L - Earnings call transcript Q2 2022

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Operator

Good day, everyone and welcome to today’s Loews Corporation Q2 Earnings Conference Call. [Operator Instructions] Please note this call maybe recorded and I will be standing by if you need any assistance. It is now my pleasure to turn today's call over to Chris Nugent, Investor Relations. Please go ahead.

Chris Nugent

Thank you, Ashley. welcome Corporation’s and conference quarter everyone call. morning, to second Loews earnings Good our investor release, on copy earnings A of and loews.com. our presentation website, found maybe I’m Jim Executive Officer, our Wang. joined Chief Jane and Financial Officer, today by Tisch; Chief

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

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

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

Please During like the Jim, our GAAP you. the we discuss to and might With security most also call over to financial call today, turn over presentation I’d a that, the reconciliation refer measures. filing comparable to to to investor for Jim. measures. non-GAAP

Jim Tisch

Loews. combined by be robust points morning. underwriting a in results, off XX.X%, subsidiaries lingering and a Boardwalk had XXXX CNA solid Loews to business gas and of a story to driven great on a produce ratio. basis the for the travel. expense Loews to especially natural at resort destinations, strong from record half start effects flows. XX to continuing The Thank despite ratio Chris each the year, of you, lower another first had to of the of quarter underlying the continues good of by half improved company's success pandemic Hotels consolidated first is with our results. benefit CNA continues

low themselves. to markets strong things happened, core risk the In its focus two CNA's written year and by XX% rose fund negatively common end period. results returns underwriting CNA rise private its retention. on the and versus impacted portfolios, at the rates, new equity the for net due prior was significantly. continues the in to stock respect were past million hedge quarter, With of which pre-tax income $XXX premiums down treaty business interest interest the the by a of billion. quarter, implemented in the speak laser financial second billion. the dramatically, in Excluding a XXXX, second portfolio CNA's quota by unrealized loss rates end assets By and grew of quarter, the and portfolio dropped pre-tax pre-tax of had impact the major fixed had share gain $X.X unrealized of at like the income last $X.X June, on comparison,

$XXat compared was per of quarter, second about As about the end the book $XX share a to CNA's value XXXX. at the result, end of

of any decline quality that In CNA portfolio, able flows to of decline deterioration important its interest of is timely company interest now maturity. a news most currently are higher portfolio, collection due those suffered impairment to from intends to of the principal yields. significantly share per any the And rates, receive has interest that note the credit invest while and of CNA from of regardless prevailing fixed book to securities. securities value securities fact, in at this those the good not same our cash will higher that to the is The does and it income nor still hold is the the imply rates,

million be average, allowing at higher generally cash to and As in than On higher its between previously a portfolio. interest beneficial for $XXX rates the income earnings CNA, I million flow it over rates $XXX invest call, fixed could. long-term, on last company said the month will the CNA its reinvest

CNA's that book higher interest are The improve rates time. portfolios longer company portion buy Higher it for securities helpful its able particularly higher advantageously rates than P&C than to long-term will could, has of over care the been yields duration it business, duration of at business. lengthen liabilities long-term previously yield of CNA's to So which has allowing this portfolio.

are the which just Hotels highest is $XXX past its group in was demand. resort of million. new has strong by Total been developed the exceptionally The of impressive amount related ever for rapidly Turning EBITDA properties. company the have first than over properties Loews performing few to travel years, performance half opened convention attractively Co. half situated the of leisure of company's the and adjusted $XX higher hotels first the certainly These by has impacted million million, pre-pandemic favorable generated EBITDA and & been year these quarterly well, results $XXX addition recovering adjusted generated the to having and XXXX. Several Loews

our report opening have that another happy this resort Florida. to to strengthening look Additionally, November, Hotel. hotel South in this we Gables Coral brand Loews property the I'm forward yet We

few As exacting hotel that The the Hotels to built properties Loews ability industry. operators is a are Hotels company's reminder, to standards. Loews design unique our ensures one owner of very its in

