NEW YORK, May 1, 2023 /PRNewswire/ -- JAVĿ¼ (NYSE: L) today released its first quarter 2023 financial results.
FirstÌýQuarter highlights:
JAVĿ¼ reported net income of $375 million, or $1.61 per share, in the first quarter of 2023 compared to $322 million, or $1.29 per share, in the first quarter of 2022. The following are the key highlights:
CEO commentary:
"Our subsidiaries performed well this quarter. JAVĿ¼ Hotels produced stellar results and CNA recorded its highest ever quarterly underlying underwriting income."
–Ìý James S. Tisch, President and CEO, JAVĿ¼
Ìý
Consolidated highlights: | ||
Three MonthsÌý Ended March 31, | ||
(In millions, except per share data) | 2023 | 2022 (a) |
Income before net investment losses | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 400 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 325 |
Net investment losses: | ||
CNA | (25) | (3) |
Net income attributable to JAVĿ¼Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý ÌýÌý | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 375 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 322 |
Net income per share | $ÌýÌýÌýÌýÌýÌýÌýÌýÌý 1.61 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌý 1.29 |
Ìý
March 31, 2023 | December 31, 2022 (a) | ||
Book value per share | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 63.41 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 60.81 | |
Book value per share excluding AOCI | 76.84 | 74.88 |
(a) | As of January 1, 2023, JAVĿ¼ adopted Accounting Standards Update 2018-12, "Financial Services – Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts ("ASU 2018-12"), which was applied retrospectively effective January 1, 2021. Previously reported amounts have been adjusted to reflect application of the new guidance. See pages 4 and 5 of this release for more information. |
Ìý
Three months ended MarchÌý31, 2023 compared to 2022
CNA:
Boardwalk:
JAVĿ¼ Hotels:
Corporate & Other:
Share Repurchases:
Reconciliation of GAAP Measures to Non-GAAP Measures
This news release contains financial measures that are not in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Management believes some investors may find these measures useful to evaluate our and our subsidiaries' financial performance. CNA utilizes core income, Boardwalk utilizes earnings before interest, income tax expense, depreciation and amortization ("EBITDA"), and JAVĿ¼ Hotels utilizes Adjusted EBITDA. These measures are defined and reconciled to the most comparable GAAP measures on pages 6 and 7 of this release.
Earnings Remarks and Conference Calls
For JAVĿ¼
–Ìý Today, MayÌý1, 2023, earnings remarks will be available on our .
–Ìý Remarks will include commentary from JAVĿ¼'s president and chief executive officer and chief financial officer.
For CNA
–Ìý Today, MayÌý1, 2023, at 9:00 a.m. ET.
–Ìý A live webcast will be available via the Investor Relations section of .
–Ìý To participate, dial 1-844-481-2830 (USA Toll Free) or +1-412-317-1850 (International).
About JAVĿ¼
JAVĿ¼ is a diversified company with businesses in the insurance, energy, hospitality, and packaging industries. For more information, please visit .
Forward-Looking Statements
Statements contained in this news 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. 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 (). 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 news 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.
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JAVĿ¼ and Subsidiaries | ||
Three Months Ended March 31, | ||
(In millions) | 2023 | 2022 |
Revenues: | ||
CNA Financial (a) | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 3,152 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 2,885 |
Boardwalk Pipelines | 397 | 381 |
JAVĿ¼ Hotels & Co | 192 | 152 |
Investment income (loss) (b) | 42 | (16) |
Total | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 3,783 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 3,402 |
Income (Loss) Before Income Tax: | ||
CNA Financial (a) (c) | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 371 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 355 |
Boardwalk Pipelines | 116 | 122 |
JAVĿ¼ Hotels & Co | 34 | 22 |
Corporate: (d) | ||
Investment income (loss), net | 42 | (16) |
Other | (44) | (44) |
Total (c) | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 519 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 439 |
Net Income (Loss) Attributable to JAVĿ¼: | ||
CNA Financial (a) (c) | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 268 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 265 |
Boardwalk Pipelines | 86 | 91 |
JAVĿ¼ Hotels & Co | 24 | 15 |
Corporate: (d) | ||
Investment income (loss), net | 33 | (13) |
Other | (36) | (36) |
Net income attributable to JAVĿ¼ (c)Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý ÌýÌý | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 375 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 322 |
(a)Ìý | The three months ended March 31, 2023 and 2022 include net investment losses of $35 million and $11 million ($25 million and $3 million after tax and noncontrolling interests). |
(b) | Includes investment income (loss) from the parent company's cash and investments. |
(c)Ìý | The effects of adopting ASU 2018-12 on the Selected Financial Information were as follows: |
Ìý
Three Months Ended March 31, 2022 | As Reported | Effect of Adoption | As Adjusted | ||
(In millions) | |||||
Income (Loss) Before Income Tax: | |||||
CNA Financial | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 378 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý (23) | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 355 | ||
Total | 462 | (23) | 439 | ||
Net Income (Loss) Attributable to JAVĿ¼: | |||||
CNA Financial | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 281 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý (16) | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 265 | ||
Total | 338 | (16) | 322 |
