In a shaky year, Buffett still beats odds

Measured by the internal standard Warren Buffett set for himself years ago, the famous investor's conglomerate, Berkshire Hathaway Inc., once again beat the performance of the stock market last year.

Buffett's preferred measure of Berkshire's performance is the growth in its book value, which is a calculation of the company's assets minus its liabilities. Buffett on Saturday said Berkshire's book value grew 4.6 percent to $99,860 per share in 2011. The S&P 500, a broad market index that Berkshire is part of, gained 2.1 percent last year when dividends were factored in.

Stockbroker Andy Kilpatrick, who wrote "Of Permanent Value: The Story of Warren Buffett," said Buffett managed to outperform the overall market in a tough year for Berkshire's insurance and housing-related subsidiaries: "It was not a great year, but he still beat the S&P."

For 2011, Berkshire generated $10.3 billion in net income, or $6,215 per Class A share, down from nearly $13 billion, or $7,928 per share, in 2010.

Strength in subsidiaries like the Burlington Northern Santa Fe railroad, MidAmerican Energy, and the Marmon Group helped offset insurance underwriting losses related to catastrophes like the Japan tsunami.

Buffett reassured Berkshire shareholders that the company has someone in mind to replace him eventually.