Loews posts 3Q profit as investment charges drop

Loews 3rd-quarter profit beats analysts expectations as it avoids costly impairment charges

• On 8:10 am EST, Monday November 2, 2009

NEW YORK (AP) -- Loews Corp. reported a third-quarter profit Monday that easily topped analysts' expectations as improving investment and credit markets led to lower impairment charges at its insurance unit, CNA Financial Corp.

Loews also reported improved investment income at the holding company level, and higher earnings at its energy drilling business.

Loews profit available to common shareholders totaled $468 million, or $1.08 per share, during the quarter ended Sept. 30. It lost $137 million, or 31 cents per share, during the same period last year.

Analysts polled by Thomson Reuters, on average, forecast earnings of 89 cents per share during the quarter.

Loews was helped by improving investment and credit markets, which allowed it to avoid costly impairment charges at CNA Financial during the most recent quarter. Loews owns a 90 percent stake in CNA Financial, the rest of which is publicly traded.

Loews recorded $61 million in net investment losses during the quarter, compared with losses of $379 million during the same period last year.

As credit markets have improved during 2009, many financial firms have been able to take significantly smaller investment charges or even begin to start racking up gains on investments that were hammered during the peak of the credit crisis last fall.

Investment income at the holding company level also improved in the quarter, turning profitable compared with the year-ago period. At the holding company level, Loew's investments earned $41 million, compared with $57 million in investment losses during the July-September period in 2008.

Loews' profit was also buoyed by continued improvement at Diamond Offshore Drilling Inc. Net income at Diamond Offshore increased to $170 million during the quarter, from $145 million during the same quarter last year.

Loews owns a 50.4 percent stake in the company.

Aside from ownership stakes in CNA Financial and Diamond Offshore, New York-based Loews fully owns HighMount Exploration & Production LLC and Loews Hotels. It owns a 72 percent stake in Boardwalk Pipeline Partners LP.

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