UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Date of Report (Date of earliest event reported)
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July 29, 2013
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LOEWS CORPORATION
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(Exact name of registrant as specified in its charter)
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Delaware
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1-6541
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13-2646102
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(State or other jurisdiction
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(Commission
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(I.R.S. Employer
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of incorporation)
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File Number)
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Identification No.)
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667 Madison Avenue, New York, N.Y.
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10065-8087
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code:
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(212) 521-2000
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NOT APPLICABLE
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(Former name or former address, if changed since last report.)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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[ ]
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4(c))
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1
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Item 2.02
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Results of Operations and Financial Condition.
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On July 29, 2013, Registrant issued a press release for Loews Corporation providing information on its results of operations for the second quarter of 2013. The press release is furnished as Exhibit 99.1 to this Form 8-K.
The information under Item 2.02 and in Exhibit 99.1 in this Current Report is being furnished and shall not be deemed “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information under Item 2.02 and in Exhibit 99.1 in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
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Item 9.01
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Financial Statements and Exhibits.
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(a)
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Not applicable.
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(b)
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Not applicable.
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(c)
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Exhibit:
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Exhibit Reference
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Number
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Exhibit Description
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99.1
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Loews Corporation press release, issued July 29, 2013, providing information on second quarter results of operations for 2013.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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LOEWS CORPORATION
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(Registrant)
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Dated: July 29, 2013
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By:
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/s/ Gary W. Garson
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Gary W. Garson
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Senior Vice President
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General Counsel
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and Secretary
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Exhibit 99.1
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Contact:
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Peter W. Keegan
Chief Financial Officer
(212) 521-2950
Mary Skafidas
Investor and Public Relations
(212) 521-2788
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NEWS RELEASE
LOEWS CORPORATION REPORTS
NET INCOME OF $269 MILLION FOR THE SECOND QUARTER OF 2013
NEW YORK, July 29, 2013—Loews Corporation (NYSE:L) today reported net income for the 2013 second quarter of $269 million, or $0.69 per share, compared to $56 million, or $0.14 per share, in the 2012 second quarter. Net income for the second quarter of 2012 includes an after tax non-cash impairment charge of $142 million at HighMount Exploration & Production LLC related to the carrying value of its natural gas and oil properties. Excluding this impairment charge, net income (non-GAAP) for the second quarter of 2012 was $198 million.
Net income for the six months ended June 30, 2013 was $511 million, or $1.31 per share as compared to $423 million, or $1.06 per share in the prior year period. Net income for the six months ended June 30, 2013 and 2012 includes after tax non-cash ceiling test impairment charges of $92 million and $170 million at HighMount. Excluding these non-cash impairment charges, net income (non-GAAP) for the six months ended June 30, 2013 and 2012 was $603 million and $593 million.
Book value per share excluding Accumulated other comprehensive income (AOCI) increased to $49.26 at June 30, 2013 from $47.42 at June 30, 2012 and $47.94 at December 31, 2012.
CONSOLIDATED HIGHLIGHTS
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June 30,
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Three Months
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Six Months
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(In millions, except per share data)
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2013
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2012
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2013
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2012
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Income before net investment gains (losses) and impairment charges
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$ | 277 | $ | 186 | $ | 597 | $ | 562 | ||||||||
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Non-cash ceiling test impairment charges
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(142 | ) | (92 | ) | (170 | ) | ||||||||||
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Net investment gains (losses)
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(8 | ) | 12 | 6 | 31 | |||||||||||
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Net income attributable to Loews Corporation
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$ | 269 | $ | 56 | $ | 511 | $ | 423 | ||||||||
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Net income per share
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$ | 0.69 | $ | 0.14 | $ | 1.31 | $ | 1.06 | ||||||||
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June 30,
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Year Ended | ||||||||||
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2013
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2012
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December 31, 2012 |
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Book value per share
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$ | 49.36 | $ | 49.31 | $ | 49.67 | |||||
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Book value per share (excluding AOCI)
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49.26 | 47.42 | 47.94 | ||||||||
Page 1 of 5
Three Months Ended June 30, 2013 Compared to 2012
Income before net investment gains (losses) and impairment charges increased in 2013 as compared to 2012. This increase is primarily due to higher earnings at CNA and improved investment income at the parent company. These increases were partially offset by lower earnings at Diamond Offshore Drilling, Inc.
