8-KEarnings & ResultsExhibits & Filings

CORNING INC /NY 8-K Report, Financial Results (Jan 24, 2007)

Filed January 24, 2007For Securities:GLW

Summary

Corning Inc. reported strong fourth-quarter and full-year 2006 financial results, exceeding company guidance and analyst expectations. For the fourth quarter, the company posted sales of $1.37 billion and net income of $646 million ($0.41 per share), with net income excluding special gains of $488 million ($0.31 per share). Full-year 2006 sales reached $5.17 billion, a 13% increase over 2005, and net income was $1.86 billion ($1.16 per share), or $1.78 billion ($1.12 per share) excluding special items, marking a 35% increase year-over-year. The company highlighted significant growth in its Display Technologies segment, driven by a more than 50% volume increase in LCD glass substrates, particularly for televisions. Corning also anticipates continued growth in 2007, projecting the LCD glass substrate market to expand by mid-30% and seeing strong potential in its Environmental Technologies segment due to new U.S. emissions regulations for diesel products. Corning ended 2006 with a robust cash position of $3.2 billion and generated $540 million in free cash flow, indicating financial strength and flexibility for future investments and potential shareholder returns.

Key Highlights

  • 1Corning reported record net income and earnings per share for the full year 2006, with net income of $1.86 billion ($1.16/share) or $1.78 billion ($1.12/share) excluding special items.
  • 2Fourth-quarter 2006 sales of $1.37 billion and net income of $646 million ($0.41/share) surpassed guidance and consensus estimates.
  • 3The Display Technologies segment was a key growth driver, with a 50% increase in LCD glass volume for the full year 2006, significantly boosted by demand for LCD televisions.
  • 4Corning generated $540 million in free cash flow for 2006 and ended the year with $3.2 billion in cash and short-term investments, demonstrating strong financial health.
  • 5The company forecasts mid-30% growth for the overall LCD glass substrate market in 2007, with Corning's volume expected to grow at the upper end of this range.
  • 6Significant growth is anticipated in the Environmental Technologies segment, with diesel product sales projected to increase by over 60% in 2007 due to new emissions regulations.
  • 7Corning provided first-quarter 2007 guidance, expecting sales between $1.26 billion and $1.31 billion and EPS (excluding special items) between $0.24 and $0.27.

Frequently Asked Questions

For the fourth quarter of 2006, Corning reported sales of $1.37 billion and net income of $646 million ($0.41 per share). Excluding special items, net income was $488 million ($0.31 per share). For the full year 2006, sales were $5.17 billion, and net income was $1.86 billion ($1.16 per share), or $1.78 billion ($1.12 per share) excluding special items.

Corning's Display Technologies segment showed strong growth in 2006, driven by a significant increase in LCD glass volume, especially for televisions. For 2007, the company expects the LCD glass substrate market to grow in the mid-30% range. Additionally, the Environmental Technologies segment is anticipated to see substantial growth in diesel product sales, projected to increase by over 60% due to new U.S. emissions regulations.

Corning ended 2006 with a strong liquidity position, holding $3.2 billion in cash and short-term investments. The company generated $540 million in free cash flow for the year. Management indicated priorities for excess cash include debt repayment and funding new development projects, with potential for share repurchases or dividend reinstatement thereafter. Corning also plans to invest in emerging technologies like green lasers and microreactors.

Corning expects first-quarter 2007 sales to be in the range of $1.26 billion to $1.31 billion. Earnings per share (excluding special items) are projected to be between $0.24 and $0.27. The company also anticipates a sequential decline in Display Technologies glass volume due to market seasonality, while Telecommunications segment sales are expected to increase modestly year-over-year.