NEW YORK, Aug. 3, 2015 /PRNewswire/ -- Loews
Corporation (NYSE: L) today reported net income for the three
months ended June 30, 2015 of
$170 million, or $0.46 per share, compared to $116 million, or $0.30 per share, in the prior year period. Net
income for the six months ended June 30,
2015 was $279 million, or
$0.75 per share, compared to
$175 million, or $0.45 per share, in the prior year period. Net
income for the three and six month periods in 2014 included losses
from discontinued operations of $187
million and $393 million
reflecting the disposition by Loews of HighMount Exploration &
Production, LLC and by CNA Financial Corporation of its annuity and
pension deposit business.
Book value per share excluding accumulated other comprehensive
income (AOCI) increased to $51.77 at
June 30, 2015 from $50.95 at December 31,
2014 and $49.74 at
June 30, 2014.
CONSOLIDATED HIGHLIGHTS
(In millions, except
per share data)
|
June 30,
|
Three
Months
|
Six Months
|
2015
|
2014
|
2015
|
2014
|
Income before net
investment gains (losses)
|
$ 167
|
$ 312
|
$ 268
|
$ 553
|
Net
investment gains (losses)
|
3
|
(9)
|
11
|
15
|
Income
from continuing operations
|
170
|
303
|
279
|
568
|
Discontinued operations, net
|
|
(187)
|
|
(393)
|
Net income attributable
to Loews Corporation
|
$ 170
|
$ 116
|
$ 279
|
$ 175
|
Net income per
share:
|
|
|
|
|
Income
from continuing operations
|
$ 0.46
|
$ 0.79
|
$ 0.75
|
$ 1.47
|
Discontinued operations, net
|
|
(0.49)
|
|
(1.02)
|
Net income per
share
|
$ 0.46
|
$ 0.30
|
$ 0.75
|
$ 0.45
|
|
|
June 30,
|
Year Ended
December 31,
2014
|
|
2015
|
2014
|
Book value per
share
|
$ 51.91
|
$ 51.85
|
$ 51.70
|
Book value per
share excluding AOCI
|
51.77
|
49.74
|
50.95
|
Three Months Ended June 30,
2015 Compared to 2014
Income from continuing operations for the three months ended
June 30, 2015 was $170 million, or $0.46 per share, compared to $303 million, or $0.79 per share, in the 2014 second quarter.
Income from continuing operations decreased primarily due to lower
earnings at CNA and less favorable performance of the parent
company trading portfolio as a result of lower returns on equities
and limited partnership investments.
CNA's earnings decreased primarily due to an $84 million ($49
million after tax and noncontrolling interests) charge
related to a retroactive reinsurance agreement to cede its legacy
asbestos and environmental pollution liabilities (loss portfolio
transfer or LPT). Under retroactive reinsurance accounting, amounts
ceded through the LPT in excess of the consideration paid result in
a deferred benefit that is recognized in income in proportion to
paid recoveries over future periods. The year-over-year earnings
comparison was also impacted by a gain of $86 million ($50
million after tax and noncontrolling interests) in 2014 from
a postretirement plan curtailment. The decline in the second
quarter of 2015 as compared to the prior year was partially offset
by an improvement in net prior year development in CNA's commercial
business segment.
Diamond Offshore's earnings were relatively flat as lower rig
utilization and increased depreciation and interest expense were
offset by significantly reduced contract drilling expenses.
Boardwalk Pipeline's earnings decreased primarily as a result of
lower parking and lending revenue and increased depreciation and
interest costs. Boardwalk Pipeline recorded $12 million of higher transportation revenue due
to business interruption insurance proceeds received and new rates
taking effect as a result of the Gulf South rate case.
Loews Hotels' earnings increased primarily due to higher income
from joint venture properties.
Discontinued operations in 2014 included an impairment charge
related to the divested HighMount
business.
Six Months Ended June 30, 2015
Compared to 2014
Income from continuing operations for the six months ended
June 30, 2015 was $279 million, or $0.75 per share, compared to $568 million, or $1.47 per share, in the prior year period. Income
from continuing operations decreased primarily due to lower
earnings at CNA and Diamond Offshore.
CNA's earnings decreased primarily due to the reasons discussed
above in the three month comparison.
Diamond Offshore's earnings decreased primarily due to a
$158 million (after tax and
noncontrolling interests) asset impairment charge taken in the
first quarter of 2015 related to the carrying value of eight
drilling rigs as well as lower rig utilization and increased
depreciation and interest expense.
Boardwalk Pipeline's earnings increase stemmed from the impact
in 2014 of a $55 million charge
(after tax and noncontrolling interests) related to the write off
of all capitalized costs associated with the terminated Bluegrass
project. Absent this charge, earnings decreased primarily due to
the unusually cold and sustained winter of 2014 as compared to the
relatively normal 2015 winter season and lower natural gas storage
revenues.
Loews Hotels' earnings increased primarily due to higher income
from joint venture properties partially offset by higher interest
expense.
