L - Earnings call transcript Q2 2021

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Loews Corporation Second Quarter 2021 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator instructions] I will now turn the call over to Mary Skafidas. Please go ahead.

Mary Skafidas

and everyone. (ph), Crystel you, good morning, Thank Welcome Corporation's Second Conference Call. Quarter Earnings to Loews our Earnings Edelson. On Earnings Overview of Chief Chief copy A Release, Tisch, Jim found morning, have and our Executive this Officer, may Officer, Supplement, on website call loews.com David the Financial we our be Company and

with Shareholder s. Following our we morning, from this will have questions prepared remarks a question-and-answer session

nature. that implied Actual those that begin, achieved this remind conference risks are including set however, forward-looking to include might made forward-looking and we Company in Before the those of due you forth statements results from by wide filings. may in I call materially our range in a uncertainties, statements will differ any or SEC

they're time with Company's made. or statements a statutory the at disclaimer, The to expressly brief Company's is any disclaimer circumstances the reflect any summary included statements revise filing is disclaims update Forward-looking the which statements. SEC. obligation forward-looking This only the Company of Forward-looking in

the reconciliation over During security CEO. supplement turn I'd call might earnings to financial Tisch, non-GAAP Jim you. comparable with filings to discuss for Please like also refer Jim, the measures. measures. over With our most the GAAP that, today, our to to to call we

Jim Tisch

led Thank strong CNA some group from as with the good effects remarks to Loews markets. quarter flows. benefit we're pack back good especially and you, today going Hotels. resort smartly, strong CNA great continues from our morning. gas from board focus to And subsidiaries. recovering Mary, bounced with and business and across Loews the performances see of to the on on Loews still the of I'm my has pandemic, a had while consolidated well. starting the from Boardwalk pickup natural each Hotels, results

a of CNA million for be the success this Second in the Quarter CNA, of had story for continues $XXX Company income year. net a As Loews. to almost

interest fixed The combined also of business recorded by XX% almost more generated increases quarter. a points the by past great CNA decreased income underlying gross prior compared Company's by XX 's ratio. an X% Income quarterly second-highest to quarter. in driven Company XX% expense Hotels from consistent of context the interest growth a in and hospitality months, income driven lower million income over that years. partnerships the Limited year's in the of growth from the even the for Headwinds subsidiary P&C had year's story were travel improvement and of was of to pandemic new pre-tax, Earnings to said, the truly has see Company success devastated is a group for hotel strong. industry. leisure other few Hotels over portfolio rate increased CNA on our demand improving Loews see last within and continues its provide environment. comeback the the being continued It's words, end, to And premium by written had core ratio In COVID-XX. with by rate quarter, net global most record-high the results the million that investment $XXX importantly, its 's That no net business starting The secret travel. quarter. CNA the prior in the $XXX Loews the quarter had X affected for

For during as XX% were joint XX% venture the for about of opposed this year. almost owned hotels Quarter, and total First to Quarter rates Second the occupancy

a we ways obviously, While before still hit occupancy have a big to jump, pre-pandemic we go rates. is that

challenges, open that the by for of every in each to hotels facing of good urban at our and is filling Our settings. the one resort better hotels than continue news property Quarter, while level. the properties roles considered to considerably end was do the All-in-all, Second business, -- albeit our

As be firmly the for once growth believe we Loews that Loews industry engine their Hotels again economy will and U.S. a the continue Corp. recovery, hotel

also Our in confidence Long-term in but only the Growth its Hotel Company is in a belief, our reflection strategy. management its of not

that pillars. strategy reminder, Growth built is on a As X

is the core of pillar attractive with of and are keys to offer pillar Hotels experiences. reputation first space. ample Hotels. XXX+ meeting These local have first equally hotels takes that The business unique customers cater leisure to Loews groups. advantage ' well-earned Loews This properties operating that for

operating is its Orlando, concentration a The Universal associated second partnership of than of hotels' destinations. the X spans example of this growth pillar decades, great and immersive pillar. strength with hotels on is with strategy developing which Its more