CNA’s earnings increased primarily from higher net investment income due to increased limited partnership results and improved non-catastrophe current accident year underwriting results. These increases were partially offset by lower favorable net prior year development and reduced results from the Life & Group Non-Core segment as a result of unfavorable morbidity in the long term care business.
Diamond Offshore’s earnings decreased primarily as a result of a prior year gain of $23 million (after tax and noncontrolling interests) from the sale of five jack-up rigs partially offset by higher dayrates and utilization as well as lower contract drilling expense in 2013, primarily reflecting reduced mobilization costs.
Six Months Ended June 30, 2013 Compared to 2012
Income before net investment gains and impairment charges increased in 2013 as compared to 2012. The increase is primarily due to the reasons discussed in the three month comparison above for CNA and the parent company. Diamond Offshore’s earnings decreased primarily as a result of a prior year gain of $32 million (after tax and noncontrolling interests) from the sale of six jack-up rigs and lower utilization in 2013 partially offset by higher dayrates.
SHARE REPURCHASES
At June 30, 2013, there were 388.0 million shares of Loews common stock outstanding. During the three and six months ended June 30, 2013, the Company purchased 1.9 million and 4.0 million shares of its common stock at an aggregate cost of $85 million and $177 million. From July 1, 2013 to July 25, 2013, the Company repurchased an additional 0.8 million shares of its common stock at an aggregate cost of $37 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 11:00 a.m. ET, today. A live webcast of the call will be available online at the Loews Corporation website at 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 11582722. 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 10:00 a.m. ET, 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) 427-9376, or for international callers, (719) 457-2645. Please go to the website at least ten minutes before the event begins to register and to download and install any necessary audio software.
Page 2 of 5
A conference call to discuss the second quarter results of Boardwalk Pipeline has been scheduled for 9:00 a.m. ET, today. A live webcast will be available at www.bwpmlp.com. Those interested in participating in the question and answer session should dial (866) 515-2908 or for international callers, (617) 399-5122. The conference ID number is 64121897. 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 second quarter results of Diamond Offshore was held on Thursday, July 25, 2013. An online replay is available on Diamond Offshore’s website at 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 53% owned subsidiary; HighMount Exploration & Production LLC, a wholly owned subsidiary; and Loews Hotels, a wholly owned subsidiary.
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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 at 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.
Page 3 of 5
Loews Corporation and Subsidiaries
Selected Financial Information
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June 30,
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(In millions)
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Three Months
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Six Months
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2013
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2012
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2013
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2012
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Revenues:
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CNA Financial
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$ | 2,507 | $ | 2,224 | $ | 4,986 | $ | 4,593 | ||||||||
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Diamond Offshore (a)
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760 | 793 | 1,492 | 1,589 | ||||||||||||
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Boardwalk Pipeline
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304 | 277 | 633 | 591 | ||||||||||||
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HighMount
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66 | 69 | 134 | 145 | ||||||||||||
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Loews Hotels
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101 | 94 | 195 | 174 | ||||||||||||
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Investment income (loss) and other
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1 | (89 | ) | 9 | (12 | ) | ||||||||||
| 3,739 | 3,368 | 7,449 | 7,080 | |||||||||||||
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Investment gains (losses):
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CNA Financial
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(14 | ) | 22 | 10 | 54 | |||||||||||
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Corporate and other
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(2 | ) | (2 | ) | ||||||||||||
| (14 | ) | 20 | 10 | 52 | ||||||||||||
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Total
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$ | 3,725 | $ | 3,388 | $ | 7,459 | $ | 7,132 | ||||||||
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Income (Loss) Before Income Tax:
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CNA Financial
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$ | 292 | $ | 211 | $ | 632 | $ | 545 | ||||||||
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Diamond Offshore (a)
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257 | 246 | 462 | 498 | ||||||||||||
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Boardwalk Pipeline
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67 | 66 | 166 | 158 | ||||||||||||
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HighMount
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Operations
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9 | 5 | 15 | 15 | ||||||||||||
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Ceiling test impairment charge
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(222 | ) | (145 | ) | (266 | ) | ||||||||||
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Loews Hotels
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2 | 11 | 2 | 18 | ||||||||||||
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Investment income (loss), net
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1 | (85 | ) | 8 | (9 | ) | ||||||||||
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Other (b)
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(33 | ) | (38 | ) | (57 | ) | (56 | ) | ||||||||
| 595 | 194 | 1,083 | 903 | |||||||||||||
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Investment gains (losses):
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CNA Financial
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(14 | ) | 22 | 10 | 54 | |||||||||||
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Corporate and other
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(2 | ) | (2 | ) | ||||||||||||
| (14 | ) | 20 | 10 | 52 | ||||||||||||
