Carolina Group Reports Net Income and Pro Forma Results for the First Quarter of 2002.Business Editors NEW YORK--(BUSINESS WIRE)--May 9, 2002 Loews The name Loews can refer to several articles in the Wikipedia:
See: New York Stock Exchange :LTR LTR - Langage Temps-Réel. (French for "real-time language") A French predecessor to Ada, LTR is Modula-like with a set of special-purpose real-time constructs based on an event model. It was mentioned in the reference below. ["An Overview of Ada", J.G.P. ) reported today net income of $18.0 million or $.45 per share for its Carolina Carolina (kärōlē`nä), city (1990 pop. 177,806), Puerto Rico. Located 7 mi (11 km) SE of San Juan, it is a residential suburb of the capital, as well as a commercial and industrial center. Group tracking stock (NYSE:CG) for the quarter ended March 31, 2002. Net income attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to Carolina Group Stock for the quarter reflects two months of actual results commencing with the initial issuance of Carolina Group Stock by Loews Corporation in February February: see month. 2002. On a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis, assuming the Carolina Group Stock had been issued at January January: see month. 1, 2001, net income for the quarter ended March 31, 2002 amounted to $32.0 million or $.80 per share of Carolina Group stock, compared to $31.3 million or $.78 per share in the 2001 first quarter. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight in the first quarter of 2002 were $973.1 million compared to $905.3 million in the comparable 2001 quarter. Net sales for 2001 were restated for comparative purposes to reflect the adoption of new accounting principles related to the classification of certain sales incentives Noun 1. sales incentive - remuneration offered to a salesperson for exceeding some predetermined sales goal bonus, incentive - an additional payment (or other remuneration) to employees as a means of increasing output . This pro forma information is based on the historical financial statements of the Carolina Group, adjusted to accrue To increase; to augment; to come to by way of increase; to be added as an increase, profit, or damage. Acquired; falling due; made or executed; matured; occurred; received; vested; was created; was incurred. interest expense at 8% per annum Per annum Yearly. on $2.5 billion of notional no·tion·al adj. 1. Of, containing, or being a notion; mental or imaginary. 2. Speculative or theoretical. 3. intergroup in·ter·group adj. Being or occurring between two or more social groups: intergroup relations; intergroup violence. debt and an adjustment to income taxes for the impact of the interest expense. Per share amounts are based on income available to Carolina Group shareholders. As previously reported, Loews Corporation intends to pay a quarterly dividend of $.445 per share on Carolina Group Stock. The first dividend on Carolina Group Stock is expected to be declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. by the Board of Directors at its meeting scheduled for May 14, 2002 and, if declared, would be payable on June June: see month. 14, 2002 to holders of record on May 28, 2002. The Carolina Group Stock, commonly called a tracking stock, is intended to reflect the economic performance of a defined group of the Company's assets and liabilities, referred to as the Carolina Group, principally consisting of the Company's subsidiary Lorillard, Inc. The Carolina Group, a notional group, is not a separate legal entity. The purpose of this financial information is to provide investors with additional information to use in analyzing the results of operations and financial condition of the Carolina Group, and this financial information should be read in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with the consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: financial information of Loews Corporation. Loews Corporation has issued a separate press release reporting its consolidated results for the first quarter of 2002, which accompanies this press release. A conference call to discuss the first quarter results of Loews Corporation has been scheduled for 11:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy , Thursday Thursday: see week. , May 9, 2002. The call can be accessed by dialing (888) 307-7192 or by visiting the Loews Corporation website (www.loews.com), where the Company will provide an online, real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. broadcast of this call. Please go to the website at least 10 minutes before the event begins to register and to download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. and install any necessary audio software. An online replay will be available at the Company's website for one week following the call.
Carolina Group
Financial Review
March 31,
Three Months
2002 2001
(Amounts in millions,
except per share data)
Net sales (a) $ 973.1 $ 905.3
Cost of sales (a) 600.2 554.1
Selling, advertising and
administrative 111.8 109.2
Total operating costs and expenses 712.0 663.3
Operating income 261.1 242.0
Investment income 14.2 30.5
Interest expense (29.0)
Income before income taxes 246.3 272.5
Income taxes 95.6 106.9
Net income 150.7 165.6
Earnings attributable to the
Loews Group intergroup interest (b) 132.7 165.6
Income attributable to Carolina
Group shareholders (c) $ 18.0 $ --
Per share of Carolina Group
stock (d) $ 0.45
Weighted number of shares
outstanding 40.25
(a) Includes excise taxes of $180.4 and $150.7.
