Loews Corporation (NYSE:L) today reported income from operations before
investment losses for the 2009 second quarter of $519 million compared
to $575 million in the 2008 second quarter. Income from continuing
operations for the 2009 second quarter was $341 million, or $0.78 per
share, compared to $511 million, or $1.00 per share, in the 2008 second
quarter.
Book value per common share increased to $34.60 at June 30, 2009, as
compared to $30.73 at March 31, 2009 and $30.18 at December 31, 2008.
The increase during the second quarter of 2009 was primarily driven by a
$1.2 billion (after tax and noncontrolling interests) improvement in
fair value of the Company’s fixed maturities investment portfolio
reflecting a narrowing of credit spreads.
Net income (loss) and earnings (loss) per share information attributable
to Loews common stock and the former Carolina Group stock is summarized
in the table below:
|
|
|
June 30,
|
|
|
|
Three Months
|
|
Six Months
|
|
(In millions, except per share data)
|
|
|
2009
|
|
|
|
2008
|
|
|
|
2009
|
|
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to Loews common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before net investment losses
|
|
$
|
519
|
|
|
$
|
575
|
|
|
$
|
182
|
|
|
$
|
1,013
|
|
|
Net investment losses (a)
|
|
|
(178
|
)
|
|
|
(64
|
)
|
|
|
(488
|
)
|
|
|
(93
|
)
|
|
Income (loss) from continuing operations
|
|
|
341
|
|
|
|
511
|
|
|
|
(306
|
)
|
|
|
920
|
|
|
Discontinued operations, net (a)
|
|
|
(1
|
)
|
|
|
4,348
|
|
|
|
(1
|
)
|
|
|
4,494
|
|
|
Net income (loss) attributable to Loews common stock
|
|
|
340
|
|
|
|
4,859
|
|
|
|
(307
|
)
|
|
|
5,414
|
|
|
Net income attributable to former Carolina Group stock -
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations, net (b)
|
|
|
|
|
|
|
104
|
|
|
|
|
|
|
|
211
|
|
|
Net income (loss) attributable to Loews Corporation
|
|
$
|
340
|
|
|
$
|
4,963
|
|
|
$
|
(307
|
)
|
|
$
|
5,625
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loews common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
$
|
0.78
|
|
|
$
|
1.00
|
|
|
$
|
(0.70
|
)
|
|
$
|
1.77
|
|
|
Discontinued operations, net
|
|
|
|
|
|
|
8.54
|
|
|
|
|
|
|
|
8.64
|
|
|
Net income (loss) attributable to Loews common stock
|
|
$
|
0.78
|
|
|
$
|
9.54
|
|
|
$
|
(0.70
|
)
|
|
$
|
10.41
|
|
|
Former Carolina Group stock - Discontinued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
operations, net
|
|
|
|
|
|
$
|
0.96
|
|
|
|
|
|
|
$
|
1.95
|
|
|
Book value per share of Loews common stock at:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2009
|
|
$
|
34.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, 2008
|
|
$
|
30.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Includes a tax-free non-cash gain of $4,287 for the three
and six months ended June 30, 2008 related to the separation of
Lorillard, Inc. and an after tax gain of $75 for the six months ended
June 30, 2008 from the sale of Bulova Corporation.
(b) The Carolina Group and Carolina Group stock were
eliminated effective June 10, 2008 as part of the separation of
Lorillard.
Income from Continuing Operations
Three Months Ended June 30, 2009 Compared with 2008
The decrease in income from continuing operations primarily reflects
higher net investment losses offset by an increase in net investment
income at CNA Financial Corporation and strong results at Diamond
Offshore Drilling, Inc. Net investment income benefited from higher
limited partnership results, partially offset by the impact of lower
short-term interest rates.
Income from continuing operations includes net investment losses of $178
million (after tax and noncontrolling interests) in the second quarter
of 2009 compared to $64 million in the comparable prior year period. Net
investment losses in the second quarter of 2009 were primarily driven by
other-than-temporary impairment losses recognized in CNA’s
available-for-sale portfolio.
