|
 |
Apr-28-2008Loews Net Income Declines 14 Percent on Insurance (Update3)(topic overview)
CONTENTS:
- Net income and earnings per share information attributable to Loews common stock and Carolina Group stock is summarized in the table below: Three Months Ended March 31, (In millions, except per share data) 2008 2007 Net income attributable to Loews common stock: Income before net investment gains (losses) $503 $570 Net investment gains (losses) (a) (29) 75 Income from continuing operations 474 645 Discontinued operations, net (b) 81 5 Net income attributable to Loews common stock 555 650 Net income attributable to Carolina Group stock 107 118 Consolidated net income $662 $768 ================= Net income per share: Loews common stock: Income from continuing operations $0.90 $1.19 Discontinued operations, net 0.15 0.01 Net income $1.05 $1.20 ================= Carolina Group stock $0.98 $1.08 ====================================================================== Book value per share of Loews common stock at: March 31, 2008 $31.66 December 31, 2007 $32.40 ====================================================================== (a) Includes a gain of $89 million related to a reduction in the Company's ownership interest in Diamond Offshore from the conversion of Diamond Offshore's 1.5% convertible debt into Diamond Offshore common stock in 2007. (b) Includes a gain of $82 million from the sale of Bulova Corporation in January 2008. (More...)
- In the fourth quarter, CNA wrote down the value of investments, including securities tied to subprime, by $188 million. (More...)
- The company posted net operating income of $221 million, or 82 cents a share. (More...)
- Six Wall Street analysts' consensus revenue estimate came in at $423.02 million. (More...)
- Forecasts generally exclude investment gains and losses. (More...)
- Boardwalk Pipeline issued common units in the first and fourth quarters of 2007. (f)Includes an after tax gain of $82 from the sale of Bulova Corporation in January 2008. (More...)
- Last week, deepwater-drilling company Diamond Offshore reported a 30% rise in first-quarter net income as contract-drilling revenue surged 31%. (More...)
- Depending on market conditions, the Company from time to time purchases shares of its, and its subsidiaries', outstanding common stock in the open market or otherwise. (More...)
- The decrease was primarily due to lower net investment income and decreased net realized investment results. (More...)
SOURCES
FIND OUT MORE ON THIS SUBJECT
Net income and earnings per share information attributable to Loews common stock and Carolina Group stock is summarized in the table below: Three Months Ended March 31, (In millions, except per share data) 2008 2007 Net income attributable to Loews common stock: Income before net investment gains (losses) $503 $570 Net investment gains (losses) (a) (29) 75 Income from continuing operations 474 645 Discontinued operations, net (b) 81 5 Net income attributable to Loews common stock 555 650 Net income attributable to Carolina Group stock 107 118 Consolidated net income $662 $768 ================= Net income per share: Loews common stock: Income from continuing operations $0.90 $1.19 Discontinued operations, net 0.15 0.01 Net income $1.05 $1.20 ================= Carolina Group stock $0.98 $1.08 ====================================================================== Book value per share of Loews common stock at: March 31, 2008 $31.66 December 31, 2007 $32.40 ====================================================================== (a) Includes a gain of $89 million related to a reduction in the Company's ownership interest in Diamond Offshore from the conversion of Diamond Offshore's 1.5% convertible debt into Diamond Offshore common stock in 2007. (b) Includes a gain of $82 million from the sale of Bulova Corporation in January 2008. [1] Carolina Group, a subsidiary and tracking stock of Loews Corp. (nyse: LTR - news - people ), posted first-quarter net income of $171 million, or 98 cents a share, compared with net income of $189 million, or $1.08 a share, in the first quarter of 2007.[2] Business Editors/Financial Editors NEW YORK--(BUSINESS WIRE)--April 28, 2008-- Loews Corporation (NYSE:LTR;CG) today reported consolidated net income (including both the Loews Group and Carolina Group) for the first quarter of 2008 of $662 million, compared to $768 million in the first quarter of 2007.[1] NEW YORK--( BUSINESS WIRE )--Loews Corporation (NYSE:LTR) today reported Carolina Group net income for the first quarter of 2008 of $171 million, compared to $189 million in the first quarter of 2007.[3]
