JAVĿ¼

LOEWS CORPORATION REPORTS NET INCOME OF $446 MILLION FOR THE FOURTH QUARTER OF 2023 AND $1.4 BILLION FOR THE FULL YEAR

14.0 MILLION COMMON SHARES REPURCHASED IN 2023 FOR $852 MILLION

NEW YORK, Feb. 5, 2024 /PRNewswire/ -- JAVĿ¼ (NYSE: L) today released its fourth quarter 2023 financial results.

Fourth Quarter highlights:
JAVĿ¼ reported net income of $446 million, or $1.99 per share, in the fourth quarter of 2023, which represents a 26% increase over $355 million, or $1.49 per share, in the fourth quarter of 2022. The following are the highlights for the fourth quarter:

  • CNA Financial Corporation's (NYSE: CNA) net income improved year-over-year due to higher net investment income and higher underwriting income.
  • Boardwalk Pipelines' results improved due to higher revenues from re-contracting, partially offset by higher expenses.
  • These increases were partially offset by lower investment returns on equity securities at the parent company compared to the 2022 period.
  • JAVĿ¼ repurchased 2.1 million shares of its common stock for a total cost of $141 million through the end of the quarter.
  • Book value per share, excludingAOCI, increased 9% to $81.92 as of December31, 2023, from $74.88 as of December31, 2022 due to repurchases of common shares and strong operating results during 2023.
  • As of December 31, 2023, the parent company had $2.6 billion of cash and investments and $1.8 billion of debt.

CEO commentary:

"JAVĿ¼ had a spectacular quarter, with each of our subsidiaries producing strong results."
James S. Tisch, President and CEO, JAVĿ¼

Consolidated highlights:


December 31,



Three Months

Years Ended


(In millions, except per share data)

2023

2022 (a)

2023

2022 (a)


Net income attributable to JAVĿ¼ before






net investment gains (losses)

$ 442

$ 378

$ 1,469

$ 960


Net investment gains (losses):






CNA

4

(23)

(71)

(138)


JAVĿ¼ Hotels & Co



36



Total net investment gains (losses)

4

(23)

(35)

(138)


Net income attributable to JAVĿ¼

$ 446

$ 355

$ 1,434

$ 822


Net income per share

$ 1.99

$ 1.49

$ 6.29

$ 3.38



December 31, 2023


December 31, 2022 (a)







Book value per share

$ 70.69


$ 60.81


Book value per share excluding AOCI

81.92


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.

Three months ended December31, 2023 compared to 2022

CNA:

  • Net income attributable toJAVĿ¼ improved 57% to $336 million from $214 million.
  • Core income increased 37% to $362 million from $265 million.
  • Results include higher net investment income from limited partnerships and fixed income securities.
  • Property and Casualty underwriting results were higher due to improved underlying underwriting income and lower net catastrophe losses, partially offset by lower favorable net prior year loss reserve development.
  • Net written premiums grew by 10% driven by strong retention and new business.
  • Property and Casualty combined ratio was 92.1% compared to 93.7%. Property and Casualty underlying combined ratio was 91.4% compared to 91.2%.
  • Net income was positively impacted by investment gains in 2023 compared to investment losses in 2022 mostly due to the favorable change in fair value of non-redeemable preferred stock.

Boardwalk:

  • Net income increased 11% to $92 million compared to $83 million.
  • EBITDA increased 5% to $260 million compared to $248 million.
  • Net income and EBITDA increased due to higher transportation revenues from re-contracting and recently completed growth projects, increased storage and parking and lending revenues, and the Bayou Ethane acquisition. These increases were partially offset by higher depreciation expenses due to an increased asset base from recently completed growth projects and higher employee-related expenses.

JAVĿ¼ Hotels:

  • Net income of $32 million compared to $33 million.
  • Adjusted EBITDA of $83 million compared to $85 million.
  • Net income slightly decreased due to lower equity income from joint ventures driven by decreased overall occupancy rates and higher operating costs offset by consolidating the results of a property previously accounted for under the equity method.

Corporate & Other:

  • Results decreased to a net loss of $14 million compared to net income of $25 million.
  • The decrease in results is primarily due to lower investment income from parent company equity securities.

Year ended December31, 2023 compared to 2022

JAVĿ¼ reported net income of $1,434 million, or $6.29 per share, compared to $822 million, or $3.38 per share. The 74% year-over-year increase was driven by the following:

  • CNA's results improved due to higher net investment income, higher Property and Casualty underwriting income, lower investment losses, and a significantly lower unfavorable impact from the long-term care annual reserve review performed in the third quarter of each year.
  • Investment income at the parent company improved due to higher returns on short-term investments and equity securities.
  • Boardwalk Pipelines' results increased due to higher revenues from re-contracting and recently completed growth projects.
  • JAVĿ¼ Hotels & Co's net income increased due to an after-tax gain of $36 million related to the acquisition of an additional equity interest in, and the consolidation of, a previously unconsolidated joint venture property in the second quarter of 2023.
  • These increases were partially offset by an after-tax charge of $37 million related to the termination of a defined benefit plan in the third quarter of 2023 in Corporate & Other.

