Loews 3Q Disappoints on Irene Destruction

By Features FOXBusiness

Loews (L) widely missed Wall Street's quarterly expectations on sharply higher catastrophe losses caused by Hurricane Irene’s destruction up and down the East Coast, the company said on Monday. 

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The New York-based commercial property and casualty insurance company posted third-quarter net income of $162 million, or 40 cents a share, compared with $36 million, or 9 cents a share, in the same quarter last year.

The results fell widely short of average analyst estimates polled by Thomson Reuters of 66 cents. The company said its net investment income for the third quarter nearly halved to $333 million year-over-year.

Revenue for the three-month period fell 7% to $3.44 billion.

Higher catastrophe losses weighed heavily on its earnings during the quarter. CNA (CNA), which is owned 90% by Loews, saw catastrophe losses jump to $32 million compared with $8 million a year ago.

Property insurers have had a rough year with severe tornados and flooding in the Midwest earlier this year, the March earthquake and tsunami in Japan, and damages from Hurricane Irene in the latest quarter.

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Offsetting the losses was a stronger-than-expected quarterly profit earlier this month from Diamond Offshore (DO), in which Loews has a 50.4% stake.