For Immediate Release
Chicago, IL – May 4, 2010 – Zacks.com Analyst Blog features: Loews Corporation (L), CNA Financial Corp. (CNA), Diamond Offshore Drilling Inc. (DO), Boardwalk Pipeline Partners LP (BWP) and The Medicines Co. (MDCO).
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Here are highlights from Monday’s Analyst Blog:
Loews Reports In Line
Loews Corporation (L) reported first quarter net income of $420 million or 99 cents per share, compared with a net loss of $647 million or $1.49 per share in the prior-year quarter. Excluding investment gains and losses, results came in at 96 cents, in-line with the Zacks Consensus Estimate. The results also compare favorably with the prior-year quarter loss of 77 cents.
The significant increase in earnings reflects a non-cash impairment charge incurred in the year-ago quarter. This charge of $1.0 billion ($660 million after tax) related to the carrying value of HighMount Exploration & Production LLC’s natural gas and oil properties in the prior-year period, which reflected declines in commodity prices.
Additionally, the results in the first quarter 2010 include higher investment income at CNA Financial Corp. (CNA), driven by an improved performance in limited partnerships and fixed maturities. These were partially offset by a drop in earnings at Diamond Offshore Drilling Inc. (DO) due to lower operating income and increased interest expense.
Loews reported a 23% year-over-year increase in revenues to $3.7 billion in the quarter. The company experienced net investment gains of $11 million compared with net investment losses of $310 million in the prior-year period. Results included $35 million of other-than-temporary impairment losses in the reported quarter compared with $359 million in the year ago quarter.
CNA Financial’s net income attributable to Loews Corp. increased to $206 million compared with $140 million in the year-ago quarter. However, Diamond Offshore’s earnings dropped to $136 million from $163 million in the prior-year period.
Boardwalk Pipeline Partners LP’s (BWP) earnings came in at $38 million, ahead of the prior-year quarter earnings of $22 million. HighMount Exploration reported earnings of $32 million compared with a loss of $641 million in the year-ago quarter, reflecting the impairment charges in the year-ago period.
Also, Loews Hotels incurred a loss of $1 million compared with a loss of $18 million a year ago, as the prior-year quarter results included impairment charges related to the write-down of Loews Hotels’ entire investment in a hotel property.
Medicines Co. Beats
The Medicines Co. (MDCO) reported a first-quarter profit of 19 cents per share, including the impact of stock-based compensation expense. First quarter profit was well above the Zacks Consensus Estimate of 13 cents and the year-ago loss of 3 cents.
Performance was boosted by lower operating expenses. The company completed its cost reduction program by cutting 74 jobs and expects to achieve annual savings in the range of $14.5 million – $16.5 million.
Revenues increased 2.9% to $102 million. While Angiomax sales in the US remained flat at $95.7 million, sales in ex-US markets increased to $5.6 million. On a sequential basis, ex-US sales increased marginally.
US sales were impacted by the company’s participation in the 340B drug pricing program, under which Angiomax was provided at a significant discount to qualifying customers, including disproportionate share hospitals (DSH).
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