Share Purchases:

  • On December 31, 2023, there were 222.2 million shares ofJAVĿ¼ common stock outstanding.
  • For the three months and year ended December 31, 2023,JAVĿ¼ repurchased 2.1 million and 14.0 million shares of its common stock at an aggregate cost of $141 million and $852 million, respectively.
  • For the year ended December 31, 2023,JAVĿ¼ purchased 4.5 million shares of CNA common stock at an aggregate cost of $178 million.
  • Depending on market conditions,JAVĿ¼ may from time to time purchase shares of its and its subsidiaries' outstanding common stock in the open market, in privately negotiated transactions or otherwise.

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

  • Today, February 5, 2024, earnings remarks will be available on our.
  • Remarks will include commentary fromJAVĿ¼'s president and chief executive officer and chief financial officer.

For CNA

  • Today, February 5, 2024,CNA will host an earnings call at 9:00 a.m. ET.
  • A live webcast will be available via the Investor Relations section ofCNA's website at .
  • To participate by phone, 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.

JAVĿ¼Corporation and Subsidiaries


Selected Financial Information





December 31,



Three Months

Years Ended


(In millions)

2023

2022

2023

2022


Revenues:






CNA Financial (a)

$ 3,507

$ 3,111

$ 13,299

$ 11,879


Boardwalk Pipelines

511

401

1,636

1,446


JAVĿ¼ Hotels & Co (b)

210

189

852

721


Corporate investment income (loss) and other

30

92

114

(2)


Total

$ 4,258

$ 3,793

$ 15,901

$ 14,044


Income (Loss) Before Income Tax:






CNA Financial (a) (c)

$ 460

$ 283

$ 1,518

$ 814


Boardwalk Pipelines

116

109

373

330


JAVĿ¼ Hotels & Co (b)

41

41

200

161


Corporate:






Investment income (loss), net

30

92

114

(8)


Other (d)

(34)

(60)

(209)

(183)


Total (c)

$ 613

$ 465

$ 1,996

$ 1,114


Net Income (Loss) Attributable to JAVĿ¼:






CNA Financial (a) (c)

$ 336

$ 214

$ 1,094

$ 612


Boardwalk Pipelines

92

83

283

247


JAVĿ¼ Hotels & Co (b)

32

33

147

117


Corporate:






Investment income (loss), net

24

72

90

(6)


Other (d)

(38)

(47)

(180)

(148)


Net income attributable to JAVĿ¼ (c)

$ 446

$ 355

$ 1,434

$ 822




(a)

The three months ended December 31, 2023 includes net investment gains of $6 million ($4 million after tax and noncontrolling interests). The three months ended December 31, 2022 includes net investment losses of $33 million ($23 million after tax and noncontrolling interests). The years ended December 31, 2023 and 2022 include net investment losses of $99 million and $199 million ($71 million and $138 million after tax and noncontrolling interests).

(b)

Includes a gain of $46 million ($36 million after tax) for the year ended December 31, 2023 related to JAVĿ¼ Hotels & Co's acquisition of an additional equity interest in, and the consolidation of, a previously unconsolidated joint venture property.

(c)

The effects of adopting ASU 2018-12 on the Selected Financial Information were as follows:



Three Months Ended December 31, 2022

As
Reported


Effect of
Adoption


As
Adjusted









Income (Loss) Before Income Tax:







CNA Financial

$ 294


$ (11)


$ 283


Total

476


(11)


465


Net Income (Loss) Attributable to JAVĿ¼:







CNA Financial

$ 223


$ (9)


$ 214


Total

364


(9)


355









Year Ended December 31, 2022

As
Reported


Effect of
Adoption


As
Adjusted









Income (Loss) Before Income Tax:







CNA Financial

$ 1,081


$ (267)


$ 814


Total

1,381


(267)


1,114


Net Income (Loss) Attributable to JAVĿ¼:







CNA Financial

$ 802


$ (190)


$ 612


Total

1,012


(190)


822









(d)

Consists of parent company interest expense, corporate expenses and the equity income (loss) of Altium Packaging. The year ended December31, 2023 includes a charge of $47 million ($37 million after tax) related to the termination of a defined benefit plan.

