NEW YORK, Oct. 28, 2019 /PRNewswire/ -- Loews Corporation
(NYSE: L) today reported net income of $72
million, or $0.24 per share,
for the three months ended September 30,
2019, compared to $278
million, or $0.88 per share,
in the comparable prior year period. Net income for the nine months
ended September 30, 2019 was
$715 million, or $2.34 per share, compared to $801 million, or $2.49 per share, in the comparable prior year
period.
Net income for the three and nine months ended September 30, 2019 included a charge of
$151 million (after tax and
noncontrolling interests) related to the recognition by CNA
Financial Corporation of an active life reserve premium deficiency
in long term care that was primarily driven by changes in interest
rate assumptions. Absent this charge, net income for the three
months ended September 30, 2019
decreased mainly due to lower results at CNA and Diamond Offshore
Drilling, Inc., partially offset by higher parent company net
investment income.
Earnings for the nine months ended September 30, 2019 were impacted by the long term
care charge at CNA and lower results at Diamond Offshore, partially
offset by higher earnings at Boardwalk Pipelines and higher parent
company net investment income. Boardwalk Pipelines' earnings in
2019 reflect Loews's 100% ownership of the company as compared to
51% for a portion of the prior year period.
Book value per share increased to $64.90 at September 30,
2019 from $59.34 at
December 31, 2018. Book value per
share excluding accumulated other comprehensive income (AOCI)
increased to $64.85 at September 30, 2019 from $62.16 at December 31,
2018.
CONSOLIDATED HIGHLIGHTS
(In millions, except
per share data)
|
September
30,
|
Three
Months
|
Nine
Months
|
2019
|
2018
|
2019
|
2018
|
Income before net
investment gains
|
$
67
|
$
267
|
$ 688
|
$ 784
|
Net investment
gains
|
5
|
11
|
27
|
17
|
Net income attributable
to Loews Corporation
|
$
72
|
$
278
|
$ 715
|
$ 801
|
Net income per
share
|
$ 0.24
|
$ 0.88
|
$ 2.34
|
$ 2.49
|
|
|
|
|
September 30,
2019
|
December 31,
2018
|
Book value per
share
|
$
64.90
|
$
59.34
|
Book value per
share excluding AOCI
|
64.85
|
62.16
|
Shares
outstanding
|
299.2
|
312.1
|
Three Months Ended September 30,
2019 Compared to 2018
CNA's earnings decreased primarily due to a charge of
$216 million ($151 million after tax and noncontrolling
interests) resulting from the recognition of an active life reserve
premium deficiency in long term care. Absent this charge, earnings
decreased mainly due to unfavorable net prior year development in
the Property & Casualty business as compared to favorable net
prior year development in 2018, partially offset by lower
catastrophe losses in 2019.
Diamond Offshore's results declined due to continuing
challenging market conditions. Diamond Offshore experienced lower
contract drilling revenues and higher contract drilling expense,
partially offset by the absence of a legal settlement charge in
2018.
Boardwalk Pipelines' earnings increased slightly as higher firm
transportation revenues from growth projects recently placed into
service mostly offset the negative revenue impact of contract
restructurings and expirations.
Loews Hotels & Co's earnings decreased due to lower earnings
from its properties in Florida as
the threat of Hurricane Dorian negatively impacted results.
Pre-opening and other non-recurring expenses related to properties
under development also contributed to the decline.
Income generated by the parent company investment portfolio
increased primarily due to higher returns on equity securities and
short-term investments.
Nine Months Ended September 30,
2019 Compared to 2018
CNA's earnings decreased primarily due to the long term care
charge set forth above and lower favorable prior year reserve
development, as well as a $15 million
loss (after tax and noncontrolling interests) on the early
redemption of debt. These decreases were partially offset by higher
net investment income driven by improved returns on limited
partnership investments and higher net investment gains. In
addition, earnings in 2019 increased due to a net retroactive
reinsurance benefit under the 2010 loss portfolio transfer with
National Indemnity as compared to a net retroactive reinsurance
charge recorded in 2018.
Diamond Offshore's results declined primarily due the reasons
set forth above, partially offset by a $7
million (after noncontrolling interests) income tax benefit
in 2019 from a favorable adjustment related to an uncertain tax
position recorded in 2017 and the absence of a $12 million (after tax and noncontrolling
interests) impairment charge recorded in 2018.
Boardwalk Pipelines' results improved primarily due to Loews
owning 100% of the company as compared to 51% for a portion of the
prior year period. Income for the nine months ended September 30, 2019 includes proceeds received in
conjunction with a contract cancellation due to a customer
bankruptcy that resulted in a $19
million (after tax) benefit to net income.
Loews Hotels & Co's earnings decreased primarily due to the
reasons set forth above, and the write-off of capitalized
development costs related to a potential development site and a
charge related to the disposition of a hotel property in 2019.
Income generated by the parent company investment portfolio
increased due to the reasons set forth above.
