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Loews Corporation Reports Net Income for the Second Quarter of 2008

NEW YORK, Jul 28, 2008 (BUSINESS WIRE) -- Loews Corporation (NYSE:L) today reported income from continuing operations for the 2008 second quarter of $511 million, or $1.00 per share, compared to $422 million, or $0.78 per share, in the 2007 second quarter. Income from continuing operations for the six months ended June 30, 2008 was $920 million, or $1.77 per share, compared to $983 million, or $1.82 per share, in the prior year.

In June of 2008, the Company disposed of its entire ownership interest in Lorillard, Inc. through the redemption of Carolina Group stock in exchange for Lorillard common stock and an exchange of our remaining Lorillard common stock for Loews common stock, collectively referred to as the Separation. The Carolina Group and Carolina Group stock have been eliminated and Lorillard's results of operations and the gain on disposal have been classified as discontinued operations.

Net income and earnings per share information attributable to Loews common stock and our former Carolina Group stock is summarized in the table below:

                                                   June 30,
                                         -----------------------------
                                          Three Months    Six Months
                                         -----------------------------
 (In millions, except per share data)     2008    2007   2008    2007
----------------------------------------------------------------------

Net income attributable to Loews common
 stock:
   Income before net investment gains
    (losses)                             $  575  $ 480  $1,013  $  966
   Net investment gains (losses) (a)        (64)   (58)    (93)     17
----------------------------------------------------------------------
   Income from continuing operations        511    422     920     983
   Discontinued operations, net (b)       4,348     91   4,494     180
----------------------------------------------------------------------
 Net income attributable to Loews common
  stock                                   4,859    513   5,414   1,163
 Net income attributable to Carolina
  Group stock-
   Discontinued operations (c)              104    141     211     259
----------------------------------------------------------------------
 Consolidated net income                 $4,963  $ 654  $5,625  $1,422
======================================================================

 Net income per share:
   Loews common stock:
     Income from continuing operations   $ 1.00  $0.78  $ 1.77  $ 1.82
     Discontinued operations, net          8.54   0.17    8.64    0.33
----------------------------------------------------------------------
     Loews common stock                  $ 9.54  $0.95  $10.41  $ 2.15
======================================================================
  Carolina Group stock-Discontinued
   operations                            $ 0.96  $1.30  $ 1.95  $ 2.39
======================================================================
 Book value per share of Loews common
  stock at:
   June 30, 2008                         $38.47
   December 31, 2007                     $32.40
======================================================================

(a) Includes a gain of $92 for the six months ended June 30, 2007 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.

(b) Includes a tax-free non-cash gain of $4,287 related to the Separation for the three and six months ended June 30, 2008 and an after tax gain of $75 from the sale of Bulova Corporation for the six months ended June 30, 2008.

(c) The Carolina Group and Carolina Group stock were eliminated effective June 10, 2008 upon completion of the Separation.

Income from Continuing Operations

Three Months Ended June 30, 2008 Compared with 2007

The increase in income from continuing operations primarily reflects higher dayrates and utilization at Diamond Offshore, increased gas transportation revenues at Boardwalk Pipeline, the operations of HighMount which was acquired in July of 2007, and an increase in equity earnings of a joint venture at Loews Hotels. These increases were partially offset by a decline in results at CNA reflecting lower net investment income, decreased current accident year underwriting results and increased catastrophe losses.

Income from continuing operations includes net investment losses of $64 million (after tax and minority interest) in the second quarter of 2008 compared to net investment losses of $58 million (after tax and minority interest) in the comparable period of the prior year.

Consolidated revenues in the second quarter of 2008 amounted to $3.9 billion, compared to $3.5 billion in the comparable period of the prior year.

Six Months Ended June 30, 2008 Compared with 2007

The decline in income from continuing operations primarily reflects a decline in results at CNA, and the increased investment losses discussed below. These decreases were partially offset by improved results at Diamond Offshore, Boardwalk Pipeline, HighMount and Loews Hotels.