The change in net income reflects the following: -- A decline in results at the Company's 90% owned subsidiary, CNA Financial Corporation. -- Improved results at the Company's 50.5% owned subsidiary, Diamond Offshore Drilling, Inc. -- The operations of the Company's wholly owned subsidiary, HighMount Exploration & Production LLC. -- Reduced net investment income. -- Net investment losses of $29 million (after tax and minority interest) in the first quarter of 2008 compared to net investment gains of $75 million (after tax and minority interest) in the first quarter of 2007.[1] Loews Corp. (LTR) posted a 14% drop in first-quarter net income, as the holding company was hurt by declining results at its CNA Financial Corp. (CNA) unit as well as net investment losses that more than offset improved results at its Diamond Offshore Drilling Inc. (DO) unit. Carolina Group (CG) saw net income fall 9.5% amid increased expenses related to the proposed spinoff of its Lorillard unit and lower investment income. Net income for CNA - Loews's 90%-owned subsidiary - plunged 37%, amid lower net investment income, with additional impacts from decreased underwriting results in its core property and casualty operations and increased catastrophe losses.[4]
The company also said that Carolina Group's (CG) first-quarter net income declined on higher expenses related to the proposed spin-off of Lorillard, and lower investment income. The company's first-quarter consolidated net income, including both the Loews Group and Carolina Group, was $662 million, lower than $768 million in the previous year.[5] Loews reported that first-quarter net income of Carolina Group, a tracking stock for the company's cigarette business, Lorillard, declined to $171 million from last year's $189 million.[5] Loews reported net income of $662 million, down from $768 million a year earlier. The results include Carolina Group, the tracking stock for Loews's cigarette subsidiary, Lorillard, which it plans to spin off as a separate, publicly traded company later this year.[4]
First-quarter net income attributable to Carolina Group stock was $107 million or $0.98 per share, lower than $118 million or $1.08 per share a year earlier.[5] Net income per share of Carolina Group stock was $0.98, down from $1.08 in the last year quarter.[6]
Carolina Group posted net income of $171 million, down from $189 million. Attributable to its common stock, Carolina Group's net income was $107 million, or 98 cents a share, down from $118 million, or $1.08 a share, a year earlier.[4] Net income attributable to Carolina Group (CG), the company's tobacco products unit and tracking stock, fell 9.5% to $171 million, or 98 cents a share, from $189 million, or $1.08 a share.[7]
Net income declined for the third straight quarter, falling 14 percent to $662 million, or $1.05 a share, from $768 million, or $1.20, the New York-based company said today in a statement. Revenue fell at CNA, sending the stock of both companies tumbling the most in three months.[8] In the quarter, net income attributable to Loews common stock fell to $555 million or $1.05 per share from $650 million or $1.20 per share last year.[5] In the sequential fourth-quarter, the company's consolidated net income was $512 million, and net income attributable to Loews common stock was $384 million or $0.72 per share.[5]
Net income was 98 cents per share, compared to $1.08 per share a year ago. The company said the decline reflected higher selling and advertising costs plus $19 million in higher pre-tax administrative and legal costs associated with the proposed spin-off of Lorillard from its parent Loews Corp.[9]
Carolina Group earned $171 million, or 98 cents per share, compared with profit of $189 million, or $1.08 per share, in the first quarter last year.[10] Carolina Group's net sales were $921 million in the first quarter of 2008, higher than $913 million in same period last year, mainly driven by higher average unit prices.[5] Net sales for the Carolina Group were $921 million in the first quarter of 2008, higher than $913 million in same period last year. The agreement outlines the actions Physio-Control have to take in order to resume unrestricted distribution of its external defibrillators.[6] Carolina Group reported slightly higher net sales for the first quarter, up to $921 million from $913 a year earlier. Lorillard shipped about 7.65 million cigarettes under its best-selling brand Newport in the first quarter, down about 1.1 percent from 2007. Shipments of its value brands, Old Gold and Maverick, were up 33 percent from the same period a year ago.[9]
Carolina Group, a tracking stock tied to the performance of Greensboro tobacco company Lorillard Inc., said Monday its first-quarter earnings of $171 million, down 9.5 percent from the $189 million profit from the first quarter of 2007.[9]
