Loews net falls 14 percent, hurt by CNA insurance unit

By Jonathan Stempel

NEW YORK (Reuters) - Loews Corp LTR.N posted an unexpected drop in first-quarter profit on Monday, hurt by disappointing results from its CNA Financial Corp (CNA.N: Quote, Profile, Research) insurance unit.

In Monday afternoon trading, shares of Loews were down $2.07, or 4.6 percent, at $42.56, while CNA slid $2.90, or 10.4 percent, to $25.09.

Net income at New York-based Loews, a conglomerate run by the billionaire Tisch family, declined 14 percent to $662 million from $768 million a year earlier.

Profit attributable to Loews shareholders fell 15 percent to $555 million, or $1.05 per share, from $650 million, or $1.20.

Excluding investments and discontinued operations, profit was $503 million, or 95 cents per share, down from $1.07 per share a year earlier. On that basis, analysts on average expected $1.14 per share, according to Reuters Estimates.

Revenue fell 2 percent to $4.54 billion. Results included an $82 million gain from the Jan. 10 sale of the Bulova Corp watch-making unit to Japan's Citizen Holdings Co (7762.T: Quote, Profile, Research).

Results suffered from a larger-than-expected 28 percent drop in operating profit at Chicago-based CNA, a commercial insurer in which Loews owns a 90 percent stake. Premiums and investment income fell, and catastrophe losses increased. CNA profit has declined for four straight quarters.

"Loews managers seem to be very good at everything except insurance, which is their biggest business," said Matt Nellans, an analyst at Morningstar Inc in Chicago. "Including run-off businesses, CNA is paying out more than it's taking in."