SHARE REPURCHASES
At September 30, 2019, there were
299.2 million shares of Loews common stock outstanding. For the
three and nine months ended September 30,
2019, the Company repurchased 3.4 million and 13.2 million
shares of its common stock at an aggregate cost of $168 million and $642
million. From October 1, 2019
to October 25, 2019, the Company
repurchased an additional 1.8 million shares of its common stock at
an aggregate cost of $90 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 third quarter results of Loews
Corporation has been scheduled for today at 11:00 a.m. ET. A live webcast will be available
at www.loews.com. 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 7075339. An
online replay will also be available at www.loews.com following the
call.
A conference call to discuss the third quarter results of CNA
has been scheduled for today at 10:00 a.m.
ET. A live webcast will be available via the Investor
Relations section of www.cna.com. Those interested in participating
in the question and answer session should dial (800) 289-0571, or
for international callers, (720) 543-0206.
A conference call to discuss the third quarter results of
Diamond Offshore has been scheduled for today at 9:00 a.m. ET. A live webcast will be available at
www.diamondoffshore.com. Those interested in participating in the
question and answer session should dial (844) 492-6043, or for
international callers, (478) 219-0839. The conference ID number is
9448907.
ABOUT LOEWS CORPORATION
Loews Corporation is a diversified company with businesses in
the insurance, energy, hospitality and packaging industries. Our
subsidiaries are: CNA Financial Corporation (NYSE: CNA), Diamond
Offshore Drilling, Inc. (NYSE: DO), Boardwalk Pipelines, Loews
Hotels & Co and Consolidated Container Company. Investors are
encouraged to view the subsidiary virtual investor presentations
found in the 'Events & Presentations' section of ir.loews.com
for an in-depth strategic review of Loews's subsidiaries. For more
information please visit www.loews.com.
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
|
|
|
|
|
Selected Financial
Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
Three
Months
|
Nine
Months
|
(In
millions)
|
2019
|
2018
|
2019
|
2018
|
Revenues:
|
|
|
|
|
CNA Financial
(a)
|
$
2,686
|
$
2,622
|
$
8,011
|
$
7,731
|
Diamond
Offshore
|
251
|
289
|
711
|
859
|
Boardwalk Pipelines
(b)
|
296
|
279
|
969
|
901
|
Loews Hotels &
Co
|
156
|
190
|
522
|
574
|
Investment income and
other (c)
|
286
|
228
|
842
|
714
|
Total
|
$
3,675
|
$
3,608
|
$
11,055
|
$
10,779
|
Income (Loss) Before
Income Tax:
|
|
|
|
|
CNA Financial (a) (d)
(e) (f)
|
$
127
|
$
401
|
$
888
|
$
1,077
|
Diamond Offshore (g)
(h) (i)
|
(102)
|
(56)
|
(321)
|
(160)
|
Boardwalk Pipelines
(b)
|
39
|
38
|
217
|
172
|
Loews Hotels &
Co
|
5
|
14
|
42
|
58
|
Corporate:
(j)
|
|
|
|
|
Investment income,
net
|
36
|
5
|
153
|
61
|
Other
|
(45)
|
(48)
|
(136)
|
(142)
|
Total
|
$
60
|
$
354
|
$
843
|
$
1,066
|
Net Income (Loss)
Attributable to Loews Corporation:
|
|
|
|
|
CNA Financial (a) (d)
(e) (f)
|
$
96
|
$
300
|
$
650
|
$
801
|
Diamond Offshore (g)
(h) (i)
|
(48)
|
(27)
|
(137)
|
(54)
|
Boardwalk Pipelines
(b)
|
29
|
28
|
161
|
80
|
Loews Hotels &
Co
|
3
|
11
|
28
|
41
|
Corporate:
(j)
|
|
|
|
|
Investment income,
net
|
28
|
4
|
121
|
49
|
Other
|
(36)
|
(38)
|
(108)
|
(116)
|
Net income
attributable to Loews Corporation
|
$
72
|
$
278
|
$
715
|
$
801
|
|
|
|
|
|
|
(a)
|
Includes net
investment gains of $8 million and $15 million ($5 million and $11
million after tax and noncontrolling interests) for the three
months ended September 30, 2019 and 2018. Includes net investment
gains of $41 million and $21 million ($27 million and $17 million
after tax and noncontrolling interests) for the nine months ended
September 30, 2019 and 2018.
|
(b)
|
Includes settlement
proceeds of $26 million ($19 million after tax) related to a
customer bankruptcy for the nine months ended September 30,
2019.
|
(c)
|
Includes parent
company investment income and the financial results of Consolidated
Container.
|
(d)
|
Includes gains of $7
million and $12 million ($4 million and $8 million after tax and
noncontrolling interests) for the three months ended September 30,
2019 and 2018 and a gain of $43 million ($30 million after tax and
noncontrolling interests) and a loss of $13 million ($10 million
after tax and noncontrolling interests) for the nine months ended
September 30, 2019 and 2018 related to the 2010 retroactive
reinsurance agreement to cede CNA's legacy asbestos and
environmental pollution liabilities.
|
(e)
|
Includes a loss of
$21 million ($15 million after tax and noncontrolling interests) on
the early redemption of debt for the nine months ended September
30, 2019.
|
(f)
|
Includes a charge of
$216 million ($151 million after tax and noncontrolling interests)
for the three and nine months ended September 30, 2019 related to
the recognition of an active life reserve premium deficiency in
long term care that was primarily driven by changes in interest
rate assumptions, partially offset by a $56 million ($39 million
after tax and noncontrolling interests) reduction in claim and
claim adjustment expense reserves for policyholders on claim
resulting from the annual long term care claim experience study.
