Corning Reports First-Quarter Results; Earnings Per Share of $0.17 Exceeds Guidance; Sales Strong over Year-Ago Results.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. -- 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. (NYSE NYSE See: New York Stock Exchange : GLW GLW Glasgow Airport (UK) GLW Gross Laden Weight GLW Good Lady Wife (Australia) ) today announced first-quarter sales of $1.05 billion, with net income of $249 million, or $0.17 per share. The company's first-quarter results exceeded its sales guidance and far exceeded its guidance for earnings. "We are extremely pleased with our overall results and we believe that we are well positioned to take advantage of continuing growth opportunities," James R. Houghton James R. Houghton is the Retired Chairman of the Board of Corning Incorporated. Houghton has Bachelor of Arts and master of business administration degrees from Harvard University (A.B., 1958, MBA, 1962). , chairman and chief executive officer, said. First-Quarter Operating Results Corning's first-quarter sales of $1.05 billion increased 2 percent over last year's fourth-quarter sales of $1.033 billion, and increased 24 percent over last year's first-quarter sales of $844 million. Gross margin for the first quarter improved to 41 percent versus 35 percent in the previous quarter. About half of the first-quarter sequential One after the other in some consecutive order such as by name or number. improvement in gross margin was due to stronger operating performance in all the company's operating segments, particularly Display Technologies and Environmental Technologies. The remainder was due to the absence of a number of unusual items which occurred in the fourth quarter. Equity earnings for the first quarter were $166 million, an increase of 25 percent over fourth-quarter equity earnings of $133 million. The sequential increase was primarily due to 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, which experienced strong volume growth, improved pricing and favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. exchange rates. Corning's equity earnings from Dow Corning were $68 million in the first quarter, nearly doubling fourth-quarter equity earnings of $35 million. Corning recorded $320 million in first-quarter sales in its Display Technologies segment, a 3 percent increase over last year's fourth-quarter sales of $311 million. The sequential sales increase was primarily driven by a 5 percent volume increase and a favorable Japanese yen “Yen” redirects here. For the other use, see Yen (disambiguation). “JPY” redirects here. For the Australian singer with the same moniker, see John Paul Young. exchange rate, offset by average glass pricing declines of less than 4 percent. Sequential first-quarter volume and pricing were within the company's guidance. Volume grew approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 35 percent and average pricing was flat in comparison to a year ago. Samsung Corning Precision Glass  The of this article or section may be compromised by "peacock terms".You can help Wikipedia by removing peacock terms. Co. Ltd., a 50-percent equity venture in Korea Korea (kôrē`ə, kə–), Korean Hanguk or Choson, region and historic country (85,049 sq mi/220,277 sq km), E Asia. , increased its sequential glass volume by 6 percent. In comparison to a year ago, volume at Samsung Corning Precision was up 44 percent in the first quarter. Equity earnings from Samsung Corning Precision were $80 million for the first quarter, compared to $73 million last quarter. Total volume in the Display Technologies segment, including both Corning's wholly-owned business and Samsung Corning Precision, increased 6 percent sequentially se·quen·tial adj. 1. Forming or characterized by a sequence, as of units or musical notes. 2. Sequent. se·quen in the first quarter. Net income for the Display Technologies segment was $161 million in the first quarter, compared to $151 million in the fourth quarter. Wendell Wendell is a name that has many uses: Places
The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , said, "In the first quarter, we saw increased indications that panel manufacturers are continuing to ramp up Ramp Up To increase a company's operations in anticipation of increased demand. Notes: A company might 'ramp up' operations if they just signed a contract creating substantially more demand for their product. See also: Demand, Economies of Scale capacity for larger-generation (Gens. 5, 6 and 7) panel sizes. We are pleased to report that we have signed four additional long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. supply agreements for liquid crystal display liquid crystal display (LCD) Optoelectronic device used in displays for watches, calculators, notebook computers, and other electronic devices. Current passed through specific portions of the liquid crystal solution causes the crystals to align, blocking the passage of light. (LCD (Liquid Crystal Display) A display technology that uses rod-shaped molecules (liquid crystals) that flow like liquid and bend light. Unenergized, the crystals direct light through two polarizing filters, allowing a natural background color to show. ) glass that include customer deposits. We now have five long-term supply agreements with customer deposits, a clear indication that our customers continue to see Corning as the first choice for meeting their large-size glass needs." Telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. segment sales were $427 million for the first quarter, consistent with the previous quarter's sales of $423 million, and higher than the company's expectations. The better-than-expected sales were primarily due to higher volumes of hardware and equipment products to support Verizon Communication's fiber-to-the-premises (FTTP (Fiber To The Premises) The installation of optical fiber from the carrier directly into the home or office. Also called "fiber to the home" (FTTH). See PON and FTTC. See also FTP. ) build-out Build-out is an urban planner’s estimate of the amount and location of potential development for an area. Build-out is one step of the land use planning process. Evaluation of potential development impacts begins with a build-out analysis. in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. and continued strong demand 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). . The segment recognized net income of $9 million
compared to a net loss of $9 million in last year's fourth quarter.
