filings.toolsItem 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Management’s discussion and analysis of financial condition and results of operations (“MD&A”) should be read in conjunction with our Consolidated Condensed Financial Statements included under Item 1 of this Report and the Consolidated Financial Statements, Risk Factors, and MD&A included in our Annual Report on Form 10-K for the year ended December 31, 2024. This MD&A is comprised of the following sections:
OVERVIEW
Loews Corporation is a holding company and has four reportable segments comprised of three individual consolidated operating subsidiaries, CNA Financial Corporation (“CNA”), Boardwalk Pipeline Partners, LP (“Boardwalk Pipelines”) and Loews Hotels Holding Corporation (“Loews Hotels & Co”); and the Corporate segment. The Corporate segment is primarily comprised of Loews Corporation, excluding its consolidated operating subsidiaries, and the equity method of accounting for Altium Packaging LLC (“Altium Packaging”), an unconsolidated subsidiary.
Unless the context otherwise requires, as used herein, the term “Company” means Loews Corporation including its subsidiaries, the terms “Parent Company,” “we,” “our,” “us” or like terms mean Loews Corporation excluding its subsidiaries and the term “Net income (loss) attributable to Loews Corporation” means Net income (loss) attributable to Loews Corporation shareholders.
We rely upon our invested cash balances and distributions from our subsidiaries to generate the funds necessary to meet our obligations and to declare and pay any dividends to our shareholders. The ability of our subsidiaries to pay dividends is subject to, among other things, the availability of sufficient earnings and funds in such subsidiaries, applicable state laws, including in the case of the insurance subsidiaries of CNA, laws and rules governing the payment of dividends by regulated insurance companies (see Note 15 of the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2024) and compliance with covenants in their respective loan agreements. Claims of creditors of our subsidiaries will generally have priority as to the assets of such subsidiaries over our claims and those of our creditors and shareholders. We are not responsible for the liabilities and obligations of our subsidiaries and there are no Parent Company guarantees.
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RESULTS OF OPERATIONS
Consolidated Financial Results
The following table summarizes net income (loss) attributable to Loews Corporation by segment and the basic and diluted net income per share attributable to Loews Corporation for the three months ended March 31, 2025 and 2024:
| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions, except per share data) | ||||||||||||||||||||
| CNA Financial | $ | 252 | $ | 310 | ||||||||||||||||
| Boardwalk Pipelines | 152 | 121 | ||||||||||||||||||
| Loews Hotels & Co | 16 | |||||||||||||||||||
| Corporate | (34) | 10 | ||||||||||||||||||
| Net income attributable to Loews Corporation | $ | 370 | $ | 457 | ||||||||||||||||
| Basic and diluted net income per share | $ | 1.74 | $ | 2.05 | ||||||||||||||||
Net income attributable to Loews Corporation for the three months ended March 31, 2025 was $370 million, or $1.74 per share, compared to net income of $457 million, or $2.05 per share in the comparable 2024 period.
The decrease in net income attributable to Loews Corporation for the three months ended March 31, 2025 as compared to the comparable 2024 period was primarily driven by lower net income at CNA and Loews Hotels & Co and lower investment income at the parent company, partially offset by higher net income at and Boardwalk Pipelines. The decrease at CNA is primarily due to lower underwriting income mainly driven by unfavorable net prior year loss reserve development. The decrease at Loews Hotels & Co is primarily due to lower equity income from joint ventures mainly driven by lower occupancy and average daily rates at Universal Orlando Resort hotels and an impairment charge recorded by a joint venture property. Lower investment income at the parent company is primarily due to the unfavorable change in the fair value of equity based investments. The increase at Boardwalk Pipelines is primarily due to increased revenues from re-contracting at higher rates and recently completed growth projects.
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CNA Financial
The following table summarizes the results of operations for CNA for the three months ended March 31, 2025 and 2024 as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report. For further discussion of Net investment income and Investment gains (losses), see the Investments section of this MD&A.
| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Revenues: | ||||||||||||||||||||
| Insurance premiums | $ | 2,626 | $ | 2,441 | ||||||||||||||||
| Net investment income | 604 | 609 | ||||||||||||||||||
| Investment losses | (9) | (22) | ||||||||||||||||||
| Non-insurance warranty revenue | 397 | 407 | ||||||||||||||||||
| Other revenues | 9 | 9 | ||||||||||||||||||
| Total | 3,627 | 3,444 | ||||||||||||||||||
| Expenses: | ||||||||||||||||||||
| Insurance claims and policyholders’ benefits | 2,027 | 1,807 | ||||||||||||||||||
| Amortization of deferred acquisition costs | 471 | 444 | ||||||||||||||||||
| Non-insurance warranty expense | 385 | 394 | ||||||||||||||||||
| Other operating expenses | 363 | 337 | ||||||||||||||||||
| Interest | 32 | 35 | ||||||||||||||||||
| Total | 3,278 | 3,017 | ||||||||||||||||||
| Income before income tax | 349 | 427 | ||||||||||||||||||
| Income tax expense | (75) | (89) | ||||||||||||||||||
| Net income | 274 | 338 | ||||||||||||||||||
| Amounts attributable to noncontrolling interests | (22) | (28) | ||||||||||||||||||
| Net income attributable to Loews Corporation | $ | 252 | $ | 310 |
Net income attributable to Loews Corporation decreased $58 million for the three months ended March 31, 2025 as compared with the comparable 2024 period, primarily due to lower underwriting income mainly driven by unfavorable net prior year loss reserve development.
CNA’s Property & Casualty and Other Insurance Operations
CNA’s commercial property and casualty insurance operations (“Property & Casualty Operations”) include its Specialty, Commercial and International lines of business. CNA’s Other Insurance Operations outside of Property & Casualty Operations include its long-term care business that is in run-off, certain corporate expenses, including interest on CNA’s corporate debt, and the results of certain property and casualty businesses in run-off, including CNA Re, asbestos and environmental pollution (“A&EP”), a legacy portfolio of excess workers’ compensation (“EWC”) policies and certain legacy mass tort reserves. We believe the presentation of CNA as one reportable segment is appropriate in accordance with applicable accounting standards on segment reporting. However, for purposes of this discussion and analysis of the results of operations, we provide greater detail with respect to CNA’s Property & Casualty Operations and Other Insurance Operations to enhance the reader’s understanding and to provide further transparency into key drivers of CNA’s financial results.
