Exhibit 99.1
Contact: Peter W. Keegan
Senior Vice President
(212) 521-2950
Candace Leeds
V.P. of Public Affairs
(212) 521-2416
Joshua E. Kahn
Investor Relations
(212) 521-2788
FOR IMMEDIATE RELEASE
- ---------------------
LOEWS CORPORATION REPORTS
-------------------------
NET INCOME FOR THE FIRST QUARTER OF 2004
----------------------------------------
NEW YORK, April 29, 2004-Loews Corporation (NYSE:LTR;CG) today reported
consolidated net income (including both the Loews Group and Carolina Group)
for the 2004 first quarter of $43.6 million, compared to $190.0 million in the
2003 first quarter. Income before net investment losses attributable to Loews
common stock amounted to $286.2 million in the first quarter of 2004 compared
to $218.3 million in the comparable 2003 quarter. Net income attributable to
Loews common stock includes net investment losses of $277.0 million (after tax
and minority interest) due primarily to an impairment loss of $368.3 million
(after tax and minority interest) for CNA's planned sale of its individual
life insurance business, compared to net investment losses of $56.6 million
(after tax and minority interest) in the comparable period of the prior year.
The life business sale is expected to provide additional statutory capital of
approximately $500.0 million to CNA.
Results for 2004 reflect improved underwriting performance for the property
and casualty operations of CNA Financial, the Company's 91% owned subsidiary,
and income contribution from Texas Gas, which was acquired in May of 2003.
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,
2004 2003
----------------------------
(In millions, except per share data)
<s> <c> <c>
Net income attributable to Loews common stock:
Income before net investment losses $ 286.2 $ 218.3
Net investment losses (a) (277.0) (56.6)
----------------------------
Income from continuing operations 9.2 161.7
Discontinued operations-net - (0.3)
----------------------------
Net income attributable to Loews common stock 9.2 161.4
Net income attributable to Carolina Group stock 34.4 28.6
----------------------------
Consolidated net income $ 43.6 $ 190.0
============================
Net income per share:
Loews common stock $ 0.05 $ 0.87
Carolina Group stock $ 0.59 $ 0.72
Page 1 of 5
(a) Includes an impairment loss of $368.3 (after tax and minority interest) in
2004 related to CNA's planned sale of its individual life insurance business.
Net income attributable to Loews common stock for the first quarter of 2004
amounted to $9.2 million or $0.05 per share, compared to $161.4 million or
$0.87 per share in the comparable period of the prior year.
Net income attributable to Carolina Group stock for the first quarter of
2004 was $34.4 million or $0.59 per Carolina Group share, compared to $28.6
million, or $0.72 per Carolina Group share in the first quarter of 2003. The
Company is issuing a separate press release reporting the results of the
Carolina Group for the quarter ended March 31, 2004 and 2003.
Consolidated revenues in the first quarter of 2004 amounted to $3.5 billion
compared to $3.9 billion in the comparable 2003 quarter. The decline in
revenues reflects CNA's sale of its Group Benefits business and the impact of
the planned sale of the individual life insurance business.
# # #
At March 31, 2004, the book value per share of Loews common stock was
$61.23, compared to $60.92 at December 31, 2003.
At March 31, 2004, there were 185,486,300 shares of Loews common stock
outstanding and 57,966,750 shares of Carolina Group stock outstanding.
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.
The Company has two classes of common stock, 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 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. At March 31, 2004, the outstanding Carolina Group stock represents a
33.43% economic interest in the economic performance of the Carolina Group.
A conference call to discuss the first quarter results of Loews Corporation
has been scheduled for 11:00 a.m. EDT, Thursday, April 29, 2004. A live
broadcast 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
of the conference call should dial (877) 692-2592. An online replay will be
available at the Company's website following the call.
A conference call to discuss the first quarter results of CNA has been
scheduled for 10:00 a.m. EDT, Thursday, April 29, 2004. A live broadcast of
the call will be available online at the CNA website
(http://investors.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 of the conference call should dial (800) 474-8920. An online replay
will be available at CNA's website following the call.
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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 and CNA. 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.
Page 3 of 5
Loews Corporation and Subsidiaries
Financial Review
Three Months Ended March 31,
----------------------------
2004 2003(a)
----------------------------
(Amounts in millions,
except per share data)
<s> <c> <c>
Revenues:
Insurance premiums and net investment income (b) $ 2,244.4 $ 2,741.2
Manufactured products (c) 808.2 884.0
Other 438.6 320.6
----------------------------
Total 3,491.2 3,945.8
----------------------------
Expenses:
Insurance claims & policyholders' benefits 1,620.3 1,869.8
Cost of manufactured products sold (c) 487.5 481.2
Other (d) 1,305.2 1,312.4
----------------------------
Total 3,413.0 3,663.4
----------------------------
78.2 282.4
----------------------------
Income tax expense 45.4 93.1
Minority interest (10.8) (1.0)
----------------------------
Total 34.6 92.1
----------------------------
Income from continuing operations 43.6 190.3
Discontinued operations-net - (0.3)
----------------------------
Net income $ 43.6 $ 190.0
============================
Net income attributable to:
Loews common stock:
Income from continuing operations $ 9.2 $ 161.7
Discontinued operations-net - (0.3)
----------------------------
Loews common stock 9.2 161.4
Carolina Group stock (e) 34.4 28.6
----------------------------
$ 43.6 $ 190.0
============================
Income per share of Loews common stock (f)
Income from continuing operations $ 0.05 $ 0.87
Discontinued operations - -
----------------------------
Net income $ 0.05 $ 0.87
============================
Net income per share of Carolina Group stock (f) $ 0.59 $ 0.72
============================
Weighted number of shares outstanding:
Loews common stock 185.47 185.45
Carolina Group stock 57.97 39.91
(a) Amounts have been reclassified to discontinued operations as a result of the sale of a
hotel property in 2003.
