Specialty glass and ceramic products manufacturer Corning Inc. (GLW: Quote) Wednesday revealed a decline in fourth-quarter earnings, as lower gross margin and absence of one-time gains last year offset a seven percent growth in revenues. Excluding items, earnings per share matched analysts' estimates, and quarterly sales topped expectations.
Going forward, Corning said it plans to significantly reduce glass prices for its customers facing financial crunch. Shares are currently down by 10 percent on the New York Stock Exchange.
For the fourth quarter, net income plunged to $491 million or $0.31 per share from $1.04 billion or $0.66 per share last year. Results for the quarter include restructuring, and other charges of $129 million, compared to one-time insurance settlement of $326 million last year. Results for the quarter also include $321 million in earnings of affiliated companies, compared to $511 million last year.
Excluding items, adjusted earnings for the quarter was $513 million or $0.33 per share, compared to $733 million or $0.46 per share last year.
On average, 21 analysts polled by Thomson Reuters expected earnings of $0.33 per share for the quarter. Analysts' estimates typically exclude special items.
The New York-based company posted sales of $1.9 billion, up from $1.76 billion last year. Analysts expected revenues of $1.85 billion.
CEO Wendell Weeks said results were impacted by significant LCD glass price declines in the display market. Also, the company's equity venture, Dow Corning Corp., suffered major upheaval in the solar panel industry with lower demand and pricing of poly silicon materials.
Telecommunications segment sales for the quarter slid 11 percent from last year to $490 million. Display Technologies sales rose 4 percent to $780 million, and Specialty Materials grew 21 percent to $238 million, year-over-year. Life Sciences gained 2 percent to $143 million, and Environmental Technologies sales were almost unchanged at $234 million.
Corning said future results at its Display Technologies segment will be hurt as it plans to reduce glass prices for its customers. The company anticipates strong price declines in the first quarter 2012, and double-digit price declines over the cumulative two-quarter period. Prospects for other segments appear to be bright, the company noted.
GLW is trading at $13.09, down $1.53 or 10.47%, on a volume of 27 million shares on the NYSE.
by RTT Staff Writer
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