Optical fiber volume in the first quarter decreased 6 percent from
fourth-quarter volume, while fiber pricing declined approximately 2
percent for the quarter. In comparison to a year ago, fiber volumes
increased more than 50 percent.Weeks said, "We were pleased with the performance of our Telecommunications segment in North America, but we continue to be challenged by the overall lower demand and strong pricing pressures for fiber in China." Environmental Technologies segment sales were $148 million for the first quarter, a 14 percent sequential sales increase. These results were driven by seasonal increases and strong volume for both the automotive and diesel product lines, the latter related to a Korean Korean, language of uncertain ancestry. It is thought by some scholars to be akin to Japanese, by others to be a member of the Altaic subfamily of the Ural-Altaic family of languages (see Uralic and Altaic languages), and by still others to be unrelated to any known diesel engine retrofit ret·ro·fit v. ret·ro·fit·ted or ret·ro·fit, ret·ro·fit·ting, ret·ro·fits v.tr. 1. To provide (a jet, automobile, computer, or factory, for example) with parts, devices, or equipment not in program underway. Enhanced manufacturing performance also drove improved segment results in first quarter compared to the fourth quarter. The company's Life Sciences segment recorded first-quarter sales of $74 million, an increase over fourth-quarter sales of $71 million. Special Items Corning's first-quarter results included special items netting to a $3 million charge, which had no impact on the company's earnings per share. The special items include a charge of $19 million to impair im·pair tr.v. im·paired, im·pair·ing, im·pairs To cause to diminish, as in strength, value, or quality: an injury that impaired my hearing; a severe storm impairing communications. the company's investment in Avanex Corporation, and a $16 million gain to reflect the decline in the market value of Corning common stock to be contributed to settle the asbestos asbestos, mineral asbestos, common name for any of a variety of silicate minerals within the amphibole and serpentine groups that are fibrous in structure and more or less resistant to acid and fire. litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. related to Pittsburgh Pittsburgh (pĭts`bərg), city (1990 pop. 369,879), seat of Allegheny co., SW Pa., at the confluence of the Allegheny and the Monongahela rivers, which there form the Ohio River; inc. 1816. Corning Corporation. Cash Flow/Liquidity Update Corning ended the first quarter with $1.5 billion in cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments, a decline from the previous quarter's balance of $1.9 billion. This decline was due to capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. in excess of operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. and the net repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan of $146 million of debt in the first quarter. Also in the first quarter, Corning converted nearly $100 million in debentures into Corning stock. These items resulted in the company's debt-to-capital ratio improving to 36.4 percent compared to the previous quarter's ratio of 41 percent. The company expects to redeem redeem v. to buy back, as when an owner who had mortgaged his/her real property pays off the debt. The term also refers to paying the amount due and all charges after a foreclosure (due to failure to make payments when due) has begun. the remaining $191 million of its 3.5 percent debentures, subject to market conditions, by the end of 2005. James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. B. Flaws, vice chairman and chief financial officer, said, "We continue to make progress on all of our financial goals. We are carefully managing our cash flow, reducing the company's overall debt levels and making strides toward achieving investment-grade investment-grade Of, relating to, or being a bond suitable for purchase by institutions under the prudent man rule. Investment-grade is restricted to those bonds graded BBB and above by Standard & Poor's and graded Baa3 and above by Moody's. ratings." Second-Quarter Outlook Corning said that it expects second-quarter sales to be in the range of $1.08 billion to $1.13 billion and EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. in the range of $0.17 to $0.19 before special items. This EPS estimate is a non-GAAP financial measure and excludes any possible special items. This and all non-GAAP financial measures are reconciled rec·on·cile v. rec·on·ciled, rec·on·cil·ing, rec·on·ciles v.tr. 1. To reestablish a close relationship between. 2. To settle or resolve. 