Corning to Present at Barclay’s Capital Global Technology Conference
CORNING, N.Y., – Corning Incorporated (NYSE: GLW) Senior Vice President and Corporate Controller Tony Tripeny will tell investors that “all of the company’s segments are performing at or above our expectations for the fourth quarter” when he speaks at the Barclay’s Capital Global Technology Conference in San Francisco at 2 p.m. PT today.
The company will note that fourth-quarter LCD glass market volumes are now expected to be consistent with those from the third quarter, a slight change to its previous guidance of flat to down slightly. “Panel maker utilization rates have changed recently, but these have not been material enough to significantly change our expectations for the overall glass market or our total glass volume this quarter,” Tripeny will say. Utilization rates at Taiwanese panel makers increased in October and November, in comparison to a very weak September. As a result, Corning now expects sequential volumes at its wholly owned business to be up about 10% versus its previous guidance of flat to down slightly.
However, Korean panel makers have recently lowered their utilization rates. As a result, sequential volumes at Samsung Corning Precision Materials Co., Ltd., are now expected to be down 5% to 10% versus previous guidance of flat to down slightly. “We expect our total glass volumes in the fourth quarter to be consistent with the third quarter, in line with the overall glass market,” Tripeny will add. The company will have no changes to its glass pricing guidance for the fourth quarter.
Regarding the retail environment, Tripeny will tell investors that “early retail data indicates sales of LCD TVs during the weeks leading up to, and including, Black Friday were in line with our expectations. In November, LCD TVs grew year-over-year in the U.S. for the first time since April, the result of attractive retail pricing.”
“As we expected, inventory levels in the display supply chain appear to be improving as we move through the fourth quarter,” Tripeny will add. The company anticipates supply chain inventories will exit the fourth quarter between 16 and 16.5 weeks, compared to 17 weeks entering the fourth quarter.
Based on the recent strength in glass demand, the company expects its first-quarter glass price declines to be more moderate in comparison to the fourth quarter. First-quarter glass market volume is expected to be consistent with the fourth quarter.
Tripeny will also remark that fourth-quarter sales in the company’s Telecommunications, Life Sciences, and Specialty Materials segments remain on track with the company’s previously announced fourth-quarter guidance. Sales in the Environmental Technologies segment are running ahead of expectations, driven by the company’s increased manufacturing production for light-duty diesel filters.
There will be no change to Corning’s corporate gross margin expectations for the fourth quarter. “We still expect fourth-quarter gross margin to be lower than the third quarter, driven primarily by the seasonally lower demand in telecom, as well as higher glass price declines than previous quarters,” Tripeny will say. In addition, as the company disclosed during its third-quarter conference call, there will be a one-time asset write-off related to the discontinuation of its green laser program. The amount of the charge will be approximately $17 million pre-tax. “As a result, we expect corporate fourth-quarter gross margin to be about 43%,” Tripeny will add.
Tripeny will close with comments on the company’s strengthened cash position through receipt of $1.2 billion in cash dividends from SCP. “We expect to end the year with approximately $6 billion in cash on hand,” Tripeny will say. “This level of cash gives us tremendous financial flexibility, allowing us to invest in our future through capital expansion and research and development, as well as the ability to fund potential acquisitions and return cash to our shareholders.”
Corning’s comments to investors at the Barclay’s Capital Global Technology Conference will be available by accessing the IR events calendar on Corning’s Web site. To access the calendar, go to www.corning.com/investor_relations and click Investor Events on the left.
About Corning Incorporated
Corning Incorporated (www.corning.com) is the world leader in specialty glass and ceramics. Drawing on more than 150 years of materials science and process engineering knowledge, Corning creates and makes keystone components that enable high-technology systems for consumer electronics, mobile emissions control, telecommunications and life sciences. Our products include glass substrates for LCD televisions, computer monitors and laptops; ceramic substrates and filters for mobile emission control systems; optical fiber, cable, hardware & equipment for telecommunications networks; optical biosensors for drug discovery; and other advanced optics and specialty glass solutions for a number of industries including semiconductor, aerospace, defense, astronomy and metrology.
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