In assessing its insurance operations, CNA utilizes the core income (loss) financial measure. Core income (loss) is calculated by excluding investment gains or losses and gains or losses resulting from pension settlement transactions from net income (loss). In addition, core income (loss) excludes the effects of noncontrolling interests. The calculation of core income (loss) excludes investment gains or losses because they are generally driven by economic factors that are not necessarily reflective of CNA’s primary insurance operations. The calculation of core income (loss) excludes gains or losses resulting from pension settlement transactions as they result from decisions regarding CNA’s defined benefit pension plans which are unrelated to its primary insurance operations. Core income (loss) is deemed to be a non-GAAP
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financial measure and management believes some investors may find this measure useful to evaluate CNA’s insurance operations. Please see the non-GAAP reconciliation of net income (loss) to core income (loss) in this MD&A.
In evaluating the results of Property & Casualty Operations CNA utilizes the loss ratio, the underlying loss ratio, the expense ratio, the dividend ratio, the combined ratio and the underlying combined ratio. These ratios are calculated using GAAP financial results. The loss ratio is the percentage of net incurred claim and claim adjustment expenses to net earned premiums. The underlying loss ratio excludes the impact of catastrophe losses and development-related items from the loss ratio. Development-related items represent net prior year loss reserve and premium development, and includes the effects of interest accretion and change in allowance for uncollectible reinsurance. The expense ratio is the percentage of insurance underwriting and acquisition expenses, including the amortization of deferred acquisition costs, to net earned premiums. The dividend ratio is the ratio of policyholders’ dividends incurred to net earned premiums. The combined ratio is the sum of the loss ratio, the expense ratio and the dividend ratio. The underlying combined ratio is the sum of the underlying loss ratio, the expense ratio and the dividend ratio. The underlying loss ratio and the underlying combined ratio are deemed to be non-GAAP financial measures, and management believes some investors may find these ratios useful to evaluate CNA’s underwriting performance since they remove the impact of catastrophe losses which are unpredictable as to timing and amount, and development-related items as they are not indicative of current year underwriting performance.
Changes in estimates of claim and claim adjustment expense reserves, net of reinsurance, for prior years are defined as net prior year loss reserve development within this MD&A. These changes can be favorable or unfavorable. Net prior year loss reserve development does not include the effect of any related acquisition expenses. Further information on CNA’s reserves is provided in Notes 4 and 5 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.
In addition, renewal premium change, rate, retention and new business are also utilized in evaluating operating trends. Renewal premium change represents the estimated change in average premium on policies that renew, including rate and exposure changes. Rate represents the average change in price on policies that renew excluding exposure change. Exposure represents the measure of risk used in the pricing of the insurance product. The change in exposure represents the change in premium dollars on policies that renew as a result of the change in risk of the policy. Retention represents the percentage of premium dollars renewed, excluding rate and exposure changes, in comparison to the expiring premium dollars from policies available to renew. New business represents premiums from policies written with new customers and additional policies written with existing customers. Gross written premiums, excluding third-party captives, excludes business which is ceded to third-party captives, including business related to large warranty programs.
CNA also uses underwriting gain (loss) and underlying underwriting gain (loss), calculated using GAAP financial results, to monitor insurance operations. Underwriting gain (loss) is deemed to be a non-GAAP financial measure and is calculated pretax as net earned premiums less total insurance expenses, which includes insurance claims and policyholders’ benefits, amortization of deferred acquisition costs and insurance related administrative expenses. Net income (loss) is the most directly comparable GAAP measure. Management believes some investors may find this measure useful to evaluate the profitability, before tax, derived from CNA’s underwriting activities, which are managed separately from its investing activities. Underlying underwriting gain (loss) is also deemed to be a non-GAAP financial measure, and represents pretax underwriting gain (loss) excluding catastrophe losses and development-related items. Management believes some investors may find this measure useful to evaluate the profitability, before tax, derived from CNA’s underwriting activities, excluding the impact of catastrophe losses, which are unpredictable as to timing and amount, and development-related items as they are not indicative of CNA’s current year underwriting performance.
