Corning Incorporated Reports Second Quarter Earnings from Continuing Operations Up 17%; Growth Fueled by Optical Fiber and Cable And Ceramic Substrate Businesses.CORNING Corning, city (1990 pop. 11,938), Steuben co., S N.Y., on the Chemung River, in a dairy and vineyard region; settled 1788, inc. as a city 1890. The glass industry for which the city is famous began in 1868. , N.Y.--(BUSINESS WIRE)--July 15, 1996--Corning Incorporated (NYSE NYSE See: New York Stock Exchange :GLW GLW Glasgow Airport (UK) GLW Gross Laden Weight GLW Good Lady Wife (Australia) ) said today that its 1996 second quarter net income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the totaled $93.8 million, or $0.41 per share, an increase of 17 percent over adjusted second quarter 1995 earnings of $0.35 per share. The adjusted 1995 second quarter results exclude a special charge taken by Corning to fully reserve its investment in Dow Corning Dow Corning is a multinational corporation headquartered in Midland, Michigan, USA. Dow Corning specializes in silicon and silicone-based technology, offering more than 7,000 products and services. Dow Corning is equally owned by The Dow Chemical Company and Corning, Inc. Corporation and a restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). provision. Second quarter sales from continuing operations totaled $913.7 million, an increase of 14 percent over adjusted 1995 levels. "The improvement in overall operating performance demonstrates the strength and market position of our core businesses and technologies," said Roger G. Ackerman, chairman and chief executive officer. "Looking ahead, we are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op about the second half of the year. We are moving aggressively to capture the growth in key markets with expansions under way for optical fiber, advanced materials Advanced Materials is a leading peer-reviewed materials science journal published every two weeks. Advanced Materials includes Communications, Reviews, and Feature Articles from the cutting edge of materials science, including topics in chemistry, physics, , television glass and projection projection, in psychology: see defense mechanism. See rear-projection TV, front-projection TV and LCD panel. (theory) projection - In domain theory, a function, f, which is (a) idempotent, i.e. lenses." The company said its sales and earnings growth was fueled by strong demand for optical fiber, cable and components for telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. markets, for ceramic This article is about ceramic materials. For the fine art, see Ceramic art. The word ceramic is derived from the Greek word κεραμικός (keramikos). substrates for environmental applications, and for life science products. In consumer products, results improved compared with 1995's second quarter. However, results from information display businesses were down from year earlier levels due to expansion-related manufacturing issues. Equity company earnings, excluding Dow Corning, increased approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 10 percent from adjusted 1995 levels, due primarily to solid results from optical fiber equity companies in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and
Australia Australia (ôstrāl`yə), smallest continent, between the Indian and Pacific oceans. With the island state of Tasmania to the south, the continent makes up the Commonwealth of Australia, a federal parliamentary state (2005 est. pop. and from Samsung-Corning Company Ltd. in South Korea Korea (kôrē`ə, kə–), Korean Hanguk or Choson, region and historic country (85,049 sq mi/220,277 sq km), E Asia. .Continuing operations include the company's Communications, Specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. Materials and Consumer Products segments. As previously announced, on May 14, 1996, Corning is pursuing the spin-off The situation that arises when a parent corporation organizes a subsidiary corporation, to which it transfers a portion of its assets in exchange for all of the subsidiary's capital stock, which is subsequently transferred to the parent corporation's shareholders. of its clinical laboratory and pharmaceutical services businesses in a transaction expected to be completed by year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. . Therefore, Corning has begun to account for the Health Care Services segment as discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. . The company recorded a loss from discontinued operations of $56.8 million, or $0.25 per share, in the second quarter of 1996. The loss includes a charge for the estimated costs related to the spin-offs and a charge to increase reserves for government claims at Corning Clinical Labs, offset by the estimated results of the segment through the anticipated date of the spin-off. Corning's total net income, including the loss from discontinued operations, was $37.0 million, or $0.16 per share, for the second quarter 1996, compared with a net loss of $297.2 million, or $1.32 per share, in the same period of 1995. Commenting on discontinued operations, Ackerman said, "Corning Pharmaceutical Services is benefiting from the high growth in the contract research field as part of the trend to bring new drugs to the marketplace at a faster pace. At Corning Clinical Laboratories, operations continue to stabilize stabilize See peg. , but the dynamics of that market continue to be difficult." Established in 1851, Corning Incorporated Corning Incorporated NYSE: GLW is an American manufacturer of glass, ceramics and related materials, primarily for industrial and scientific applications. The company was known until 1989 as Corning Glass Works. creates leading-edge technologies for the fastest growing segments of the world's economy. Corning manufactures optical fiber, cable and components, high- performance glass and components for televisions, and other electronic displays for communications and communications-related industries; advanced materials for the scientific, life sciences and environmental markets; and consumer products. Corning's total revenues from continuing operations in 1995 were $3.3 billion. -0-
Notice to Editors and Reporters:
The following accounting and reporting changes, that had been announced previously, are referenced in this second quarter 96 press release.