The prior year claim experience study resulted in a reduction in
claim and claim adjustment expense reserves of $31 million ($21
million after tax and noncontrolling interests) for the three and
nine months ended September 30, 2018.
|
(g)
|
Includes asset
impairment charges of $27 million ($12 million after tax and
noncontrolling interests) for the nine months ended September 30,
2018.
|
(h)
|
For the nine months
ended September 30, 2019 and 2018, includes a favorable tax
adjustment of $14 million and $43 million ($7 million and $23
million after noncontrolling interests) related to an uncertain tax
position recorded by Diamond Offshore at year-end 2017.
|
(i)
|
Includes a legal
settlement charge of $18 million ($8 million after tax and
noncontrolling interests) for the three and nine months ended
September 30, 2018.
|
(j)
|
The Corporate segment
consists of investment income from the parent company's cash and
investments, interest expense, other unallocated expenses and the
financial results of Consolidated Container.
|
Loews Corporation
and Subsidiaries
|
Consolidated
Financial Review
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
Three
Months
|
Nine
Months
|
(In millions, except
per share data)
|
2019
|
2018
|
2019
|
2018
|
Revenues:
|
|
|
|
|
Insurance
premiums
|
$
1,890
|
$
1,853
|
$
5,517
|
$
5,453
|
Net investment
income
|
525
|
494
|
1,733
|
1,551
|
Investment
gains
|
8
|
15
|
41
|
21
|
Operating revenues
and other (a)
|
1,252
|
1,246
|
3,764
|
3,754
|
Total
|
3,675
|
3,608
|
11,055
|
10,779
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
Insurance claims and
policyholders' benefits (b) (c)
|
1,614
|
1,312
|
4,323
|
3,978
|
Operating expenses
and other (d) (e)
|
2,001
|
1,942
|
5,889
|
5,735
|
Total
|
3,615
|
3,254
|
10,212
|
9,713
|
|
|
|
|
|
|
Income before income
tax
|
60
|
354
|
843
|
1,066
|
Income tax expense
(f)
|
(21)
|
(65)
|
(183)
|
(149)
|
Net
income
|
39
|
289
|
660
|
917
|
Amounts attributable
to noncontrolling interests
|
33
|
(11)
|
55
|
(116)
|
Net income
attributable to Loews Corporation
|
$
72
|
$
278
|
$
715
|
$
801
|
|
|
|
|
|
|
Net income per share
attributable to Loews Corporation
|
$
0.24
|
$
0.88
|
$
2.34
|
$
2.49
|
|
|
|
|
|
|
Weighted average
number of shares
|
302.35
|
316.80
|
305.73
|
321.73
|
|
|
|
|
|
(a)
|
Includes settlement
proceeds of $26 million ($19 million after tax) related to a
customer bankruptcy for the nine
months ended September 30, 2019.
|
(b)
|
Includes gains of $7
million and $12 million ($4 million and $8 million after tax and
noncontrolling interests) for the three months ended September 30,
2019 and 2018 and a gain of $43 million ($30 million after tax and
noncontrolling interests) and a loss of $13 million ($10 million
after tax and noncontrolling interests) for the nine months ended
September 30, 2019 and 2018 related to the 2010 retroactive
reinsurance agreement to cede CNA's legacy asbestos and
environmental pollution liabilities.
|
(c)
|
Includes a charge of
$216 million ($151 million after tax and noncontrolling interests)
for the three and nine months ended September 30, 2019 related to
the recognition by CNA of an active life reserve premium deficiency
in long term care that was primarily driven by changes in interest
rate assumptions, partially offset by a $56 million ($39 million
after tax and noncontrolling interests) reduction in claim and
claim adjustment expense reserves for policyholders on claim
resulting from the annual long term care claim experience study.
The prior year claim experience study resulted in a reduction in
claim and claim adjustment expense reserves of $31 million ($21
million after tax and noncontrolling interests) for the three and
nine months ended September 30, 2018.
|
(d)
|
Includes a loss of
$21 million ($15 million after tax and noncontrolling interests) on
the early redemption of debt for the nine months ended September
30, 2019.
|
(e)
|
Includes asset
impairment charges of $27 million ($12 million after tax and
noncontrolling interests) for the nine months ended September 30,
2018.
|
(f)
|
For the nine months
ended September 30, 2019 and 2018, includes a favorable tax
adjustment of $14 million and $43 million ($7 million and $23
million after noncontrolling interests) related to an uncertain tax
position recorded by Diamond Offshore at year-end 2017.
|
View original
content:http://www.prnewswire.com/news-releases/loews-corporation-reports-net-income-of-72-million-for-the-third-quarter-of-2019-300945802.html
SOURCE Loews Corporation