3. on the company's investor relations Investor relations The process by which the corporation communicates with its investors. Web site and in attachments to this news release. The company expects gross margins will be about 40 percent for the quarter and equity earnings will be consistent with the first quarter. Corning expects that the second-quarter corporate tax rate will be between 20 percent and 25 percent. For the second half of the year, the company believes the tax rate will be between 20 percent and 30 percent. In the Display Technologies segment, Corning anticipates that second-quarter sequential volume growth for its wholly-owned business and Samsung Corning Precision will be in the range of 10 percent to 20 percent, both individually and in the aggregate. Corning said that the actual rate of glass volume growth could vary by geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. market. In addition, the level of volume growth will be influenced by the industry's ability to efficiently bring on new panel manufacturing capacity during the quarter and the level of end market demand for LCD products. Pricing pressures are expected to be slightly less than what occurred in the first quarter. "We believe that in the second quarter our panel customers will continue to ramp up capacity at their Gen 6 and Gen 7 plants in anticipation The performance of an act or obligation before it is legally due. In patent law, the publication of the existence of an invention that has already been patented or has a patent pending, of increasing LCD television demand," Weeks, said. "There are indications that the retail price of LCD televisions will continue to drop throughout the year and we believe that overall LCD television penetration The successful unauthorized breach of a security perimeter. See penetration test. could reach 10 percent of the TV market in 2005." He said that the second quarter should also see sustained strength in LCD monitor A flat panel display that uses liquid crystals. Although laptops have used LCDs as their flat panel technology almost exclusively, LCD is also the most popular for flat panel desktop monitors. Toward the end of 2003, sales of LCD displays for desktops overtook CRTs for the first time. demand. The company continues to forecast that the total LCD glass market volume will grow in excess of 50 percent for the year. Telecommunications segment second-quarter sales are expected to grow approximately 5 percent, led primarily by the seasonal strength in hardware and equipment products. The company's second-quarter fiber volume increase is expected to be in the range of flat to a 10 percent increase. Second-quarter fiber pricing is expected to decline less than 5 percent sequentially. Corning believes that second-quarter volumes of FTTP products sold to Verizon will be similar to the very strong first quarter. The company also expects that FTTP sales will decline in the second quarter with the implementation of expected price reductions as the Verizon project enters its second year. The company also expects equity earnings from Dow Corning to be in the range of $50 million to $60 million in the second quarter, and it believes this is a reasonable expectation per quarter for the remainder of the year. Weeks said, "We have had an outstanding start to the year and we are excited about our prospects. We believe we have excellent momentum coming into this quarter and we are well positioned for growth in 2005." Annual Shareholders Meeting Corning will hold its annual shareholder meeting on Thursday Thursday: see week. , April 28, 2005 beginning at 11 a.m., EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT , at The Corning Museum of Glass The Corning Museum of Glass grants permission to Wikipedia to include text from its website in the article below. The Corning Museum of Glass, in Corning, New York, explores every facet of glass: its unique place in art, history, culture, science and technology, Auditorium auditorium Portion of a theater or hall where an audience sits, as distinct from the stage. The auditorium originated in the theaters of ancient Greece, as a semicircular seating area cut into a hillside. in Corning, N.Y. First-Quarter Conference Call Information The company will host a first-quarter conference call at 8:30 a.m. EDT on Wednesday Wednesday: see week. , April 27. To access the call, dial (630) 395-0017. The password A secret word or code used to serve as a security measure against unauthorized access to data. It is normally managed by the operating system or DBMS. However, the computer can only verify the legitimacy of the password, not the legitimacy of the user. See NCSC. is RESULTS. A replay of the call will begin at approximately 10:30 a.m. EDT and will run through 5 p.m. EDT, Wednesday, May 11. To listen, dial (203) 369-2041, no pass code is required. To listen to a live audio webcast of the call