- "adjusted earnings" from 1995 reflect an accounting calendar
change from 13 reporting periods in 1995 to 12 month
reporting in 1996 -- announced first quarter 1996.
- "special charge taken by Corning to fully reserve its
investment in Dow Corning Corporation" and discontinued
recognition of equity earnings from Dow Corning Corporation
following Dow Corning's Chapter 11 filing -- announced
second quarter 1995.
- "restructuring provision" -- announced second quarter 1995.
- Adoption of discontinued operations accounting and
restatement of prior periods as part of spin off of Corning
Pharmaceutical Services and Corning Clinical Laboratories --
announced second quarter 1996.
-0-
Corning Incorporated and Subsidiary Companies
Consolidated Statements of Income
(Unaudited; in millions, except per-share amounts)
Six Months Twenty-Four Three Months Twelve Weeks
Ended Weeks Ended Ended Ended
June 30, June 18, June 30, June 18,
1996 1995 1996 1995
Revenues
Net sales $1,751.3 $1,397.0 $913.7 $764.8
Royalty, interest
and dividend
income 15.0 14.6 7.0 8.2
1,766.3 1,411.6 920.7 773.0
Deductions Cost of sales 1,085.7 867.2 568.7 474.8 Selling, general and administrative expenses 306.8 241.0 148.4 124.9 Research and development expenses 90.2 77.4 44.9 39.9 Provision for restructuring and other special charges 26.5 26.5 Interest expense 36.0 31.6 18.3 16.8 Other, net 11.2 9.7 4.1 1.8 Income from continuing operations before taxes on income 236.4 158.2 136.3 88.3 Taxes on income from continuing operations 79.2 47.9 45.7 25.1 Income from continuing operations before minority interest and equity earnings 157.2 110.3 90.6 63.2 Minority interest in earnings of subsidiaries (28.0) (28.3) (15.8) (17.3) Dividends on convertible preferred securities of subsidiary (6.9) (6.3) (3.5) (3.1) Equity in earnings (losses) of associated companies: Other than Dow Corning Corp. 34.1 29.4 22.5 21.0 Dow Corning Corp. (348.0) (365.5) Income (loss) from continuing operations 156.4 (242.9) 93.8 (301.7) Income (loss) from discontinued operations, net of income taxes (47.6) 25.1 (56.8) 4.5 Net Income (Loss) $108.8 $(217.8) $37.0 $(297.2) Per Common Share: Continuing operations $0.68 $(1.08) $0.41 $(1.34) Discontinued operations (0.21) 0.11 (0.25) 0.02 Net Income (Loss) $0.47 $(0.97) $0.16 $(1.32) Dividends Declared $0.36 $0.36 $0.18 $0.18 Weighted Average Shares Outstanding 227.3 225.9 227.3 226.3 The accompanying notes are an integral part of these statements. -0- Corning Incorporated and Subsidiary Companies Condensed Consolidated Balance Sheets (In millions)
June 30, 1996 Dec. 31, 1995
(Unaudited)
Assets
Current Assets Cash and short-term investments $122.2 $187.6 Receivables, net 550.9 479.5 Inventories 501.0 426.5 Deferred taxes on income and other current assets 136.5 102.8 Total current assets 1,310.6 1,196.4 Investments 339.9 364.9 Plant and Equipment, Net 1,769.2 1,599.6 Goodwill and Other Intangible Assets, Net 347.1 330.8 Other Assets 273.8 305.3
Net Assets of Discontinued
Operations 1,736.7 1,664.7
$5,777.3 $5,461.7
Liabilities and Stockholders' Equity
Current Liabilities Loans payable $415.0 $143.1 Accounts payable 166.2 202.6 Other accrued liabilities 431.6 396.3 Total current liabilities 1,012.8 742.0
Other Liabilities 634.7 618.3
Loans Payable Beyond One Year 1,303.8 1,340.0
Minority Interest in
Subsidiary Companies 302.5 269.8
Convertible Preferred Securities
of Subsidiary 364.9 364.7
Convertible Preferred Stock 23.3 23.9
Common Stockholders' Equity 2,135.3 2,103.0
$5,777.3 $5,461.7