Analysts estimated revenue of $884.69 million. Earlier, on December 17, 2007, the company announced that its Board of Directors had approved a plan to spin-off its entire ownership interest in Lorillard to holders of Carolina Group stock and Loews common stock in a tax-free transaction, which will result in Lorillard becoming a separate publicly traded company.[5] Depending on market conditions, the Company, for the account of the Carolina Group, from time to time may purchase shares of Carolina Group stock in the open market or otherwise. On December 17, 2007, Loews announced that its Board of Directors had approved a plan to spin-off the Company's entire ownership interest in Lorillard to holders of Carolina Group stock and Loews common stock in a tax-free transaction.[1] As a result of the transaction, the Carolina Group, and all of the Carolina Group stock, will be eliminated and Lorillard will become a separate publicly traded company. The transaction will be accomplished by the Company through its (i) redemption of all outstanding Carolina Group stock in exchange for shares of Lorillard common stock, with holders of Carolina Group stock receiving one share of Lorillard common stock for each share of Carolina Group stock they own, and (ii) disposition of its remaining Lorillard common stock in an exchange offer for shares of outstanding Loews common stock, or as a pro rata dividend to the holders of Loews common stock.[1]
As of March 31, 2008, there were 108.48 million shares of Carolina Group stock outstanding. (e)Represents 62.4% of the economic interest in the Carolina Group for the three months ended March 31, 2008 and 2007. Carolina Group Supplemental Information The following information regarding unit volume shipped by Lorillard Tobacco Company to its direct buying customers by brand follows (all units in thousands): Three Months Ended March 31, 2008 2007 Full Price Brands Total Newport 7,650,379 7,731,573 Total Kent Family 100,188 116,967 Total True 91,122 104,670 Total Max 6,030 6,900 Total Satin 72 Total Full Price Brands 7,847,719 7,960,182 Price/Value Brands Total Old Gold 126,996 148,952 Total Maverick 440,508 278,118 Total Price/Value Brands 567,504 427,070 Total Domestic Cigarettes 8,415,223 8,387,252 Total Puerto Rico and U.S. Possessions 146,466 190,092 Grand Total 8,561,689 8,577,344 =================== 1.This information is not adjusted for returns. 2.Domestic unit volume includes units sold as well as promotional units, and excludes volumes for Puerto Rico and U.S. Possessions. 3.Unit volume for a quarter is not necessarily indicative of unit volume for any subsequent period. 4.Unit volume is not necessarily indicative of the level of revenues for any period. This content is for your personal use only, subject to Terms and Conditions.[1] The decrease in net income per share of Carolina Group stock reflects increased selling, advertising and administrative expenses as a result of costs associated with the proposed spin-off of Lorillard, as discussed below, and lower investment income, partially offset by lower interest expense related to the Carolina Group notional debt.[1] Analysts on average expected profit of $US1.01 per share. CNA said operating profit fell because of lower net investment income and weaker results in its core property and casualty operations.[11] Excluding investment gains and losses, operating profit fell 28 percent to $221 million, or 82 cents per share, from $307 million, or $1.13, CNA said.[12] Profit at Chicago-based CNA Financial Corp, a commercial insurer in which Loews owns a 90 per cent stake, fell 37 per cent to $US187 million, or 69 cents per share.[11]
BOSTON (Thomson Financial) - CNA Financial Corp. Monday said first-quarter net income fell to $187 million, or 69 cents a share, from $296 million, or $1.09 a share, in the year-ago period.[13] First-quarter net income fell to $171 million, or 98 cents per share, from $189 million, or $1.08 per share, a year ago.[14] Completion of the proposed transaction is subject to a number of conditions, the company noted. Among peers, The Travelers Companies, Inc. (TRV), a provider of commercial and personal property and casualty insurance products and services, on last Thursday reported that its first-quarter net income fell to $967 million or $1.54 per share from $1.086 billion or $1.56 per share in the previous year.[5]
Net operating income for the quarter was $221.0 million or $0.82 per share, compared to net operating income of $307.0 million or $1.13 per share in the year-ago quarter.[6] Income from continuing operations for the quarter was $188.0 million or $0.70 per share, down from $294.0 million or $1.08 per share in the same quarter previous year.[6] Earnings from continuing operations totaled $28.38 million or 28 cents per share, compared to $21.76 million or 22 cents per share in the same quarter last year.[6]
