Corning Reports Strong Growth in 2016
Corning Inc. recently announced results for the fourth quarter and full year 2016.
Corning Inc. recently announced results for the fourth quarter and full year 2016. Fourth quarter generally accepted accounting principle (GAAP) and core sales were up 11% and 6%, respectively, compared to the 2015 fourth quarter. Year-over-year sales, net income, and earnings per share (EPS) growth reportedly is expected in the first quarter of 2017.
“Corning delivered outstanding fourth quarter results, continuing the momentum that began earlier in the year,” said Wendell P. Weeks, chairman, president, and CEO. “Our very strong finish to the year was highlighted by year-over-year core sales growth of 6%, core earnings growth of 24% and core EPS growth of 47%. We are encouraged by this strength, and expect growth in these year-over-year measures in the first quarter of 2017.”
Corning’s Strategy and Capital Allocation Framework outlines the company’s 2016-2019 leadership priorities. Under the framework, the company reportedly plans to deliver more than $12.5 billion to shareholders while investing $10 billion in growth opportunities. Since the framework was announced, the company has achieved several key milestones, including the return of $6 billion to shareholders by increasing the dividend 12.5% and repurchasing 22% of its outstanding shares; and completing the realignment of the Dow Corning Corp., which unlocked value for shareholders.
“As we enter the second year under our framework, the strategic and financial benefits of Corning’s focused portfolio are even more apparent,” said Weeks. “We’re particularly pleased to see our market-access platforms continue to evolve as we anticipated. Progress on our initiatives includes the rapid adoption rate of Gorilla® Glass 5. In 2017, we will continue to advance the objectives of our Strategy and Capital Allocation Framework. We expect to increase the value of Corning products used on mobile devices, accelerate growth in Optical Communications, commercialize gas particulate filters, and make advancements in pharmaceutical glass and Gorilla Glass for Automotive. Corning’s focused portfolio positions the company well for the long term.”
In the fourth quarter, Display Technologies reported strong results, with core sales of $904 million, consistent with a year ago, and core earnings of $276 million, up 18%. Full-year core sales were $3.6 billion, and core earnings were $1 billion. During the full year of 2016, the percentage of growth in the LCD glass market and demand for Corning’s glass was in the mid-single digits. Corning’s sequential glass price declines remained moderate throughout 2016. For the full year 2017, Corning expects the rate of growth in both the retail market and glass demand to be in the mid-single digit percentages. In the first quarter of 2017, the company expects volume to increase by a mid-teen percentage year over year, and decline by mid-single-digit percentage sequentially. The company expects an overall favorable LCD glass price environment for the full year, with price declines more moderate than in 2016.
Fourth quarter 2016 sales in Optical Communications rose 11%, and core earnings rose 85% over the same period last year. Sales growth of fiber-to-the-home solutions in North America, along with improved manufacturing performance, contributed to the higher year-over-year profitability. Full-year 2016 sales were $3 billion, and core earnings were $297 million. In the first quarter of 2017, year-over-year Optical Communications sales growth is expected to be at least 25%. Full-year 2017 sales are expected to increase by a low-teens percentage over 2016.
In Environmental Technologies, fourth quarter and full year sales were down slightly compared to the same periods in 2015. Sales of light-duty substrates in both periods were strong, driven by global automotive demand, but demand for heavy-duty diesel products remained weak. Full year 2016 sales were $1 billion, and core earnings were $136 million. For the first quarter of 2017, year-over-year segment sales are expected to be consistent to down slightly. Full year 2017 sales are expected to be consistent to up slightly from last year, with continued strength in the automotive market and lower demand for heavy-duty diesel products. Sales of the company’s new gas particulate filters are expected to begin during the second half of 2017.
Specialty Materials fourth quarter 2016 sales rose 22% over last year, led by record Gorilla Glass volume, while core earnings were up 48%. Full year 2016 sales were $1.1 billion, and core earnings were $189 million. In the first quarter of 2017, year-over-year segment sales growth is expected to be in the high-teen percentages. The company expects full year 2017 segment sales to increase, with the rate of growth dependent on the timing and extent of customers deploying Gorilla Glass 5 and other Corning innovations.
For more information, visit www.corning.com.