The accompanying notes are an integral part of these statements. -0- Corning Incorporated and Subsidiary Companies Notes to Consolidated Financial Statements Quarter 2, 1996 (1) In May 1996, Corning's Board of Directors approved a plan to distribute to its shareholders on a pro rata basis all of the shares of Corning Clinical Laboratories Inc. and Corning Pharmaceutical Services Inc. (the "Distributions"). The result of the plan will be the creation of two independent, publicly-owned (but as yet unnamed) companies. Corning has submitted to the Internal Revenue Service a request for a ruling that the Distributions will qualify as tax-free distributions under the Internal Revenue Code of 1986. The final terms of the Distributions, which are subject to approval by Corning s Board of Directors, will be set forth in registration statements to be filed with the Securities and Exchange Commission and in an Information Statement to be distributed to Corning's shareholders. The Distributions are expected to occur by the end of 1996. Corning's investment in equity and intercompany debt of the companies to be distributed totaled $1.7 billion at June 30, 1996. Corning currently estimates that, prior to the Distributions, the companies to be distributed will borrow approximately $600 million to $800 million from third-party lenders and repay intercompany debt to Corning, reducing Corning's investment to approximately $900 million to $1.1 billion. Corning's stockholders equity will be reduced by Corning's investment in these companies at the date of the Distribution. Corning intends to use the proceeds from the repayment of intercompany debt to repay third-party debt, repurchase shares or invest for future strategic uses. As a result of the plan to distribute the clinical-laboratory and pharmaceutical-services businesses, Corning's consolidated financial statements and notes report these businesses, which comprised Corning s Health Care Services segment, as discontinued operations. Prior period financial statements have been restated accordingly. The loss from discontinued operations in the second quarter of 1996 includes a charge for the estimated costs related to the Distributions and a charge to increase reserves for government claims, offset by the estimated results of operations of the businesses to be distributed from April 1, 1996, through December 31, 1996, the anticipated date of the Distributions. Income from discontinued operations for the second quarter of 1995 includes an after-tax restructuring charge of $24.4 million. As disclosed in Corning's 1995 Annual Report on Form 10-K, government investigations of certain practices by clinical laboratories acquired in recent years are ongoing. In the second quarter, the U.S. Department of Justice notified Corning Clinical Labs that it has taken issue with certain payments received by Damon Corporation from federally funded healthcare programs prior to its acquisition by Corning. Corning Clinical Labs management has met with the U.S. Department of Justice several times to evaluate the substance of the government's allegations. Discussions with the U.S. Department of Justice are in a preliminary state and consequently, it is not possible to predict the outcome of this matter with any certainty. Corning Clinical Labs has established reserves equal to management's estimate of the low end of the range of potential amounts which could be required to satisfy the government's claims. However, it is possible that the aggregate claim (which might include restitution, multiple damages, other civil penalties or criminal fines) could be in excess of established reserves by an amount which could be material to Corning's results of operations and cash flows in the quarter in which such claim is settled. Corning does not believe that this claim will have a material adverse impact on Corning's overall financial condition. (2) Earnings per common share are computed by dividing net income less dividends on Series B convertible preferred stock by the weighted average number of common shares outstanding during the period. The weighted average shares outstanding for the second quarter and first half of 1996 was 227.3 million and 226.3 million and 225.9 million, respectively, for the same periods in 1995. Series B preferred dividends amounted to $0.5 million and $1.0 million in the second quarter and first half, respectively, in both 1996 and 1995. (3) Depreciation and amortization charged to continuing operations during the first half of 1996 and 1995 totaled $141.8 million and $120.2 million, respectively. (4) Corning's effective tax rate for continuing operations was 33.5% for