(b) Includes investment losses of $416.2 (including an impairment loss of $565.9 related to
CNA's planned sale of its individual life insurance business) and $95.6 for the respective
periods.
(c) Includes excise taxes of $156.1 and $156.9 paid on sales of manufactured products for the
respective periods.
(d) Includes a $28.0 charge ($17.1 after taxes) in 2003 to resolve indemnification claims and
trademark matters in connection with the 1977 sale by Lorillard of its international
business.
(e) Represents 33.43% and 23.01% of the economic interest in the Carolina Group for the three
months ended March 31, 2004 and 2003.
(f) Earnings per common share-assuming dilution is not presented because securities that could
potentially dilute basic earnings per common share in the future would have been
insignificant or antidilutive for the periods presented.
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Loews Corporation and Subsidiaries
Additional Financial Information
Three Months Ended March 31,
----------------------------
2004 2003
----------------------------
(In millions)
<s> <c> <c>
Revenues:
CNA Financial $ 2,722.6 $ 2,921.6
Lorillard (a) 775.7 851.9
Loews Hotels 80.7 73.0
Diamond Offshore 185.9 152.0
Texas Gas 86.0 -
Investment income-net and other (b) 56.5 42.9
----------------------------
3,907.4 4,041.4
----------------------------
Investment (losses) gains:
CNA Financial (c) (455.0) (76.1)
Corporate and other 38.8 (19.5)
----------------------------
(416.2) (95.6)
----------------------------
Total $ 3,491.2 $ 3,945.8
============================
Income Before Taxes:
CNA Financial $ 289.1 $ 184.1
Lorillard (e) (f) 152.4 203.9
Loews Hotels 11.3 8.5
Diamond Offshore (16.1) (28.8)
Texas Gas 43.1 -
Investment income-net and other (b) (d) (41.8) (36.8)
----------------------------
438.0 330.9
----------------------------
Investment (losses) gains:
CNA Financial (c) (455.0) (76.1)
Corporate and other 38.8 (19.2)
----------------------------
(416.2) (95.3)
----------------------------
Loews common stock 21.8 235.6
Carolina Group stock (g) 56.4 46.8
----------------------------
Total $ 78.2 $ 282.4
============================
Net Income:
CNA Financial $ 194.2 $ 123.4
Lorillard (e) (f) 93.0 124.8
Loews Hotels 6.9 5.4
Diamond Offshore (6.9) (12.1)
Texas Gas 26.0 -
Investment income-net and other (b) (d) (27.0) (23.2)
----------------------------
286.2 (218.3)
----------------------------
Investment (losses) gains:
CNA Financial (c) (302.2) (43.9)
Corporate and other 25.2 (12.7)
----------------------------
(277.0) (56.6)
----------------------------
Income from continuing operations 9.2 161.7
Discontinued operations-net - (0.3)
----------------------------
Loews common stock 9.2 161.4
Carolina Group stock (g) 34.4 28.6
----------------------------
Total $ 43.6 $ 190.0
============================
(a) Includes excise taxes of $156.1 and $156.9 paid on sales of manufactured products for the
respective periods.
(b) Consists primarily of corporate investment income, interest expenses, the operations of
Bulova Corporation and other unallocated expenses.
(c) Includes an impairment loss of $565.9 ($368.3 after tax and minority interest) related to
CNA's planned sale of its individual life insurance business for the three months ended
March 31, 2004.
(d) Includes additional interest expense of $17.0 ($11.1 after taxes) for the the three months
ended March 31, 2004 related to charges from the April 12, 2004 early redemption of $300.0
principal amount of the Company's 7.625% notes.
(e) The Loews Group's intergroup interest in the earnings of the Carolina Group declined from
76.99% in 2003 to 66.57% in 2004 due to the sale of Carolina Group stock by Loews in
November of 2003.
(f) Includes a $28.0 charge ($17.1 after taxes) in 2003 to resolve indemnification claims and
trademark matters in connection with the 1977 sale by Lorillard of its international
business.
(g) Represents 33.43% and 23.01% of the economic interest in the Carolina Group for the three
months ended March 31, 2004 and 2003.
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