CORNING, N.Y.; JANUARY 30, 2018 - Corning
Incorporated (NYSE: GLW) today announced results for fourth-quarter
and full-year 2017.
News Summary:
· Strong
fourth-quarter finishes an excellent 2017
- Full-year GAAP sales of
$10.1 billion, up 8%, and full-year GAAP EPS of $(0.66), compared
to $3.23 in 2016; Q4 GAAP sales of $2.6 billion, up 7% year over
year, and Q4 GAAP EPS of $(1.66)
- 2017 core sales of
$10.5 billion, up 8%; core EPS of $1.72, up 11%
- Fourth-quarter core
sales of $2.7 billion, up 7% year over year, and core EPS of
$0.49
- Full-year and
fourth-quarter 2017 core results have been adjusted to exclude $1.8
billion in non-cash items related to tax reform
· Significant
progress on Strategy and Capital Allocation Framework halfway
through four-year plan
- Returned $9 billion to
shareholders and on a path to return more than $12.5
billion
- All five market-access
platforms delivered key milestones, including: major customer
agreements and product wins; strategic acquisitions; and sales of
new products in existing and emerging businesses
· 2017 results
demonstrated benefits of growth investments:
- Optical Communications'
full-year sales increase of 18%, and significant progress toward
2020 goal of $5 billion in sales
- Specialty Materials'
full-year sales growth of 25%, driven by strong adoption of
Corning®
Gorilla® Glass
technologies
- Environmental
Technologies' full-year sales growth of 7%, with first sales of gas
particulate filters initiating progress toward building a new $500
million business
· 2018
highlights expected to include sales of approximately $11 billion,
continued innovation and growth investments, and further
improvement in LCD pricing to mid-single digit percentage
declines
"Strong growth and strong investment made 2017 an
outstanding year. We exited the year running at full capacity in
several of our businesses and with committed customer demand that
supports our current capacity-expansion initiatives. We expect to
see the benefits of these initiatives in the second half of 2018
and beyond as production ramps," said Wendell P. Weeks, chairman,
chief executive officer, and president. "2018 will be another year
of strong growth and investment, consistent with our Strategy &
Capital Allocation Framework. We feel great about our progress and
prospects."
Strategy and Capital Allocation
Framework Progress
"We're proud of our 2017 performance," Weeks
continued. "But it's important to recognize that our achievements
are not just the result of strong execution this year. Our success
stems from the Strategy and Capital Allocation Framework that we
introduced more than two years ago, and its focus on what's best
for Corning and its stakeholders."
The Framework outlines the company's 2016-2019
leadership priorities. Under the Framework, Corning plans to
deliver more than $12.5 billion to shareholders while investing $10
billion in growth opportunities. Since it was announced in October
2015, the company has achieved key milestones including the return
of $9 billion to shareholders through dividends, which have
increased 29%, and share repurchases, which have reduced
outstanding shares by 30%.
"The strategic and financial benefits of Corning's
focused portfolio are increasingly evident as we enter the third
year under our Framework," Weeks said. "We're particularly pleased
with significant achievements across our market-access
platforms."
Highlights of progress in Corning's market-access
platforms include: a major contract with Verizon for next
generation networks, and two significant acquisitions in Optical
Communications; initiating shipment of the world's first Gen 10.5
glass and capturing opportunities for Corning®
Iris(TM) Glass in Display; celebrating the 10th anniversary of
Corning®
Gorilla® Glass with
new applications and more glass on devices in Mobile Consumer
Electronics; winning the majority of awarded platforms for gas
particulate filters and advancing Gorilla Glass for Automotive to
35 platform wins; and introducing Valor(TM) Glass, a revolutionary
new pharmaceutical packaging solution, and related manufacturing
capacity plans in Life Sciences Vessels.
"In 2018, we will continue to advance the
objectives of our Strategy and Capital Allocation Framework," Weeks
added. "Our results and outlook confirm that we have the right
strategy in place to achieve the goals of our Framework and drive
consistent growth."