on hotel active hotels today's is the company's destinations. properties these market and the ideally in Additionally, business; operating group pillars: strategy catering demands. means company's to To review, are and that these based to two developing growth hotels second, first, immersive designing suited participation in

keys alike. focuses that pillar plus hotels transient and attract space local XXX first offer ample The also meeting unique with customers that and experiences on group

great destinations properties partnership generators. recent has the Hotel all significant owns X,XXX currently the with of with of decades, second the than with Hotels two Orlando demand in spanning and encompassing strategy, really highly eight travel immersive pillar Loews We The The a locations Universal been successful, are very with partnership that more rooms. and group hotels Universal Orlando example in space. are meeting by Loews at locations, pickup in these encouraged built

Texas, destination that immersive its an which difficulty] group been caters has Hotels travel, Loews of building to both with consistent therefore Additionally, is focused is on and growth [technical Arlington, pillars strategy.

Live! our within three Medal home of the me, an also and sports Orlando of the Hotel property venues, by it's future in Honor national resilient XXXX. Museum, property Live! close particularly pandemic. professional with the is performance Arlington, first in This excuse the during at Loews to end stadiums district entertainment by of and Hotels current -- the Loews opening Our was

first will have in Given space Live! to meeting XXX-room topped connected will by of report pleased major over Arlington brand feet The are XXX,XXX visiting this this convention hotel the that new for our construction quarter meetings for vibrant connected convention to new and Sky our either property Arlington's Loews the hotels have of center. attending remains confidence and XXXX. two Arlington open Hotel. This the Arlington off Together, district Hotel, almost Bridge X,XXX we Loews guests will I'm in space. Loews entertainment the on of event the via events indoor in market, to be an in line have track rooms new to who Hotel of for or top

Delaware resolution heard appeal strong, is is Pipeline, forward currently in Supreme case As XX. be the and Court. the on to to company look the scheduled our whose The is of September we operationally litigation for pending Boardwalk

year. that hope will every case by of be have We the this end resolved the

quarter litigation, refer I more like to you my know first Boardwalk on thoughts the you'd comments. my about to If

shares from outstanding share last X.X% have April of back concerning share repurchased common $XXX Finally, for bought day million. the until X.X repurchases we've shares repurchases, our stock of today, reported XX, Year-to-date, for we million we Loews million. $XXX

to As to earnings And view Loews our welcome you, value, I've Jane, we over discount continue your so of as repurchase to still itself. for speak that and significant let activity to intrinsic its often said, at Corporation. Loews a we of the our the will CFO now first call share believe trades

Jane Wang

forward I'm to role. Jim, this you, all with engaging in and morning, new Thank you everyone. looking really

by billion Second of Net $X.XX share The year-over-year XXXX, $X very last or of strong prior per the comparable Loews per subsidiaries. in $XXX was versus a net million driven operating share or per seem or items masked $X.XX per may income $X.XX it's X-month quarter two quarter. for share performance $X.XX net or of decrease second but our large, million share of period. that year's period $XXX to the million for $XXX income income compared reported

at $XX.XX investments. year-end effect at per later. $XX.XX quarter, to second end partial The non-recurrence of the and being second first deconsolidation the year's interest XXXX the to market Altium which and Book fixed being value and the due both detail sale of discuss of of last Packaging; results the on the CNA rates, CNA's lowering I'll mainly of $XXX at after-tax more in investment Loews, investment the declined gain higher share income from million lower value

the a loss shareholders' in income AOCI As or balance reminder, within unrealized other equity. this accumulated sheet sits comprehensive on

$XX.XX If of value you to actually per share book at year-end exclude AOCI, the at from end June increased XXXX. $XX.XX

our first securities. to fixed by subsidiary. net higher lower partially Turning to income of year. LP quarter net improved million to CNA underwriting results and common income compared $XXX primarily from $XXX reflects contributed this year-over-year million stocks, The investment Loews decline income income largest last and from offset

better X growth This of to that last In written was which line to by declined P&C increase significant apples-to-apples by driven on share the in when of catch-up preferred written premiums investment income quarter, growth, XX% was property you their rate nonredeemable both points treaty. losses CNA and to basis improvement Net quota This year's of we a this in are unfavorable Putting due by showed gains exclude fair stock. margins. new and over pleased the on value addition, results, business driven change one-time retention aside profit XX%. and grew X%. XX% XX% investment a grew top improvement net the an related underwriting