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The following tables present a reconciliation of net income attributable to Loews Corporation to core income (loss), underwriting gain (loss) and underlying underwriting gain (loss) for the three months ended March 31, 2025 and 2024:
| Three Months Ended March 31, 2025 | Specialty | Commercial | International | Property & Casualty | Other Insurance Operations | Total | |||||||||||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||||||||||||||
| Net income (loss) attributable to Loews Corporation | $ | 137 | $ | 114 | $ | 35 | $ | 286 | $ | (34) | $ | 252 | |||||||||||||||||||||||
| Investment (gains) losses | 1 | (1) | — | 7 | 7 | ||||||||||||||||||||||||||||||
| Noncontrolling interests | 12 | 10 | 3 | 25 | (3) | 22 | |||||||||||||||||||||||||||||
| Core income (loss) | $ | 150 | $ | 124 | $ | 37 | $ | 311 | $ | (30) | $ | 281 | |||||||||||||||||||||||
| Less: | |||||||||||||||||||||||||||||||||||
| Net investment income | 151 | 177 | 34 | 362 | |||||||||||||||||||||||||||||||
| Non-insurance warranty revenue | 12 | 12 | |||||||||||||||||||||||||||||||||
| Other revenue (expense), including interest expense | (14) | (2) | 1 | (15) | |||||||||||||||||||||||||||||||
| Income tax expense on core income | (41) | (34) | (13) | (88) | |||||||||||||||||||||||||||||||
| Underwriting gain (loss) | 42 | (17) | 15 | 40 | |||||||||||||||||||||||||||||||
| Effect of catastrophe losses | 86 | 11 | 97 | ||||||||||||||||||||||||||||||||
| Effect of unfavorable development-related items | 10 | 53 | 63 | ||||||||||||||||||||||||||||||||
| Underlying underwriting gain | $ | 52 | $ | 122 | $ | 26 | $ | 200 |
| Three Months Ended March 31, 2024 | |||||||||||||||||||||||||||||||||||
| Net income (loss) attributable to Loews Corporation | $ | 153 | $ | 132 | $ | 34 | $ | 319 | $ | (9) | $ | 310 | |||||||||||||||||||||||
| Investment (gains) losses | 10 | 14 | 24 | (7) | 17 | ||||||||||||||||||||||||||||||
| Noncontrolling interests | 14 | 12 | 3 | 29 | (1) | 28 | |||||||||||||||||||||||||||||
| Core income (loss) | $ | 177 | $ | 158 | $ | 37 | $ | 372 | $ | (17) | $ | 355 | |||||||||||||||||||||||
| Less: | |||||||||||||||||||||||||||||||||||
| Net investment income | 150 | 176 | 31 | 357 | |||||||||||||||||||||||||||||||
| Non-insurance warranty revenue | 13 | 13 | |||||||||||||||||||||||||||||||||
| Other revenue (expense), including interest expense | (14) | (4) | (2) | (20) | |||||||||||||||||||||||||||||||
| Income tax expense on core income | (48) | (43) | (13) | (104) | |||||||||||||||||||||||||||||||
| Underwriting gain | 76 | 29 | 21 | 126 | |||||||||||||||||||||||||||||||
| Effect of catastrophe losses | 82 | 6 | 88 | ||||||||||||||||||||||||||||||||
| Effect of favorable development-related items | (5) | (5) | |||||||||||||||||||||||||||||||||
| Underlying underwriting gain | $ | 71 | $ | 111 | $ | 27 | $ | 209 |
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Property & Casualty Operations
The following tables summarize the results of CNA’s Property & Casualty Operations and provides the components to reconcile the combined ratio and loss ratio to the underlying combined ratio and underlying loss ratio for the three months ended March 31, 2025 and 2024.
| Three Months Ended March 31, 2025 | Specialty | Commercial | International | Total | |||||||||||||||||||
| (In millions, except %) | |||||||||||||||||||||||
| Gross written premiums | $ | 1,672 | $ | 1,853 | $ | 373 | $ | 3,898 | |||||||||||||||
| Gross written premiums excluding third-party captives | 930 | 1,839 | 373 | 3,142 | |||||||||||||||||||
| Net written premiums | 842 | 1,498 | 266 | 2,606 | |||||||||||||||||||
| Net earned premiums | 830 | 1,380 | 310 | 2,520 | |||||||||||||||||||
| Underwriting gain (loss) | 42 | (17) | 15 | 40 | |||||||||||||||||||
| Net investment income | 151 | 177 | 34 | 362 | |||||||||||||||||||
| Core income | 150 | 124 | 37 | 311 | |||||||||||||||||||
| Other performance metrics: | |||||||||||||||||||||||
| Loss ratio | 61.4 | % | 73.0 | % | 62.1 | % | 67.8 | % | |||||||||||||||
| Expense ratio | 33.4 | 27.6 | 33.3 | 30.2 | |||||||||||||||||||
| Dividend ratio | 0.3 | 0.5 | 0.4 | ||||||||||||||||||||
| Combined ratio | 95.1 | % | 101.1 | % | 95.4 | % | 98.4 | % | |||||||||||||||
| Less: Effect of catastrophe impacts | 6.3 | 3.6 | 3.8 | ||||||||||||||||||||
| Less: Effect of unfavorable development-related items | 1.3 | 3.8 | 2.5 | ||||||||||||||||||||
| Underlying combined ratio | 93.8 | % | 91.0 | % | 91.8 | % | 92.1 | % | |||||||||||||||
| Underlying loss ratio | 60.1 | % | 62.9 | % | 58.5 | % | 61.5 | % | |||||||||||||||
| Rate | 3 | % | 6 | % | (2)% | 4 | % | ||||||||||||||||
| Renewal premium change | 4 | 7 | 1 | 6 | |||||||||||||||||||
| Retention | 89 | 84 | 85 | 86 | |||||||||||||||||||
| New business | $ | 112 | $ | 370 | $ | 83 | $ | 565 |
| Three Months Ended March 31, 2024 | |||||||||||||||||||||||
| Gross written premiums | $ | 1,682 | $ | 1,686 | $ | 374 | $ | 3,742 | |||||||||||||||
| Gross written premiums excluding third-party captives | 880 | 1,682 | 374 | 2,936 | |||||||||||||||||||
| Net written premiums | 792 | 1,338 | 260 | 2,390 | |||||||||||||||||||
| Net earned premiums | 814 | 1,202 | 315 | 2,331 | |||||||||||||||||||
| Underwriting gain | 76 | 29 | 21 | 126 | |||||||||||||||||||
| Net investment income | 150 | 176 | 31 | 357 | |||||||||||||||||||
| Core income | 177 | 158 | 37 | 372 | |||||||||||||||||||
| Other performance metrics: | |||||||||||||||||||||||
| Loss ratio | 58.6 | % | 68.8 | % | 60.1 | % | 64.1 | % | |||||||||||||||
| Expense ratio | 31.8 | 28.2 | 33.2 | 30.1 | |||||||||||||||||||
| Dividend ratio | 0.3 | 0.6 | 0.4 | ||||||||||||||||||||
| Combined ratio | 90.7 | % | 97.6 | % | 93.3 | % | 94.6 | % | |||||||||||||||
| Less: Effect of catastrophe impacts | 6.8 | 2.0 | 3.8 | ||||||||||||||||||||
| Less: Effect of favorable development-related items | (0.6) | (0.2) | |||||||||||||||||||||
| Underlying combined ratio | 91.3 | % | 90.8 | % | 91.3 | % | 91.0 | % | |||||||||||||||
| Underlying loss ratio | 59.2 | % | 62.0 | % | 58.1 | % | 60.5 | % | |||||||||||||||
| Rate | 2 | % | 6 | % | 1 | % | 4 | % | |||||||||||||||
| Renewal premium change | 3 | 8 | 3 | 6 | |||||||||||||||||||
| Retention | 88 | 85 | 82 | 85 | |||||||||||||||||||
| New business | $ | 94 | $ | 367 | $ | 68 | $ | 529 |
Gross written premiums, excluding third-party captives, for Specialty increased $50 million for the three months ended March 31, 2025 as compared with the comparable 2024 period driven by higher new business and favorable renewal premium change, inclusive of rate. Net written premiums for Specialty increased $50 million for the three months ended
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March 31, 2025 as compared with the comparable 2024 period. The increase in net earned premiums for the three months ended March 31, 2025 was consistent with the trend in net written premiums for Specialty.