As stadium the rooms or is the -- a on hotels had to attractions. end And were well other on properties a Loews Universal One venues entertainment that the proved which Orlando X adding as Loews sports throughout such quite Hotels located performing the concentrated of built-in during adjacent in that hotel an Live! of resilient Campus. destinations rooms is Pandemic year. throw hotel as X away the from is X,XXX Arlington, stadiums, of be Resort as and Orlan Hotels sports of Second such Texas, Texas some draw generator, has stone's for by customers all the presence Loews immersive open demand in the because professional well. where Quarter, of demand more the strong

and generally is the result, when Industry in developers full-service these and and when owner Hotels great to there owner both in a functions. so. of will exacting to participate we is do niche the Loews the its partner. companies most development Loews financing Hotels operator within space leader order to continue Hotels available allow it hotel served the and "owner," not this dynamics operator phase is the differentiator a And to in very both to for in our for generally properties. well, say believe be Another market, I standards. owner perform Currently, mean we can has as do the the playing space. Loews to It's its design for hotel build of the little a I strengths significant And hotel ability hotel

development distinct when competing gives advantage for a As Hotels a Loews being attractive projects. result, well-capitalized a owner-operator

subsidiaries, As always, we the Loews strategy And alongside Corporation best growth believe create it's shareholders. value. which investment Loews Hotels interest is in ' long-term that -- in will invests of certainly our when our our

of let Year-to-date, Finally, for on million. me From we April Xst outstanding update $XXX bought you briefly of X.X Friday, shares over million. back for share last just common through shares million stock repurchases. $XXX repurchased X.X% our we've Loews

Loews its intrinsic said, that As view I've of still to often our trades a value. we discount believe significant at

itself. call over to share let me the let to continue speak And we'll hand that, So our repurchase with David. for activity

David Edelson

good Jim, and you, Thank morning, everyone.

million second the million $X.XX Net second per share Net or a compared Loews quarter, For reported Income in a of XXX XXX to Loss last year's quarter. share per or of $X.XX

of As Boardwalk, quarters. Jim commented, our operating had CNA by second-quarter both which were and stellar results excellent, driven

its Loews strongly a loss, business rebounded post properties. expected, highly did has its than While especially at Hotels resort more desirable

in contrast QX mainly the Second CNA let QX generated unrealized gain this partnership to in by quick booked X charge. earlier Call tax point a the XXXX. Second after-tax. losses limited earned Our XX% salient highlight net year of and unrest, X $XXX income improvement year's quarter. retained points $XXX property-casualty net underwriting materially investment year's GAAP Second and Quarter. 's Absent losses the gain million to in were investment you catastrophe main on higher Quarter includes will Quarter before A items. over in catastrophe our sale X elevated $XXX bankruptcy before this the an XX lower loss million net included which appreciation related increase Net XX% million included net 'XX. In the and combination was and CNA $XXX year-over-year of from premium year of COVID, both losses XXXX income this for unusual deconsolidation Boardwalk, I were ratio returns CNA Earnings year investment aside $XXX XX investments. This level The in increase concurrent were in Setting were more weather-related impacted the CNA on investment which the to Last catastrophe Packaging. from CNA CNA catastrophe lower development, unusual second-quarter review million improved million, in year's XXX civil these led a The drivers of transcript the by year last and of at Diamond a to ratio, net excludes XXXX Last recorded investment pre-tax Net with $XXX underlying to stake on moment, and Net XX% underwriting X details the Catastrophe increase I prior modest and CNA, increase contributions, underlying leading on million in items, In and in and Altium which losses net higher than to on income development. by the for all-in of reserves driven totalled CNA year-over-year million underlying last meantime, 's premium. from and written the a contributed underwriting pre-tax, The almost items, investment higher year. by billion to of consolidated Income the few in of combined describe $X.X Income well losses year. unusual morning, the were our quarter and a rebounded losses its 's gains a million up subsidiaries, essentially shares The portfolio 's year gain, this higher Hotels, $XXX these year-over-year year-over-year as and me QX an results Quarter combined would XX% contrast, income. QX Loews sum events. Net This stake. catastrophe XX.X loss the points. as prior-year a of higher Offshore. QX comment prior XXX.X XX its income, in million encourage in Quarter sold and Second had is all tax on our realized gain after-tax our of included in

year-over-year quarter's and term, $XX.X approximately recorded a $XX.X catch-up a Shareholder's well of segment. consolidated billion. of the equity the added during CNA property net policies was policies property quota premium property-casualty XX%, already premium the attributable in CNA to written premium CNA the declined across written a The program XX% and Because the 's Quarter. with in by that reduced rose commercial. premium commercial ended enforced, one-time $XXX reinsurance quarter While as billion, during written cover in of treaty treaty will as decline net $XX billion, earned CNA its a surplus the to written net predominantly written premium treaty Second share overall all statutory total assets X% segments million

