Corning Incorporated (NYSE: GLW) today announced results for the
fourth quarter and full year ended Dec. 31, 2020.
Fourth-quarter financial performance:
- GAAP sales of $3.4 billion and GAAP EPS of $0.28
- Core sales of $3.3 billion, up 11% sequentially and 17% year
over year
- Core EPS of $0.52, up 21% sequentially and 13% year over
year
- Free cash flow of $464 million and $948 million cumulatively
for the year
- Strong execution across the company’s focused portfolio drove
sales and net income growth in all segments:
- Sequentially, core sales grew 11% and operating margin grew
18%, both above expectations
- Core operating margin was 19.4%, up 110 basis points
sequentially
- Life Sciences and Environmental Technologies delivered the
largest sequential sales growth, with 23% and 17% growth
respectively
- Organic sales, which exclude $163 million in consolidated sales
from Hemlock Semiconductor, grew 11% year over year
- Year over year, Specialty Materials sales grew 20%,
Environmental Technologies sales grew 19% – both strongly
outperforming their underlying markets – and Optical Communications
returned to growth with continued growth expected
Wendell P. Weeks, chairman and chief executive officer,
said:
“We delivered outstanding fourth-quarter results, as each of our
businesses grew sales and profits year over year.” Weeks continued,
“2020 was an incredibly difficult year as the world dealt with the
pandemic, economic uncertainty, and social unrest. Throughout the
year, we focused on serving our customers, executing our strategic
priorities, and protecting our people. We gained sales-growth
momentum, expanded margins in the second half, and generated
significant free cash flow. Our investments in our people and
technology, along with our deep relevance across key markets, are
creating opportunities for ‘more Corning.’”
Weeks added, “We continue to strengthen the company and remain
committed to our employees, communities, customers, and
shareholders. Corning is proud to be creating life-changing
technologies that contribute to keeping people safe and that help
society address the challenges of the pandemic.”
Financial Outlook Tony Tripeny, executive vice
president and chief financial officer, said, “In 2020, we
successfully navigated a very challenging year. We strengthened our
balance sheet, achieved growth in the second half, and generated
free cash flow of $948 million for the year.”
Tripeny continued, “We expect year-over-year growth to
accelerate in the first quarter of 2021. We expect core sales of
$3.0 billion to $3.2 billion – compared with $2.5 billion in the
first quarter last year – and EPS of $0.40 to $0.44, which is
double last year’s first-quarter EPS at the low end of the range.
We will continue to focus on operational excellence, cash-flow
generation, and prudent capital allocation.”
Market-Access Platform Highlights
Corning holds a leadership position in each of the markets
addressed by its five Market-Access Platforms. Throughout 2020, the
company advanced important growth initiatives and reported the
following highlights:
- Life Sciences – Corning deployed its broad
Life Sciences capabilities to combat the pandemic by supplying
technologies that help customers develop novel treatments and
vaccines, provide mass testing, and accelerate vaccine production.
In the second quarter, Corning was awarded $204 million in funding
from the Biomedical Advanced Research and Development Authority to
substantially expand domestic manufacturing capacity for Corning
Valor® Glass vials. In the fourth quarter, Corning shipped Valor
Glass vials to multiple COVID-19 vaccine manufacturers that support
more than 100 million doses. Corning also received a $15 million
award from the U.S. Department of Defense and U.S. Department of
Health and Human Services to further expand domestic production
capacity for robotic pipette tips used in support of COVID-19
diagnostic testing. The company was also recognized by BioNTech for
its role in the successful development of its COVID-19 vaccine.
- Mobile Consumer Electronics – Innovation
adoption drove Specialty Materials sales up 18% year over year
despite the declining smartphone market. The company launched
Corning® Gorilla® Glass Victus™, the toughest Gorilla Glass yet,
which is featured on six Samsung devices. Corning also invented the
world’s first transparent, color-free glass-ceramic, which is
featured on the front cover of the latest iPhone. Apple and Corning
partnered to develop and scale manufacturing of Ceramic Shield,
which offers unparalleled durability and toughness. Strength in the
IT market contributed to sales growth as work- and learn-from-home
trends remained pervasive throughout the year, driving demand for
tablets and touch-screen laptops.
- Automotive – Environmental Technologies is
recovering faster than its markets, driven by more Corning content
in both automotive and diesel. Fourth-quarter results were
highlighted by year-over-year growth in gasoline particulate filter
sales as adoption expanded in Europe and China. Additionally,
Groupe Renault honored Corning with a 2020 Supplier Award for
innovation for Corning® FLORA® substrates. Mercedes-Benz
recently debuted the MBUX Hyperscreen dashboard display system
featuring Gorilla Glass for Automotive.