(b) Adjusted to reflect the Loews Group's 76.83% intergroup interest
in the earnings of the Carolina Group after completion of the
February 1, 2002 offering of 40,250,000 shares of Carolina Group
stock. The Loews Group's economic interest is expressed in share
equivalents amounting to 133,500,000 shares for a total of
173,750,000 shares and share equivalents outstanding after the
offering.
(c) Represents 23.17% of the economic interest in the Carolina Group
for the two month period ended March 31, 2002.
(d) Earnings per common share-assuming dilution is not presented
because securities that could potentially dilute basic earnings
per share in the future would have been insignificant for the
periods presented.
Carolina Group
Pro Forma Financial Review
March 31,
Three Months
2002 2001
(Amounts in millions,
except per share data)
Net sales (a) $ 973.1 $ 905.3
Cost of sales (a) 600.2 554.1
Selling, advertising and
administrative 111.8 109.2
Total operating costs and
expenses 712.0 663.3
Operating income 261.1 242.0
Investment income 14.2 30.5
Interest expense (b) (50.0) (50.0)
Income before income taxes 225.3 222.5
Income taxes (b) 87.4 87.4
Net income 137.9 135.1
Earnings attributable to the
Loews Group intergroup
interest (c) 105.9 103.8
Income available to Carolina
Group shareholders $ 32.0 $ 31.3
Per share of Carolina
Group stock (d) $ 0.80 $ 0.78
Weighted number of shares
outstanding 40.25 40.25
(a) Includes excise taxes of $180.4 and $150.7 paid on sales of
manufactured products for the respective periods.
(b) Includes pro forma adjustment to accrue interest expense at 8% per
annum on $2,500.0 of notional intergroup debt and an adjustment to
income taxes for the impact of the interest expense.
(c) Includes pro forma adjustment to reflect the Loews Group's 76.83%
intergroup interest in the earnings of the Carolina Group after
completion of the offering of 40,250,000 shares of Carolina Group
stock. The Loews Group's economic interest is expressed in share
equivalents amounting to 133,500,000 shares for a total of
173,750,000 shares and share equivalents outstanding after the
offering.
(d) Pro forma earnings per share of Carolina Group stock assumes the
Carolina Group was a separate group as of January 1, 2001. Pro
forma earnings per common share-assuming dilution is not presented
because securities that could potentially dilute basic earnings
per share in the future would have been insignificant for the
periods presented.
Carolina Group
Supplemental Information
The following information regarding domestic U.S. unit volume shipped
by Lorillard Tobacco Company to its direct buying customers by brand
as follows (all units in billions):
March 31,
Three Months
2002 2001
Full Price Brands
Total Newport 8.395 7.747
Total Kent Family 0.363 0.413
Total True 0.247 0.267
Total Max 0.017 0.019
Total Satin 0.004 0.005
Total Triumph 0.001 0.002
Total Full Price Brands 9.027 8.453
Price/Value Brands
Total Old Gold 0.329 0.432
Total Maverick 0.202 0.406
Total Price/Value Brands 0.531 0.838
Total Domestic Cigarettes 9.558 9.291
Notes:
1. This information is unaudited and is not adjusted for returns.
2. Domestic unit volume includes units sold as well as promotional
units, and excludes volumes for Puerto Rico and U.S. Possessions.
3. Unit volume for a quarter is not necessarily indicative of unit
volume for any subsequent period.
4. Unit volume is not necessarily indicative of the level of revenues
for any period.