please go to Corning's Web site and follow the instructions: http://www.corning.com/investor_relations. The audio 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 Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with, or an alternative to, GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). . Corning's non-GAAP net income and EPS measures exclude 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). , impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. and other charges and adjustments to prior estimates for such charges. Additionally, the company's non-GAAP measures exclude adjustments to asbestos settlement reserves required by movements in Corning's common stock price, gains and losses arising from debt retirements, charges resulting from the impairment of equity or cost method investments and gains or losses recognized in equity earnings from restructuring, impairment or other charges or credits taken by equity method companies. The company believes presenting non-GAAP net income and EPS measures is helpful to analyze an·a·lyze v. 1. To examine methodically by separating into parts and studying their interrelations. 2. To separate a chemical substance into its constituent elements to determine their nature or proportions. 3. financial performance without the impact of unusual items that may obscure OBSCURE - "A Formal Description of the Specification Language OBSCURE", J. Loeckx, TR A85/15, U Saarlandes, Saarbrucken, 1985. trends in the company's underlying performance. These non-GAAP measures are reconciled on the company's Web site at www.corning.com/investor_relations and accompany To go along with; to go with or to attend as a companion or associate. A motor vehicle statute may require beginning drivers or drivers under a certain age to be accompanied by a licensed adult driver whenever operating an automobile. this news release. About Corning Incorporated Corning Incorporated (www.corning.com) is a diversified diversified (di·verˑ·s technology company that concentrates its efforts on high-impact growth opportunities. Corning combines its expertise in 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. glass, 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). materials, polymers and the manipulation Manipulation Dealing in a security to create a false appearance of active trading, in order to bring in more traders. Illegal. of the properties of light, with strong process and manufacturing capabilities to develop, engineer and commercialize significant innovative products for the telecommunications, flat panel display A thin display screen for computer and TV usage. The first flat panels appeared on laptop computers in the mid-1980s, and the LCD technology became the standard. Stand-alone LCD screens became available for desktop computers in the mid-1990s and exceeded sales of CRTs for the first time , environmental, semiconductor, and life sciences industries. Forward-Looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. and Cautionary Statements This news release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve a variety of business risks and other uncertainties that could cause actual results to differ materially. These risks and uncertainties include the possibility of changes or fluctuations in global economic and political conditions; tariffs This is a list of tariffs and trade legislation:
The earliest stage of a new business venture. costs; possible disruption disruption /dis·rup·tion/ (dis-rup´shun) a morphologic defect resulting from the extrinsic breakdown of, or interference with, a developmental process. in commercial activities due to terrorist activity, armed conflict, political instability instability /in·sta·bil·i·ty/ (-stah-bil´i-te) lack of steadiness or stability. detrusor instability or major health concerns; ability to obtain financing and capital on commercially reasonable terms; adequacy and availability of insurance; capital resource and cash flow activities; capital spending; equity company activities; interest costs; acquisition and divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). activities; the level of excess or obsolete inventory Obsolete Inventory Term that refers to inventory that is at the end of its product life cycle and has not seen any sales or usage for a set period of time usually determined by the industry. This type of inventory has to be written down and can cause large losses for a company. ; the rate of technology change; the ability to enforce patents; product and components performance issues; changes in key personnel; stock price fluctuations; and adverse litigation or regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. developments. These and other risk factors are identified 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.