X.X X.X catastrophe of points point of of and ratio was points points rate This of development, X X% prior expense rate written losses, decelerated, lower increases second ratio. by unfavorable XX% of from increases loss earned of offset The than improvement the combined X.X remain consists of better ratio of underlying period improvement Although cost have XXXX. quarter in point favorable the trends. loss above X

Life the X.X Group Jim just at years extended reinvest advantage current the CNA of one maturities, interest quarter, to of In within years at has portfolio. CNA the from extend and end rate the the within end portfolio As X.X Group March duration to & environment mentioned, & particularly Life June. at the rates taken attractive of

in natural such to end-use Revenues as business. projects of compared recently last to higher power increase has projects. expense by to from driven The Boardwalk from connecting on projects That in storage as contributed due maintenance this by to requirements. completed pipeline second $XXX offset income an recently gas million costs depreciation demand this million to gas growth year. Moving year's EBITDA largely markets decrease safety been revenue completed net quarter $XXX last higher higher million was growth pipeline to our due plants. quarter quarter $XX in million well $XX as revised from were

investor a were to and of at Miami presentation the due of Orlando second quarter properties exceptionally our in quarter its second the company a contributed travel performed for especially loss EBITDA, And net Loews million versus quarter at Turning city hotels. as closed in website, this quarter part mentioned, improvement $XX period-over-period in income as has is pickup The Resorts Loews of for still $XX year hotel Jim quarter. contributed million year. demand properties, $XXX and of center our strong opened versus ago versus to reconciled was to a rooms for the quarter's all The defined The at leisure an Loews the million company all-time this its the for $XX which Hotels. quarter Orlando when to were well as last as the in Adjusted last year in result on high is year. this in properties Hotels. meaningfully two well entire resort Universal group the X,XXX million

This quarter. the by the segment the loss to method. income after-tax Altium's for includes in portfolio. quarter was million prior declines $XX our million earnings, Corporate investment of under in Corporate compared segment. $XX of The for an equity Loews loss the reported equity driven in proportionate which is our share also Finally, year's of accounted

short-term share cash volume Our repurchased Altium's in quarter per share. year-to-date, regular price $X dividend million. a of and of million. consisting updated special cost $X.X Since with and cost That two of of Friday than repurchases quarterly slightly from quarter at of we held dividends million this Loews are $X.XX investments. million perspective, improved held dividends call lower you ended an hand less I quarter, now Chris. in The are quarter X.X billion shares to CNA million in last $XXX and we a incremental cash to funds a our million total at share and through per have flow the From brings to the $XXX and this last offsetting majority income XX% received X.X of limited share we treasury in a these due $XXX will total partnerships. bills $XX equities year-to-date back increases shares demand. of

Chris Nugent

Thank you, Jane.

Moving on to question-and-answer call. portion the the of

have shareholders in would earnings answer advance a to quarter, number us call. of that Every questions We like our encourage shareholders. they send questions from on us to we our

Boardwalk Jane, can question for is litigation? give Our Jane. on first update you the an us

Jane Wang

our We before the argue appeal both filed XX. end of our and anticipate year. our by hopefully on to We a the reply Sure. and expect court the September brief, decision brief case we

Chris Nugent

is Thank incident Did impact the an liquefaction you. at next recent for the Great. Freeport you, plant The on question LNG also have Jane. Boardwalk?

Jane Wang

Freeport not. for down there did in to the LNG facilities the back early does at full and it capacity largest And June, U.S. this on operation in its shut until export was be just context, of year. fire expect not is Freeport which No, LNG, later one at a

However, the contracts on was shippers impacted not transportation this it materially take-or-pay a Freeport basis, Boardwalk's are so by incident. with

Chris Nugent

Jane. you, Thank

update us subsidiaries? question are Next Jim. for shortages can is how with Loews' you labor Jim, provide an affecting on

Jim Tisch

Gladly.