the second quarter and first half of 1996. Excluding the impact of the restructuring charge, the effective tax rate was 31% and 31.5% for the second quarter and first half of 1995. The lower 1995 rate was due to a higher percentage of Corning's earnings from consolidated entities with lower effective tax rates. (5) Effective January 1, 1996, Corning made several changes to its accounting calendar to make Corning's results more comparable with other companies and to enable Corning to report results of certain subsidiaries on a more current basis. First, Corning adopted an annual reporting calendar. Previous years operated on a fiscal year ending on the Sunday nearest December 31. As a result, Corning's 1996 quarters will include results for three calendar months while Corning's quarters previously included results for 12 weeks (16 weeks in the third quarter). Second, Corning's 1996 quarters will include three months of operations for all significant subsidiaries and affiliates. Previously, certain subsidiaries reported two months of results in the first quarter and four months of results in the third quarter. Third, Corning Life Sciences, Inc. and certain other consolidated subsidiaries that previously reported on a fiscal year ending November 30 adopted a calendar year end. The December 1995 results of these subsidiaries were recorded in retained earnings during the first quarter of 1996. Second quarter and first half 1995 financial statements were not restated for the calendar change. The following table presents unaudited pro forma results for the second quarter and first half 1995 as if this change had occurred at the beginning of 1995 (in millions except per-share amounts):
Three Six
Months Ended Months Ended
June 30, 1995 June 30, 1995
(pro forma) (pro forma)
Sales $801.3 $1,568.8 Net income (loss) Before Dow Corning Corporation and restructuring $80.3 $136.8 Equity in losses of Dow Corning Corporation (365.5) (348.0) Provision for restructuring (16.1) (16.1) Continuing operations (301.3) (227.3) Discontinued operations 3.1 29.5 Net loss $(298.2) $(197.8) Net income (loss) per common share Before Dow Corning Corporation and restructuring $0.35 $0.60 Equity in losses of Dow Corning Corporation (1.62) (1.54) Provision for restructuring (0.07) (0.07) Continuing operations (1.34) (1.01) Discontinued operations 0.02 0.13 Net loss per common share $(1.32) $(0.88) (6) On May 15, 1995, Dow Corning Corporation (a 50%-owned equity company) voluntarily filed for protection under Chapter 11 of the United States Bankruptcy Code. As a result of this action, Corning recorded an after-tax charge of $365.5 million, or $1.62 per share, in the second quarter of 1995 to fully reserve its investment in Dow Corning Corporation. Corning also discontinued recognition of equity earnings from Dow Corning Corporation beginning in the second quarter of 1995. Corning recognized equity earnings from Dow Corning Corporation of $17.5 million in the first quarter of 1995. (7) In the second quarter of 1995, Corning recorded a restructuring charge in continuing operations totaling $26.5 million ($16.1 million after- tax) or $0.07 per share. CONTACT: Kathryn Kathryn may refer to: People with the given name Kathryn:
Paul Paul, 1901–64, king of the Hellenes (1947–64), brother and successor of George II. He married (1938) Princess Frederika of Brunswick. During Paul's reign Greece followed a pro-Western policy, and the Cyprus question was temporarily resolved. A. Rogoski, (607) 974-8832 or Investor Relations Investor relations The process by which the corporation communicates with its investors. Contact: Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a B. Klein Klein , Melanie 1882-1960. Austrian-born British psychoanalyst who first introduced play therapy and was the first to use psychoanalysis to treat young children. , (607) 974-8313 Katherine Katherine “intolerably curst and shrewd and froward.” [Br. Lit.: The Taming of the Shrew] See : Shrewishness M. Dietz Dietz is a surname, and may refer to:
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