Posted on 04 May 2009
Holding Company Loews Corp., run by the Tisch family, posted its third straight quarterly loss on the declining value of investments at its insurance unit and a charge at a natural gas business.
The first-quarter loss was $647 million, or $1.49 a share, compared with profit of $662 million, or $1.05, in the same period a year earlier, the New York-based company said in a statement today.
Loews owns 90 percent of CNA Financial Corp., the Chicago-based property and casualty insurer, which earlier today reported its third straight unprofitable period. The loss of $195 million compares with a profit of $187 million a year earlier. The company wrote down holdings including asset-backed securities and investments tied to financial firms by $399 million in the quarter.
Loews shares advanced 83 cents, or 3.3 percent, to $26.02 at 9:38 a.m. in New York Stock Exchange composite trading. Shares of CNA jumped 55 cents, or 4.6 percent, to $12.48.
CNA has recorded $3.8 billion in write-downs and unrealized losses on investments through the end of 2008. Loews in October agreed to buy $1.25 billion in preferred shares of CNA after the insurance unit posted a third-quarter loss on investment declines and hurricane claims.
The insurer’s book value advanced to $21.57 in the first quarter from $20.92 at the end of 2008, and CNA spent 98.2 cents on claims and expenses for every dollar it collected in premiums, “with current period underwriting results reflecting lower losses and higher expenses as compared to the prior period,” CNA said.
Loews also took a $1 billion non-cash impairment charge at its HighMount Exploration & Production LLC business reflecting “declines in commodity prices,” the company said.