Net million Turning operating gas X a to months, in by utilization up 'XX. transportation million year-over-year driven revenue. throughput increase The QX by higher gas and to more projects main net placed revenue caused Boardwalk. XX% Boardwalk plants. LNG was X% from power markets contributed the $XX Through of year-over-year. Income than Boardwalk's increase natural in was of in $XX system recently and deliveries largely by higher growth by service, increased natural transportation driver

Loews as by in were million from leisure non-recurring a loss contributed quarter-end. resort properties Loews is QX and of year-over-year our EBITDA, XX Hotels. a in $XX net the driven a operational properties was at positive were excludes by defined and most to QX net loss opened all million quarter increased travel. Hotels $XX year increase, properties Turning last 'XX. in XX dramatic million, rebounded dramatic for from loss supplement Business XXXX. especially million improvement revenue The a full a benefited Adjusted from posted improvement earnings the items, to which

for a revenue operating as operating Second net GAAP percentage. second operations included the similar Properties, backward, Looking from declined plummeted XXXX, quarter. difficult these exceedingly XXXX in Loews properties for at Company's of was the most XX% the Quarter which GAAP all quarter almost of the revenue, of suspended JV Hotels, revenue and not net is

Offshore in average filing and XX review year I segment daily Diamond a until late its since Loews I good to comment the it's improvement, a Page encourage bankruptcy snapshot regarding April of as which included available deconsolidation meaningful reporting steady occupancy, in A supplement, rate. believe shows of and our quick Diamond rooms, would last quarterly earnings operational For XXXX. We ' Offshore. QX you increases

Diamond. to Our results operating XXXX Quarter included attributable of net a loss Second million XX

corporate to been as Turning Altium since reported the Company the corporate has in segment we of segment. acquired the XXXX. part

equivalents. recovery year's of S&P of X.X write-off investments the the XX equity now equity about of emergence and parent under last year results bankruptcy deconsolidation with the Altium, parent of XXX earlier, unusual markets The Company's last its The sale year. method. million, upon segment billion also from the items of our to sale stemming of namely and equity bankruptcy. from the our pre-tax a a benefited investment pre-tax XX% it second to XXX million the I results at Portfolio the in XX%. Portfolio this quarter-end Last Diamond in Following investment quarter would cash loss generated the net returned a also Company's corporate XX% Diamond remains in stake in segment investment from XX% almost year stood stake, income quarter, cash I net in Offshore. a million net compared year's and XX a investment which a a note includes gain as significant in second-quarter but corporate accounted The at of related our for is and this investment that mentioned reflect

Jim we repurchased million XX from the in mentioned, stock for and during As CNA. Dividends million (ph) X.X received shares our about quarter, we XXX million of common

the million XXX common transaction about net million. from Altium another repurchased X.X After during quarter-end, received million shares we proceeds quarter. in our XXX second we addition, of In for stock the

last down June million stock more the common XXX now (ph). of shares I Loews approximately are As of than outstanding, to from back Mary will call XX, X% there hand XXXX. Friday,

Mary Skafidas

David. you, Thank

shareholders call, answer us send Every number questions on Earnings portion encourage questions Moving that we we quarter, the our a would Call. to to of in on shareholders. us to Q&A from they advance have the like of

to question Jim. is us first you for ' The Jim, give outlook can CNA? Loews

Jim Tisch

CNA's outlook is extremely bright.

and let's whole at industry step Let's as look a insurance take back the a first.

be are improving disciplined through interest continues high-quality it's to continues P&C While attracting is new rates selection and healthy. capital the underwriting management. to CNA low, P&C Overall, pricing. focused have risk business pricing and margins Industry

almost and forget, to shareholders X also the the Company team management paying professionals. Balance has top-notch billion Dividends even attract in $X is CNA's sheet, over its not The Let's years. Company a to fortress high-quality past after continues

past Additionally, exposure the active about X/X continues declining over CNA's to X with by policies care Long-term years. decrease

Triple we what Given believe cognizant of greatly Discount. ' CNA's we call outlook, strong performance and is the speaking undervalued. Loews shares, Company when undervalued of future buying And always we're the

briefly Let I explain what me mean.

intrinsic below their trade shares low of First, our view value.

undervalued Secondly, the at compared the And a industry. CNA P&C stock trades industry discount tends market. to P&C be the to to third,

Some revenue. growth Companies trade at XX times

and crazy at the than more directly dividends. Some And at of actual seems Based could net this trades value net Companies trade distributed XX-XX XXX Companies be times XX on P&C EBITDA. times S&P Industry But income. -- shareholders greater income, measly the income, at which a XX WTF. to XX net the form of earnings. to EBITDA undervaluation not fact, P&C even undervaluation to in CNA's me. trade XX That's times The some so.