CORNING INCORPORATED AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; in millions, except per share amounts)
For the three
months ended
March 31,
-----------------------
2005 2004
----------- -----------
Net sales $ 1,050 $ 844
Cost of sales 621 544
----------- -----------
Gross margin 429 300
Operating expenses:
Selling, general and administrative expenses 184 160
Research, development and engineering
expenses 98 84
Amortization of purchased intangibles 5 10
Restructuring, impairment and other charges
and (credits) 19 34
Asbestos settlement (16) 19
----------- -----------
Operating income (loss) 139 (7)
Interest income 10 6
Interest expense (37) (36)
Loss on repurchases and retirement of debt, net (23)
Other expense, net (9) (4)
----------- -----------
Income (loss) before income taxes 103 (64)
(Provision) benefit for income taxes (19) 12
----------- -----------
Income (loss) before minority interests and
equity earnings 84 (52)
Minority interests (1)
Equity in earnings of associated companies 166 107
----------- -----------
Net income $ 249 $ 55
=========== ===========
Basic earnings per common share $ 0.18 $ 0.04
=========== ===========
Diluted earnings per common share $ 0.17 $ 0.04
=========== ===========
Shares used in computing per share amounts for:
Basic earnings per common share 1,411 1,358
=========== ===========
Diluted earnings per common share 1,503 1,437
=========== ===========
CORNING INCORPORATED AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Unaudited; in millions, except share and per share amounts)
March 31, December 31,
2005 2004
------------ ------------
Assets
Current assets:
Cash and cash equivalents $ 847 $ 1,009
Short-term investments, at fair value 700 872
------------ ------------
Total cash, cash equivalents and short-
term investments 1,547 1,881
Trade accounts receivable, net of doubtful
accounts and allowances 621 585
Inventories 562 535
Deferred income taxes 90 94
Other current assets 208 188
------------ ------------
Total current assets 3,028 3,283
Investments 1,485 1,484
Property, net 4,096 3,941
Goodwill and other intangible assets, net 387 398
Deferred income taxes 478 472
Other assets 159 166
------------ ------------
Total Assets $ 9,633 $ 9,744
============ ============
Liabilities and Shareholders' Equity
Current liabilities:
Short-term borrowings, including current
portion of long-term debt $ 288 $ 478
Accounts payable 667 682
Other accrued liabilities 1,001 1,178
------------ ------------
Total current liabilities 1,956 2,338
Long-term debt 2,125 2,214
Postretirement benefits other than pensions 595 600
Other liabilities 740 747
------------ ------------
Total liabilities 5,416 5,899
------------ ------------
Commitments and contingencies
Minority interests 29 29
Shareholders' equity:
Preferred stock - Par value $100.00 per
share; Shares authorized: 10 million
Series C mandatory convertible preferred
stock - Shares issued: 5.75 million;
Shares outstanding: 633 thousand and 637
thousand 63 64
Common stock - Par value $0.50 per share;
Shares authorized: 3.8 billion; Shares
issued: 1,437 million and 1,424 million 719 712
Additional paid-in capital 10,484 10,363
Accumulated deficit (7,060) (7,309)
Treasury stock, at cost; Shares held: 15
million and 16 million (155) (162)
Accumulated other comprehensive income 137 148
------------ ------------
Total shareholders' equity 4,188 3,816
------------ ------------
Total Liabilities and Shareholders' Equity $ 9,633 $ 9,744
============ ============
Certain amounts for 2004 were reclassified to conform to 2005
classifications.
CORNING INCORPORATED AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; in millions)
For the three
months ended
March 31,
-----------------------
2005 2004
----------- -----------
Cash Flows from Operating Activities:
Income from continuing operations $ 249 $ 55
Adjustments to reconcile income from
continuing operations to net cash provided
by operating activities:
Depreciation 120 120
Amortization of purchased intangibles 5 10
Asbestos settlement (16) 19
Restructuring, impairment and other
charges and (credits) 19 34
Loss on repurchases and retirement of debt 23
Undistributed earnings of associated
companies (23) (29)
Deferred taxes 3 (40)
Restructuring payments (9) (34)
Customer deposits 20
Changes in certain working capital items:
Trade accounts receivable (54) (17)
Inventories (39) (32)
Other current assets (16) 3
Accounts payable and other current
liabilities, net of restructuring
payments (151) (66)
Other, net 34 (1)
----------- -----------
Net cash provided by operating activities 142 45
----------- -----------
Cash Flows from Investing Activities:
Capital expenditures (323) (134)
Short-term investments - acquisitions (314) (544)
Short-term investments - liquidations 486 421
Other, net 2 11
----------- -----------
Net cash used in investing activities (149) (246)
----------- -----------
Cash Flows from Financing Activities:
Repayments of short-term borrowings and
current portion of long-term debt (192) (2)
Proceeds from issuance of long-term debt, net 48 396
Retirements of long-term debt (2) (141)
Proceeds from issuance of common stock, net 12 11
Proceeds from the exercise of stock options 9 12
Other, net (5) (2)
----------- -----------
Net cash (used in) provided by financing
activities (130) 274
----------- -----------
Effect of exchange rates on cash (25) (1)
----------- -----------
Net (decrease) increase in cash and cash
equivalents (162) 72
Cash and cash equivalents at beginning of
period 1,009 688
----------- -----------
Cash and cash equivalents at end of period $ 847 $ 760
=========== ===========
Certain amounts for 2004 were reclassified to conform to 2005
classifications.
