Markel (MKL 0.67%) announced first-quarter 2019 results on Tuesday after the market closed, achieving modest growth in book value and demonstrating sound performances from each of its investing, insurance, and acquired businesses operating under the Markel Ventures moniker. Shares of the diversified financial holding company closed down slightly after waffling between positive and negative territory on Wednesday in response. 

Let's dig deeper for a closer look at how Markel kicked off the new year.

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Markel results: The raw numbers


Q1 2019

Q1 2018

Year-Over-Year Growth

Operating revenue

$2.472 billion

$1.575 billion


Net income (loss) to shareholders

$576.4 million

($64.3 million)


Net income (loss) per diluted share




Book value per share




Data source: Markel.

What happened with Markel this quarter?

  • As the stock market recovered last quarter, Markel's operating revenue was bolstered by a $611.5 million increase in the fair value of equity securities held in its investment portfolio.
  • Comprehensive income to shareholders in Q1 was $732.2 million, swinging from a comprehensive loss of $174.8 million in the same year-ago period.
  • At Markel's investment operations:
    • Net investment income increased 5.7% year over year, to $114.2 million, largely driven by higher yields from fixed-maturity investments and higher dividend income from equity securities.
    • Total invested assets climbed to $20.1 billion at the end of March, up from $19.2 billion at the end of 2018. Equity securities were 32% of that total, up from 30% last quarter.
  • At insurance operations:
    • Markel's consolidated combined ratio was 95% -- meaning it earned $5 for every $100 in premiums it wrote -- including ratios of 95% from the insurance segment and 99% from reinsurance.
    • Earned premiums increased 4.6%, to $1.204 billion.
  • At Markel Ventures:
    • Operating revenue grew 16.1% year over year, to $455 million, largely driven by higher sales volumes and selling prices from transportation-related businesses and contributions from the acquisition of fashion-handbag company Brahmin in late 2018.
    • Operating income grew 25.8%, to $29.9 million, while EBITDA grew 17.5%, to $54.7 million.
    • Net income to shareholders rose 11.4%, to $15.2 million.
  • Within Markel's "Other Operations" segment:
    • Operating revenue increased 84.4%, to $87.4 million, as revenue from Markel's acquisition of Nephila in late 2018 was partially offset by lower revenue from CATCo.

What management had to say

Markel co-CEOs Tom Gayner and Richard Whitt stated:

Our results for the quarter reflect strong performance in our investment portfolio, largely driven by favorable movements in the equity markets. We experienced organic growth within both our underwriting and Markel Ventures operations, and our results also reflect contributions from our recent acquisitions of Brahmin, within our Markel Ventures operations, and Nephila, within our insurance-linked securities operations.

During the subsequent conference call, Gayner quipped:

The headline is that we're off to a very good start so far in 2019. Trust me, at this point in the year, we're drinking coffee and going to work as opposed to any celebratory champagne. But I do think the quarter serves as an illustration of what happens around here when all three of our economic engines are firing.

Looking forward

As Gayner noted above, Markel won't be resting on its laurels any time soon. But all things considered -- and particularly in contrast to Markel's seemingly ugly Q4 report three months ago -- there was little not to like about Markel's early 2019 performance, with encouraging showings from each of its three core businesses.