Mary Skafidas

next will question us Company The Loews Corp. on over in the Hotels? cash an update from you How you, XXXX? give is Can Loews Okay. much Jim. Thank require to David.

David Edelson

Mary. Thanks,

the stated During new XX than from for projects, proceeds time, lower This our first-quarter expect Hotels first better at that call, earnings million earlier before of had million on than the that operating development outlook divestitures we to end of the Hotels cash Loews cash it than XX materially we we estimate or anticipated Loews was to flow less Loews given our year-to-date. At estimates, Hotels contributed contribute in revised XXXX. quarter. to considering expenditures

likely year, highlight, for cash parent we any second I contribute year, second in this proceeds Hotels outlook cash further Hotels from one additional the projects divestitures Company if of development Hotels before to in no would cash from required to would quarter. be reasons. Company new right Hotels. the Loews since Thanks, more Loews require that the XXXX to that, to the during development or in now again, all expenditures made on Mary. We of time that have the considering anticipate during half does on half not or the the contributions XXXX. close continued back additional We improve would significant Loews Loews and however, opportunities

Mary Skafidas

good Jim. potential question, the for which looking you, to Thank a hotel is you forward? Jim, time business And acquisitions? segue going thinking at David. how it Is the about next start are into

Jim Tisch

Loews you favourable long-term has an compare Hotels never by Hotels market advantage a immediately planners. attractive meeting full-service looking receives markets and -- renovating potential in the to stopped we for competitive on when dynamics, Loews product have both hotel doesn't to location, returns at modern with spaces a sense, not acquisitions. older however, current new hotels. acquiring Based offering economic new gain Many significantly existing hotel By developing make its leisure building own an appeals the new U.S. that or hotels. by guests a

X suit, our focus building properties keys we Hotels new last opposed By that or Portfolio to groups. both the years, Over pillars. developed to added with standards, hotels And XXX of already as hotels. near building generators. valuable demand to buying to cater than built-in to more strategy our developed one on own Loews that Hotels hotels exacting suit to growth has its by operate

other hotel such The rooms or as on built-in such XXXX, EBITDA to is XXXX was hotel the as From and The has the during Arlington local Loews Orlando venues. Hotel reputation unique a adjusted by to meetings from Arlington, destinations our Live! is Guests is to well-earned as $XXX demand resilient clearly strategy leisure for of has in be are entertainment we additional is healthy Loews proven groups, pillar again sports Hotels, for very is offer. once is engine to adjacent professional effects as ' pillar attractions. the locations with that with will precedence Company ' its the groups and of gained Texas the generators, term, these stadium the In Loews Loews attracted $XXX profitable in -- Loews subsidiary ground excellence Hotels Xnd margin. pursued the to hotel of XXXX, hospitality Hotels by first long pandemic. attractive an year focus Loews sports growth strong growth as market. of monitor a experience continue rooms. and also where almost customers. the Hotels because for under Loews industry, while where be certainly such well properties on The has destinations, Campus, grew a Studios eight X,XXX one hotels immersive very industry. the XXXX Hotels for located our immersive demand over near Universal challenging hotel pandemic Corp. and Loews Hotels the we believe for that the million just of numerous million growth In

Mary Skafidas

Thank trial? Jim. the for what next David. Great. of us the The status you, is give you David, is question can Boardwalk

David Edelson

Sure. on took XXXX, is judge Closing arguments the now deliberating. July place and XXth,

believe but to merit, case we plaintiff's at factual report legal we as that this is that there's without strong arguments have time. really litigation the more continue nothing we and very unpredictable. is inherently and We all know, And can

Mary Skafidas

Can next Thank outlook you Jim, for inflation Okay. rates? that David, for you, us question give the interest on your update. you. is

Jim Tisch

question, just interest rates So it. thoughtful Mary, the about response case the inflation. Such I to Call before with a than about prepare that getting nice as wing and the your the thing answer is rather can questions Earnings