JAVĿ¼Corporation and Subsidiaries


Consolidated Financial Review





December 31,



Three Months

Years Ended


(In millions, except per share data)

2023

2022

2023

2022


Revenues:






Insurance premiums

$ 2,479

$ 2,232

$ 9,480

$ 8,667


Net investment income

643

600

2,395

1,802


Investment gains (losses) (a)

6

(33)

(53)

(199)


Operating revenues and other

1,130

994

4,079

3,774


Total

4,258

3,793

15,901

14,044








Expenses:






Insurance claims and policyholders' benefits (b)

1,810

1,694

7,068

6,653


Operating expenses and other

1,835

1,634

6,837

6,277


Total

3,645

3,328

13,905

12,930








Income before income tax (b)

613

465

1,996

1,114


Income tax expense (b)

(136)

(87)

(451)

(223)


Net income (b)

477

378

1,545

891


Amounts attributable to noncontrolling interests (b)

(31)

(23)

(111)

(69)


Net income attributable to JAVĿ¼ (b)

$ 446

$ 355

$ 1,434

$ 822








Net income per share attributable to JAVĿ¼

Corporation (b)

$ 1.99

$ 1.49

$ 6.29

$ 3.38








Weighted average number of shares

223.80

238.08

227.81

243.28




(a)

Includes a gain of $46 million ($36 million after tax) for the year ended December 31, 2023 related to JAVĿ¼ Hotels & Co's acquisition of an additional equity interest in, and the consolidation of, a previously unconsolidated joint venture property.

(b)

The effects of adopting ASU 2018-12 on the Consolidated Financial Review were as follows:



Three Months Ended December 31, 2022

As
Reported


Effect of
Adoption


As
Adjusted









Insurance claims and policyholders' benefits

$ 1,683


$ 11


$ 1,694


Income before income tax

476


(11)


465


Income tax expense

(88)


1


(87)


Net income

388


(10)


378


Amounts attributable to noncontrolling interests

(24)


1


(23)


Net income attributable to JAVĿ¼

364


(9)


355


Net income per share attributable to JAVĿ¼

1.53


(0.04)


1.49









Year Ended December 31, 2022

As
Reported


Effect of
Adoption


As
Adjusted









Insurance claims and policyholders' benefits

$ 6,386


$ 267


$ 6,653


Income before income tax

1,381


(267)


1,114


Income tax expense

(278)


55


(223)


Net income

1,103


(212)


891


Amounts attributable to noncontrolling interests

(91)


22


(69)


Net income attributable to JAVĿ¼

1,012


(190)


822


Net income per share attributable to JAVĿ¼

4.16


(0.78)


3.38


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:


December 31,



Three Months

Years Ended


(In millions)

2023

2022

2023

2022


CNA net income attributable to JAVĿ¼

Corporation

$ 336

$ 214

$ 1,094

$ 612


Investment (gains) losses

(5)

26

79

154


Consolidation adjustments including noncontrolling
interests

31

25

111

70


Core income

$ 362

$ 265

$ 1,284

$ 836


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:


December 31,



Three Months

Years Ended


(In millions)

2023

2022

2023

2022


Boardwalk net income attributable to JAVĿ¼
Corporation

$ 92

$ 83

$ 283

$ 247


Interest, net

38

40

144

166


Income tax expense

24

26

90

83


Depreciation and amortization

106

99

412

396


EBITDA

$ 260

$ 248

$ 929

$ 892


JAVĿ¼ Hotels & Co

Adjusted EBITDA is calculated by excluding from JAVĿ¼ Hotels & Co's EBITDA, noncontrolling interest share of EBITDA adjustments, state and local government development grants, gains or losses on asset acquisitions and 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:


December 31,



Three Months

Years Ended


(In millions)

2023

2022

2023

2022


JAVĿ¼ Hotels & Co net income attributable to JAVĿ¼
Corporation

$ 32

$ 33

$ 147

$ 117


Interest, net

4

4

9

11


Income tax expense

9

8

53

44


Depreciation and amortization

18

17

69

64


EBITDA

63

62

278

236


Noncontrolling interest share of EBITDA adjustments

(2)


(5)



Gain on asset acquisition



(46)



Asset impairments

3

3

12

25


Equity investment adjustments:






JAVĿ¼ Hotels & Co's equity method income

(31)

(33)

(129)

(148)


Pro rata Adjusted EBITDA of equity method
investments

50

54

218

234


Consolidation adjustments


(1)


(2)


Adjusted EBITDA

$ 83

$ 85

$ 328

$ 345


The following table presents a reconciliation of JAVĿ¼ Hotels & Co's equity method income to Pro rata Adjusted EBITDA of equity method investments:


December 31,



Three Months

Years Ended


(In millions)

2023

2022

2023

2022


JAVĿ¼ Hotels & Co's equity method income

$ 31

$ 33

$ 129

$ 148


Pro rata share of equity method investments:






Interest, net

10

11

43

40


Income tax expense






Depreciation and amortization

12

12

49

50


Distributions in excess of basis

(3)

(3)

(3)

(4)


Consolidation adjustments


1




Pro rata Adjusted EBITDA of equity method
investments

$ 50

$ 54

$ 218

$ 234


SOURCE JAVĿ¼