Income from continuing operations includes net investment losses of $93 million (after tax and minority interest) in the first half of 2008 compared to net investment gains of $17 million (after tax and minority interest) in the comparable period of the prior year. The 2007 investment gains included $92 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.

Consolidated revenues in the first half of 2008 amounted to $7.5 billion, compared to $7.2 billion in the comparable period of the prior year.

At June 30, 2008, there were 436,267,871 shares of Loews common stock outstanding. During the three and six months ended June 30, 2008, as part of the Separation the Company acquired 93,492,857 shares of Loews common stock in exchange for 65,445,000 shares of Lorillard common stock. 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 11:00 a.m. EDT, Monday, July 28, 2008. 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 54392374.

A conference call to discuss the second quarter results of CNA has been scheduled for 10:00 a.m. EDT, Monday, July 28, 2008. A live webcast of the call will be available online at http://investor.cna.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 (888) 778-8903, or for international callers, (913) 312-0378.

A conference call to discuss the second quarter results of Boardwalk Pipeline Partners, LP has been scheduled for 9:00 a.m. EDT, Monday, July 28, 2008. A live webcast of the call will be available online at the Boardwalk Pipeline website (www.bwpmlp.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 (800) 295-4740, or for international callers, (617) 614-3925. The PIN number to access the call is 50323024.

A conference call to discuss the second quarter results of Diamond Offshore was held on Thursday, July 24, 2008. An online replay is available at the Diamond Offshore 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; HighMount Exploration & Production LLC, a wholly owned subsidiary; Boardwalk Pipeline Partners, LP (NYSE: BWP), a 70% 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
Financial Review
                                                 June 30,
                                    ----------------------------------
                                      Three Months       Six Months
                                    ----------------- ----------------
                                      2008     2007     2008    2007
                                    ----------------------------------
                                     (In millions, except per share
                                                   data)
Revenues:
  Insurance premiums                $ 1,774  $ 1,872  $ 3,586  $ 3,734
  Net investment income                 697      785    1,176    1,518
  Investment gains (losses) (a)        (109)    (104)    (160)      10
  Contract drilling revenues            937      636    1,707    1,226
  Other                                 623      328    1,225      697
                                    ----------------------------------
       Total                          3,922    3,517    7,534    7,185
                                    ----------------------------------

Expenses:
 Insurance claims & policyholders'
  benefits                            1,472    1,473    2,861    2,921
 Contract drilling expenses             271      222      558      434
 Other                                1,072      975    2,146    1,920
                                    ----------------------------------
       Total                          2,815    2,670    5,565    5,275
                                    ----------------------------------

Income before income tax and
 minority interest                    1,107      847    1,969    1,910
                                    ----------------------------------

  Income tax expense                    340      256      593      592
  Minority interest                     256      169      456      335
                                    ----------------------------------
       Total                            596      425    1,049      927
                                    ----------------------------------

Income from continuing operations       511      422      920      983
Discontinued operations:
    Results of operations               170      232      343      439
    Gain on disposal (b)              4,282             4,362
                                    ----------------------------------

Net income                          $ 4,963  $   654  $ 5,625  $ 1,422
                                    ==================================

Net income attributable to:
  Loews common stock:
       Income from continuing
        operations                  $   511  $   422  $   920  $   983
       Discontinued operations, net   4,348       91    4,494      180
                                    ----------------------------------
  Loews common stock                  4,859      513    5,414    1,163
  Carolina Group stock -
   Discontinued operations              104      141      211      259
                                    ----------------------------------
                                    $ 4,963  $   654  $ 5,625  $ 1,422
                                    ==================================

Income per share of Loews common
 stock:
  Income from continuing operations $  1.00  $  0.78  $  1.77  $  1.82
  Discontinued operations, net         8.54     0.17     8.64     0.33
                                    ----------------------------------
  Diluted net income                $  9.54  $  0.95  $ 10.41  $  2.15
                                    ==================================

Diluted net income per share of
 Carolina Group stock
  - Discontinued operations         $  0.96  $  1.30  $  1.95  $  2.39
                                    ==================================

Weighted diluted number of shares:
  Loews common stock                 509.43   537.50   520.17   540.01
  Carolina Group stock               108.60   108.56   108.60   108.54

(a) Includes a gain of $142 ($92 after tax), for the six months ended
     June 30, 2007, 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.
(b) Includes a tax-free non-cash gain of $4,287 related to the
     Separation for the three and six months ended June 30, 2008 and
     an after tax gain of $75 from the sale of Bulova Corporation for
     the six months ended June 30, 2008.