- Optical Communications – Optical
Communications returned to growth – and expects growth to continue
– as customers increase spending to support growing bandwidth
requirements. In 2020, the company introduced new and innovative
solutions that help speed the deployment of 5G. Corning launched
its Evolv™ 5G-ready connectivity solutions featuring compact,
easy-to-install terminals that connect the fiber network to
neighborhoods and businesses. Operators can save up to $500 at each
terminal site by dramatically lowering installation costs and
speeding deployment. By collaborating with Verizon, Corning is
enabling 5G mmWave indoor deployments for enterprise customers.
Additionally, Corning is working with Qualcomm Technologies to
deliver indoor networks that are 5G-ready, easy-to-install, and
affordable and with EnerSys to simplify the delivery of fiber and
electrical power to small-cell wireless sites.
- Display – Retail demand for TV and IT products
remains strong. Demand for large-size TVs continues to grow –
75-inch sets were up more than 60% for the full year. Large TVs are
most efficiently made on Gen 10.5 fabs and Corning is
well-positioned to capture that growth with its Gen 10.5 plants in
China, including its two newest Gen 10.5 facilities, in Wuhan and
Guangzhou, which are now expanding production to meet customer
demand.
Fourth-Quarter and Full-Year 2020 Results and
Comparisons (In millions, except per-share amounts)
|
|
Q4 2020 |
|
Q3 2020 |
|
% change |
|
Q4 2019 |
|
% change |
|
|
Full-year 2020 |
|
|
Full-year 2019 |
|
% change |
GAAP Net Sales |
|
$ |
3,350 |
|
$ |
3,001 |
|
12 |
% |
|
$ |
2,817 |
|
19 |
% |
|
$ |
11,303 |
|
$ |
11,503 |
|
(2 |
%) |
GAAP Net Income |
|
$ |
252 |
|
$ |
427 |
|
(41 |
%) |
|
$ |
32 |
|
** |
|
$ |
512 |
|
$ |
960 |
|
(47 |
%) |
GAAP Diluted EPS |
|
$ |
0.28 |
|
$ |
0.48 |
|
(42 |
%) |
|
$ |
0.01 |
|
** |
|
$ |
0.54 |
|
$ |
1.07 |
|
(50 |
%) |
Core Sales* |
|
$ |
3,328 |
|
$ |
3,007 |
|
11 |
% |
|
$ |
2,851 |
|
17 |
% |
|
$ |
11,452 |
|
$ |
11,656 |
|
(2 |
%) |
Core Net Income* |
|
$ |
462 |
|
$ |
380 |
|
22 |
% |
|
$ |
406 |
|
14 |
% |
|
$ |
1,237 |
|
$ |
1,578 |
|
(22 |
%) |
Core
EPS* |
|
$ |
0.52 |
|
$ |
0.43 |
|
21 |
% |
|
$ |
0.46 |
|
13 |
% |
|
$ |
1.39 |
|
$ |
1.76 |
|
(21 |
%) |
*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. The largest difference between our GAAP and core results
stemmed from restructuring charges, which are primarily non-cash,
as well as non-cash, mark-to-market losses associated with the
company’s currency-hedging contracts.**Not Meaningful
Fourth-Quarter Segment Results
Display Technologies
|
|
Q4 2020 |
|
Q3 2020 |
|
% change |
|
Q4 2019 |
|
% change |
|
|
Full-year 2020 |
|
Full-year 2019 |
% change |
Net Sales |
|
$ |
841 |
|
$ |
827 |
|
2 |
% |
|
$ |
795 |
|
6 |
% |
|
$ |
3,172 |
|
$ |
3,254 |
|
(3 |
%) |
Net Income Before Tax |
|
$ |
274 |
|
$ |
248 |
|
10 |
% |
|
$ |
227 |
|
21 |
% |
|
$ |
907 |
|
$ |
993 |
|
(9 |
%) |
Net
Income |
|
$ |
217 |
|
$ |
196 |
|
11 |
% |
|
$ |
180 |
|
21 |
% |
|
$ |
717 |
|
$ |
786 |
|
(9 |
%) |
In Display Technologies, fourth-quarter sales were $841 million,
up 2% sequentially and 6% year over year, and net income was $217
million, up 11% sequentially and 21% year over year. Corning’s
volume grew by a low-single digit percentage sequentially.