(d)Ìý | The Corporate segment consists of investment income (loss) from the parent company's cash and investments, interest expense, corporate expenses, and the equity income (loss) of Altium Packaging. |
Ìý
JAVĿ¼ and Subsidiaries | ||
Three Months Ended March 31, | ||
(In millions, except per share data) | 2023 | 2022 |
Revenues: | ||
Insurance premiums | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 2,248 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 2,059 |
Net investment income | 569 | 432 |
Investment losses | (35) | (11) |
Operating revenues and other | 1,001 | 922 |
Total | 3,783 | 3,402 |
Expenses: | ||
Insurance claims and policyholders' benefits (a) | 1,653 | 1,478 |
Operating expenses and other | 1,611 | 1,485 |
Total | 3,264 | 2,963 |
Income before income tax (a) | 519 | 439 |
Income tax expense (a) | (115) | (87) |
Net income (a) | 404 | 352 |
Amounts attributable to noncontrolling interests (a) | (29) | (30) |
Net income attributable to JAVĿ¼ (a) | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 375 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 322 |
Net income per share attributable to JAVĿ¼ (a)ÌýÌý | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 1.61 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 1.29 |
Weighted average number of shares | 233.62 | 248.48 |
Ìý
(a) | The effects of adopting ASU 2018-12 on the Consolidated Financial Review were as follows: |
Three Months Ended March 31, 2022 | As Reported | Effect of | As Adjusted | ||
(In millions) | |||||
Insurance claims and policyholders' benefits | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 1,455 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 23 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 1,478 | ||
Income before income tax | 462 | (23) | 439 | ||
Income tax expense | (92) | 5 | (87) | ||
Net income | 370 | (18) | 352 | ||
Amounts attributable to noncontrolling interests | (32) | 2 | (30) | ||
Net income attributable to JAVĿ¼ | 338 | (16) | 322 | ||
Net income per share attributable to JAVĿ¼ | 1.36 | (0.07) | 1.29 |
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Definitions of Non-GAAP Measures and Reconciliation of GAAP Measures to Non-GAAP Measures:
CNA Financial Corporation
Core income is calculated by excluding from CNA's net income attributable to JAVĿ¼ the after-tax effects of investment gains (losses). In addition, core income excludes the effects of noncontrolling interests. The calculation of core income excludes investment gains (losses) because these are generally driven by economic factors that are not necessarily reflective of CNA's primary operations. The following table presents a reconciliation of CNA net income attributable to JAVĿ¼ to core income:
Ìý
Three Months Ended March 31, | ||
(In millions) | 2023 | 2022 |
CNA net income attributable to JAVĿ¼Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý Ìý | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 268 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 265 |
Investment losses | 28 | 3 |
Consolidating adjustments including noncontrolling interestsÌý | 29 | 30 |
Core income | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 325 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 298 |
Ìý
Boardwalk Pipelines
EBITDA is defined as earnings before interest, income tax expense, depreciation and amortization. The following table presents a reconciliation of Boardwalk net income attributable to JAVĿ¼ to EBITDA:
Ìý
Three Months Ended March 31, | ||
(In millions) | 2023 | 2022 |
Boardwalk net income attributable to JAVĿ¼Ìý Ìý Ìý Ìý Ìý ÌýÌý | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 86 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 91 |
Interest | 39 | 42 |
Income tax expense | 30 | 31 |
Depreciation and amortization | 101 | 94 |
EBITDA | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 256 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 258 |
Ìý
JAVĿ¼ Hotels & Co
Adjusted EBITDA is calculated by excluding from JAVĿ¼ Hotels & Co's EBITDA, state and local government development grants, gains or losses on dispositions, asset impairments, and equity method income and including JAVĿ¼ Hotels & Co's pro rata Adjusted EBITDA of equity method investments. Pro rata Adjusted EBITDA of equity method investments is calculated by applying JAVĿ¼ Hotels & Co's ownership percentage to the underlying equity method investment's components of EBITDA and excluding distributions in excess of basis.
The following table presents a reconciliation of JAVĿ¼ Hotels & Co net income attributable to JAVĿ¼ to Adjusted EBITDA:
Ìý
Three Months Ended March 31, | ||
(In millions) | 2023 | 2022 |
JAVĿ¼ Hotels & Co net income attributable to JAVĿ¼ | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 24 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 15 |
Interest | 6 | 4 |
Income tax expense | 10 | 7 |
Depreciation and amortization | 16 | 15 |
EBITDA | 56 | 41 |
Equity investment adjustments: | ||
JAVĿ¼ Hotels & Co's equity method income | (31) | (26) |
Pro rata Adjusted EBITDA of equity method investments | 62 | 53 |
Consolidating adjustments | (1) | (1) |
Adjusted EBITDA | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 86 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 67 |
Ìý
The following table presents a reconciliation of JAVĿ¼ Hotels & Co's equity method income to Pro rata Adjusted EBITDA of equity method investments:
Ìý
Three Months Ended March 31, | ||
(In millions) | 2023 | 2022 |
JAVĿ¼ Hotels & Co's equity method income | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 31 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 26 |
Pro rata share of equity method investments: | ||
Interest | 12 | 9 |
Income tax expense | ||
Depreciation and amortization | 13 | 12 |
Distributions in excess of basis | 6 | 5 |
Consolidation adjustments | 1 | |
Pro rata Adjusted EBITDA of equity method investmentsÌý Ìý Ìý Ìý Ìý Ìý ÌýÌý | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 62 | $ÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌýÌý 53 |
SOURCE JAVĿ¼