Fourth-Quarter and Full-Year 2017
Results and Comparisons
(In millions, except per-share amounts)
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Q4 2017 |
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Q3 2017 |
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%
change |
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Q4 2016 |
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%
change |
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|
Full-year 2017 |
|
|
Full-year 2016 |
|
%
change |
GAAP
Net Sales |
|
$ |
2,637 |
|
$ |
2,607 |
|
1% |
|
$ |
2,476 |
|
7% |
|
$ |
10,116 |
|
$ |
9,390 |
|
8% |
GAAP
Net (Loss) Income |
|
$ |
(1,412) |
|
$ |
390 |
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(462%) |
|
$ |
1,572 |
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(190%) |
|
$ |
(497) |
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$ |
3,695 |
|
(113%) |
GAAP
EPS |
|
$ |
(1.66) |
|
$ |
0.39 |
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(526%) |
|
$ |
1.47 |
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(213%) |
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$ |
(0.66) |
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$ |
3.23 |
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(120%) |
Core
Sales* |
|
$ |
2,739 |
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$ |
2,700 |
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1% |
|
$ |
2,551 |
|
7% |
|
$ |
10,514 |
|
$ |
9,710 |
|
8% |
Core
Earnings* |
|
$ |
485 |
|
$ |
433 |
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12% |
|
$ |
534 |
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(9%) |
|
$ |
1,756 |
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$ |
1,774 |
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(1%) |
Core EPS* |
|
$ |
0.49 |
|
$ |
0.43 |
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14% |
|
$ |
0.50 |
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(2%) |
|
$ |
1.72 |
|
$ |
1.55 |
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11% |
*Core performance measures 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.
Segment Results and Outlook
Display Technologies:
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Q4 2017 |
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Q3 2017 |
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%
change |
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Q4 2016 |
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%
change |
|
|
Full-year 2017 |
|
|
Full-year 2016 |
|
%
change |
GAAP
Net Sales |
|
$ |
745 |
|
$ |
768 |
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(3%) |
|
$ |
830 |
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(10%) |
|
$ |
2,997 |
|
$ |
3,238 |
|
(7%) |
GAAP
Net Income |
|
$ |
168 |
|
$ |
203 |
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(17%) |
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$ |
243 |
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(31%) |
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$ |
831 |
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$ |
935 |
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(11%) |
Core
Sales* |
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$ |
847 |
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$ |
860 |
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(2%) |
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$ |
904 |
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(6%) |
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$ |
3,394 |
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$ |
3,556 |
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(5%) |
Core Earnings* |
|
$ |
221 |
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$ |
227 |
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(3%) |
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$ |
276 |
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(20%) |
|
$ |
944 |
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$ |
1,006 |
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(6%) |
NOTE: In all segments except the
Display Technologies segment, core net sales are consistent with
GAAP net sales. Because a significant portion of sales and costs in
the Display Technologies segment are denominated in Japanese yen
and South Korean won, this segment's net sales and costs are
adjusted to remove the impact of translating yen and won into U.S.
dollars.
Full-year core sales in Display Technologies were
$3.4 billion, and core earnings were $944 million. For the
full-year, volume was up mid-single digit percentages, in line with
our expectations. Pricing improved as anticipated, and reached
single-digit percentage declines year over year in both the third
and fourth quarters of 2017.
Fourth-quarter core sales were $847 million, and
core earnings were $221 million. In the fourth quarter, volume was
up slightly sequentially, in line with the market.
For full-year 2018, Corning expects LCD glass
market growth to be in the mid-single digit percentages, similar to
2017, as screen size growth continues. The company expects
Corning's volume to grow faster than the market as Corning supports
the ramp-up of the world's first Gen 10.5 fab. The improvements in
LCD glass pricing are expected to continue in 2018, with full-year
price declines expected to reach the mid-single digit
percentages.
Optical
Communications:
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Q4 2017 |
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Q3 2017 |
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%
change |
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Q4 2016 |
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%
change |
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Full-year 2017 |
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Full-year 2016 |
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%
change |
GAAP
Net Sales |
|
$ |
928 |
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$ |
917 |
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1% |
|
$ |
819 |
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13% |
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$ |
3,545 |
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$ |
3,005 |
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18% |
GAAP
Net Income |
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$ |
56 |
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$ |
102 |
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(45%) |
|
$ |
67 |
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(16%) |
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$ |
341 |
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$ |
245 |
|
39% |
Core Earnings* |
|
$ |
84 |
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$ |
111 |
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(24%) |
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$ |
87 |
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(3%) |
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$ |
396 |
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$ |
297 |
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33% |
Optical Communications had a very strong year,
with full-year 2017 sales of $3.5 billion, up 18%, and core
earnings up 33%. Sales growth in both enterprise and carrier
businesses, as well as contributions from acquisitions, drove the
outstanding results. Fourth-quarter sales increased 13% year over
year.