Net investment losses in the first quarter was $29 million in the first quarter of 2008, compared to net investment gains of $75 million last year, which included a gain of $89 million related to a reduction in the company's ownership interest in Diamond Offshore from the conversion of Diamond Offshore's 1.5% convertible debt into Diamond Offshore common stock.[5] The results for the first quarter of 2007 included a gain of $89 million (after tax) related to a reduction in the Company's ownership interest in Diamond Offshore from the conversion of Diamond Offshore's 1.5% convertible debt into Diamond Offshore common stock. -- Discontinued operations primarily consisting of an $82 million gain from the sale of Bulova Corporation in the first quarter of 2008.[1]
Net results for the first quarter of 2008 decreased $17 million as compared with the same period in 2007. This decrease was primarily attributable to net realized investment losses and a decline in net results in our pension deposit business. Corporate & Other Non-Core primarily includes certain corporate expenses, including interest on corporate debt, and the results of certain property and casualty business primarily in run-off, including CNA Re. This segment also includes the results related to the centralized adjusting and settlement of asbestos and environmental pollution.[15] Net income and net operating income decreased $55 million and $59 million for the first quarter of 2008 as compared with the same period in 2007. These decreases were primarily driven by lower net investment income, decreased current accident year underwriting results and higher catastrophe losses.[15] Net income and net operating income decreased $14 million and $18 million for the first quarter of 2008 as compared with the same period in 2007, primarily driven by lower net investment income and the unfavorable impact of foreign currency rate movements. These decreases were partially offset by $10 million of favorable results in our warranty line of business, which resulted from an annual review.[15]
Pretax net investment income for the first quarter of 2008 decreased $174 million over the same period of 2007. This decrease was primarily driven by a $91 million decline in limited partnership results and an $80 million unfavorable change in trading portfolio results.[15]
Income from limited partnerships, which is included in investment income, amounted to less than $1 million in the first quarter of 2008 compared to $11 million ($7 million after tax) in the first quarter of 2007.[1]
Net sales for the Carolina Group were $921 million in the first quarter of 2008, compared to $913 million in the first quarter of 2007.[1] Net interest income for the quarter was $5.22 million, down from $5.48 million in the same quarter prior year. The consolidated net income net income included both the Loews Group and Carolina Group.[6] Results of operations of the Carolina Group include interest expense on notional intergroup debt of $4 million and $15 million, net of taxes, for the three months ended March 31, 2008 and 2007, respectively.[1] At March 31, 2008, the outstanding Carolina Group stock represents a 62.4% interest in the economic performance of the Carolina Group. On December 17, 2007, the Company announced that its Board of Directors had approved a plan to spin-off the Company's entire ownership interest in Lorillard to holders of Carolina Group stock and Loews common stock in a tax-free transaction.[1] The Company has two classes of common stock: (i) Carolina Group stock, a tracking stock intended to reflect the economic performance of a group of the Company's assets and liabilities, called the Carolina Group, principally consisting of the Company's subsidiary Lorillard, Inc. and (ii) Loews common stock, representing the economic performance of the Company's remaining assets, including the interest in the Carolina Group not represented by Carolina Group stock.[1]
The Carolina Group stock, commonly called a tracking stock, is intended to reflect the economic performance of a defined group of the Company's assets and liabilities, referred to as the Carolina Group, principally consisting of the Company's subsidiary Lorillard, Inc. The Carolina Group, a notional group, is not a separate legal entity. The purpose of this financial information is to provide investors with additional information to use in analyzing the results of operations and financial condition of the Carolina Group, and this financial information should be read in conjunction with the consolidated financial information of Loews Corporation.[1]
The company shipped 8.56 billion units in the quarter, down 0.2%. Loews created the Carolina Group tracking stock earlier this decade to increase market awareness of Lorillard and reflect its economic performance.[4]