Sequential price declines were very moderate, as expected.
Optical Communications
|
|
Q4 2020 |
|
Q3 2020 |
|
% change |
|
Q4 2019 |
|
% change |
|
|
Full-year 2020 |
|
Full-year 2019 |
% change |
Net Sales |
|
$ |
976 |
|
$ |
909 |
|
7 |
% |
|
$ |
903 |
|
8 |
% |
|
$ |
3,563 |
|
$ |
4,064 |
|
(12 |
%) |
Net Income Before Tax |
|
$ |
179 |
|
$ |
147 |
|
22 |
% |
|
$ |
81 |
|
121 |
% |
|
$ |
467 |
|
$ |
639 |
|
(27 |
%) |
Net
Income |
|
$ |
141 |
|
$ |
115 |
|
23 |
% |
|
$ |
62 |
|
127 |
% |
|
$ |
366 |
|
$ |
489 |
|
(25 |
%) |
Optical Communications fourth-quarter sales were $976 million,
up 7% sequentially and 8% year over year, driven by strength in
both carrier and enterprise businesses. Fourth-quarter net income
was $141 million, up 23% sequentially and 127% year over year,
driven by increased volume and favorable cost performance.
Management expects Optical Communications to grow in 2021 as
customers increase investments in their optical networks.
Environmental Technologies
|
|
Q4 2020 |
|
Q3 2020 |
|
% change |
|
Q4 2019 |
|
% change |
|
|
Full-year 2020 |
|
Full-year 2019 |
% change |
Net Sales |
|
$ |
445 |
|
$ |
379 |
|
17 |
% |
|
$ |
374 |
|
19 |
% |
|
$ |
1,370 |
|
$ |
1,499 |
|
(9 |
%) |
Net Income Before Tax |
|
$ |
118 |
|
$ |
87 |
|
36 |
% |
|
$ |
81 |
|
46 |
% |
|
$ |
249 |
|
$ |
333 |
|
(25 |
%) |
Net
Income |
|
$ |
93 |
|
$ |
69 |
|
35 |
% |
|
$ |
64 |
|
45 |
% |
|
$ |
197 |
|
$ |
263 |
|
(25 |
%) |
Environmental Technologies fourth-quarter sales were $445
million, up 17% sequentially and 19% year over year driven by
improving markets and more Corning content. Greater adoption of
GPFs and diesel filters to meet regulations in China increased
Corning’s total addressable market.
Specialty Materials
|
|
Q4 2020 |
|
Q3 2020 |
|
% change |
|
Q4 2019 |
|
% change |
|
|
Full-year 2020 |
|
Full-year 2019 |
% change |
Net Sales |
|
$ |
545 |
|
$ |
570 |
|
(4 |
%) |
|
$ |
453 |
|
20 |
% |
|
$ |
1,884 |
|
$ |
1,594 |
|
18 |
% |
Net Income Before Tax |
|
$ |
173 |
|
$ |
184 |
|
(6 |
%) |
|
$ |
119 |
|
45 |
% |
|
$ |
536 |
|
$ |
383 |
|
40 |
% |
Net
Income |
|
$ |
136 |
|
$ |
146 |
|
(7 |
%) |
|
$ |
94 |
|
45 |
% |
|
$ |
423 |
|
$ |
302 |
|
40 |
% |
Specialty Materials fourth-quarter sales were $545 million, up
20% year over year, due to strong demand for premium cover
materials, strength in the IT market, and demand for
semiconductor-related materials. Full-year sales increased 18% to
$1.9 billion.
Life Sciences
|
|
Q4 2020 |
|
Q3 2020 |
|
% change |
|
Q4 2019 |
|
% change |
|
|
Full-year 2020 |
|
Full-year 2019 |
% change |
Net Sales |
|
$ |
274 |
|
$ |
223 |
|
23 |
% |
|
$ |
256 |
|
7 |
% |
|
$ |
998 |
|
$ |
1,015 |
|
(2 |
%) |
Net Income Before Tax |
|
$ |
53 |
|
$ |
36 |
|
47 |
% |
|
$ |
49 |
|
8 |
% |
|
$ |
176 |
|
$ |
190 |
|
(7 |
%) |
Net
Income |
|
$ |
42 |
|
$ |
28 |
|
50 |
% |
|
$ |
38 |
|
11 |
% |
|
$ |
139 |
|
$ |
150 |
|
(7 |
%) |
Life Sciences fourth-quarter sales grew 23% sequentially and 7%
year over year to $274 million. Segment results reflect strong
demand for research consumables and bioproduction products.
