-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KPpML7rSxL3d/qzGKmCE9N+XkhlO79Oiw0Dxb2rYIoFfpUDgo4WZ+HRjSTQ5vQlK x48rPJ+klCSEZl5KHT5nuA== 0000024741-99-000022.txt : 19990416 0000024741-99-000022.hdr.sgml : 19990416 ACCESSION NUMBER: 0000024741-99-000022 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19990331 ITEM INFORMATION: FILED AS OF DATE: 19990415 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CORNING INC /NY CENTRAL INDEX KEY: 0000024741 STANDARD INDUSTRIAL CLASSIFICATION: GLASS, GLASSWARE, PRESSED OR BLOWN [3220] IRS NUMBER: 160393470 STATE OF INCORPORATION: NY FISCAL YEAR END: 1228 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-03247 FILM NUMBER: 99594019 BUSINESS ADDRESS: STREET 1: ONE RIVERFRONT PLAZA CITY: CORNING STATE: NY ZIP: 14831 BUSINESS PHONE: 6079749000 FORMER COMPANY: FORMER CONFORMED NAME: CORNING INC /NY / CORNING LAB SERVICES INC DATE OF NAME CHANGE: 19930713 FORMER COMPANY: FORMER CONFORMED NAME: CORNING GLASS WORKS DATE OF NAME CHANGE: 19890512 8-K 1 CORNING'S Q1, 1999 8K SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report: (Date of earliest event reported) April 14, 1999 CORNING INCORPORATED (Exact name of registrant as specified in its charter) New York 1-3247 16-0393470 (State or other jurisdiction (Commission (I.R.S. Employer of incorporation) File Number) Identification No.) One Riverfront Plaza, Corning, New York 14831 (Address of principal executive offices) (Zip Code) (607) 974-9000 (Registrant's telephone number, including area code) N/A (Former name or former address, if changed since last report) Item 5. Other Events. Item 7. Financial Statements. Exhibits: The Registrant's press release of April 14, 1999. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CORNING INCORPORATED Registrant Date: April 14, 1999 By /s/ KATHERINE A. ASBECK Katherine A. Asbeck Vice President and Controller FOR IMMEDIATE RELEASE Media Contact: April 14, 1999 Robert W. DeMallie (607) 974-8778 demallierw@corning.com Investor Relations Contact: Katherine M. Dietz (607) 974-8217 dietzkm@corning.com CORNING RETURNS TO DOUBLE DIGIT EARNINGS GROWTH CORNING, N.Y., April 14, 1999 - Corning Incorporated (NYSE:GLW) reported today that demand for its LEAF -Registered Trademark- brand optical fiber, the most successful new optical fiber in the company's history, helped lift 1999 first quarter earnings to $0.36 per share, an increase of 33 percent compared with earnings of $0.27 per share from the same operations in 1998. Net income for the first quarter of 1999 totaled $86.5 million, an increase of 39 percent compared with $62.1 million for the same operations in 1998. First quarter sales were $892 million, compared to 1998 first quarter sales of $795 million, an increase of 12 percent. This sales growth was driven by gains in the optical fiber and cable and photonic technologies businesses. First quarter 1998 sales and income were adversely impacted by economic downturns in Asian markets. Corning's Chairman and Chief Executive Officer Roger G. Ackerman said, "While LEAF fiber was clearly the main driver for the quarter's improved results, increased sales of new catalytic converter substrates and flat panel display glass used by computer manufacturers also contributed to the strong performance. These growth engines illustrate the value of our balanced portfolio." (more) -2- Sales of materials to the semiconductor industry remained soft due to the worldwide slump in the construction of new manufacturing plants for integrated circuits. Equity earnings fell 21 percent primarily due to Samsung-Corning Company Ltd., a Korean manufacturer of glass panels and funnels for television and display monitors, which had an exceptionally strong first quarter in 1998 due in part to favorable exchange rates. Ackerman also said that, "The favorable trends in many of our growth businesses lead us to anticipate that we will achieve our long-term goal of 15 percent earnings growth for the remainder of the year. At the same time, we will continue to invest in new products and facilities for our future." Established in 1851, Corning Incorporated creates leading-edge