NEW YORK, April 28 (Reuters) - Carolina Group (CG.N: Quote, Profile, Research ), a tracking stock for Loews Corp's (LTR.N: Quote, Profile, Research ) Lorillard Inc cigarette business, posted a lower quarterly profit on Monday, hurt by lower investment income and costs related to the proposed spin-off of Lorillard.[14] NEW YORK, April 28 (Reuters) - CNA Financial Corp (CNA.N: Quote, Profile, Research ), a commercial insurer whose majority owner is Loews Corp (LTR.N: Quote, Profile, Research ), said on Monday first-quarter profit fell 37 percent as premiums and investment income declined.[12] NEW YORK, April 28 (Reuters) - Loews Corp (LTR.N: Quote, Profile, Research ) on Monday posted an unexpected decline in first-quarter profit, as disappointing results from its CNA Financial Corp insurance unit offset improved performance from drilling operations.[16] NEW YORK -- Loews Corp says first-quarter profit fell 14 per cent as declining results from its insurance and tobacco units offset improved results from drilling operations.[11]
Excluding investments and discontinued operations, profit was $US503 million, or about 95 cents per share based on reported shares outstanding, Loews said.[11] Excluding investments and discontinued operations, profit was $503 million, or 95 cents per share, down from $1.07 per share a year earlier. On that basis, analysts on average expected $1.14 per share, according to Reuters Estimates.[16]
Profit attributable to Loews shareholders declined 15 per cent to $US555 million, or $US1.05 per share, from $US650 million, or $US1.20.[11] Operating profit fell 28 per cent to $US221 million, or 82 cents per share.[11]
BOSTON (Thomson Financial) - Loews Corp. Monday reported first-quarter income from continuing operations of $474 million, or 90 cents a share, compared with $645 million, or $1.19 a share, in the year-earlier quarter.[2] The later quarter's results include 15 cents a share in earnings from discontinued operations in the latest quarter and $29 million in net investment losses.[4] Net operating income for our core Property & Casualty Operations decreased $77 million, while net operating income for our Non-Core operations decreased $9 million. This overall decrease was primarily due to lower net investment income, with additional impacts from decreased current accident year underwriting results in our core Property & Casualty Operations and increased catastrophe losses.[15]
Net income for the three months ended March 31, 2008 decreased $109 million as compared with the same period in 2007. This decrease was primarily due to lower net operating income and higher net realized investment losses.[15]
Net income attributable to Loews stock was $555 million, or $1.05 a share, down from $650.7 million, or $1.20 a share.[4] CNA, a commercial-insurance underwriter and property and casualty insurer, reported net income of $187 million, or 69 cents a share, down from $296 million, or $1.09 a share, a year earlier.[4] The Chicago-based insurer CNA Financial reported first-quarter net income of $200 million, down from $275 million last year.[5] Diamond Offshore net income increased to $136 million from $107 million last year.[5]
Net income at New York-based Loews, a conglomerate run by the billionaire Tisch family, fell 14 percent to $662 million from $768 million a year earlier.[16] Cigarette making unit Lorillard recorded net income of $67 million, lower than prior year's $84 million.[5]
Net sales for the March quarter rose to $921 million from $913 million a year earlier, primarily reflecting higher average unit prices, the company said.[2] Net sales for the second quarter increased 7.7% to $412.8 million from $383.4 million in the prior year quarter.[6]
Catastrophe losses were $34 million after-tax in the first quarter of 2008, as compared to $20 million after-tax in the first quarter of 2007. These decreases were partially offset by increased favorable net prior year development. Specialty Lines provides professional, financial and specialty property and casualty products and services, both domestically and abroad, through a network of brokers, managing general underwriters and independent agencies.[15] Net results for the first quarter of 2008 decreased $20 million as compared with the same period in 2007.[15]
The results included discontinued operations primarily consisting of an $82 million gain from the sale of Bulova Corp. in the first quarter of 2008.[5]
Administrative expenses in the first quarter of 2008 include costs related to the proposed spin-off of Lorillard from Loews of $10 million ($6 million after tax) for a management bonus and $3 million ($2 million after tax) for financial and legal fees associated with the transaction.[1] Selling, advertising and administrative expenses rose to $100 million from $82 million a year ago, due to costs related to the proposed spin-off of Lorillard from Loews and higher legal expenses.[14]
In the fourth quarter, CNA wrote down the value of investments, including securities tied to subprime, by $188 million. "We are buying these, but we're not going whole hog into these,'' Loews Chief Executive Officer Jim Tisch said today on CNA's new subprime investments. "It is not for the faint of heart,'' he said on a conference call. [8] CNA added $550 million in subprime and Alt-A investments in the first three months of the year, the company said on a conference call.[8]
