Loews Corporation Reports Net Income for 2012

  Loews Corporation Reports Net Income for 2012

Business Wire

NEW YORK -- February 11, 2013

Loews Corporation (NYSE:L) today reported net income for 2012 of $568 million
or $1.43 per share as compared to $1.1 billion or $2.62 per share in 2011. Net
income in 2012 includes catastrophe losses of $243 million (after tax and
noncontrolling interests) at CNA Financial Corporation primarily related to
Storm Sandy and after tax ceiling test impairment charges of $433 million at
HighMount Exploration & Production LLC related to the carrying value of its
natural gas and oil properties reflecting declines in natural gas and NGL
prices. Excluding these charges, net income (non-GAAP), as adjusted, in 2012
was $1.2 billion.

For the three months ended December 31, 2012, Loews reported a net loss of $32
million or $0.08 per share as compared to net income of $271 million, or $0.68
per share, in the 2011 fourth quarter. Excluding catastrophe losses of $171
million (after tax and noncontrolling interests) at CNA and the after tax
ceiling test impairment charge of $97 million at HighMount, net income
(non-GAAP), as adjusted, in the 2012 fourth quarter was $236 million.

Book value per share increased to $49.67 at December 31, 2012 from $47.33 at
December 31, 2011.

CONSOLIDATED HIGHLIGHTS


(In millions,          December 31,
except per share           Three Months              Years Ended
data)                  2012        2011        2012       2011
                                                             
Income before net
investment gains
(losses) and               $ 67          $ 311          $ 968        $ 1,093

ceiling test
impairment charges
Non-cash ceiling
test impairment              (97   )                      (433 )
charges
Net investment          (2    )    (40  )     33       (31   )
gains (losses)
Net income (loss)
attributable to        $ (32   )   $ 271      $ 568     $ 1,062 
Loews Corporation
                                                                     
Net income (loss)      $ (0.08 )   $ 0.68     $ 1.43    $ 2.62  
per share
Book value per
share at:
December 31, 2012          $ 49.67
December 31, 2011       47.33                         
                                                                     

Three Months Ended December 31, 2012 Compared to 2011

Income before net investment losses and ceiling test impairment charges in
2012 was $67 million, as compared to $311 million in the 2011 fourth quarter.
The decrease is due primarily to lower results at CNA and Diamond Offshore
Drilling, Inc. as well as decreased parent company investment income as a
result of lower performance of equity investments. These decreases were
partially offset by higher earnings at Boardwalk Pipeline Partners, L.P.

CNA’s earnings declined due to higher catastrophe losses of $171 million
(after tax and noncontrolling interests) primarily related to Storm Sandy and
a lower level of favorable net prior year development in 2012 than in 2011,
partially offset by increased investment income. Increased investment income
reflects improved performance of limited partnership investments.

Diamond Offshore’s earnings decreased primarily due to an impairment charge
related to the carrying value of three semisubmersible rigs and lower average
daily revenue partially offset by an overall increase in utilization and lower
contract drilling expense.

Boardwalk Pipeline’s earnings increased primarily due to the contributions
from recent acquisitions and lower general and administrative expenses.

Year Ended December 31, 2012 Compared to 2011

Income before net investment gains and ceiling test impairment charges in 2012
was $968 million, as compared to $1.1 billion in 2011. The decrease is due
primarily to lower results at CNA and Diamond Offshore partially offset by
higher earnings at Boardwalk Pipeline and higher parent company investment
income as a result of improved performance of equity investments.

CNA’s earnings decreased primarily due to the reasons discussed in the three
month comparison above.

Diamond Offshore earnings decreased as a result of lower rig utilization and a
decrease in average dayrate partially offset by lower interest expense.

Boardwalk Pipeline’s earnings increased primarily due to the reasons discussed
in the three month comparison above as well as lower impairment charges in
2012.

SHARE REPURCHASES

At December 31, 2012, there were 391.8 million shares of Loews common stock
outstanding. During the three months and year ended December 31, 2012, the
Company purchased 2.1 million and 5.6 million shares of its common stock at an
aggregate cost of $83 million and $222 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 fourth quarter results of Loews Corporation
has been scheduled for 11:00 a.m. EST, today. 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
88744024. An online replay will also be available on the Loews Corporation’s
website following the call.

A conference call to discuss the fourth quarter results of CNA has been
scheduled for 10:00 a.m. EST, today. A live webcast will be available at
http://investor.cna.com. Those interested in participating in the question and
answer session should dial (888) 556-4997, or for international callers, (719)
325-2429. Please go to the website at least ten minutes before the event
begins to register and to download and install any necessary audio software.

A conference call to discuss the fourth quarter results of Boardwalk Pipeline
has been scheduled for 9:00 a.m. EST, today. A live webcast will be available
at www.bwpmlp.com. Those interested in participating in the question and
answer session should dial (866) 272-9941 or for international callers, (617)
213-8895. The conference ID number is 56922529. Please go to the website at
least ten minutes before the event begins to register and to download and
install any necessary audio software.