Six Months Ended June 30, 2009 Compared with 2008
The loss from continuing operations in 2009 primarily reflects higher
net investment losses at CNA and a non-cash impairment charge of $1.0
billion ($660 million after tax) recorded in the first quarter of 2009,
related to the carrying value of HighMount Exploration & Production
LLC’s natural gas and oil properties, reflecting declines in commodity
prices, partially offset by strong results at Diamond Offshore. There
were no comparable impairment charges in the prior year period. Lower
investment income in the first half of 2009 also contributed to the
unfavorable comparison to the prior year period.
Net investment losses were $488 million (after tax and noncontrolling
interests) in the first half of 2009, compared to $93 million in the
comparable prior year period.
Discontinued Operations
In June of 2008, the Company disposed of its entire ownership interest
in Lorillard, Inc. through the redemption of Carolina Group stock in
exchange for Lorillard common stock and an exchange of our remaining
Lorillard common stock for Loews common stock. The Carolina Group and
Carolina Group stock have been eliminated. The Company also sold Bulova
Corporation in January 2008. Lorillard’s results of operations and the
gain on disposal of Lorillard and Bulova have been classified as
discontinued operations.
SHARE REPURCHASES
At June 30, 2009, there were 434,017,991 shares of Loews common stock
outstanding. During the second quarter, the Company acquired 1,195,900
shares of Loews common stock for approximately $32 million. Subsequent
to June 30, 2009, the Company acquired 1,000,000 shares of Loews common
stock for approximately $26 million. Depending on market conditions, the
Company may from time to time purchase shares of its and its
subsidiaries’ outstanding common stock in the open market or otherwise.
CONFERENCE CALLS
A conference call to discuss the second quarter results of Loews
Corporation has been scheduled for 11:00 a.m. EDT, Monday, August 3,
2009. A live webcast of the call will be available online at the Loews
Corporation website (www.loews.com).
Please go to the website at least ten minutes before the event begins to
register and to download and install any necessary audio software. Those
interested in participating in the question and answer session should
dial (877) 692-2592, or for international callers, (973) 582-2757. The
conference ID number is 18149646.
A conference call to discuss the second quarter results of CNA has been
scheduled for 10:00 a.m. EDT, Monday, August 3, 2009. A live webcast of
the call will be available online at http://investor.cna.com.
Please go to the website at least ten minutes before the event begins to
register and to download and install any necessary audio software. Those
interested in participating in the question and answer session should
dial (800) 289-0507, or for international callers, (913) 312-0837.
A conference call to discuss the second quarter results of Boardwalk
Pipeline was held on Monday, July 27, 2009. An online replay is
available on Boardwalk Pipeline’s website (www.bwpmlp.com).
A conference call to discuss the second quarter results of Diamond
Offshore was held on Thursday, July 23, 2009. An online replay is
available on Diamond Offshore’s website (www.diamondoffshore.com).
ABOUT LOEWS CORPORATION
Loews Corporation, a holding company, is one of the largest diversified
corporations in the United States. Its principal subsidiaries are CNA
Financial Corporation (NYSE: CNA), a 90% owned subsidiary; Diamond
Offshore Drilling, Inc. (NYSE: DO), a 50.4% owned subsidiary; HighMount
Exploration & Production LLC, a wholly owned subsidiary; Boardwalk
Pipeline Partners, LP (NYSE: BWP), a 75% owned subsidiary; and Loews
Hotels, a wholly owned subsidiary.
FORWARD-LOOKING STATEMENTS
Statements contained in this press release which are not historical
facts are “forward-looking statements” within the meaning of the federal
securities laws. Forward-looking statements are inherently uncertain and
subject to a variety of risks that could cause actual results to differ
materially from those expected by management of the Company. A
discussion of the important risk factors and other considerations that
could materially impact these matters as well as the Company’s overall
business and financial performance can be found in the Company’s reports
filed with the Securities and Exchange Commission and readers of this
release are urged to review those reports carefully when considering
these forward-looking statements. Copies of these reports are available
through the Company’s website (www.loews.com).