Discontinued operations in 2014 included impairment charges
related to the sale of both CNA's annuity and pension deposit
business and HighMount.
SHARE REPURCHASES
At June 30, 2015, there were 365.6
million shares of Loews common stock outstanding. During the three
and six months ended June 30, 2015,
the Company repurchased 5.8 million and 7.6 million shares of its
common stock at an aggregate cost of $233
million and $305 million. From
July 1, 2015 to July 31, 2015, the Company repurchased an
additional 3.3 million shares of its common stock at an aggregate
cost of $127 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 today at 11:00 a.m. ET. 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 74859424. An
online replay will also be available on the Loews Corporation's
website following the call.
A conference call to discuss the second quarter results of CNA
has been scheduled for today at 10:00 a.m.
ET. A live webcast will be available at www.cna.com. Those
interested in participating in the question and answer session
should dial (888) 397-5352, or for international callers, (719)
457-2727.
A conference call to discuss the second quarter results of
Boardwalk Pipeline has been scheduled for today at 9:30 a.m. ET. A live webcast will be available at
www.bwpmlp.com. Those interested in participating in the question
and answer session should dial (855) 793-3255 or for international
callers, (631) 485-4925. The conference ID number is 74493272.
A conference call to discuss the second quarter results of
Diamond Offshore has been scheduled for today at 8:30 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 (800) 247-9979, or for
international callers, (973) 321-1100. The conference ID number is
77534754.
ABOUT LOEWS CORPORATION
Loews Corporation is a diversified company with three
publicly-traded subsidiaries: CNA Financial Corporation (NYSE:
CNA), Diamond Offshore Drilling, Inc. (NYSE: DO) and Boardwalk
Pipeline Partners, LP (NYSE: BWP); and one wholly owned subsidiary,
Loews Hotels & Resorts. 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
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
Three
Months
|
Six
Months
|
(In
millions)
|
2015
|
2014
|
2015
|
2014
|
Revenues:
|
|
|
|
|
CNA
Financial
|
$
2,329
|
$
2,454
|
$
4,671
|
$
4,875
|
Diamond
Offshore
|
632
|
701
|
1,259
|
1,411
|
Boardwalk
Pipeline
|
299
|
295
|
629
|
652
|
Loews
Hotels
|
167
|
112
|
306
|
217
|
Investment income and
other
|
10
|
45
|
40
|
98
|
|
|
3,437
|
3,607
|
6,905
|
7,253
|
Investment gains
(losses) - CNA Financial
|
(2)
|
(14)
|
8
|
28
|
Total
|
$
3,435
|
$
3,593
|
$
6,913
|
$
7,281
|
|
|
|
|
|
|
Income (Loss) Before
Income Tax:
|
|
|
|
|
CNA Financial
(a)
|
$
167
|
$
379
|
$
471
|
$
638
|
Diamond Offshore
(b)
|
106
|
112
|
(181)
|
280
|
Boardwalk Pipeline
(c)
|
38
|
54
|
115
|
77
|
Loews
Hotels
|
14
|
9
|
24
|
14
|
Investment income,
net
|
10
|
46
|
39
|
97
|
Other (d)
|
(38)
|
(40)
|
(76)
|
(74)
|
|
|
297
|
560
|
392
|
1,032
|
Investment gains
(losses) - CNA Financial
|
(2)
|
(14)
|
8
|
28
|
Total
|
$
295
|
$
546
|
$
400
|
$
1,060
|
|
|
|
|
|
|
Net Income (Loss)
Attributable to Loews Corporation:
|
|
|
|
|
CNA Financial
(a)
|
$
121
|
$
244
|
$
323
|
$
420
|
Diamond Offshore
(b)
|
45
|
42
|
(81)
|
111
|
Boardwalk Pipeline
(c)
|
12
|
17
|
37
|
(1)
|
Loews
Hotels
|
8
|
5
|
13
|
8
|
Investment income,
net
|
7
|
30
|
26
|
64
|
Other (d)
|
(26)
|
(26)
|
(50)
|
(49)
|
|
|
167
|
312
|
268
|
553
|
Investment gains
(losses) - CNA Financial
|
3
|
(9)
|
11
|
15
|
Income from
continuing operations
|
170
|
303
|
279
|
568
|
Discontinued
operations, net (e)
|
|
(187)
|
|
(393)
|
Net income
attributable to Loews Corporation
|
$
170
|
$
116
|
$
279
|
$
175
|
|
|
|
|
|
|
(a)
|
Includes a charge of
$84 million ($49 million after tax and noncontrolling interests)
for the three and six months ended June 30, 2015 related to
retroactive reinsurance accounting for the Loss Portfolio Transfer.