CORNING INCORPORATED
QUARTERLY SALES INFORMATION
(Unaudited; in millions)
2005 2004
-------- --------------------------------------------
Q1 Q1 Q2 Q3 Q4 Total
-------- -------- -------- -------- -------- --------
Display
Technologies $ 320 $ 230 $ 277 $ 295 $ 311 $ 1,113
Telecommunications
Fiber and cable 212 149 192 202 212 755
Hardware and
equipment 215 163 200 210 211 784
-------- -------- -------- -------- -------- --------
427 312 392 412 423 1,539
Environmental
Technologies
Automotive 127 125 121 119 114 479
Diesel 21 16 20 17 16 69
-------- -------- -------- -------- -------- --------
148 141 141 136 130 548
Life Sciences 74 79 79 75 71 304
Other 81 82 82 88 98 350
-------- -------- -------- -------- -------- --------
Total $ 1,050 $ 844 $ 971 $ 1,006 $ 1,033 $ 3,854
======== ======== ======== ======== ======== ========
The above supplemental information is intended to facilitate analysis
of Corning's businesses.
CORNING INCORPORATED AND SUBSIDIARY COMPANIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE TO GAAP FINANCIAL MEASURE
Three Months Ended March 31, 2005
(Unaudited; amounts in millions, except per share amounts)
Corning's net income and earnings per share (EPS) excluding special
items for the first quarter of 2005 are non-GAAP financial measures
within the meaning of Regulation G of the Securities and Exchange
Commission. Non-GAAP financial measures are not in accordance with, or
an alternative to, generally accepted accounting principles (GAAP).
The company believes presenting non-GAAP net income and EPS is helpful
to analyze financial performance without the impact of unusual items
that may obscure trends in the company's underlying performance. A
detailed reconciliation is provided below outlining the differences
between these non-GAAP measures and the directly related GAAP measure.
Income
Before
Per Income Net
Share Taxes Income
--------- --------- ---------
Earnings per share (EPS) and net income,
excluding special items $ 0.17 $ 106 $ 252
Special items:
Restructuring, impairment and other
(charges) and credits (a) (0.01) (19) (19)
Asbestos settlement (b) 0.01 16 16
--------- --------- ---------
Total EPS and net income $ 0.17 $ 103 $ 249
========= ========= =========
(a) In the first quarter of 2005, Corning recorded an impairment
charge of $19 million for an other than temporary decline in the
fair value of its investment in Avanex Corporation (Avanex). At
March 31, 2005, shares of Avanex were trading at $1.30 per share
compared to Corning's average cost basis of $2.40 per share.
Corning believes it will not recover its cost basis in Avanex
shares given the significant decline in its stock price.
(b) As part of Corning's asbestos settlement arrangement to be
incorporated into the Pittsburgh Corning Corporation
reorganization plan, Corning will contribute, if the
reorganization plan becomes effective, 25 million shares of
Corning common stock to a trust. This portion of the asbestos
liability requires quarterly adjustment based upon movements in
Corning's common stock price prior to contribution of the shares
to the trust. In the first quarter of 2005, Corning recorded a
credit of $16 million for the change in its common stock price of
$11.13 at March 31, 2005 compared to $11.77, the common stock
price at December 31, 2004.
CORNING INCORPORATED AND SUBSIDIARY COMPANIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE TO GAAP FINANCIAL MEASURE
Three Months Ended December 31, 2004
(Unaudited; amounts in millions, except per share amounts)
Corning's net income and earnings per share (EPS) excluding special
items for the fourth quarter of 2004 are non-GAAP financial measures
within the meaning of Regulation G of the Securities and Exchange
Commission. Non-GAAP financial measures are not in accordance with, or
an alternative to, generally accepted accounting principles (GAAP).
The company believes presenting non-GAAP net income and EPS is helpful
to analyze financial performance without the impact of unusual items
that may obscure trends in the company's underlying performance. A
detailed reconciliation is provided below outlining the differences
between these non-GAAP measures and the directly related GAAP measure.
Income
Before
Per Income Net
Share Taxes Income
--------- --------- ---------
Earnings per share (EPS) and net income,
excluding special items $ 0.12 $ 79 $ 177
Special items:
Restructuring, impairment and other
(charges) and credits (a) 5 3
Asbestos settlement (b) (0.01) (17) (17)
--------- --------- ---------
Total EPS and net income $ 0.11 $ 67 $ 163
========= ========= =========
(a) Corning recorded net credits of $5 million ($3 million after-tax
and minority interest) for adjustments to prior periods'
restructuring and impairment charges, primarily in the
Telecommunications segment.