Gross written premiums for Commercial increased $167 million for the three months ended March 31, 2025 as compared with the comparable 2024 period driven by favorable renewal premium change, inclusive of rate. Net written premiums for Commercial increased $160 million for the three months ended March 31, 2025 as compared with the comparable 2024 period. The increase in net earned premiums for the three months ended March 31, 2025 was consistent with the trend in net written premiums for Commercial.
Gross written premiums for International decreased $1 million for the three months ended March 31, 2025 as compared with the comparable 2024 period. Excluding the effect of foreign currency exchange rates, gross written premiums increased $14 million driven by higher new business. Net written premiums for International increased $6 million for the three months ended March 31, 2025 as compared with the comparable 2024 period. Excluding the effect of foreign currency exchange rates, net written premiums increased $19 million for the three months ended March 31, 2025 as compared with the comparable 2024 period. The decrease in net earned premiums for the three months ended March 31, 2025 was consistent with the trend in net written premiums in recent quarters for International.
Core income for Property & Casualty Operations decreased $61 million for the three months ended March 31, 2025 as compared with the comparable 2024 period, primarily due to lower underwriting results, mainly driven by unfavorable net prior year loss reserve development and higher catastrophe losses.
Catastrophe losses for Property & Casualty Operations were $97 million for the three months ended March 31, 2025 as compared with $88 million for the comparable 2024 period, primarily driven by severe weather-related events, including $53 million for the California wildfires in the 2025 period. For the three months ended March 31, 2025 and 2024, Specialty had no catastrophe losses, Commercial had catastrophe losses of $86 million and $82 million and International had catastrophe losses of $11 million and $6 million.
Unfavorable net prior year loss reserve development for Property & Casualty Operations of $61 million and favorable net prior year loss reserve development of $7 million was recorded for the three months ended March 31, 2025 and 2024. For the three months ended March 31, 2025 and 2024, Specialty recorded unfavorable net prior year loss reserve development of $10 million and favorable net prior year loss reserve development of $5 million, Commercial recorded unfavorable net prior year loss reserve development of $51 million and favorable net prior year loss reserve development of $2 million and International recorded no net prior year loss reserve development. Further information on net prior year loss reserve development is included in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.
Specialty’s combined ratio increased 4.4 points for the three months ended March 31, 2025 as compared with the comparable 2024 period primarily due to a 2.8 point increase in the loss ratio and a 1.6 point increase in the expense ratio. The increase in the loss ratio was due to unfavorable net prior year loss reserve development recorded in the current year period, driven by auto warranty in accident year 2024, and an increase in the underlying loss ratio primarily driven by continued pricing pressure in management liability lines. The increase in the expense ratio was primarily driven by higher acquisition and employee related costs.
Commercial’s combined ratio increased 3.5 points for the three months ended March 31, 2025 as compared with the comparable 2024 period due to a 4.2 point increase in the loss ratio, partially offset by a 0.6 point improvement in the expense ratio. The increase in the loss ratio was due to unfavorable net prior year loss reserve development, driven by commercial auto in accident year 2024 and an increase in the underlying loss ratio driven by the continuation of elevated loss cost trends in commercial auto. Catastrophe losses were 6.3 points of the loss ratio for the three months ended March 31, 2025 as compared with 6.8 points of the loss ratio in the comparable 2024 period. The improvement in the expense ratio was primarily driven by higher net earned premiums.
International’s combined ratio increased 2.1 points for the three months ended March 31, 2025 as compared with the comparable 2024 period largely due to a 2.0 point increase in the loss ratio. The increase in the loss ratio was primarily driven by higher catastrophe losses, which were 3.6 points of the loss ratio for the three months ended March 31, 2025, as compared with 2.0 points of the loss ratio in the comparable 2024 period. The expense ratio was generally consistent with the comparable 2024 period.
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Other Insurance Operations
The following table summarizes the results of CNA’s Other Insurance Operations for the three months ended March 31, 2025 and 2024.
| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Net earned premiums | $ | 106 | $ | 110 | ||||||||||||||||
| Net investment income | 242 | 252 | ||||||||||||||||||
| Core loss | (30) | (17) |
Core results for Other Insurance Operations decreased $13 million for the three months ended March 31, 2025 as compared with the comparable 2024 period, primarily due to a $17 million after-tax charge related to unfavorable net prior year loss reserve development associated with legacy mass tort abuse claims. CNA’s annual comprehensive review of legacy mass tort exposures is undertaken in the second quarter of each year, consistent with the recent historical timing of such review. Further information on net prior year loss reserve development is included in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.