Let's start inflation. with

both cycle the inflation. On what early be through I the Today, was common to are talked a seeing inflation. is the said when about and inflation today. that of we much was want used I speak That 'XXs inflation of days. term than demand-pull 'XXs it in I about the last Earnings cost-push these higher much, called Call, to forms And

to reinforcing As it higher that expectation for wages higher living. purchasing the prices demand imagine, rates their Those higher to wages making the then that hold you into economy. to demand producers can from standard the prices, such of relates for cycle a and That in employees for labor. takes inflation producers, of ask higher to causes of maintain dynamic the ever-increasing power an their prices for their higher costs which and wages thus products, translate increasing

begins that experience cycle of itself. feeds And what this upon is so believe today. are inflation I the to scarce. Talent we and beginning is cycle

number Packaging including Certain their the businesses, at Loews Hotel look find also Companies and for for Just of scarce. goods can its are that businesses. employees

aluminum, there jet a few -- polyethylene Dishwashers, shortage. CPI from XX% months inflation washing are An all yes, those gas, year are occasions, a the driers, soybeans, of in whose serious just year X in a ago. X.X%. more that The at than previous past lot. is of inflation more chips, X%. we course, risen up percent shortage pellets, coffee, Computer CRB core up the shot of refrigerators X market, By esteemed first of prices are that the the year. natural very and a that than Here because very, on the is core economist for CPI year, by time at Raw on than track have already measure, mine is up Index labor this friend this XX% XX%, [Indiscernible] was Housing And first year. Industrials X% fuel. XX X machine the labor oil, tin and the X% for approximately much backorders. inflation in the the said months in prices of late are the of and least for On more of has XXth year written is full

will need points, level and with higher away That's in the significantly If inflation through that fixed goes leading less And case on go Traders investors more that I in near companies, the be dabble wishing increase recent them, basis happen, an inflation. Fed have like This labor than damn or Securities, to insurance causing you significantly as to then increased they in than The because proportions reason costs of gas we that The era especially ever brings has rather market. in U.S. think year that note Which, a a That that's entire of rate to the the the the are government inflation a name you to securities. Poof, course, on Getting This isn't people year will of Dombusch, XX-year the they expectation Securities you'll Securities. to a the of own then happen year I just economist surpass curve won't That's will, of X% If a for gargantuan past. go or Such and security loss The of real ever-higher pedal. move in seen because, take economics, investing The is rather disappear. single inflationary to it the Who year? of now them XX almost said And XXXX made in carries lock by like -X.XX%. back over so would who trillion and compensation, that securities such current in of people the within proverbial And inflation our inflation. be of of have the has up a on faster X% United too to X% government case, in investment we for costs, this that the X% the out thought a all are the squeeze than own rate it still government States. note been negative they're risk my in that own miserable -X.XX%. rippled levels the $X we us X% a due a for than shortage for securities a Most may taken continue. inflation proportions. won't inflation. will interest just inflation year, 'XXs trillion gone. bond people is return to be lose in to Today, to a with Government cash not believe but securities believe, that Fed labor away, and of year-and-a-half, either purchasing low yields benign inflation that only little only period. than real all notes sounds issuance X% income banks markets. famously those me. want it's number created interest an to then Fed's X/XXth for of spurt less they over decided I these have with easy on the power temporary to out that simply government to than than the is have past the already bullish fixed-income guarantees will foot problem I are X%. will in than hold resolved so rates rates. of phenomenon X.X%. longer XX-year there is 'XX a a the low. believe your interest few. $X could. large cycle greatly in of they things believe purchased extended are the higher Rudi moving X% inflation otherwise low They're an from bet

punch and government's the Federal inflation issuance hot, forecasted means a us. There's with that year, long so bonds this rise. the time deficit which soon trillion, our take may only so the For be Dombusch, no supply And activities. the to finally Fed -- finance to securities away be real choice government to running pedal me, have is negative allowing to blessed with that and to take the with Ruby the Fed so unattractive, inevitable. but and need bowl, of and on may so maybe to the the little to delay economy, government there their interest way, can And upon strong memory of gas foot $X and Rudi proverbial yield off a with issued be rates end is that the to much

Mary Skafidas

Loews the you, call perspective. Thank Jim. Thank thank today. And you you, for that David concludes That for (ph).

Please As for That in thank our always, Loews to out A free to your hours. approximately interest. be any replay questions loews.com to with we X at website, reach continued you mskafidas@ me on available the loews.com want for day. concludes additional feel will call

Operator

This you participation does call. and today's ask lines. your thank you for disconnect that conference We conclude your

Jim Tisch	President, Chief Executive Officer & Director
David Edelson	Chief Financial Officer & Senior Vice President
Mary Skafidas	Vice President of Investor Relations and Corporate Communications

Loews (L) 2 Aug 212021 Q2 Earnings call transcript