Core EPS up 16% year over year
LCD glass price declines
expected to moderate further in third quarter
CORNING, N.Y., July 29,
2014 - Corning Incorporated (NYSE: GLW) today
announced its results for the second quarter of 2014.
Second-Quarter
Highlights
- Core sales were $2.6 billion*, a 28% increase on
a year-over-year basis. Net sales (GAAP) were $2.5 billion, a 25%
increase on a year-over-year basis.
- Core earnings per share were $0.37 per share*, a
16% improvement over a year ago, marking the seventh consecutive
quarter of year-over-year core EPS growth. GAAP earnings per share
were $0.11.
- Corning's LCD glass volume grew more than
expected due in part to stronger-than-expected retail TV sales in
Europe and South America, likely driven by the FIFA World Cup.
Year-over-year sales in the Optical Communications and
Environmental Technologies segments grew 14% and 25%,
respectively.
Second-Quarter Financial
Comparisons
In millions, except percentages and per-share amounts
|
Core Performance* |
|
Q2 2014 |
Q2 2013 |
% Change |
Core Net Sales |
$2,577 |
$2,021 |
28% |
Core Equity Earnings |
$58 |
$173 |
(66%) |
Core Earnings |
$527 |
$469 |
12% |
Core EPS |
$0.37 |
$0.32 |
16% |
|
GAAP |
|
Q2 2014 |
Q2 2013 |
% Change |
Net Sales |
$2,482 |
$1,982 |
25% |
Equity Earnings |
$62 |
$166 |
(63%) |
Net Income |
$169 |
$638 |
(74%) |
EPS |
$0.11 |
$0.43 |
(74%) |
*These are non-GAAP financial measures. The
reconciliation between GAAP and non-GAAP measures is provided in
the tables following this news release, as well as on the company's
website. Core performance metrics (non-GAAP) are adjusted to
exclude the impact of changes in Japanese yen and Korean won
foreign exchange rates, as well as other items that do not reflect
ongoing operations of the company. See "Use of Non-GAAP Financial
Measures" section of attached Form 8-K for details on core
performance measures.
Wendell P. Weeks, chairman, chief executive
officer and president, said, "We had great results in the quarter
that led to our seventh consecutive year-over-year quarterly core
earnings improvement. We have positive momentum, and we are
well-positioned to deliver on our 2014 business plan.
"We are particularly pleased with the improved
performance in our Display Technologies segment. As we anticipated,
LCD glass price declines were more moderate than they were last
quarter. The integration of Corning Precision Materials Co., Ltd.
into our global organization is proceeding very well, and we are
benefiting from synergies attained through the
consolidation."
Weeks also pointed out that Corning's Optical
Communications segment maintained its outstanding sales performance
with 14% year-over-year growth in the second quarter, and the
Environmental Technologies segment had record sales in the
quarter.
Second-Quarter Segment
Results
Display Technologies segment core sales were $1.1 billion*, a 62%
increase over core sales of $670 million a year ago. The sales
improvement was driven by the consolidation of Corning Precision
Materials. Core earnings for the quarter increased by 9% from the
year-ago comparable period. LCD glass volume grew in the low teens
percentage sequentially and was higher than anticipated. As the
company expected, price declines were more moderate versus the
first quarter.
Optical Communications segment sales were $686
million, a 14% increase from $601 million in quarter two of last
year. The sales increase was stronger than anticipated, driven
primarily by continued demand for Corning's fiber-to-the-home
solutions in North America and Europe.
Environmental Technologies segment sales reached a
record $285 million, a 25% increase over second-quarter sales for
2013. Strong demand for the company's heavy-duty diesel emissions
control products continued in North America, China, and Europe.
Sales in Corning's Specialty Materials segment
were $298 million, comparable with quarterly results a year ago.
Corning®
Gorilla® Glass sales
were less than anticipated in the quarter, due to lower retail
demand for smartphones and high-end tablets, and
lower-than-expected sales for planned new models.
Corning's Life Sciences segment sales were $223
million, up 2% on a year-over-year quarterly basis. Core equity
earnings from Dow Corning Corporation improved 17%* year over
year.
In the second quarter of 2014, Corning repurchased
9.3 million shares for approximately $200 million under its current
share repurchase program. The company also received 8.7 million
shares in May from the settlement of an accelerated share
repurchase transaction initiated in the first quarter of 2014. The
company has approximately $400 million remaining under the share
repurchase program that it expects to use by year-end.
Corning ended the second quarter with $5.9 billion
in cash and short-term investments. The company's capital spending
for the quarter was $232 million. Corning has lowered its 2014
full-year capital spending estimate from $1.5 billion to
approximately $1.3 billion.
Looking
Forward
"We have accomplished a great deal with our first-half business
performance. We expect the third quarter will bring Corning's
eighth consecutive year-over-year quarterly sales and earnings
improvement, and we are on track for strong earnings growth for the
full year," James B. Flaws, vice chairman and chief financial
officer, remarked.
In the third quarter, the company anticipates its
LCD glass volume will be up by a mid-single digit percentage,
sequentially. Glass price declines are expected to moderate
further, returning to the rates experienced through most of
2013.
Optical Communications segment third-quarter sales
are expected to increase by a mid-single digit percentage year over
year, driven by continued strong sales of fiber-to-the-home
solutions in North America and Europe.