Boardwalk Pipelines
A significant portion of Boardwalk Pipelines’ revenues is fee-based, being derived from capacity reservation charges under firm agreements with customers, which do not vary significantly period to period, but are impacted by longer term trends in its business such as changes in pricing on contract renewals and other factors as discussed in our Annual Report on Form 10-K for the year ended December 31, 2024. The pricing contained in the purchase and sales agreements associated with Boardwalk Pipelines’ ethane supply services is generally based on the same ethane commodity index, plus a fixed delivery fee. As a result, except for possible timing differences that may occur when volumes are purchased in one month and sold in another month, Boardwalk Pipelines’ ethane supply services, like its other businesses, has little to no direct commodity price exposure. For further information on Boardwalk Pipelines’ revenue recognition policies see Note 1 of the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2024. Boardwalk Pipelines’ operations and maintenance expenses are impacted by its compliance with the requirements of, among other regulations, the Pipeline and Hazardous Materials Safety Administration Mega Rule and Boardwalk Pipelines’ efforts to monitor, control and reduce emissions, as further discussed in Results of Operations of our MD&A included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.
The following table summarizes the results of operations for Boardwalk Pipelines for the three months ended March 31, 2025 and 2024, as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report. Boardwalk Pipelines also utilizes a non-GAAP measure, earnings before interest, income tax expense, depreciation and amortization (“EBITDA”) as a financial measure to assess its operating and financial performance and return on invested capital. Management believes some investors may find this measure useful in evaluating Boardwalk Pipelines’ performance as EBITDA is a commonly used metric within the midstream industry.
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| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Revenues: | ||||||||||||||||||||
| Operating revenues and other | $ | 621 | $ | 513 | ||||||||||||||||
| Interest income | 1 | 4 | ||||||||||||||||||
| Total | 622 | 517 | ||||||||||||||||||
| Expenses: | ||||||||||||||||||||
| Operating and other: | ||||||||||||||||||||
| Operating costs and expenses | 275 | 206 | ||||||||||||||||||
| Depreciation and amortization | 106 | 106 | ||||||||||||||||||
| Interest | 39 | 43 | ||||||||||||||||||
| Total | 420 | 355 | ||||||||||||||||||
| Income before income tax | 202 | 162 | ||||||||||||||||||
| Income tax expense | (50) | (41) | ||||||||||||||||||
| Net income attributable to Loews Corporation | $ | 152 | $ | 121 | ||||||||||||||||
| EBITDA | $ | 346 | $ | 307 |
Net income attributable to Loews Corporation and EBITDA increased $31 million and $39 million for the three months ended March 31, 2025 as compared with the comparable 2024 period, primarily due to the reasons discussed below.
Total revenues increased $105 million for the three months ended March 31, 2025 as compared with the comparable 2024 period. Boardwalk Pipelines’ transportation revenues increased $34 million, primarily due to re-contracting at higher rates and recently completed growth projects; storage, parking and lending revenues increased $7 million due to favorable market conditions which allowed for contracting at higher rates; and product sales revenues increased $68 million primarily from higher volumes from the sale of ethane due to a customer outage in 2024, which impacted 2024 volumes.
Operating costs and expenses increased $69 million for the three months ended March 31, 2025 as compared with the comparable 2024 period primarily from higher product costs associated with increased ethane product sales.
Interest expenses decreased $4 million for the three months ended March 31, 2025 as compared with the comparable 2024 period due to lower average outstanding long-term debt.
Non-GAAP Reconciliation of Net Income Attributable to Loews Corporation to EBITDA
The following table reconciles net income attributable to Loews Corporation to EBITDA for the three months ended March 31, 2025 and 2024:
| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Net income attributable to Loews Corporation | $ | 152 | $ | 121 | ||||||||||||||||
| Interest, net | 38 | 39 | ||||||||||||||||||
| Income tax expense | 50 | 41 | ||||||||||||||||||
| Depreciation and amortization | 106 | 106 | ||||||||||||||||||
| EBITDA | $ | 346 | $ | 307 |
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Loews Hotels & Co
The following table summarizes the results of operations for Loews Hotels & Co for the three months ended March 31, 2025 and 2024, as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.
| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Revenues: | ||||||||||||||||||||
| Operating revenue | $ | 211 | $ | 183 | ||||||||||||||||
| Revenues related to reimbursable expenses | 34 | 33 | ||||||||||||||||||
| Total | 245 | 216 | ||||||||||||||||||
| Expenses: | ||||||||||||||||||||
| Operating and other | 173 | 155 | ||||||||||||||||||
| Reimbursable expenses | 34 | 33 | ||||||||||||||||||
| Depreciation and amortization | 24 | 21 | ||||||||||||||||||
| Equity income from joint ventures | (6) | (27) | ||||||||||||||||||
| Interest | 16 | 6 | ||||||||||||||||||
| Total | 241 | 188 | ||||||||||||||||||
| Income before income tax | 4 | 28 | ||||||||||||||||||
| Income tax expense | (4) | (12) | ||||||||||||||||||
| Net income attributable to Loews Corporation | $ | — | $ | 16 |
Net income attributable to Loews Corporation decreased $16 million for the three months ended March 31, 2025 as compared with the comparable 2024 period primarily due to the reasons discussed below.
Operating revenues improved by $28 million and operating and other expenses increased by $18 million for the three months ended March 31, 2025 as compared with the comparable 2024 period. The increase in operating revenues and operating and other expenses was primarily driven by the Loews Arlington Hotel and Convention Center, which opened during the first quarter of 2024, but was operating for the entire first quarter of 2025. Operating revenues also increased due to improvements in average daily room rates and food and beverage revenues at certain other owned hotels. Operating and other expenses also increased due to the termination of a contract with a minority owner.
Equity income from joint ventures decreased $21 million for the three months ended March 31, 2025 as compared with the comparable 2024 period. The decrease was primarily driven by a decline in overall occupancy levels and average daily room rates for joint venture hotels, particularly at the Universal Orlando Resort, due in part to ongoing renovations. In addition, equity income from joint ventures for the first quarter of 2025 was impacted by the reduction in distributions for one joint venture property due to property improvement costs, and the expenses related to the opening of three new hotels at the Universal Orlando Resort, including pre-opening costs. Equity income from joint ventures also included an impairment charge recorded at a joint venture hotel that reduced Loews Hotels & Co’s equity income by $9 million in the three months ended March 31, 2025.
