Company achieves $10 billion* in
core sales milestone;
Annual core EPS grows
24%
CORNING, N.Y., January 27,
2015 - Corning Incorporated (NYSE: GLW) today announced
its results for the fourth quarter and full year of 2014.
Fourth-Quarter Highlights
- Core earnings per share were $0.45*, a 55%
increase over last year's fourth quarter. These results were better
than anticipated and completed the company's ninth consecutive
quarter of year-over-year core earnings growth. GAAP earnings per
share were $0.70.
- Core sales were $2.6 billion*, a 30% increase
from the comparable period last year. GAAP sales were $2.4
billion.
- In the Display Technologies segment, LCD glass
volume remained strong as retail demand for large screen TVs
continued.
- All of Corning's business segments delivered
year-over-year quarterly sales gains.
Full-Year Highlights
- Core sales were $10.2 billion*, a 29% increase
from $7.9 billion last year, marking a record year in sales
performance for the company. GAAP sales were $9.7 billion.
- Core earnings per share were $1.53*, a 24%
year-over-year improvement compared with last year's full-year EPS
of $1.23*. GAAP earnings per share were $1.73.
- The very successful integration of Corning
Precision Materials Co., Ltd. resulted in pretax synergies of
greater than $100 million, which exceeded the company's original
expectations.
Fourth-Quarter Financial
Comparisons
(In millions, except percentages and per-share
amounts)
|
Core Performance* |
|
Q4 2014 |
Q4 2013 |
% Change |
Core Net Sales |
$2,602 |
$2,005 |
30% |
Core Equity Earnings |
$116 |
$121 |
(4)% |
Core Earnings |
$630 |
$410 |
54% |
Core EPS |
$0.45 |
$0.29 |
55% |
|
GAAP |
|
Q4 2014 |
Q4 2013 |
% Change |
Net Sales |
$2,404 |
$1,956 |
23% |
Equity Earnings |
$23 |
$70 |
(67)% |
Net Income |
$988 |
$421 |
135% |
EPS |
$0.70 |
$0.30 |
133% |
Full-Year Financial
Comparisons
|
Core Performance* |
|
2014 |
2013 |
% Change |
Core Net Sales |
$10,217 |
$7,948 |
29% |
Core Equity Earnings |
$311 |
$595 |
(48)% |
Core Earnings |
$2,185 |
$1,797 |
22% |
Core EPS |
$1.53 |
$1.23 |
24% |
|
GAAP |
|
2014 |
2013 |
% Change |
Net Sales |
$9,715 |
$7,819 |
24% |
Equity Earnings |
$266 |
$547 |
(51)% |
Net Income |
$2,472 |
$1,961 |
26% |
EPS |
$1.73 |
$1.34 |
29% |
*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.
"2014 was one of the strongest years in Corning's
history," Wendell P. Weeks, chairman, chief executive officer and
president, remarked. "Our sales exceeded $10 billion* for the first
time in the company's history, with 29% core sales growth, and 22%
core earnings improvement from a year ago. We have now produced two
full years of quarterly year-over-year earnings growth.
"We started the year with a clear priority to grow
sales and earnings. We achieved this with outstanding growth in our
Optical Communications and Environmental Technologies segments, and
a very successful integration of Corning Precision Materials. We
also introduced several new technology innovations in 2014,
highlighted by Corning®
Gorilla® Glass 4,
which launched in November.
"We continued to deliver on our commitment to
return cash to shareholders with the 20% increase in the company's
stock dividend and the additional $1.5 billion share repurchase
program that was announced in December."
Fourth-Quarter Segment
Results
Core sales in the Display Technologies segment were $1.1 billion*,
a 69% increase from $665 million* in last year's fourth quarter,
driven by the Corning Precision Materials acquisition. Core
earnings for the quarter increased 26% on a year-over-year basis.
Sustained retail demand for larger LCD television sizes drove
stronger-than-expected glass volume in the quarter, while glass
pricing declined less than in the third quarter, continuing a trend
of moderating declines.
Optical Communications segment core sales were
$676 million*, a 12% increase from last year's fourth quarter. The
fourth-quarter performance was better than expected, driven
primarily by strength in North American Fiber-to-the-Home sales.
Fourth-quarter core earnings were $59 million* in the segment, up
64% year over year.
Environmental Technologies segment core sales were
$250 million*, a 5% year-over-year increase from $238 million* in
the comparable period. Global demand for Corning's light-duty and
heavy-duty emissions products remained strong. Core earnings were
$40 million*, an increase of 5% on a year-over-year basis.