The company posted net operating income of $221 million, or 82 cents a share. [13] Net operating income of $221 million, or $0.82 per diluted share.[15]
Operating income was $1.008 billion or $1.61 per share, compared to $1.078 billion, $1.55 per share last year.[5] On average, two analysts polled by First Call/Thomson Financial expected the company to report earnings of $1.15 per share for the quarter.[5] On average analysts polled by Thomson Financial expected earnings for Carolina Group of $1.16 a share on revenue of $885 million.[7] Analysts polled by Thomson Reuters, on average, estimated first-quarter earnings at Carolina Group of $1.16 a share.[2]
Shares of Carolina Group, a New York-based cigarette producer, closed Friday at $72.43.[2]
At March 31, 2008, there were 529,701,152 shares of Loews common stock outstanding and 108,476,929 shares of Carolina Group stock outstanding.[1] At March 31, 2008 there were 108,476,929 shares of Carolina Group stock outstanding, representing a 62.4% economic interest.[1] Carolina Group stock represented a 62.4% economic interest in the Carolina Group for the three months ended March 31, 2008 and 2007.[1]
Carolina Group closed Friday at $72.43 and CNA finished Friday at $27.99. Both stocks had no pre-market activity.[4]
Carolina Group's sales rose to $921 million from $913 million a year ago.[7] Net sales rose to $921 million from $913 million a year ago, due mostly to price increases.[14]
Earnings from continuing operations for the latest period were $474 million, or 90 cents a share, compared with $645 million, or $1.19 a share, a year ago.[7] Loews recorded net investment losses of $29 million in the period, compared with net investment gains of $75 million in the year-earlier period.[8] Loews is preparing to spin off the cigarette business, which includes the Newport brand, and said it had $13 million in administrative expenses in the period tied to the transaction. Laurence Tisch, Jim Tisch's father, and Preston Robert Tisch, his uncle, started Loews when they bought a New Jersey hotel in 1946.[8]
Six Wall Street analysts' consensus revenue estimate came in at $423.02 million. Commenting on the second quarter results, CEO James Marino said, "Our strong performance this quarter was due to the continued growth of TRESemme as well as growth in other beauty care brands including St Ives and multicultural brands Motions and Soft and Beautiful." The company also announced that its board of directors approved the regular 6.5 cent quarterly cash dividend. [6] Profit at Lorillard, Loews's tobacco unit, fell 20 percent to $67 million on a decline in revenue.[8] Lorillard revenues also declined to $931 million from $945 million a year ago.[5] Diamond Offshore revenues increased to $792 million from $619 million last year.[5] CNA Financial revenues declined to $2.33 billion from $2.54 billion last year.[5] CNA Financial said net written premiums fell to $1.62 billion from $1.73 billion a year earlier.[17]
Loews attributed the poor year-over-year first-quarter results to a decline in results at the company's 90% owned subsidiary, CNA Financial Corp., and lower net investment income.[5] Loews owns a majority stake in CNA Financial Corp. (CNA), which said Monday it posted a 37% decrease in first-quarter net income.[7]
A majority of CNA's shares are owned by Loews Corp. (LTR), which posted Monday an 14% decrease in first-quarter net income.[17]
April 28 (Bloomberg) -- Loews Corp., the holding company run by New York's Tisch family, and its CNA Financial Corp. insurance unit reported first-quarter earnings that fell short of analysts' estimates as policy sales shrank.[8] 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); Lorillard, Inc.; Diamond Offshore Drilling, Inc. (NYSE: DO); HighMount Exploration & Production LLC; Boardwalk Pipeline Partners, LP (NYSE: BWP); and Loews Hotels. 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, CNA, Diamond Offshore and Boardwalk Pipeline. Important factors that could cause actual events to differ from those described include, but are not limited to, satisfaction of the conditions to completion of the proposed spin-off transaction noted herein. Therefore, no assurance can be given that the spin-off will be consummated on the current terms or otherwise. Copies of these reports are available through the Company's website (www.loews.com).[1] Completion of the proposed transaction is subject to a number of conditions, as described in the Loews press release dated December 17, 2007, a copy of which is posted on Loews's website. A separate press release reporting Loews Corporation's consolidated results for the first quarter of 2008 is being issued contemporaneously with this report.[1] CONFERENCE CALLS A conference call to discuss the first quarter results of Loews Corporation has been scheduled for 11:00 a.m. EDT, Monday, April 28, 2008.[1]