Depreciation and amortization expense increased $3 million for the three months ended March 31, 2025 as compared with the comparable 2024 period mainly due to the Loews Arlington Hotel and Convention Center.
Interest expense increased $10 million for the three months ended March 31, 2025 as compared with the comparable 2024 period primarily due to the Loews Arlington Hotel and Convention Center, lower capitalized interest on projects under development, and higher interest rates on certain debt refinanced in 2024.
Corporate
Corporate operations consist primarily of investment income, interest expense and administrative costs at the Parent Company. Investment income includes earnings on cash and short-term investments held at the Parent Company to meet
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current and future liquidity needs, as well as results of the trading portfolio held at the Parent Company. Corporate also includes the equity method of accounting for Altium Packaging.
The following table summarizes the results of operations for Corporate for the three months ended March 31, 2025 and 2024 as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report:
| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Revenues: | ||||||||||||||||||||
| Net investment income | $ | — | $ | 54 | ||||||||||||||||
| Expenses: | ||||||||||||||||||||
| Operating and other | 16 | 22 | ||||||||||||||||||
| Equity method loss | 7 | 1 | ||||||||||||||||||
| Interest | 18 | 19 | ||||||||||||||||||
| Total | 41 | 42 | ||||||||||||||||||
| Income (loss) before income tax | (41) | 12 | ||||||||||||||||||
| Income tax (expense) benefit | 7 | (2) | ||||||||||||||||||
| Net income (loss) attributable to Loews Corporation | $ | (34) | $ | 10 |
Net loss attributable to Loews Corporation of $34 million was recorded for the three months ended March 31, 2025 as compared with net income of $10 million in the comparable 2024 period, primarily due to the reasons discussed below.
Net investment income for the Parent Company decreased $54 million for the three months ended March 31, 2025 as compared with the comparable 2024 period, primarily due to the unfavorable change in the fair value of equity based investments.
LIQUIDITY AND CAPITAL RESOURCES
Parent Company
Parent Company cash and investments, net of receivables and payables, totaled $3.5 billion at March 31, 2025 as compared to $3.3 billion at December 31, 2024. During the three months ended March 31, 2025, we received $686 million in cash dividends from our subsidiaries, including a special cash dividend of $497 million from CNA and a $75 million distribution from Boardwalk Pipelines. Cash outflows during the three months ended March 31, 2025 included the payment of $394 million to fund treasury stock purchases and $13 million of cash dividends to our shareholders. As a holding company we depend on dividends from our subsidiaries and returns on our investment portfolio to fund our obligations. We also have an effective shelf registration statement on file with the Securities and Exchange Commission (“SEC”) under which we may publicly issue an unspecified amount of our debt, equity or hybrid securities from time to time. We are not responsible for the liabilities and obligations of our subsidiaries and there are no Parent Company guarantees.
Depending on market and other conditions, we may purchase shares of our and our subsidiaries outstanding common stock in the open market, in privately negotiated transactions or otherwise. During the three months ended March 31, 2025, we purchased 4.5 million shares of Loews Corporation common stock for $376 million. As of May 2, 2025, we repurchased 0.6 million additional shares of Loews Corporation common stock in 2025 for $53 million. As of May 2, 2025, there were 209,696,528 shares of Loews Corporation common stock outstanding.
Future uses of our cash may include purchases of our and our subsidiaries’ outstanding common stock, dividends, investing in our subsidiaries and/or to make opportunistic investments. The declaration and payment of future dividends to holders of our common stock will be at the discretion of our Board of Directors and will depend on many factors, including our earnings, financial condition and business needs.
Subsidiaries
CNA’s cash provided by operating activities was $638 million for the three months ended March 31, 2025 as compared with $504 million for the comparable 2024 period. The net cash increase quarter over quarter was primarily a result of
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higher ceded reinsurance premium payments CNA paid during the first quarter of 2024, with such similar premium amounts scheduled to occur in the second quarter of 2025. In addition to the foregoing, the increase quarter over quarter was also attributable to higher cash from underwriting and investment earnings.
CNA paid cash dividends of $2.46 per share on its common stock, including a special cash dividend of $2.00 per share, during the three months ended March 31, 2025. On May 2, 2025, CNA’s Board of Directors declared a quarterly cash dividend of $0.46 per share payable June 5, 2025 to shareholders of record on May 19, 2025. CNA’s declaration and payment of future dividends is at the discretion of its Board of Directors and will depend on many factors, including CNA’s earnings, financial condition, business needs and regulatory constraints. CNA believes that its present cash flows from operating, investing and financing activities are sufficient to fund its current and expected working capital and debt obligation needs and does not expect this to change in the near term.
Dividends to CNA from Continental Casualty Company (“CCC”), a subsidiary of CNA, are subject to the insurance holding company laws of the State of Illinois, the domiciliary state of CCC. Under these laws, ordinary dividends, or dividends that do not require prior approval by the Illinois Department of Insurance, are determined based on the greater of the prior year’s statutory net income or 10% of statutory surplus as of the end of the prior year, as well as the timing and amount of dividends paid in the preceding 12 months. Additionally, ordinary dividends may only be paid from earned surplus, which is calculated by removing unrealized gains from unassigned surplus. As of March 31, 2025, CCC was in a positive earned surplus position. CCC paid dividends of $440 million and $300 million during the three months ended March 31, 2025 and 2024. The actual level of dividends paid in any year is determined after an assessment of available dividend capacity, holding company liquidity and cash needs as well as the impact the dividends will have on the statutory surplus of the applicable insurance company.
CNA has an effective shelf registration statement on file with the SEC under which it may publicly issue an unspecified amount of debt, equity or hybrid securities from time to time.
Boardwalk Pipelines’ cash provided by operating activities was $244 million for the three months ended March 31, 2025 as compared with $249 million for the comparable 2024 period.
For the three months ended March 31, 2025 and 2024, Boardwalk Pipelines’ capital expenditures were $52 million and $97 million, consisting of growth capital expenditures of $16 million and $59 million and maintenance capital expenditures of $36 million and $38 million.