technologies for the fastest-growing markets of the world's economy. Corning manufactures optical fiber, cable and photonic components for the telecommunications industry; and high-performance displays and components for television and other communications-related industries. The company also uses advanced materials to manufacture products for scientific, semiconductor and environmental markets. Corning's total revenues in 1998 were $3.5 billion. More information on the company is available at http://www.corning.com, Corning's website. -30- Forward-Looking and Cautionary Statements Except for historical information and discussions contained herein, statements included in this release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve a number of risks, uncertainties and other factors that could cause results to differ materially, as discussed in the company's filing with the Securities and Exchange Commission. Corning Incorporated and Subsidiary Companies Consolidated Statements of Income (Unaudited; in millions, except per share amounts)
Three Months Ended March 31, ---------------------------- 1999 1998 ---- ---- Revenues Net sales $892.2 $794.8 Royalty, interest and dividend income 9.9 9.1 ------ ------ 902.1 803.9 Deductions Cost of sales 548.3 514.7 Selling, general and administrative expenses 136.8 112.9 Research, development and engineering expenses 79.6 67.1 Interest expense 16.3 17.6 Other, net 9.9 27.1 ------ ------ Income from continuing operations before taxes on income 111.2 64.5 Taxes on income from continuing operations 33.9 21.0 ------ ------ Income from continuing operations before minority interest and equity earnings 77.3 43.5 Minority interest in earnings of subsidiaries (10.1) (5.5) Dividends on convertible preferred securities of subsidiary (2.3) (3.4) Equity in earnings of associated companies 21.6 27.5 ------ ------ Income from continuing operations 86.5 62.1 Loss from discontinued operations, net of taxes (0.6) ------ ------ Net Income $ 86.5 $ 61.5 ====== ====== Basic Earnings Per Share Continuing operations $ 0.37 $ 0.27 Discontinued operations ------ ------ Net Income $ 0.37 $ 0.27 ====== ====== Diluted Earnings Per Share Continuing operations $ 0.36 $ 0.27 Discontinued operations (0.01) ------ ------ Net Income $ 0.36 $ 0.26 ====== ====== Dividends Declared $ 0.18 $ 0.18 ====== ====== Shares used in computing earnings per share Basic earnings per share 233.8 229.6 Diluted earnings per share 245.2 232.6
The accompanying notes are an integral part of these statements. Corning Incorporated and Subsidiary Companies Condensed Consolidated Balance Sheets (Unaudited; in millions)
March 31, 1999 Dec. 31, 1998 -------------- ------------- Assets Current Assets Cash and short-term investments $ 151.9 $ 45.4 Accounts receivable, net 592.3 636.0 Inventories 514.0 458.7 Deferred taxes on income and other current assets 180.2 170.2 -------- -------- Total current assets 1,438.4 1,310.3 Investments 377.5 366.2 Plant and equipment, net 2,729.4 2,684.9 Goodwill and other intangible assets, net 309.0 309.7 Other assets 312.1 310.8 -------- -------- Total Assets $5,166.4 $4,981.9 ======== ======== Liabilities and Shareholders' Equity Current Liabilities Loans payable $ 143.9 $ 204.6 Accounts payable 250.5 291.7 Other accrued liabilities 524.2 578.4 -------- -------- Total current liabilities 918.6 1,074.7 Other liabilities 683.1 674.1 Loans payable beyond one year 1,291.1 998.3 Minority interest in subsidiary companies 349.6 346.1 Convertible preferred securities of subsidiary 365.2 Convertible preferred stock 16.0 17.9 Common shareholders' equity 1,908.0 1,505.6 -------- -------- Total Liabilities and Shareholders' Equity $5,166.4 $4,981.9 ======== ========
The accompanying notes are an integral part of these statements. Corning Incorporated and Subsidiary Companies Notes to Consolidated Financial Statements Quarter 1, 1999 (1) Information about the performance of Corning's three operating segments for the first quarter of 1999 and 1998 are below. These amounts do not include revenues, expenses and equity earnings not specifically identifiable to segments.