A conference call to discuss first quarter results of Diamond Offshore was held on Thursday, April 24, 2008.[1] A conference call to discuss the first quarter results of CNA has been scheduled for 10:00 a.m. EDT, Monday, April 28, 2008.[1] A conference call to discuss the first quarter results of Boardwalk Pipeline Partners, LP has been scheduled for 9:00 a.m. EDT, Monday, April 28, 2008.[1]
The Company is issuing a separate press release reporting the results of the Carolina Group for the first quarter of 2008.[1] NEW YORK -- Carolina Group's profit slipped 10 percent in the first quarter on weaker investment returns and higher advertising costs, the cigarette maker said Monday.[10]
Forecasts generally exclude investment gains and losses. CNA said operating profit fell because of lower net investment income and weaker results in its core property and casualty operations. [12] Excluding discontinued operations and investment gains and losses, CNA earned 82 cents a share, down from $1.13 a share.[4]
Analysts polled by Thomson Financial forecast profit of $1.16 per share.[10] Analysts on average expected a profit of $1.01 per share, according to Reuters Estimates.[12]
Seven Wall Street analysts, on average, expected the company to report earnings of $1.16 per share.[5]
Book value per common share of $34.79 at March 31, 2008, as compared to $37.36 at December 31, 2007.[15] At March 31, 2008, $218 million principal amount of notional intergroup debt was outstanding.[1]
Revenue for the three-month period ended March 31 slipped to $4.54 billion from $4.61 billion a year ago.[2] Revenues for the quarter declined to $6.232 billion from $6.427 billion in the prior year period.[5] Loews noted that total consolidated revenues for the quarter decreased to $4.54 billion from $4.61 billion in the prior year quarter.[5]
Net Written Premiums for the quarter was $1.62 billion, down from $1.73 billion in the same quarter prior year.[6] Insurance premiums in the quarter declined slightly to $1.812 billion from $1.862 billion a year ago.[5]
Consolidated income from continuing operations fell to $581 million from $763 million a year ago.[5] Investment income also shrank by $22 million because investments yielded lower interest rates.[10] Investment income declined $22 million ($14 million after tax) due to lower yields and a lower average invested asset balance.[1]
CNA Financial (nyse: CNA - news - people ) said earnings for the March quarter were hurt by reduced investment income.[13] Includes income from limited partnership investments of $11 ($7 after taxes) for the three months ended March 31, 2007.[3]
Boardwalk Pipeline issued common units in the first and fourth quarters of 2007. (f)Includes an after tax gain of $82 from the sale of Bulova Corporation in January 2008. [1] Results included an $US82 million gain from the Jan. 10 sale of the Bulova Corp watch-making unit to Japan's Citizen Holdings Co.[11] Sales climbed about 1 percent to $921 million from $913 million because of higher prices for cigarettes.[10] CNA, the Chicago-based property and casualty insurer majority-owned by Loews, said sales of policies declined 6.5 percent to $1.62 billion.[8]
Loews declined $1.85, or 4.2 percent, to $42.78 at 12:22 p.m. in New York Stock Exchange composite trading.[8] Shares of Loews, a New York-based provider of commercial property and casualty insurance, closed Friday at $44.63.[2] Loews shares closed Friday at $44.63 and rose to $45.20 in pre-market trading.[4]
Analysts' mean estimates, according to Thomson Reuters, were for earnings of $1.16 a share on $885 million in revenue.[4] Revenue rose 0.9% to $921 million, reflecting higher average unit prices.[4]
Diamond's first-quarter profit rose 30 percent to $290.6 million as demand stoked record crude oil prices.[8] The mean estimate of analysts polled by Thomson Reuters was for first-quarter profit of $1.04 a share.[13]
Shares of the Chicago-based commercial insurance writer closed Friday at $27.99.[13]
We repurchased shares during the quarter for the first time in nearly 10 years. These transactions, along with the dividend initiated last year, were made possible by CNA ' s much improved capital position and reflect our ongoing focus on capital management[15] Financial supplement information related to the first quarter results is available on the investor relations pages of the CNA website or by contacting David Adams at (312) 822-2183.[15] Lorillard's investments in limited partnerships were substantially reduced during the first quarter of 2008.[1] The company is thus exposed to several areas of the U.S. economy, which many economists say may have slipped into a recession in the first quarter.[11]