2018 full-year Optical Communications sales are
expected to increase by about 10%, excluding any contribution from
the pending acquisition of 3M's Communications Markets
Division.
Environmental
Technologies:
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Q4 2017 |
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Q3 2017 |
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%
change |
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Q4 2016 |
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%
change |
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Full-year 2017 |
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Full-year 2016 |
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%
change |
GAAP
Net Sales |
|
$ |
291 |
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$ |
277 |
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5% |
|
$ |
245 |
|
19% |
|
$ |
1,106 |
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$ |
1,032 |
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7% |
GAAP
Net Income |
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$ |
30 |
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$ |
34 |
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(12%) |
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$ |
27 |
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11% |
|
$ |
127 |
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$ |
133 |
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(5%) |
Core Earnings* |
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$ |
36 |
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$ |
34 |
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6% |
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$ |
27 |
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33% |
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$ |
139 |
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$ |
136 |
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2% |
In Environmental Technologies, 2017 sales,
including the first sales of gas particulate filters, were $1.1
billion, up 7%, driven by worldwide auto market growth and new
business wins. Core earnings were $139 million, as capacity and
engineering investments partially offset the benefits of sales
growth. Fourth-quarter sales grew 19% year over year, with core
earnings up 33%.
For 2018, Environmental Technologies sales are
expected to increase by a high-single digit percentage.
Specialty Materials:
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|
Q4 2017 |
|
Q3 2017 |
|
%
change |
|
Q4 2016 |
|
%
change |
|
|
Full-year 2017 |
|
|
Full-year 2016 |
|
%
change |
GAAP
Net Sales |
|
$ |
393 |
|
$ |
373 |
|
5% |
|
$ |
336 |
|
17% |
|
$ |
1,403 |
|
$ |
1,124 |
|
25% |
GAAP
Net Income |
|
$ |
73 |
|
$ |
72 |
|
1% |
|
$ |
68 |
|
7% |
|
$ |
249 |
|
$ |
174 |
|
43% |
Core Earnings* |
|
$ |
73 |
|
$ |
71 |
|
3% |
|
$ |
65 |
|
12% |
|
$ |
250 |
|
$ |
189 |
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32% |
Specialty Materials 2017 sales rose 25%, led by
the increasing adoption of glass on the backs of devices.
Fourth-quarter sales were up 17% year over year.
The company expects year-over-year sales growth
for Specialty Materials in 2018, with the rate and pace dependent
on customer adoption of Corning's innovations.
Life Sciences:
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|
Q4 2017 |
|
Q3 2017 |
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%
change |
|
Q4 2016 |
|
%
change |
|
|
Full-year 2017 |
|
|
Full-year 2016 |
|
%
change |
GAAP
Net Sales |
|
$ |
225 |
|
$ |
223 |
|
1% |
|
$ |
206 |
|
9% |
|
$ |
879 |
|
$ |
839 |
|
5% |
GAAP
Net Income |
|
$ |
16 |
|
$ |
17 |
|
(6%) |
|
$ |
13 |
|
23% |
|
$ |
64 |
|
$ |
58 |
|
10% |
Core Earnings* |
|
$ |
20 |
|
$ |
21 |
|
(5%) |
|
$ |
17 |
|
18% |
|
$ |
80 |
|
$ |
77 |
|
4% |
In Life Sciences, full-year 2017 sales were up 5%
and fourth-quarter sales were up 9% year over year, as the business
continued to outpace market growth. For full-year 2018, sales are
expected to grow by a mid-single-digit percentage.
Upcoming Investor
Events
On Feb. 13, Corning will attend the Goldman Sachs Technology and
Internet Conference to be held in San Francisco at the Palace
Hotel.