Three months ended March 31, -------------------- 1999 1998 ---- ---- Telecommunications Net sales $488.5 $387.2 Income from continuing operations before minority interest and equity earnings $ 48.6 $ 34.9 Minority interest in earnings of subsidiaries (4.3) (6.9) Equity in earnings of associated companies 4.4 4.5 ------ ------ Segment net income $ 48.7 $ 32.5 ====== ====== Advanced Materials Net sales $252.1 $258.7 Income from continuing operations before minority interest and equity earnings $ 20.0 $ 18.9 Minority interest in earnings of subsidiaries 0.1 0.2 Equity in earnings of associated companies 4.1 3.2 ------ ------ Segment net income $ 24.2 $ 22.3 ====== ====== Information Display Net sales $145.7 $143.3 Income from continuing operations before minority interest and equity earnings $ 9.4 $ (9.4) Minority interest in earnings of subsidiaries (5.9) 1.2 Equity in earnings of associated companies 12.4 16.4 ------ ------ Segment net income $ 15.9 $ 8.2 ====== ====== Total segments Net sales $886.3 $789.2 Income from continuing operations before minority interest and equity earnings $ 78.0 $ 44.4 Minority interest in earnings of subsidiaries (10.1) (5.5) Equity in earnings of associated companies 20.9 24.1 ------ ------ Segment net income $ 88.8 $ 63.0 ====== ======
(2) Depreciation and amortization charged to continuing operations during the first quarters of 1999 and 1998 totaled $94.6 million and $78.9 million, respectively. These amounts include amortization of purchased intangibles totaling $5.1 million and $3.9 million in the first quarters of 1999 and 1998, respectively. (3) Corning's effective tax rate for continuing operations was 30.5% for the first quarter of 1999 and 32.5% for the first quarter of 1998. The lower 1999 rate was due to a higher percentage of Corning's earnings resulting from consolidated entities with lower effective tax rates. (4) During the first quarter of 1999, Corning issued $300 million of debt securities under a shelf registration agreement previously filed with the Securities and Exchange Commission. This issuance consisted of $150 million of notes with a 6.30% coupon due in 2009, and $150 million of debentures with a 6.85% coupon due in 2029. The proceeds from these borrowings will be used for the repayment of short and long-term debt, working capital, capital spending and acquisitions. (5) During the first quarter of 1999, Corning Delaware L.P., a special purpose limited partnership in which Corning is the sole general partner, called for the redemption of all Convertible Monthly Income Preferred Securities (MIPS). The MIPS were guaranteed by Corning and convertible into Corning common stock at a rate of 1.534 shares of Corning common stock for each MIPS. As of March 31, 1999, all of the MIPS were converted into 11.5 million shares of Corning common stock. The conversion will cause Corning's reported income to increase in comparison to 1998, but will have no impact on Corning's diluted earnings per share. (6) Dow Corning and the Committee of Tort Claimants, one of Dow Corning's Chapter 11 creditor committees, filed with the United States Bankruptcy Court (the Bankruptcy Court) a joint plan of reorganization on November 9, 1998 (the Joint Plan). After hearings held in early 1999, the Bankruptcy Court ruled in early February 1999 that the disclosure statement related to the Joint Plan was adequate to send to Dow Corning's creditors for consideration. In that ruling, the Bankruptcy Court indicated that the period for voting will extend through May 14, 1999 and hearings to confirm the Joint Plan are scheduled to begin on June 28, 1999. To become effective, the Joint Plan will require a favorable vote by many classes of creditors and final Bankruptcy Court approval after confirmation hearings. In addition, appeals of the Bankruptcy Court's confirmation order are possible. The recent developments, including the support of the Committee of Tort Claimants, tend to increase the probability that Dow Corning will successfully emerge from Chapter 11 proceedings, but the timing and the eventual outcome of these proceedings is uncertain. (7) On March 1, 1999, Corning announced that it will acquire BICC's telecommunication cable business and the 50 percent equity interest in Optical Waveguides Australia, Pty. Ltd. it does not already own for cash consideration of approximately $135 million. The transaction is expected to be completed during the second quarter of 1999. Total sales for these businesses in 1998 approximated $400 million. - 30 - -----END PRIVACY-ENHANCED MESSAGE-----