Loews Corporation and Subsidiaries
Additional Financial Information
                                                  June 30,
                                       -------------------------------
                                        Three Months     Six Months
                                       -------------------------------
                                        2008     2007   2008    2007
                                       -------------------------------
                                                (In millions)
Revenues:
  CNA Financial                        $2,432  $2,608  $4,765  $5,146
  Diamond Offshore                        970     661   1,762   1,280
  HighMount                               201             390
  Boardwalk Pipeline                      206     159     419     349
  Loews Hotels                            105     100     202     195
  Investment income, net                  117      93     156     205
                                       -------------------------------
                                        4,031   3,621   7,694   7,175
                                       -------------------------------
Investment gains (losses):
  CNA Financial                          (111)   (139)   (162)   (160)
  Corporate and other (a)                   2      35       2     170
                                       -------------------------------
                                         (109)   (104)   (160)     10
                                       -------------------------------
       Total                           $3,922  $3,517  $7,534  $7,185
                                       ===============================

Income Before Taxes and Minority
 Interest:
  CNA Financial                        $  367  $  471  $  684  $  930
  Diamond Offshore                        590     351     995     660
  HighMount                                76             151
  Boardwalk Pipeline                       64      36     153     116
  Loews Hotels                             32      22      50      40
  Investment income, net                  117      93     156     205
  Other (b)                               (30)    (22)    (60)    (51)
                                       -------------------------------
                                        1,216     951   2,129   1,900
                                       -------------------------------
  Investment gains (losses):
    CNA Financial                        (111)   (139)   (162)   (160)
    Corporate and other (a)                 2      35       2     170
                                       -------------------------------
                                         (109)   (104)   (160)     10
                                       -------------------------------
         Total                         $1,107  $  847  $1,969  $1,910
                                       ===============================

Net Income:
  CNA Financial                        $  227  $  285  $  427  $  560
  Diamond Offshore                        194     118     330     225
  HighMount                                48              95
  Boardwalk Pipeline (c)                   28      16      67      55
  Loews Hotels                             19      14      30      25
  Investment income, net                   77      62     102     133
  Other (b)                               (18)    (15)    (38)    (32)
                                       -------------------------------
                                          575     480   1,013     966
                                       -------------------------------
  Investment gains (losses):
         CNA Financial                    (65)    (81)    (94)    (93)
         Corporate and other (a)            1      23       1     110
                                       -------------------------------
                                          (64)    (58)    (93)     17
                                       -------------------------------

  Income from continuing operations       511     422     920     983
  Discontinued operations, net (d)      4,348      91   4,494     180
                                       -------------------------------
  Loews common stock                    4,859     513   5,414   1,163
  Carolina Group stock - Discontinued
   operations                             104     141     211     259
                                       -------------------------------
              Total                    $4,963  $  654  $5,625  $1,422
                                       ===============================

(a) Includes a gain of $142 ($92 after tax), for the six months ended
     June 30, 2007, 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.
(b) Consists primarily of corporate interest expense and other
     unallocated expenses.
(c) Represents a 70.3%, 74.8%, 70.3% and 77.1% ownership interest in
     Boardwalk Pipeline for the respective periods.
(d) Includes a tax-free non-cash gain of $4,287 related to the
     Separation for the three and six months ended June 30, 2008 and
     an after tax gain of $75 from the sale of Bulova Corporation for
     the six months ended June 30, 2008.

SOURCE: Loews Corporation

Loews Corporation
Peter W. Keegan, 212-521-2950
Chief Financial Officer
or
Darren Daugherty, 212-521-2788
Investor Relations
or
Candace Leeds, 212-521-2416
Public Affairs