Loews Corporation Reports Net Income for the First Quarter of 2002 NEW YORK--May 9, 2002--Loews Corporation (NYSE:LTR;CG) today reported consolidated net income (including both the Loews Group and Carolina Group) for the 2002 first quarter of $252.9 million, compared to $472.3 million in the 2001 first quarter. Net income in the first quarter of 2002 includes net investment gains of $15.5 million compared to $228.9 million in the comparable period of the prior year. Net income in the first quarter of 2002 also includes a loss for discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. at CNA (Certified NetWare Administrator) See Novell certification. of $31.0 million, compared to income of $0.2 million in the 2001 first quarter. The first quarter of 2001 included a charge for accounting changes of $53.3 million related to accounting for derivative instruments Derivative instruments Contracts such as options and futures whose price is derived from the price of an underlying financial asset. at CNA. Consolidated net operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. , which excludes net investment gains, discontinued operations and accounting changes, for the quarter ended March 31, 2002 was $268.1 million, compared to $296.5 million in the 2001 first quarter. The Company has two classes of common stock, Loews Common Stock and Carolina Group Stock, issued in February 2002. Earnings per share data are presented for the Company's two classes of common stock for the periods they were outstanding. Net income attributable to Loews Common Stock for the 2002 first quarter amounted to $234.9 million or $1.23 per share, compared to $472.3 million or $2.40 per share in the 2001 first quarter. Net income in the first quarter of 2002 includes net investment gains attributable to Loews Common Stock of $15.5 million or $.08 per share, compared to gains of $228.9 million or $1.16 per share in the comparable period of the prior year. Net income attributable to Loews Common Stock in the first quarter of 2002 also included a loss for discontinued operations at CNA of $31.0 million or $.16 per share, compared to income of $0.2 million in the 2001 first quarter. The first quarter of 2001 also included a charge for accounting changes of $53.3 million or $.27 per share, related to accounting for derivative instruments at CNA. Net operating income attributable to Loews Common Stock, which excludes net investment gains, discontinued operations and accounting changes, for the quarter ended March 31, 2002, was $250.4 million or $1.31 per share, compared to $296.5 million or $1.51 per share in the 2001 first quarter. Net income attributable to Carolina Group stock for the 2002 first quarter amounted to $18.0 million or $.45 per share. The Company is issuing a separate press release reporting the actual and pro forma results of the Carolina Group for the quarters ended March 31, 2002 and 2001. The Carolina Group's reported results for the quarter ended March 31, 2001 do not reflect the issuance in February 2002 of Carolina Group stock. Consolidated gross revenues amounted to $4.8 billion in the first quarter of 2002, compared to $4.9 billion in the comparable period of the prior year. Revenues for the quarter ended 2001 have been restated for comparative purposes to reflect the adoption of new accounting principles related to the classification of certain sales incentives by Lorillard. In February 2002 the Company created a second class of common stock, called Carolina Group Stock, a tracking stock intended to reflect the economic performance of a group of the Company's assets and liabilities, called the Carolina Group, principally consisting of the Company's subsidiary Lorillard, Inc., and in an initial public offering the Company issued shares of Carolina Group Stock representing 23.17% of the economic performance of the Carolina Group. Loews Common Stock will continue to represent the economic performance of the Company's remaining assets, including the 76.83% interest in the Carolina Group not represented by Carolina Group Stock. At March 31, 2002, the Company had a book value of $57.29 per share of Loews Common Stock compared to a book value of $50.39 per share at December December: see month. 31, 2001. The increase in Loews Common Stock book value per share is primarily due to proceeds from issuance of the Carolina Group common stock and the Loews Group's net economic interest in the notional intergroup debt receivable. As of March 31, 2002, there were 189,405,800 shares of Loews Common Stock outstanding. During the quarter ended March 31, 2002, the Company purchased 2,099,200 shares of Loews Common Stock at an aggregate cost of $122.9 million. Depending on market conditions, the Company from time to time purchases shares of its, and its subsidiaries', outstanding common stock in the open market or otherwise. A conference call to discuss the first quarter results of Loews Corporation has been scheduled for 11:00 a.m. EST, Thursday, May 9, 2002. The call can be accessed by dialing (888) 307-7192 or by visiting the Loews Corporation website (www.loews.com), where the Company will provide an online, real-time broadcast of this call. Please go to the website at least 10 minutes before the event begins to register and to download and install any necessary audio software. An online replay will be available at the Company's website for one week following the call. A conference call to discuss the first quarter results of CNA has been scheduled for 10:00 a.m. EST, Thursday, May 9, 2002. The call can be accessed by dialing (800) 289-0436 or by visiting the CNA website (www.cna.com/cna/html/investor.html), where CNA will provide an online, real-time broadcast of its call. Please go to the website at least 10 minutes before the event begins to register and to download and install any necessary audio software. An online replay will be available at CNA's website for one week following the call or by dialing (888) 203-1112, passcode 438756.