I'm to then, and are also report are and locations. So address labor up Hotels guests close Hotels its happy levels pleased high-quality seeing retention the market. Altium They've continues team with facilities. be At Loews Altium staffing issues adjusted this keep of referral labor a staffing bonuses. ago, Altium become Since sign-on in gaps in has to Altium some service is a to Hotels. few wages are less Loews These to deliver To are Overall, we actions custom. labor Loews in a challenge Hotels, improvements offering challenge, manufacturing both I enabled staffing. problem. Increased for to the Altium, many quarters enabling discussed continuity to at Loews employee which base that and at the members have

Chris Nugent

Jim. Thanks, Great.

final Our you. Would like recent for on is thoughts question you interest your with us share most to also and rates? inflation

Jim Tisch

Sure.

following on May, in that the time, fight Fed tripled tied their call through to against to the to a points last about closely our from seems be At bills, funds market rate, in since Fed basis treasury So X.X%. yield XX-day inflation. has the about XX

helped the is XX%. [ph] The and story. to much enact war Ukraine, prices commodities that to treasury is market in down same about Since unchanged, beginning On delivering about of yield policies to X% [indiscernible] promise Wheat Fed the in has down action inflation. This down its that of is tells XX-year that other notwithstanding of time tell price the the believes period, tame some moved the lumber a is note pretty X.XX%. XX%. the me to from hand, in the on the yield year,

As down the prices from significantly the measured are of from than more the beginning year. the peaks,

years at So X.X% hunch I recession. has growth be a the mean? what does for what this for new is I As in rate have month. past what's XXX,XXX going X.X that unemployment we a per all employment and of may I on, current The jobs would full job call look averaged

a wages the the in still twice What's been have of for year is new with demand number of going to but inflation. labor, there's on about room unemployed are pace for people openings for past that kept job While not for job. so a seekers, the job plenty decline find

by the by points. X.X% has report, a fell X.X% number latest average employment increased been meaning time XXX employment. basis forward versus has July inflation the X.X% kept year-over-year. The year-ago, up was has the the For moving year, In were thing in of workers working but the earnings that increase people hourly CPI past economy in example, the behind that up in span, that

engineer are was in to have too a relatively There the not and financial Stated respect financial of shape economy ramping declining, are this seemingly against truly all investment the real inflation, which has the up be moving way, So are the long several inflation the imagine real the the to increase can spiral X% for workers' give or our coming don't we will would of remain I come down. go needs the slowdown the will reason that recession. good to shallow, Fed of and real And incomes wage avoid wages be can there accomplish fight prognosticating, months. XX don't able I that will a recession. to have deep spending and it possible inflation made their outcome, I'm with damaging in time, This so with X Fed is as at to housing full The above state steadfast in have given people chance to reasonably seem we employment price and affairs I world's in been I we the a significant conclusion earnings. that inflation demand, many the a reduction in don't consistent aggregate to but number institutions in in To another for hasn't expect up, are decline check. the I've in and be be the working But see might will best employment but see behind. will the this that that soft foresee institutions. falling debilitating months whereby where doesn't in as in in is unemployment is XXXXs. I to the employment continuing X%, Rather, XX landing, while time inflation come quarters a problematic increasing. federal excesses to more coming that No, is foresee same be might overextended. can

So have myself of crazy a realize a realistic coming recession self that overall, XX But to optimist. benign. sound, as the I optimist. the I I'm consider seems full it I might possibility as recession, that foresee for a would enough awareness I a employment And idea as characterize months. an realistic like

We my next update will now. X in for see. tuned months from Stay

Chris Nugent

Great. for Thank the you, concludes That Jim. today. call Loews

Please out call interest. be this of continued X Thank your reach on additional in at for questions our approximately you any will hours A thank always, feel me replay site, cnugent@loews.com. to free with much. As available you to so loews.com

all may You disconnect. now

Operator

Thank you. today's And does program. conclude this your you Thank participation. for

You may time. disconnect at any

Loews (L) 1 Aug 222022 Q2 Earnings call transcript