A conference call to discuss the fourth quarter results of Diamond Offshore
was held on Tuesday, February 5, 2013. 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; Boardwalk Pipeline
Partners, LP (NYSE: BWP), a 55% owned subsidiary; HighMount Exploration &
Production LLC, a wholly 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
  Selected Financial Information
  
                       December 31,
  (In                  Three Months               Years Ended
  millions)
                  2012        2011         2012         2011
  Revenues:
  CNA                  $ 2,437       $ 2,294         $ 9,487        $ 8,982
  Financial
  Diamond                753           752             3,072          3,334
  Offshore (a)
  Boardwalk              325           301             1,187          1,144
  Pipeline
  HighMount              78            93              297            390
  Loews Hotels           125           86              397            337
  Investment
  income            (11   )    22         55         (6     )
  (loss) and
  other
                   3,707     3,548      14,495     14,181 
  Investment
  gains
  (losses):
  CNA                    (2    )       (33   )         60             (19    )
  Financial
  Corporate                    (34   )     (3     )    (33    )
  and other
                   (2    )    (67   )     57         (52    )
  Total            $ 3,705    $ 3,481     $ 14,552    $ 14,129 
                                                                               
  Income
  (Loss)
  Before
  Income Tax:
  CNA
  Financial            $ (31   )     $ 274           $ 820          $ 898
  (b)
  Diamond
  Offshore (a)           185           203             917            1,177
  (c)
  Boardwalk              88            70              304            211
  Pipeline (d)
  HighMount
  Operations             16            21              44             99
  Ceiling test
  impairment             (153  )                       (680   )
  charge
  Loews Hotels           (3    )       4               14             17
  Investment
  income                 (9    )       24              61             1
  (loss), net
  Other (e)         (56   )    (47   )     (138   )    (125   )
                   37        549        1,342      2,278  
  Investment
  gains
  (losses):
  CNA                    (2    )       (33   )         60             (19    )
  Financial
  Corporate                    (34   )     (3     )    (33    )
  and other
                   (2    )    (67   )     57         (52    )
  Total            $ 35       $ 482       $ 1,399     $ 2,226  
                                                                               
  Net Income
  (Loss)
  Attributable
  to Loews
  Corporation:
  CNA
  Financial            $ (5    )     $ 195           $ 535          $ 567
  (b)
  Diamond
  Offshore (a)           73            88              337            451
  (c)
  Boardwalk
  Pipeline (d)           31            21              111            77
  (f)
  HighMount
  Operations             9             12              26             62
  Ceiling test
  impairment             (97   )                       (433   )
  charge
  Loews Hotels           (2    )       5               7              13
  Investment
  income                 (6    )       16              41             3
  (loss), net
  Other (e)         (33   )    (26   )     (89    )    (80    )
                   (30   )    311        535        1,093  
  Investment
  gains
  (losses):
  CNA                    (2    )       (19   )         35             (10    )
  Financial
  Corporate                    (21   )     (2     )    (21    )
  and other
                   (2    )    (40   )     33         (31    )
  Net income
  (loss)
  attributable     $ (32   )   $ 271       $ 568       $ 1,062  
  to Loews
  Corporation

     
        Includes a $76 million gain ($32 million after tax and noncontrolling
  (a)   interests) for the year ended December 31, 2012 related to the sale
        of jack-up rigs.
        Includes catastrophe losses of $268 million and $391 million ($171
  (b)   million and $243 million after tax and noncontrolling interests) for
        the three months and year ended December 31, 2012 primarily related
        to Storm Sandy.
        Includes an impairment charge of $62 million ($19 million after tax
  (c)   and noncontrolling interests) for the three months and year ended
        December 31, 2012 related to the carrying value of three
        semisubmersible rigs.
        Includes an impairment charge of $29 million ($11 million after tax
  (d)   and noncontrolling interests) for the year ended December 31, 2011
        related to the carrying value of steel pipe materials.
  (e)   Consists primarily of corporate interest expense and other
        unallocated expenses.
  (f)   Represents a 55.5%, 64.0%, 59.3% and 64.7% ownership interest in
        Boardwalk Pipeline for the respective periods.

                                                           
                                                                                   
  Loews
  Corporation
  and
  Subsidiaries
  Consolidated
  Financial
  Review
  
                         December 31,
  (In millions,
  except per             Three Months                 Years Ended
  share data)
                    2012         2011          2012         2011
  Revenues:
  Insurance              $ 1,784        $ 1,661          $ 6,882        $ 6,603
  premiums
  Net investment           555            550              2,349          2,063
  income
  Investment               (2     )       (67    )         57             (52    )
  gains (losses)
  Contract
  drilling                 741            734              2,936          3,254
  revenues
  Other               627        603         2,328      2,261  
  Total               3,705      3,481       14,552     14,129 
                                                                                   
  Expenses:
  Insurance
  claims &                 1,732          1,358            5,896          5,489
  policyholders’
  benefits
  Contract
  drilling                 377            407              1,537          1,549
  expenses
  Other (a)           1,561      1,234       5,720      4,865  
  Total               3,670      2,999       13,153     11,903 
                                                                                   
  Income before            35             482              1,399          2,226
  income tax
  Income tax
  (expense)           48         (70    )     (289   )    (532   )
  benefit
                                                                                   
  Net income               83             412              1,110          1,694
  Amounts
  attributable
  to                  (115   )    (141   )     (542   )    (632   )
  noncontrolling
  interests
  Net income
  (loss)
  attributable       $ (32    )   $ 271        $ 568       $ 1,062  
  to Loews
  Corporation
                                                                                   
                                                                                   
  Diluted income
  (loss) per
  share              $ (0.08  )   $ 0.68       $ 1.43      $ 2.62   
  attributable
  to Loews
  Corporation
                                                                                   
  Weighted
  diluted number      392.85     397.31      395.87     405.32 
  of shares

     
        Includes non-cash impairment charges of $153 million ($97 million
  (a)   after tax) and $680 million ($433 million after tax) for the three
        months and year ended December 31, 2012 related to the carrying value
        of HighMount's natural gas and oil properties.
        

Contact:

Loews Corporation
Peter W. Keegan, 212-521-2950
Chief Financial Officer
or
Mary Skafidas, 212-521-2788
Investor and Public Relations
 
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