Upcoming Investor Events (Virtual)On Feb. 11,
Corning will attend the Goldman Sachs 2021 Virtual Tech and
Internet Conference. On Feb. 23, Corning will attend the UBS West
Coast Conference. And on Mar. 1, Corning will attend the Morgan
Stanley Technology, Media, and Telecom Conference.
Fourth-Quarter Conference Call InformationThe
company will host a fourth-quarter conference call on Wednesday,
Jan. 27, at 8:30 a.m. EST. To participate, please call toll free
(877) 710-0209 or for international access, call (315) 625-3068
approximately 10 to15 minutes prior to the start of the call. The
Access Code is 128 5416. To listen to a live audio webcast of the
call, go to Corning’s website
at http://www.corning.com/investor_relations, click “Events,”
and follow the instructions.
Presentation of Information in this News
ReleaseThis news release includes non-GAAP financial
measures. 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.
Definitions of these non-GAAP financial measures and
reconciliations of these non-GAAP financial measures to the most
directly comparable GAAP financial measures can be found on the
Company’s website by going to the Investor Relations page and
clicking “Quarterly Results” under the “Financials and Filings”
tab. These reconciliations also accompany this news release.
Caution Concerning Forward-Looking
StatementsThe statements in this release that are not
historical facts or information and contain words such as “will,”
“believe,” “anticipate,” “expect,” “intend,” “plan,” “seek,” “see,”
“would,” and “target” and similar expressions are forward-looking
statements. These forward-looking statements are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 and include estimates and assumptions
related to economic, competitive and legislative developments. Such
statements relate 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. These
statements are subject to change and uncertainty which are, in many
instances, beyond our control. There can be no assurance that
future developments will be in accordance with management’s
expectations. Actual results could differ materially from those
expected by us, depending on the outcome of various factors. We do
not undertake to update forward-looking statements.
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: the
duration and severity of the COVID-19 pandemic, and its ultimate
impact across our businesses on demand, operations and our global
supply chains; the effects of acquisitions, dispositions and other
similar transactions; global business, financial, economic and
political conditions; tariffs and import duties; currency
fluctuations between the U.S. dollar and other currencies,
primarily the Japanese yen, new Taiwan dollar, euro, Chinese yuan
and South Korean won; product demand and industry capacity;
competitive products and pricing; availability and costs of
critical components and materials; new product development and
commercialization; order activity and demand from major customers;
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; possible disruption in commercial activities due to
terrorist activity, cyber-attack, armed conflict, political or
financial instability, natural disasters, or major health concerns;
loss of intellectual property due to theft, cyber-attack, or
disruption to our information technology infrastructure;
unanticipated disruption to equipment, facilities, IT systems or
operations; effect of regulatory and legal developments; ability to
pace capital spending to anticipated levels of customer demand;
rate of technology change; ability to enforce patents and protect
intellectual property and trade secrets; adverse litigation;
product and components performance issues; retention of key
personnel; customer ability, most notably in the Display
Technologies segment, to maintain profitable operations and obtain
financing to fund ongoing operations and manufacturing expansions
and pay receivables when due; loss of significant customers;
changes in tax laws and regulations including the 2017 Tax Cuts and
Jobs Act; the impacts of audits by taxing authorities; the
potential impact of legislation, government regulations, and other
government action and investigations; and other risks detailed in
Corning’s SEC filings.
For a complete listing of risks and other factors, please
reference the risk factors and forward-looking statements described
in our annual reports on Form 10-K and quarterly reports on Form
10-Q.
Web DisclosureIn 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 uses 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, or
supplemental to information contained in this or other press
releases. 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 IncorporatedCorning
(www.corning.com) is one of the world's leading innovators in
materials science, with a 170-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, automotive, and life sciences.
Media Relations
Contact: Gabrielle
Bailey
(607)
974-6394
baileygr@corning.com
Investor Relations Contact: Ann H.S. Nicholson
(607) 974-6716 nicholsoas@corning.com
- Q4 2020 Earnings Release Financials
- Q4_Earnings_2020_Infographic
Corning (NYSE:GLW)
Historical Stock Chart
From Jun 2024 to Jul 2024
Corning (NYSE:GLW)
Historical Stock Chart
From Jul 2023 to Jul 2024