Given these risk factors, investors and analysts should not place undue
reliance on forward-looking statements. Any such forward-looking
statements speak only as of the date of this press release. The Company
expressly disclaims any obligation or undertaking to release publicly
any updates or revisions to any forward-looking statement to reflect any
change in the Company’s expectations with regard thereto or any change
in events, conditions or circumstances on which any forward-looking
statement is based.
|
Loews Corporation and Subsidiaries
|
|
Financial Review
|
|
|
|
|
|
|
|
June 30,
|
|
|
|
|
|
Three Months
|
|
Six Months
|
|
|
|
|
|
|
2009
|
|
|
|
2008
|
|
|
|
2009
|
|
|
|
2008
|
|
|
|
|
|
|
(Amounts in millions, except per share data)
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance premiums
|
|
|
$
|
1,656
|
|
|
$
|
1,774
|
|
|
$
|
3,328
|
|
|
$
|
3,586
|
|
|
Net investment income
|
|
|
|
735
|
|
|
|
697
|
|
|
|
1,182
|
|
|
|
1,176
|
|
|
Investment losses
|
|
|
|
(297
|
)
|
|
|
(109
|
)
|
|
|
(828
|
)
|
|
|
(160
|
)
|
|
Contract drilling revenues
|
|
|
|
923
|
|
|
|
937
|
|
|
|
1,779
|
|
|
|
1,707
|
|
|
Other
|
|
|
|
517
|
|
|
|
623
|
|
|
|
1,096
|
|
|
|
1,225
|
|
|
Total
|
|
|
|
3,534
|
|
|
|
3,922
|
|
|
|
6,557
|
|
|
|
7,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance claims & policyholders’ benefits
|
|
|
|
1,295
|
|
|
|
1,472
|
|
|
|
2,637
|
|
|
|
2,861
|
|
|
Contract drilling expenses
|
|
|
|
306
|
|
|
|
273
|
|
|
|
600
|
|
|
|
558
|
|
|
Impairment of natural gas and oil properties (a)
|
|
|
|
|
|
|
|
|
|
|
|
1,036
|
|
|
|
|
|
|
Other
|
|
|
|
1,176
|
|
|
|
1,070
|
|
|
|
2,395
|
|
|
|
2,146
|
|
|
Total
|
|
|
|
2,777
|
|
|
|
2,815
|
|
|
|
6,668
|
|
|
|
5,565
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before income tax
|
|
|
|
757
|
|
|
|
1,107
|
|
|
|
(111
|
)
|
|
|
1,969
|
|
|
Income tax (expense) benefit
|
|
|
|
(197
|
)
|
|
|
(340
|
)
|
|
|
198
|
|
|
|
(593
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
|
560
|
|
|
|
767
|
|
|
|
87
|
|
|
|
1,376
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of operations
|
|
|
|
(1
|
)
|
|
|
170
|
|
|
|
(1
|
)
|
|
|
343
|
|
|
|
Gain on disposal (b)
|
|
|
|
|
|
|
|
4,282
|
|
|
|
|
|
|
|
4,362
|
|
|
Net income (loss)
|
|
|
|
559
|
|
|
|
5,219
|
|
|
|
86
|
|
|
|
6,081
|
|
|
Amounts attributable to noncontrolling interests
|
|
|
|
(219
|
)
|
|
|
(256
|
)
|
|
|
(393
|
)
|
|
|
(456
|
)
|
|
Net income (loss) attributable to Loews Corporation
|
|
|
$
|
340
|
|
|
$
|
4,963
|
|
|
$
|
(307
|
)
|
|
$
|
5,625
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loews common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
$
|
341
|
|
|
$
|
511
|
|
|
$
|
(306
|
)
|
|
$
|
920
|
|
|
|
Discontinued operations, net
|
|
|
|
(1
|
)
|
|
|
4,348
|
|
|
|
(1
|
)
|
|
|
4,494
|
|
|
Net income (loss) attributable to Loews common stock
|
|
|
|
340
|
|
|
|
4,859
|
|
|
|
(307
|
)
|
|
|
5,414
|
|
|
Former Carolina Group stock - Discontinued Operations, net
|
|
|
|
|
|
|
|
104
|
|
|
|
|
|
|
|
211
|
|
|
Net income (loss) attributable to Loews Corporation
|
|
|
$
|
340
|
|
|
$
|
4,963
|
|
|
$
|
(307
|
)
|
|
$
|
5,625
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) per share attributable to Loews common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
$
|
0.78
|
|
|
$
|
1.00
|
|
|
$
|
(0.70
|
)
|
|
$
|
1.77
|
|
|
|
Discontinued operations, net
|
|
|
|
|
|
|
|
8.54
|
|
|
|
|
|
|
|
8.64
|
|
|
|
Diluted net income (loss) attributable to Loews common stock
|
|
|
$
|
0.78
|
|
|
$
|
9.54
|
|
|
$
|
(0.70
|
)
|
|
$
|
10.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income per share of former Carolina Group stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Discontinued operations, net
|
|
|
|
|
|
|
$
|
0.96
|
|
|
|
|
|
|
$
|
1.95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted diluted number of shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loews common stock
|
|
|
|
435.63
|
|
|
|
509.43
|
|
|
|
435.09
|
|
|
|
520.17
|
|
|
Former Carolina Group stock
|
|
|
|
|
|
|
|
108.60
|
|
|
|
-
|
|
|
|
108.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
The non-cash impairment charge ($660 after tax) for the six months
ended June 30, 2009 relates to the carrying value of HighMount's
natural gas and oil properties.