As of March 31, 2025, Boardwalk Pipelines had the full borrowing capacity of $1.0 billion available under its revolving credit facility. The revolving credit facility has a borrowing capacity of $1.0 billion through May 27, 2027, and a borrowing capacity of $912 million from May 28, 2027 to May 26, 2028. Boardwalk Pipelines anticipates that its existing capital resources, including its cash and cash equivalents, revolving credit facility and cash flows from operating activities, will be adequate to fund its operations and capital expenditures for 2025. As of March 31, 2025, Boardwalk Pipelines also has an effective shelf registration statement on file with the SEC under which it may publicly issue up to $900 million of debt securities, warrants or rights from time to time.
During the three months ended March 31, 2025, Boardwalk Pipelines paid a distribution of $75 million to the Company.
Loews Hotels & Co, through its subsidiaries, has mortgage loans maturing beyond twelve months as of March 31, 2025, which it may refinance before they mature. Refinancing any indebtedness, including loans of unconsolidated joint venture partnerships, may require Loews Hotels & Co to make principal pay downs, establish restricted cash reserves or provide guaranties of the subsidiary’s debt. Through the date of this Report, all Loews Hotels & Co’s subsidiaries are in compliance with their debt covenants.
INVESTMENTS
Investment activities of our non-insurance subsidiaries primarily consist of investments in fixed income securities, including short-term investments. The Parent Company portfolio also includes equity securities, including short sales and derivative instruments. Certain of these types of Parent Company investments generally have greater volatility, less liquidity and greater risk than fixed income investments and are included within Results of Operations – Corporate.
The Parent Company enters into short sales and invests in certain derivative instruments that are used for asset and liability management activities, income enhancements to its portfolio management strategy and to benefit from anticipated future movements in the underlying markets. If such movements do not occur as anticipated, significant losses may occur. Monitoring procedures include senior management review of daily reports of existing positions and valuation fluctuations to seek to ensure that open positions are consistent with the portfolio strategy.
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Credit exposure associated with non-performance by counterparties to derivative instruments is generally limited to the uncollateralized change in fair value of the derivative instruments recognized in the Consolidated Condensed Balance Sheets. The risk of non-performance is mitigated by monitoring the creditworthiness of counterparties and diversifying derivatives by using multiple counterparties. Collateral is occasionally required from derivative investment counterparties depending on the amount of the exposure and the credit rating of the counterparty.
Insurance
CNA maintains a large portfolio of fixed maturity and equity securities, including large amounts of corporate and government issued debt securities, residential and commercial mortgage-backed securities, other asset-backed securities and investments in limited partnerships which pursue a variety of long and short investment strategies across a broad array of asset classes. CNA’s investment portfolio supports its obligation to pay future insurance claims and provides investment returns which are an important part of CNA’s overall profitability.
Net Investment Income
The significant components of CNA’s net investment income are presented in the following table. Fixed income securities, as presented, include both fixed maturity securities and non-redeemable preferred stock.
| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Fixed income securities: | ||||||||||||||||||||
| Taxable fixed income securities | $ | 496 | $ | 472 | ||||||||||||||||
| Tax-exempt fixed income securities | 34 | 38 | ||||||||||||||||||
| Total fixed income securities | 530 | 510 | ||||||||||||||||||
| Limited partnership and common stock investments | 54 | 68 | ||||||||||||||||||
| Other, net of investment expense | 20 | 31 | ||||||||||||||||||
| Net investment income | $ | 604 | $ | 609 |
| Effective income yield for the fixed income securities portfolio | 4.8 | % | 4.7 | % | ||||||||||||||||
| Limited partnership and common stock return for the period | 2.0 | % | 2.9 | % |
CNA’s net investment income decreased $5 million for the three months ended March 31, 2025 as compared with the comparable 2024 period, reflecting the largely offsetting impacts of lower common stock returns and higher income from fixed income securities.
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Investment Gains (Losses)
The components of CNA’s investment gains (losses) are presented in the following table:
| Three Months Ended March 31 | 2025 | 2024 | ||||||||||||||||||
| (In millions) | ||||||||||||||||||||
| Investment gains (losses): | ||||||||||||||||||||
| Fixed maturity securities: | ||||||||||||||||||||
| Corporate and other bonds | $ | (9) | $ | (17) | ||||||||||||||||
| States, municipalities and political subdivisions | (1) | |||||||||||||||||||
| Asset-backed | 1 | (15) | ||||||||||||||||||
| Total fixed maturity securities | (9) | (32) | ||||||||||||||||||
| Non-redeemable preferred stock | 11 | |||||||||||||||||||
| Derivatives, short-term and other | (1) | |||||||||||||||||||
| Total investment losses | (9) | (22) | ||||||||||||||||||
| Income tax benefit | 2 | 5 | ||||||||||||||||||
| Amounts attributable to noncontrolling interests | 1 | 1 | ||||||||||||||||||
| Investment losses attributable to Loews Corporation | $ | (6) | $ | (16) |
CNA’s pretax investment losses decreased $13 million for the three months ended March 31, 2025 as compared with the comparable 2024 period, driven by lower net losses on disposals of fixed maturity securities and lower impairment losses, partially offset by the favorable change in fair value of non-redeemable preferred stock in the prior year quarter.
Further information on CNA’s investment gains and losses is set forth in Note 2 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.
