Loews Corporation (NYSE:L) Q4 2018 Earnings Conference Call Transcript
Feb 11, 2019 • 11:00 am ET
Ladies and gentlemen, thank you for standing by, and welcome to the Loews Corporation Q4 2018 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions) Thank you.
I will now turn the call over to Mary Skafidas to begin.
Thank you, Laurie. Good morning, everyone. Welcome to Loews Corporation's Fourth Quarter and Year-End Earnings Call. A copy of our earnings release, earnings supplement and company overview, may be found on our website, loews.com. On the call this morning, we have our Chief Executive Officer, Jim Tisch; and our Chief Financial Officer, David Edelson.
Following our prepared remarks this morning, we will have a question-and-answer session, which will include questions from our shareholders. Before we begin, however, I will remind you that this conference call might include statements that are forward-looking in nature. Actual results achieved by the company may differ materially from those made or implied in any forward-looking statements due to a wide range of risks and uncertainties, including those set forth in our SEC filings forward-looking statements reflect circumstances at the time they are made.
The company expressly disclaims any obligation to update or revise any forward-looking statements. This disclaimer is only a brief summary of the company's statutory forward-looking statements disclaimer, which is included in the company's filings with the SEC. During the call today, we might also discuss non-GAAP financial measures. Please refer to our security filings and earnings supplement for reconciliation to the most comparable GAAP measures
In a few minutes, our CFO, David Edelson will walk you through the key drivers for the quarter and the year. But before he does, Jim Tisch, our CEO, will kick off the call. Jim, over to you.
James S. Tisch
Thank you, Mary, and good morning. Loews had a disappointing fourth quarter, results negatively affected by higher than expected catastrophe losses in CNA and severe declines in the stock market at the end of 2018, impacting both Loews' and CNA's investment portfolios. Specifically with regard to CNA, let's put these equity related losses in context. While the stock market declined 14% in the fourth quarter, CNA's limited partnership and common equity portfolios were down 5.7% or about a $138 million, counterbalancing CNA's fourth quarter investment performance, underlying operations for the full year were strong.
In 2018, net written premiums grew by 4% and rate increased by 2.6%. CNA's underlying combined ratio improved for the second straight year and while CNA's loss ratio ticked up slightly in 2018, it's essentially on par with its top quartile peers. Additionally, CNA has reduced its expense ratio by 2 points over the past two years, while still making necessary investments in technology, analytics and talents.
Earlier today, in light of the full year 2018 results and its strong balance sheet and the CNA bodes positive outlooks, CNA declared a $0.35 quarterly dividend as well as a $2 special dividend. These dividend payments will result in Loews receiving