Loews Corporation and Subsidiaries
Financial Review
March 31,
Three Months
2002 2001
(Amounts in millions,
except per share data)
Revenues:
Insurance premiums and
net investment income (a) $ 3,322.7 $ 3,487.6
Manufactured products (b) 1,004.5 937.4
Other 459.2 503.9
-------------------------
Total 4,786.4 4,928.9
-------------------------
Expenses:
Insurance claims &
policyholders' benefits 2,310.1 2,069.4
Cost of manufactured
products sold (b) 607.4 563.7
Other 1,385.5 1,372.3
-------------------------
Total 4,303.0 4,005.4
-------------------------
483.4 923.5
-------------------------
Income tax expense 171.5 328.4
Minority interest 28.0 69.7
-------------------------
Total 199.5 398.1
-------------------------
Income from continuing
operations 283.9 525.4
Discontinued operations-net (31.0) 0.2
Cumulative effect of change
in accounting principles-net (c) (53.3)
-------------------------
Net income $ 252.9 $ 472.3
=========================
Net income attributable
to:
Loews Common Stock:
Income from continuing
operations $ 265.9 $ 525.4
Discontinued operations-net (31.0) 0.2
Cumulative effect of change
in accounting principles-net (c) (53.3)
-------------------------
Loews Common Stock 234.9 472.3
Carolina Group Stock (d) 18.0
-------------------------
$ 252.9 $ 472.3
=========================
Income per Loews common share (e):
Income before cumulative
effect of change in accounting
principles $ 1.39 $ 2.67
Discontinued operations-net (0.16)
Cumulative effect of changes
in accounting principles-net (c) (0.27)
-------------------------
Net income $ 1.23 $ 2.40
=========================
Income per Carolina Group
common share (e) $ 0.45
=========================
Weighted number of
shares outstanding:
Loews Common Stock 191.09 197.23
Carolina Group Stock 40.25
(a) Includes investment gains of $23.5 and $407.5 for the respective
periods.
(b) Includes excise taxes of $180.4 and $150.7 paid on sales of
manufactured products for the respective periods.
(c) Adoption of SFAS No. 133, accounting for derivative instruments
and hedging activities at the CNA subsidiary.
(d) Represents 23.17% of the economic interest in the Carolina Group
from the February 2002 initial public offering of Carolina Group
Stock.
(e) Earnings per common share-assuming dilution is not presented
because securities that could potentially dilute basic earnings
per common share in the future would have been insignificant for
the periods presented.
Loews Corporation and Subsidiaries
Additional Financial Information
March 31,
Three Months
2002 2001
(In millions)
Revenues:
CNA Financial $ 3,446.9 $ 3,198.0
Lorillard (a) 984.3 933.9
Loews Hotels 77.2 84.8
Diamond Offshore 204.1 224.4
Bulova 32.4 32.9
Investment income-net
and other (b) 18.0 47.4
-----------------------
4,762.9 4,521.4
-----------------------
Investment gains:
CNA Financial 1.0 370.8
Corporate and other 22.5 36.7
-----------------------
23.5 407.5
-----------------------
Total $ 4,786.4 $ 4,928.9
=======================
Income Before Taxes:
CNA Financial $ 172.4 $ 179.5
Lorillard (c) 243.7 270.5
Loews Hotels 9.5 8.7
Diamond Offshore 27.7 47.2
Bulova 3.0 4.3
Investment income-net
and other (b) (25.2) 5.8
-----------------------
431.1 516.0
-----------------------
Investment gains:
CNA Financial 1.0 370.8
Corporate and other 22.0 36.7
-----------------------
23.0 407.5
-----------------------
Loews Common Stock 454.1 923.5
Carolina Group (d) 29.3
-----------------------
Total $ 483.4 $ 923.5
=======================
Net Income:
CNA Financial $ 101.4 $ 105.8
Lorillard (c) 149.0 164.4
Loews Hotels 6.0 5.5
Diamond Offshore 8.7 14.7
Bulova 1.6 2.4
Investment income-net
and other (b) (16.3) 3.7
-----------------------
250.4 296.5
-----------------------
Investment gains:
CNA Financial 2.2 206.9
Corporate and other 13.3 22.0
-----------------------
15.5 228.9
-----------------------
Income from continuing operations 265.9 525.4
Discontinued operations-net (31.0) 0.2
Cumulative effect of changes
in accounting principles-net (53.3)
-----------------------
Loews Common Stock 234.9 472.3
Carolina Group (d) 18.0
-----------------------
Total $ 252.9 $ 472.3
=======================
(a) Includes excise taxes of $180.4 and $150.7 paid on sales of
manufactured products for the respective periods.
(b) Consists primarily of corporate investment income, interest
expenses and other unallocated expenses.
(c) Represents the Loews Group's 76.83% intergroup interest in the
earnings of the Carolina Group.
(d) Represents 23.17% of the economic interest in the Carolina Group
from the February 2002 initial public offering of Carolina Group
Stock.
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