Fourth-Quarter Conference Call
Information
The company will host a fourth-quarter conference call on Tuesday,
Jan. 30, at 8:30 a.m. ET. To participate, please call toll free
(800) 230-1059 or for international access call (612) 234-9960
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,
click "Events" and follow the instructions. A replay will be
available beginning at 11 a.m. EST and will run through 5 p.m. ET,
Tuesday, Feb. 13. To listen, dial (800) 475-6701 or for
international access dial (320) 365-3844. The access code is
438690. 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 the Investor Relations page
and clicking "Financial Highlights" under the "Performance" tab.
These reconciliations also accompany this news release.
Caution Concerning
Forward-Looking Statements
This press release contains "forward-looking statements" - that is,
statements related to future events that by their nature address
matters that are, to different degrees, uncertain. These
forward-looking statements relate to, among other things, the
company's future operating performance, the company's share of new
and existing markets, the company's revenue and earnings growth
rates, the company's ability to innovate and commercialize new
products, and the company's implementation of cost-reduction
initiatives and measures to improve pricing, including the
optimization of the company's manufacturing capacity.
In this context, forward-looking statements often
contain words such as "will," "believe," "anticipate," "expect,"
"intend," "plan," "seek," "see," "would," and "target." Although
the company believes that these forward-looking statements are
based upon reasonable assumptions regarding, among other things,
current estimates and forecasts, general economic conditions, its
knowledge of its business, and key performance indicators that
impact the company, actual results could differ materially. The
company does not undertake to update forward-looking statements.
Some of the risks, uncertainties and other factors that could cause
actual results to differ materially from those expressed in or
implied by the forward-looking statements include, but are not
limited to: competitive products and pricing; availability and
costs of critical components and materials; new product development
and commercialization; order activity and demand from major
customers; unanticipated disruption to equipment, facilities, or
operations; facility expansions and new plant start-up costs; our
ability to pace capital spending to anticipated levels of customer
demand; the amount and timing of our cash flows and earnings and
other conditions, which may affect our ability to pay our quarterly
dividend at the planned level or to repurchase shares at planned
levels; our capital allocation plans, as such plans may change
including with respect to the timing and size of share repurchases,
acquisitions, joint ventures, dispositions and other strategic
actions; and the effectiveness of our risk management
framework.
For a complete listing of risks and other factors,
please reference the risk factors and forward-looking statements
described in the annual reports on Form 10-K and quarterly reports
on Form 10-Q.
Digital Media Disclosure
In accordance with guidance provided by the SEC regarding the use
of company websites and social media channels to disclose material
information, Corning Incorporated ("Corning") wishes to notify
investors, media, and other interested parties that it intends to
use its website
(http://www.corning.com/worldwide/en/about-us/news-events.html) to
publish important information about the company, including
information that may be deemed material to investors. The list of
websites and social media channels that the company uses may be
updated on Corning's media and website from time to time. Corning
encourages investors, media, and other interested parties to review
the information Corning may publish through its website and social
media channels as described above, in addition to the company's SEC
filings, press releases, conference calls, and webcasts.
About Corning
Incorporated
Corning (www.corning.com) is one of the world's leading innovators
in materials science, with a 166-year track record of life-changing
inventions. Corning applies its unparalleled expertise in glass
science, ceramic science, and optical physics along with its deep
manufacturing and engineering capabilities to develop
category-defining products that transform industries and enhance
people's lives. Corning succeeds through sustained investment in
RD&E, a unique combination of material and process innovation,
and deep, trust-based relationships with customers who are global
leaders in their industries.
Corning's capabilities are versatile and synergistic, which allows
the company to evolve to meet changing market needs, while also
helping our customers capture new opportunities in dynamic
industries. Today, Corning's markets include optical
communications, mobile consumer electronics, display technology,
automotive, and life sciences vessels. Corning's industry-leading
products include damage-resistant cover glass for mobile devices;
precision glass for advanced displays; optical fiber, wireless
technologies, and connectivity solutions for state-of-the-art
communications networks; trusted products to accelerate drug
discovery and delivery; and clean-air technologies for cars and
trucks.
Media Relations
Contact:
M. Elizabeth Dann
(607)
974-4989
dannme@corning.com
Investor Relations
Contact:
Ann H.S. Nicholson
(607) 974-6716
nicholsoas@corning.com
Q4 2017 Financial Tables
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq 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
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