Includes an $86 million curtailment gain ($50 million after tax and
noncontrolling interests) related to a negative plan amendment and
the re-measurement of postretirement benefit obligations at CNA for
the three and six months ended June 30, 2014.
|
(b)
|
Includes an asset
impairment charge of $359 million ($158 million after tax and
noncontrolling interests) for the six months ended June 30, 2015
related to the carrying value of eight drilling rigs.
|
(c)
|
Includes a loss of
$94 million ($55 million after tax and noncontrolling interests)
for the six months ended June 30, 2014 to write off all capitalized
costs associated with the terminated Bluegrass project.
|
(d)
|
Consists primarily of
corporate interest expense and other unallocated
expenses.
|
(e)
|
See table on page six
for a summary of items comprising discontinued operations for
2014.
|
Loews Corporation
and Subsidiaries
|
Consolidated
Financial Review
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
|
Three
Months
|
Six
Months
|
(In millions, except
per share data)
|
2015
|
2014
|
2015
|
2014
|
Revenues:
|
|
|
|
|
Insurance
premiums
|
$ 1,735
|
$ 1,811
|
$ 3,422
|
$ 3,617
|
Net investment
income
|
510
|
597
|
1,098
|
1,174
|
Investment gains
(losses)
|
(2)
|
(14)
|
8
|
28
|
Contract drilling
revenues
|
617
|
650
|
1,217
|
1,335
|
Other
|
575
|
549
|
1,168
|
1,127
|
Total
|
3,435
|
3,593
|
6,913
|
7,281
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
Insurance claims
& policyholders' benefits (a)
|
1,469
|
1,441
|
2,808
|
2,887
|
Contract drilling
expenses
|
344
|
395
|
695
|
765
|
Other (b) (c)
(d)
|
1,327
|
1,211
|
3,010
|
2,569
|
Total
|
3,140
|
3,047
|
6,513
|
6,221
|
|
|
|
|
|
|
Income before income
tax
|
295
|
546
|
400
|
1,060
|
Income tax
expense
|
(48)
|
(145)
|
(104)
|
(248)
|
Income from
continuing operations
|
247
|
401
|
296
|
812
|
Discontinued
operations, net of income tax
|
|
(186)
|
|
(413)
|
Net
income
|
247
|
215
|
296
|
399
|
Amounts attributable
to noncontrolling interests
|
(77)
|
(99)
|
(17)
|
(224)
|
Net income
attributable to Loews Corporation
|
$
170
|
$
116
|
$
279
|
$
175
|
|
|
|
|
|
|
Net income
attributable to Loews Corporation:
|
|
|
|
|
Income from
continuing operations
|
$
170
|
$
303
|
$
279
|
$
568
|
Discontinued
operations, net (e)
|
|
(187)
|
|
(393)
|
Net
income
|
$
170
|
$
116
|
$
279
|
$
175
|
|
|
|
|
|
|
Diluted income per
share:
|
|
|
|
|
Income from
continuing operations
|
$ 0.46
|
$ 0.79
|
$ 0.75
|
$ 1.47
|
Discontinued
operations, net
|
|
(0.49)
|
|
(1.02)
|
Diluted income per
share attributable to Loews Corporation
|
$ 0.46
|
$ 0.30
|
$ 0.75
|
$ 0.45
|
|
|
|
|
|
|
Weighted diluted
number of shares
|
369.97
|
386.37
|
371.57
|
387.21
|
|
|
|
|
|
(a)
|
Includes a charge of
$84 million ($49 million after tax and noncontrolling interests)
for the three and six months ended June 30, 2015 related to
retroactive reinsurance accounting for the Loss Portfolio
Transfer.
|
(b)
|
Includes an $86
million curtailment gain ($50 million after tax and noncontrolling
interests) related to a negative plan amendment and the
re-measurement of postretirement benefit obligations at CNA for the
three and six months ended June 30, 2014.
|
(c)
|
Includes an asset
impairment charge of $359 million ($158 million after tax and
noncontrolling interests) for the six months ended June 30, 2015
related to the carrying value of eight drilling rigs.
|
(d)
|
Includes a loss of
$94 million ($55 million after tax and noncontrolling interests)
for the six months ended June 30, 2014 to write off all capitalized
costs associated with the terminated Bluegrass project.
|
(e)
|
See table on page six
for a summary of items comprising discontinued operations for
2014.
|
Loews Corporation
and Subsidiaries
|
|
|
Discontinued
Operations Review
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2014
|
(In
millions)
|
Three
Months
|
Six
Months
|
CNA
Financial
|
|
|
Continental Assurance
Company (῝CAC῞) operations
|
$
5
|
$
12
|
Impairment loss on
sale of CAC
|
|
(193)
|
CNA Financial -
Discontinued operations, net
|
5
|
(181)
|
|
|
|
HighMount
|
|
|
Operations
|
(25)
|
(26)
|
Ceiling test
impairment
|
|
(19)
|
Impairment
loss
|
|
(167)
|
(167)
|
HighMount -
Discontinued operations, net
|
(192)
|
(212)
|
|
|
|
|
Discontinued
operations, net
|
$
(187)
|
$
(393)
|
To view the original version on PR Newswire,
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SOURCE Loews Corporation