 2025 from 20% in 2024 [52]. - The balance sheet valuation for 2025 stands at $14,194,435, up from $12,526,791 in 2024 and $10,982,661 in 2023 [64]. - Common shares outstanding decreased to 12,590 in 2025 from 12,790 in 2024 [64]. Operational Efficiency - The total operating expenses for the year increased to $13,394,462, compared to $12,908,201 in 2024 [42]. - The expense ratio for the quarter was 36.7%, a slight increase from 37.2% in the prior year, indicating stable expense management [72]. - The expense ratio for Markel Insurance was 36.1%, compared to 35.5% in 2024, indicating a slight increase in operational costs [73].