For the Environmental Technologies segment,
third-quarter year-over-year sales are anticipated to grow by 20%
to 25%. Corning continues to benefit from strong demand for its
heavy-duty diesel emissions control products in North America,
China, and Europe.
Specialty Materials segment sales are expected to
grow approximately 10% sequentially as demand for Gorilla Glass
increases in the second half of the year. Life Sciences segment
sales are expected to be up slightly on a year-over-year
comparison.
"Synergies from the Corning Precision Materials
acquisition are rapidly being achieved, and we expect to surpass
our original goal. The company is delivering excellent growth in
our Environmental Technologies and Optical Communications business
segments, which we expect will continue through the second half of
this year," Flaws said.
"Corning continues to invest in research and
development to drive our future growth," he pointed out. "We are
working on new glass substrates for high-performance displays to
enhance consumer viewing experiences, improved diesel emissions
filters and substrates, and advancements in fiber-to-the-home and
next-generation, data-center network solutions. Additionally, we
have developments underway in wireless communications, and we plan
to introduce a new, enhanced generation of our market-leading
Gorilla Glass later this year," Flaws concluded.
Upcoming Investor
Events
Corning will present at Citi Global Technology Conference on Sept.
3, 2014 in New York City.
Second-Quarter Conference
Call Information
The company will host a second-quarter conference call on Tuesday,
July 29, at 8:30 a.m. ET. To participate, please call toll free
(877) 209-9922 or for international access call (612) 332-0932
approximately 10-15 minutes prior to the start of the call. The
host is 'NICHOLSON'. To listen to a live audio webcast of the call,
go to Corning's website at www.corning.com/investor_relations and
click "Investor Events" on the left. A replay will be available
beginning at 11:00 a.m. ET and will run through 5 p.m. ET, Tuesday,
August 12. To listen, dial (800) 475-6701 or for international
access dial (320) 365-3844. The access code is 330195. The webcast
will be archived for one year following the call.
Presentation of Information
in this News Release
Non-GAAP financial measures are not in accordance with, or an
alternative to, GAAP. Corning's non-GAAP financial measures exclude
the impact of items that are driven by general economic conditions
and events that do not reflect the underlying fundamentals and
trends in the company's operations. The company believes
presenting non-GAAP financial measures assists in analyzing
financial performance without the impact of items that may obscure
trends in the company's underlying performance. Detailed
reconciliations outlining the differences between these non-GAAP
measures and the most directly comparable GAAP measure can be found
on the company's website by going to
www.corning.com/investor_relations and clicking "Financial Reports"
on the left. These reconciliations also accompany this news
release.
Forward-Looking and
Cautionary Statements
This press release contains "forward-looking statements" (within
the meaning of the Private Securities Litigation Reform Act of
1995), which are based on current expectations and assumptions
about Corning's financial results and business operations, that
involve substantial risks and uncertainties that could cause actual
results to differ materially. These risks and uncertainties
include: the effect of global political, economic and business
conditions; conditions in the financial and credit
markets; currency fluctuations; tax rates; product demand
and industry capacity; competition; reliance on a concentrated
customer base; manufacturing efficiencies; cost reductions;
availability of critical components and materials; new product
commercialization; pricing fluctuations and changes in
the mix of sales between premium and non-premium products; new
plant start-up or restructuring costs; possible
disruption in commercial activities due to terrorist activity,
armed conflict, political or financial instability, natural
disasters, adverse weather conditions, or major health concerns;
adequacy of insurance; equity company activities; acquisition and
divestiture activities; the level of excess or obsolete inventory;
the rate of technology change; the ability to enforce patents;
product and components performance issues; retention of key
personnel; stock price fluctuations; and adverse litigation or
regulatory developments. These and other risk factors
are detailed in Corning's filings with the Securities and
Exchange Commission. Forward-looking statements speak only as
of the day that they are made, and Corning undertakes no obligation
to update them in light of new information or future events.
About Corning
Incorporated
Corning (www.corning.com) is one of the world's leading innovators
in materials science. For more than 160 years, Corning has applied
its unparalleled expertise in specialty glass, ceramics, and
optical physics to develop products that have created new
industries and transformed people's lives. Corning succeeds through
sustained investment in R&D, a unique combination of material
and process innovation, and close collaboration with customers to
solve tough technology challenges. Corning's businesses and markets
are constantly evolving. Today, Corning's products enable diverse
industries such as consumer electronics, telecommunications,
transportation, and life sciences. They include damage-resistant
cover glass for smartphones and tablets; precision glass for
advanced displays; optical fiber, wireless technologies, and
connectivity solutions for high-speed communications networks;
trusted products that accelerate drug discovery and manufacturing;
and emissions-control products for cars, trucks, and off-road
vehicles.
Media Relations
Contact:
Daniel F. Collins
(607)
974-4197
collinsdf@corning.com
Investor Relations
Contact:
Ann H. S. Nicholson
(607) 974-6716
nicholsoas@corning.com
Q2 2014 Financial
Documents
This
announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Corning Incorporated via Globenewswire
HUG#1840832
Corning (NYSE:GLW)
Historical Stock Chart
From Mar 2024 to Apr 2024
Corning (NYSE:GLW)
Historical Stock Chart
From Apr 2023 to Apr 2024