Last week, deepwater-drilling company Diamond Offshore reported a 30% rise in first-quarter net income as contract-drilling revenue surged 31%. [4] Sequentially, consolidated revenues declined from $4.6 billion recorded in the fourth quarter.[5] Property and casualty net written premiums declined 6 percent to $1.62 billion.[12]
CNA stock declined $3.08 or 11%, and currently trading at $24.91.[5] '''We'''re not distracted.''' That gives CNA more stability than it'''s enjoyed in well over a decade, industry observers say. '''We have better comfort they'''ll be able to manage the soft market this time around,''' says Brian Schneider, managing director at Fitch Ratings in Chicago, which upgraded CNA'''s debt last October. That stability also gives New York-based Loews Corp., which owns 90% of CNA'''s stock, more options as a new round of insurance industry consolidation appears to be underway.[18] Mr. Lilienthal overhauled the company, cutting jobs and exiting or shrinking major business lines while refocusing CNA on serving middle-market companies and writing high-margin specialty insurance policies, such as liability coverage for corporate board members and executives. Now, with the industry in the midst of a new price-cutting cycle, Mr. Lilienthal says CNA is better positioned this time around to withstand the market turbulence without having to add substantially to reserves for claims, as it did repeatedly earlier this decade. '''We are a highly diversified company and are very capable of navigating the industry conditions,''' he said following the company'''s annual meeting April 23.[18]
Depending on market conditions, the Company from time to time purchases shares of its, and its subsidiaries', outstanding common stock in the open market or otherwise. [1]
Carolina Group has been spending more on advertising and marketing. The company also incurred costs to spin off its Lorillard brand as a separate company.[10] Strong sales growth was offset by payments Carolina Group agreed to make under state settlements for tobacco lawsuits.[10]
Gross profit was essentially unchanged as the increase in net sales was offset by higher costs related to the State Settlement Agreements.[1]
CNA profit has declined for four straight quarters. "Loews managers seem to be very good at everything except insurance, which is their biggest business," said Matt Nellans, an analyst at Morningstar Inc in Chicago. "Including run-off businesses, CNA is paying out more than it's taking in."[16]
On the conference call will be Stephen W. Lilienthal, Chairman and Chief Executive Officer of CNA Financial Corporation, and other members of senior management.[15]
The decrease was primarily due to lower net investment income and decreased net realized investment results. [15] The company used 98.1 percent of premium income for claims and expenses, up from 95.1 percent a year earlier.[12] The company is the seventh-largest business insurer in the U.S. Rates for commercial coverage industrywide dropped 14 percent in the first three months of the year as insurers competed for business, according to a survey by the Council of Insurance Agents and Brokers.[8]
SOURCES
1. Loews Corporation Reports Net Income for the First Quarter of 2008 - - insurancenewsnet.com
2. Loews ongoing 1Q profit falls; Carolina Group 1Q EPS below analyst estimates - Forbes.com
3. Carolina Group Reports Net Income for the First Quarter of 2008
4. UPDATE: Loews, Carolina Group, CNA Post Lower 1Q Profits
5. Loews Q1 Profit Falls On Lower Revenues From CNA Financial, Lorillard - Update [LTR] - RTTNews, Today's Top Stories, Global Newswires, ToDay's Top News,Global Business news .
6. RTTNews - Quick facts Articles, Positive EPS Surprises, News Analysis, Earnings, Audio News.
7. Loews Corp 1Q Net Down 14%;Carolina Group 1Q Net Down 9.5%
8. Bloomberg.com: Worldwide
9. Carolina Group's 1Q profits down 9.5 percent - The Business Journal of the Greater Triad Area:
10. Carolina Group's profit slips 10 percent in 1Q | Chron.com - Houston Chronicle
11. Business Spectator - Loews Q1 profit falls
12. UPDATE 1-CNA Financial 1st-qtr profit falls 37 pct | Markets | Markets News | Reuters
13. CNA Financial 1Q income falls to 69c a share - Forbes.com
14. UPDATE 1-Carolina Group 1st-quarter profit falls | Markets | Markets News | Reuters
15. CNA Financial Announces 1st Quarter 2008 Results
16. UPDATE 2-Loews net falls 14 pct, hurt by CNA insurance unit | Markets | Reuters
17. CNA Financial 1Q Net Down 37% To $187 Million
18. CNA Financial Corp. News | Chicago Business News, Analysis & Articles | CNA better positioned for turbulence: CEO | Crain's
GENERATE A MULTI-SOURCE SUMMARY ON THIS SUBJECT:
Please WAIT 10-20 sec for the new window to open...
You might want to EDIT the default search query below:
Get more info on Loews Net Income Declines 14 Percent on Insurance (Update3) by using the iResearch Reporter tool from Power Text Solutions.
 |
|  |
|