Portfolio Quality
The following table presents the estimated fair value and net unrealized gains (losses) of CNA’s fixed maturity securities by rating distribution:
| March 31, 2025 | December 31, 2024 | ||||||||||||||||||||||
| Estimated Fair Value | Net Unrealized Gains (Losses) | Estimated Fair Value | Net Unrealized Gains (Losses) | ||||||||||||||||||||
| (In millions) | |||||||||||||||||||||||
| U.S. Government, Government agencies and Government-sponsored enterprises | $ | 3,043 | $ | (309) | $ | 2,936 | $ | (369) | |||||||||||||||
| AAA | 3,080 | (198) | 3,010 | (217) | |||||||||||||||||||
| AA | 6,227 | (545) | 6,369 | (567) | |||||||||||||||||||
| A | 10,711 | (288) | 10,260 | (379) | |||||||||||||||||||
| BBB | 17,077 | (551) | 16,757 | (729) | |||||||||||||||||||
| Non-investment grade | 1,835 | (80) | 1,779 | (64) | |||||||||||||||||||
| Total | $ | 41,973 | $ | (1,971) | $ | 41,111 | $ | (2,325) |
As of March 31, 2025 and December 31, 2024, 1% of CNA’s fixed maturity portfolio was rated internally. AAA rated securities included $0.2 billion of prefunded municipal bonds as of March 31, 2025 and December 31, 2024.
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The following table presents CNA’s available-for-sale fixed maturity securities in a gross unrealized loss position by ratings distribution:
| March 31, 2025 | Estimated Fair Value | Gross Unrealized Losses | |||||||||
| (In millions) | |||||||||||
| U.S. Government, Government agencies and Government-sponsored enterprises | $ | 2,212 | $ | 322 | |||||||
| AAA | 1,453 | 265 | |||||||||
| AA | 3,981 | 701 | |||||||||
| A | 6,254 | 527 | |||||||||
| BBB | 10,922 | 849 | |||||||||
| Non-investment grade | 1,024 | 103 | |||||||||
| Total | $ | 25,846 | $ | 2,767 |
The following table presents the maturity profile for these available-for-sale fixed maturity securities. Securities not due to mature on a single date are allocated based on weighted average life:
| March 31, 2025 | Estimated Fair Value | Gross Unrealized Losses | |||||||||
| (In millions) | |||||||||||
| Due in one year or less | $ | 1,350 | $ | 22 | |||||||
| Due after one year through five years | 7,185 | 317 | |||||||||
| Due after five years through ten years | 7,338 | 785 | |||||||||
| Due after ten years | 9,973 | 1,643 | |||||||||
| Total | $ | 25,846 | $ | 2,767 |
Duration
A primary objective in the management of CNA’s investment portfolio is to optimize return relative to the corresponding liabilities and respective liquidity needs. CNA’s views on the current interest rate environment, tax regulations, asset class valuations, specific security issuer and broader industry segment conditions as well as domestic and global economic conditions, are some of the factors that enter into an investment decision. CNA also continually monitors exposure to issuers of securities held and broader industry sector exposures and may from time to time adjust such exposures based on its views of a specific issuer or industry sector.
A further consideration in the management of CNA’s investment portfolio is the characteristics of the corresponding liabilities and the ability to align the duration of the portfolio to those liabilities and to meet future liquidity needs, minimize interest rate risk and maintain a level of income sufficient to support the underlying insurance liabilities. For portfolios where future liability cash flows are determinable and typically long-term in nature, CNA segregates investments for asset/liability management purposes. The segregated investments support the long-term care and structured settlement liabilities in Other Insurance Operations. The effective durations of CNA’s fixed income securities and short-term investments are presented in the following table. Amounts presented are net of payable and receivable amounts for securities purchased and sold, but not yet settled.
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| March 31, 2025 | December 31, 2024 | ||||||||||||||||||||||
| Estimated Fair Value | Effective Duration (Years) | Estimated Fair Value | Effective Duration (Years) | ||||||||||||||||||||
| (In millions of dollars) | |||||||||||||||||||||||
| Life & Group | $ | 15,351 | 9.8 | $ | 14,915 | 9.8 | |||||||||||||||||
| Property & Casualty and other | 28,627 | 4.4 | 28,779 | 4.3 | |||||||||||||||||||
| Total | $ | 43,978 | 6.3 | $ | 43,694 | 6.2 |
CNA’s investment portfolio is periodically analyzed for changes in duration and related price risk. Certain securities have duration characteristics that are variable based on market interest rates, credit spreads and other factors that may drive variability in the amount and timing of cash flows. Additionally, CNA periodically reviews the sensitivity of the portfolio to the level of foreign exchange rates and other factors that contribute to market price changes. A summary of these risks and specific analysis on changes is included in the Quantitative and Qualitative Disclosures about Market Risk included under Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2024.
CRITICAL ACCOUNTING ESTIMATES
Certain accounting policies require us to make estimates and judgments that affect the amounts reflected in the Consolidated Condensed Financial Statements. Such estimates and judgments necessarily involve varying, and possibly significant, degrees of uncertainty. Accordingly, certain amounts currently recorded or disclosed in the financial statements will likely be adjusted in the future based on new available information and changes in other facts and circumstances. See the Critical Accounting Estimates and the Insurance Reserves sections of our MD&A included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024 for further information.
ACCOUNTING STANDARDS UPDATE
For a discussion of accounting standards updates that have been adopted, please read Note 1 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.
FORWARD-LOOKING STATEMENTS
Investors are cautioned that certain statements contained in this Report as well as in other of our and our subsidiaries’ SEC filings and periodic press releases and certain statements made by us and our subsidiaries and our and their officials in presentations or remarks may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”). Forward-looking statements include, without limitation, any statement that does not directly relate to any historical or current fact and may project, indicate or imply future results, events, performance or achievements. Such statements may contain the words “expect,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “will be,” “will continue,” “will likely result,” and similar expressions. In addition, any statement concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, and possible actions taken by us or our subsidiaries are also forward-looking statements as defined by the Act. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to a variety of risks and uncertainties, many of which are beyond our control, that could cause actual results to differ materially from those anticipated or projected.
Developments in any of the risks or uncertainties facing us or our subsidiaries, including those described under Part I, Item 1A, Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024 and in our and our subsidiaries’ other filings with the SEC, could cause our and our subsidiaries’ results to differ materially from results that have been or may be anticipated or projected. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made and we and our subsidiaries expressly disclaim any obligation or undertaking to update these statements to reflect any change in expectations or beliefs or any change in events, conditions or circumstances on which any forward-looking statement is based.
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