Summary
Corning Incorporated announced its second-quarter 2006 financial results, reporting sales of $1.26 billion and net income of $514 million, or $0.32 per share. These results met the company's earnings per share guidance, despite a panel inventory correction impacting the Display Technologies segment. The company highlighted strength in its Telecommunications segment and lower operating expenses as offsets to the Display Technologies segment's performance. Corning also provided third-quarter 2006 guidance, expecting sales between $1.26 billion and $1.33 billion, with earnings per share (excluding special items) in the range of $0.22 to $0.26. The company anticipates a sequential volume growth in its Display Technologies segment as the supply-chain correction eases, and it projects overall LCD glass market volume growth of 40-50% for the full year 2006. Liquidity remains strong, with $2.48 billion in cash and short-term investments and a reduced debt level. Moody's recently upgraded Corning's debt rating to Baa2.
Key Highlights
- 1Corning met its Q2 2006 EPS guidance, reporting $0.32 per share, which included $0.06 from special gains.
- 2Second-quarter sales were $1.26 billion, even with the prior quarter and up 11% year-over-year.
- 3The Display Technologies segment faced a sequential sales decline of 16% due to a panel inventory correction, but year-over-year sales increased 11%.
- 4The Telecommunications segment showed strength, with sales up 19% sequentially to $472 million, driven by strong demand for fiber and cable.
- 5Corning ended Q2 with $2.48 billion in cash and short-term investments and reduced its debt to $1.5 billion.
- 6Moody's Investor Service upgraded Corning's debt rating to Baa2 with a stable outlook.
- 7Third-quarter 2006 guidance projects sales of $1.26-$1.33 billion and non-GAAP EPS of $0.22-$0.26.