Loews Q2 Profit Climbs On Insurance Unit Revenues, Investment Income

(RTTNews) - Diversified holding company Loews Corp. (L) Monday reported a sharp increase in second-quarter profit, reflecting mainly higher earnings and revenues at CNA Financial Corp. (CNA) and improved investment income at the parent company.

The company's 90 percent owned property and casualty insurance unit CNA Financial Corp. (CNA) generated higher results, while its 50.4 percent-owned unit Diamond Offshore Drilling, Inc. (DO) recorded lower earnings.

Apart from CNA and Diamond Offshore, Loews holds 53 percent of Boardwalk Pipeline Partners, LP. (BWP), excluding incentive distribution rights, while HighMount Exploration & Production LLC and Loews Hotels are its wholly owned units.

In the second quarter, net income attributable to Loews surged to $269 million or $0.69 per share from $56 million or $0.14 per share in the previous year.

On average, analysts polled by Thomson Reuters expected earnings per share of $0.79 for the quarter. Analysts' estimates typically exclude one-time items.

Loews said its prior-year quarter included an after tax non-cash impairment charge of $142 million at HighMount Exploration & Production LLC related to carrying value of its natural gas and oil properties. Excluding the impairment charge, adjusted net income for last year totaled $198 million.

Revenues for the recent quarter grew to $3.73 billion from $3.39 billion in the same quarter last year. Revenues from insurance premiums were $1.80 billion, higher than $1.67 billion a year ago. Net investment income rose to $579 million from $386 million last year.

CNA Financial's net income was $194 million or $0.72 per share, higher than $166 million or $0.62 per share a year earlier. Net operating income per share climbed to $0.75 from $0.56 per share in the previous year. Revenues grew to $2.51 billion from $2.22 billion in the prior year.

Property & Casualty Operations' net operating income was $258 million, compared with $163 million in the prior-year quarter.

CNA Financial's net Income attributable to Loews increased to $183 million from $138 million a year earlier. According to the company, CNA's earnings increased mainly from higher net investment income due to increased limited partnership results and improved non-catastrophe current accident year underwriting results.

On the other hand, Diamond Offshore's earnings slid mainly due to a gain of $23 million from sale of five jack-up rigs in the previous year. Diamond Offshore posted net income attributable to Loews of $87 million, lower than $94 million last year.

Net income from Boardwalk Pipeline attributable to Loews was $22 million, compared to $25 million in the preceding year. Operating revenues for the quarter increased to $288.7 million from $275.8 million in the prior year.

CNA Financial also declared a quarterly dividend of $0.20 per share, to stockholders of record on August 12, 2013, payable August 28.

Loews shares closed Friday's trading at $46.05 on the NYSE, while CNA Financial settled at $34.47.