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Total
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$ | 581 | $ | 214 | $ | 1,093 | $ | 955 | ||||||||
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Net Income (Loss) Attributable to Loews Corporation:
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CNA Financial
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$ | 183 | $ | 138 | $ | 395 | $ | 345 | ||||||||
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Diamond Offshore (a)
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87 | 94 | 169 | 181 | ||||||||||||
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Boardwalk Pipeline (c)
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22 | 25 | 55 | 60 | ||||||||||||
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HighMount
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Operations
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5 | 3 | 9 | 9 | ||||||||||||
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Ceiling test impairment charge
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(142 | ) | (92 | ) | (170 | ) | ||||||||||
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Loews Hotels
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1 | 6 | 1 | 10 | ||||||||||||
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Investment income (loss), net
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1 | (56 | ) | 6 | (6 | ) | ||||||||||
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Other (b)
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(22 | ) | (24 | ) | (38 | ) | (37 | ) | ||||||||
| 277 | 44 | 505 | 392 | |||||||||||||
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Investment gains (losses):
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CNA Financial
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(8 | ) | 13 | 6 | 32 | |||||||||||
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Corporate and other
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(1 | ) | (1 | ) | ||||||||||||
| (8 | ) | 12 | 6 | 31 | ||||||||||||
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Net income attributable to Loews Corporation
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$ | 269 | $ | 56 | $ | 511 | $ | 423 | ||||||||
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(a)
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Includes a $51 million gain ($23 million after tax and noncontrolling interests) and a $76 million gain ($32 million after tax and noncontrolling interests) for the three and six months ended June 30, 2012 related to the sale of jack-up rigs.
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(b)
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Consists primarily of corporate interest expense and other unallocated expenses.
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(c)
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Represents a 54.3% , 61.2%, 54.9% and 61.5% ownership interest in Boardwalk Pipeline for the respective periods.
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Page 4 of 5
Loews Corporation and Subsidiaries
Consolidated Financial Review
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June 30,
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(In millions, except per share data)
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Three Months
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Six Months
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2013
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2012
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2013
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2012
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Revenues:
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Insurance premiums
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$ | 1,800 | $ | 1,668 | $ | 3,564 | $ | 3,317 | ||||||||
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Net investment income
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579 | 386 | 1,220 | 1,112 | ||||||||||||
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Investment gains (losses)
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(14 | ) | 20 | 10 | 52 | |||||||||||
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Contract drilling revenues
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745 | 726 | 1,445 | 1,481 | ||||||||||||
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Other
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615 | 588 | 1,220 | 1,170 | ||||||||||||
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Total
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3,725 | 3,388 | 7,459 | 7,132 | ||||||||||||
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Expenses:
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Insurance claims & policyholders’ benefits
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1,521 | 1,348 | 2,950 | 2,729 | ||||||||||||
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Contract drilling expenses
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369 | 405 | 744 | 802 | ||||||||||||
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Other (a)
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1,254 | 1,421 | 2,672 | 2,646 | ||||||||||||
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Total
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3,144 | 3,174 | 6,366 | 6,177 | ||||||||||||
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Income before income tax
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581 | 214 | 1,093 | 955 | ||||||||||||
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Income tax expense
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(169 | ) | (16 | ) | (283 | ) | (238 | ) | ||||||||
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Net income
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412 | 198 | 810 | 717 | ||||||||||||
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Amounts attributable to noncontrolling interests
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(143 | ) | (142 | ) | (299 | ) | (294 | ) | ||||||||
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Net income attributable to Loews Corporation
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$ | 269 | $ | 56 | $ | 511 | $ | 423 | ||||||||
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Diluted income per share attributable to Loews
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Corporation
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$ | 0.69 | $ | 0.14 | $ | 1.31 | $ | 1.06 | ||||||||
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Weighted diluted number of shares
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389.62 | 397.13 | 390.88 | 397.30 | ||||||||||||
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(a)
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Includes non-cash impairment charges of $222 million ($142 million after tax) for the three months ended June 30, 2012 and $145 million and $266 million ($92 million and $170 million after tax) for the six months ended June 30, 2013 and 2012 related to the carrying value of HighMount's natural gas and oil properties.
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Page 5 of 5