|
|
(b)
|
Includes a tax-free non-cash gain of $4,287 for the three and six
months ended June 30, 2008 related to the separation of Lorillard,
Inc. and an after tax gain of $75 for the six months ended June 30,
2008 from the sale of Bulova Corporation.
|
|
Loews Corporation and Subsidiaries
|
|
Additional Financial Information
|
|
|
|
|
|
|
|
June 30,
|
|
|
|
|
|
Three Months
|
|
Six Months
|
|
|
|
|
|
|
2009
|
|
|
|
2008
|
|
|
|
2009
|
|
|
|
2008
|
|
|
|
|
|
|
(In millions)
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
CNA Financial
|
|
|
$
|
2,393
|
|
|
$
|
2,432
|
|
|
$
|
4,563
|
|
|
$
|
4,765
|
|
|
Diamond Offshore
|
|
|
|
957
|
|
|
|
970
|
|
|
|
1,843
|
|
|
|
1,762
|
|
|
HighMount
|
|
|
|
147
|
|
|
|
201
|
|
|
|
322
|
|
|
|
390
|
|
|
Boardwalk Pipeline
|
|
|
|
201
|
|
|
|
206
|
|
|
|
425
|
|
|
|
419
|
|
|
Loews Hotels
|
|
|
|
73
|
|
|
|
105
|
|
|
|
146
|
|
|
|
202
|
|
|
Investment income and other
|
|
|
|
60
|
|
|
|
117
|
|
|
|
86
|
|
|
|
156
|
|
|
|
|
|
|
|
3,831
|
|
|
|
4,031
|
|
|
|
7,385
|
|
|
|
7,694
|
|
|
Investment gains (losses):
|
|
|
|
|
|
|
|
|
|
|
CNA Financial
|
|
|
|
(297
|
)
|
|
|
(111
|
)
|
|
|
(829
|
)
|
|
|
(162
|
)
|
|
Corporate and other
|
|
|
|
|
|
2
|
|
|
|
1
|
|
|
|
2
|
|
|
|
|
|
|
|
(297
|
)
|
|
|
(109
|
)
|
|
|
(828
|
)
|
|
|
(160
|
)
|
|
Total
|
|
|
$
|
3,534
|
|
|
$
|
3,922
|
|
|
$
|
6,557
|
|
|
$
|
7,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) Before Income Tax:
|
|
|
|
|
|
|
|
|
|
|
CNA Financial
|
|
|
$
|
431
|
|
|
$
|
367
|
|
|
$
|
631
|
|
|
$
|
684
|
|
|
Diamond Offshore
|
|
|
|
520
|
|
|
|
590
|
|
|
|
971
|
|
|
|
995
|
|
|
HighMount (a)
|
|
|
|
46
|
|
|
|
76
|
|
|
|
(960
|
)
|
|
|
151
|
|
|
Boardwalk Pipeline
|
|
|
|
18
|
|
|
|
64
|
|
|
|
69
|
|
|
|
153
|
|
|
Loews Hotels (b)
|
|
|
|
6
|
|
|
|
32
|
|
|
|
(23
|
)
|
|
|
50
|
|
|
Investment income, net
|
|
|
|
60
|
|
|
|
117
|
|
|
|
85
|
|
|
|
156
|
|
|
Other (c)
|
|
|
|
(27
|
)
|
|
|
(30
|
)
|
|
|
(56
|
)
|
|
|
(60
|
)
|
|
|
|
|
|
|
1,054
|
|
|
|
1,216
|
|
|
|
717
|
|
|
|
2,129
|
|
|
Investment gains (losses):
|
|
|
|
|
|
|
|
|
|
|
CNA Financial
|
|
|
|
(297
|
)
|
|
|
(111
|
)
|
|
|
(829
|
)
|
|
|
(162
|
)
|
|
Corporate and other
|
|
|
|
|
|
2
|
|
|
|
1
|
|
|
|
2
|
|
|
|
|
|
|
|
(297
|
)
|
|
|
(109
|
)
|
|
|
(828
|
)
|
|
|
(160
|
)
|
|
|
Total
|
|
|
$
|
757
|
|
|
$
|
1,107
|
|
|
$
|
(111
|
)
|
|
$
|
1,969
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) Attributable to Loews Corporation:
|
|
|
|
|
|
|
|
|
|
|
CNA Financial
|
|
|
$
|
278
|
|
|
$
|
227
|
|
|
$
|
418
|
|
|
$
|
427
|
|
|
Diamond Offshore
|
|
|
|
181
|
|
|
|
194
|
|
|
|
344
|
|
|
|
330
|
|
|
HighMount (a)
|
|
|
|
29
|
|
|
|
48
|
|
|
|
(612
|
)
|
|
|
95
|
|
|
Boardwalk Pipeline (d)
|
|
|
|
8
|
|
|
|
28
|
|
|
|
30
|
|
|
|
67
|
|
|
Loews Hotels (b)
|
|
|
|
3
|
|
|
|
19
|
|
|
|
(15
|
)
|
|
|
30
|
|
|
Investment income, net
|
|
|
|
40
|
|
|
|
77
|
|
|
|
56
|
|
|
|
102
|
|
|
Other (c)
|
|
|
|
(20
|
)
|
|
|
(18
|
)
|
|
|
(39
|
)
|
|
|
(38
|
)
|
|
|
|
|
|
|
519
|
|
|
|
575
|
|
|
|
182
|
|
|
|
1,013
|
|
|
Investment gains (losses):
|
|
|
|
|
|
|
|
|
|
|
CNA Financial
|
|
|
|
(178
|
)
|
|
|
(65
|
)
|
|
|
(488
|
)
|
|
|
(94
|
)
|
|
Corporate and other
|
|
|
|
|
|
1
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
(178
|
)
|
|
|
(64
|
)
|
|
|
(488
|
)
|
|
|
(93
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from continuing operations
|
|
|
|
341
|
|
|
|
511
|
|
|
|
(306
|
)
|
|
|
920
|
|
|
Discontinued operations, net (e)
|
|
|
|
(1
|
)
|
|
|
4,348
|
|
|
|
(1
|
)
|
|
|
4,494
|
|
|
Net income (loss) attributable to Loews common stock
|
|
|
|
340
|
|
|
|
4,859
|
|
|
|
(307
|
)
|
|
|
5,414
|
|
|
Former Carolina Group stock - Discontinued operations, net
|
|
|
|
|
|
104
|
|
|
|
|
|
211
|
|
|
Net income (loss) attributable to Loews Corporation
|
|
|
$
|
340
|
|
|
$
|
4,963
|
|
|
$
|
(307
|
)
|
|
$
|
5,625
|
|
|
(a)
|
Reflects a non-cash impairment charge of $1,036 ($660 after tax) for
the six months ended June 30, 2009 related to the carrying value of
HighMount's natural gas and oil properties.
|
|
(b)
|
Reflects an impairment charge of $27 ($16 after tax) for the six
months ended June 30, 2009 related to the writedown of Loews Hotels'
entire investment in a hotel property.
|
|
(c)
|
Consists primarily of corporate interest expense and other
unallocated expenses.
|
|
(d)
|
Represents a 74.0%, 70.3%, 73.9% and 70.3% ownership interest in
Boardwalk Pipeline for the respective periods.
|
|
(e)
|
Includes a tax-free non-cash gain of $4,287 for the three and six
months ended June 30, 2008 related to the separation of Lorillard,
Inc. and an after tax gain of $75 for the six months ended June 30,
2008 from the sale of Bulova Corporation.
|
Loews Corporation
Peter W. Keegan, 212-521-2950
Chief
Financial Officer
or
Darren Daugherty, 212-521-2788
Investor
Relations
or
Candace Leeds, 212-521-2416
Public Affairs