Core sales in the Specialty Materials segment were
$319 million*, a 12% increase year over year and stronger than the
company anticipated. Fourth-quarter core earnings of $34 million*
decreased 13% on a year-over-year basis. Without the write-off of a
customer receivable, core earnings would have been up 8%. Corning
introduced Gorilla Glass 4 in the fourth quarter amid strong
consumer and manufacturer interest in improved mobile device
screen-breakage resistance. Gorilla Glass 4 delivers up to two
times improved breakage performance over competitive glass
products.
Corning's Life Sciences segment core sales were
$215 million*, increasing slightly from the $210 million* a year
ago, and core earnings were $22 million*. The company's core equity
earnings from Dow Corning Corporation were strong at $111
million*.
In the fourth quarter, Corning announced a new
$1.5 billion share repurchase program to be completed by the end of
2016, and a 20% increase in its quarterly stock dividend beginning
in the first quarter of 2015. Corning ended the fourth quarter and
full year with $6.1 billion in cash and short-term investments.
Financial Reporting
Matters
"Corning will be using a Japanese yen-to-U.S. dollar exchange rate
of 99 in its core performance measures reporting in 2015," James B.
Flaws, vice chairman and chief financial officer, said. "We adopted
the use of constant currency reporting as a supplement to GAAP in
early 2013 when the Japanese yen began a significant weakening
trend relative to the U.S. dollar. We believe the constant exchange
core-performance measures aid our investors in understanding our
results.
"We used a 93 yen-to-dollar rate for core
reporting in 2013 and 2014, which was aligned with our hedge rates.
We have entered into new hedges at a rate of 99 yen-to-dollar, so
we think the constant yen rate of 99 is appropriate for 2015. Our
new hedges extend through 2017, so we anticipate using this rate
for three years.
"The majority of our analysts have already
converted their models to the 99 rate. We will be providing a
recast of 2014 and 2013 results to the 99 rate in a Form 8-K to be
furnished today. There are some nuances on recasting from a 93 to
99 rate, so our Investor Relations staff will be available to help
investors update their models."
Flaws also noted that Corning's capital spending for 2014 was $1.1
billion. "We anticipate 2015 capital spending to be in the $1.3 to
$1.4 billion range," he said. He also confirmed that the company
has begun repurchasing shares under its new $1.5 billion
authorization.
Looking Forward
"We are entering 2015 with momentum. We are expecting sales growth
again this year in Optical Communications and Environmental
Technologies. And we anticipate that growing demand for Gorilla
Glass will improve the Specialty Materials segment results," Flaws
remarked.
"We expect that another strong year of
manufacturing process improvements and cost reductions, in
combination with sales growth, will deliver overall earnings growth
for Corning this year," he noted.
In the first quarter, Corning anticipates LCD
glass volume in its Display Technologies segment will be consistent
to down slightly on a sequential basis, following a very strong
fourth-quarter performance. This is in line with normal seasonality
in the business. Quarterly glass price declines are expected to be
moderate again.
Optical Communications segment first-quarter core
sales are expected to increase by more than 10 percent on a
year-over-year basis, as the segment continues its strong overall
performance. In the Environmental Technologies segment, core sales
are anticipated to be consistent year over year. First-quarter
sales for Corning's Life Sciences segment should be comparable to
last year's first quarter.
Specialty Materials segment sales are expected to
increase by approximately 10 percent versus last year's
first-quarter performance, the result of increased Gorilla Glass
demand for products launched in the third and fourth quarters of
2014.
Upcoming Investor
Events
Corning will host investors and provide more information on its
2015 outlook at its annual investor meeting in New York on Friday,
Feb. 6 beginning at 8 a.m. ET at Cipriani Wall Street at 55 Wall
Street. Attendees can register online at the company's investor
relations website. Investors will hear presentations from the
company's chairman and chief executive officer, Corning business
leaders, and the vice chairman and chief financial
officer.
Also, company executives will be presenting at the
Goldman Sachs Technology Conference in San Francisco on Tuesday,
Feb. 10; the SIG Semi, Storage & Technology Summit in New York
on Tuesday, Feb. 24; and the Morgan Stanley Technology, Media &
Telecom Conference in San Francisco on Tuesday, Mar. 3.
Fourth-Quarter Conference Call
Information
The company will host a fourth-quarter conference call on Tuesday,
Jan. 27, 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 and
click "Investor Events" on the left. A replay will be available
beginning at 11 a.m. ET and will run through 5 p.m. ET, Tuesday,
Feb. 10. To listen, dial (800) 475-6701 or for international access
dial (320) 365-3844. The access code is 349651. 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
Q4 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#1889707
Corning (NYSE:GLW)
Historical Stock Chart
From Mar 2024 to Apr 2024
Corning (NYSE:GLW)
Historical Stock Chart
From Apr 2023 to Apr 2024