(b) As part of Corning's asbestos settlement arrangement to be
incorporated into the Pittsburgh Corning Corporation
reorganization plan, Corning will contribute, when the
reorganization plan becomes effective, 25 million shares of
Corning common stock to a trust. This portion of the asbestos
liability requires quarterly adjustment based upon movements in
Corning's common stock price prior to contribution of the shares
to the trust. In the fourth quarter of 2004, Corning recorded a
charge of $17 million for the change in its common stock price of
$11.77 at December 31, 2004 compared to $11.08, the common stock
price at September 30, 2004.
CORNING INCORPORATED AND SUBSIDIARY COMPANIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE TO GAAP FINANCIAL MEASURE
Three Months Ended March 31, 2005
(Unaudited; amounts in millions)
Corning's free cash flow financial measures for the three months ended
March 31, 2005 and December 31, 2004 are non-GAAP financial measures
within the meaning of Regulation G of the Securities and Exchange
Commission. Non-GAAP financial measures are not in accordance with, or
an alternative to, generally accepted accounting principles (GAAP).
The company believes presenting non-GAAP financial measures is helpful
to analyze financial performance without the impact of unusual items
that may obscure trends in the company's underlying performance. A
detailed reconciliation is provided below outlining the differences
between these non-GAAP measures and the directly related GAAP
measures.
For the three For the three
months ended months ended
March 31, 2005 December 31, 2004
----------------- -----------------
Operating cash flow $ 142 $ 366
Less: Investing cash flow (149) (359)
Plus: Short-term investments -
acquisitions 314 284
Less: Short-term investments -
liquidations (486) (217)
---------------- -----------------
Free cash flow $ (179) $ 74
================ =================
CORNING INCORPORATED AND SUBSIDIARY COMPANIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE TO GAAP FINANCIAL MEASURE
Three Months Ended June 30, 2005
(Unaudited; amounts in millions, except per share amounts)
Corning's earnings per share (EPS) excluding special items for the
second quarter of 2005 is a non-GAAP financial measure within the
meaning of Regulation G of the Securities and Exchange Commission.
Non-GAAP financial measures are not in accordance with, or an
alternative to, generally accepted accounting principles (GAAP). The
company believes presenting non-GAAP EPS is helpful to analyze
financial performance without the impact of unusual items that may
obscure trends in the company's underlying performance. A detailed
reconciliation is provided below outlining the differences between
this non-GAAP measure and the directly related GAAP measure.
Range
---------------------
Guidance: EPS excluding special items $ 0.17 $ 0.19
Special items:
Restructuring, impairment and other (charges)
and credits (a)
Asbestos settlement (b)
(Loss) gain on repurchases and retirements of
debt, net (c)
---------- ----------
Earnings per share
This schedule will be updated as additional announcements occur.
(a) From time to time, Corning may need to make adjustments to
estimates used in the determination of prior year restructuring
and impairment charges, which could result in a gain or loss
during the quarter.
(b) As part of Corning's asbestos settlement arrangement to be
incorporated into the Pittsburgh Corning Corporation
reorganization plan, Corning will contribute, when the
reorganization plan becomes effective, 25 million shares of
Corning common stock to a trust. The common stock will be
contributed to the trust, after the plan has been approved by the
asbestos claimants and bankruptcy court. The portion of the
asbestos liability to be settled in common stock requires
adjustment each quarter based upon movements in Corning's common
stock price prior to contribution of the shares to the trust. In
the second quarter of 2005, Corning will record a charge or credit
for the change in its common stock price as of June 30, 2005
compared to $11.13, the common stock price at March 31, 2005.
(c) From time to time, Corning may repurchase or retire debt, which
could result in a gain or loss during the quarter.
Please note that the company may pursue other financing, restructuring and divestiture activities at any time in the future, and that the potential impact of these events is not included within Corning's second quarter 2005 guidance. This schedule contains forward looking statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such forward looking statements are based on current expectations and involve certain risks and uncertainties. Actual results may differ from those projected in the forward looking statements. Additional information concerning factors that could cause actual results to materially differ from those in the forward looking statements is contained in the Securities and Exchange Commission filings of this Company. |
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