Corning Reports Full-Year 2020 Results Highlighted by Strong Fourth Quarter with Growth in All Segments
CORNING, N.Y., Jan. 27, 2021 (GLOBE NEWSWIRE) — Corning Incorporated (NYSE: GLW) today announced results for the fourth quarter and full year ended Dec. 31, 2020.Fourth-quarter financial performance:GAAP sales of $3.4 billion and GAAP EPS of $0.28Core sales of $3.3 billion, up 11% sequentially and 17% year over yearCore EPS of $0.52, up 21% sequentially and 13% year over yearFree cash flow of $464 million and $948 million cumulatively for the yearStrong execution across the company’s focused portfolio drove sales and net income growth in all segments:Sequentially, core sales grew 11% and operating margin grew 18%, both above expectationsCore operating margin was 19.4%, up 110 basis points sequentially Life Sciences and Environmental Technologies delivered the largest sequential sales growth, with 23% and 17% growth respectivelyOrganic sales, which exclude $163 million in consolidated sales from Hemlock Semiconductor, grew 11% year over year Year over year, Specialty Materials sales grew 20%, Environmental Technologies sales grew 19% – both strongly outperforming their underlying markets – and Optical Communications returned to growth with continued growth expected Wendell P. Weeks, chairman and chief executive officer, said:“We delivered outstanding fourth-quarter results, as each of our businesses grew sales and profits year over year.” Weeks continued, “2020 was an incredibly difficult year as the world dealt with the pandemic, economic uncertainty, and social unrest. Throughout the year, we focused on serving our customers, executing our strategic priorities, and protecting our people. We gained sales-growth momentum, expanded margins in the second half, and generated significant free cash flow. Our investments in our people and technology, along with our deep relevance across key markets, are creating opportunities for ‘more Corning.’”Weeks added, “We continue to strengthen the company and remain committed to our employees, communities, customers, and shareholders. Corning is proud to be creating life-changing technologies that contribute to keeping people safe and that help society address the challenges of the pandemic.”Financial Outlook
Tony Tripeny, executive vice president and chief financial officer, said, “In 2020, we successfully navigated a very challenging year. We strengthened our balance sheet, achieved growth in the second half, and generated free cash flow of $948 million for the year.”Tripeny continued, “We expect year-over-year growth to accelerate in the first quarter of 2021. We expect core sales of $3.0 billion to $3.2 billion – compared with $2.5 billion in the first quarter last year – and EPS of $0.40 to $0.44, which is double last year’s first-quarter EPS at the low end of the range. We will continue to focus on operational excellence, cash-flow generation, and prudent capital allocation.”Market-Access Platform HighlightsCorning holds a leadership position in each of the markets addressed by its five Market-Access Platforms. Throughout 2020, the company advanced important growth initiatives and reported the following highlights:Life Sciences – Corning deployed its broad Life Sciences capabilities to combat the pandemic by supplying technologies that help customers develop novel treatments and vaccines, provide mass testing, and accelerate vaccine production. In the second quarter, Corning was awarded $204 million in funding from the Biomedical Advanced Research and Development Authority to substantially expand domestic manufacturing capacity for Corning Valor® Glass vials. In the fourth quarter, Corning shipped Valor Glass vials to multiple COVID-19 vaccine manufacturers that support more than 100 million doses. Corning also received a $15 million award from the U.S. Department of Defense and U.S. Department of Health and Human Services to further expand domestic production capacity for robotic pipette tips used in support of COVID-19 diagnostic testing. The company was also recognized by BioNTech for its role in the successful development of its COVID-19 vaccine.
Mobile Consumer Electronics – Innovation adoption drove Specialty Materials sales up 18% year over year despite the declining smartphone market. The company launched Corning® Gorilla® Glass Victus™, the toughest Gorilla Glass yet, which is featured on six Samsung devices. Corning also invented the world’s first transparent, color-free glass-ceramic, which is featured on the front cover of the latest iPhone. Apple and Corning partnered to develop and scale manufacturing of Ceramic Shield, which offers unparalleled durability and toughness. Strength in the IT market contributed to sales growth as work- and learn-from-home trends remained pervasive throughout the year, driving demand for tablets and touch-screen laptops.
Automotive – Environmental Technologies is recovering faster than its markets, driven by more Corning content in both automotive and diesel. Fourth-quarter results were highlighted by year-over-year growth in gasoline particulate filter sales as adoption expanded in Europe and China. Additionally, Groupe Renault honored Corning with a 2020 Supplier Award for innovation for Corning® FLORA® substrates. Mercedes-Benz recently debuted the MBUX Hyperscreen dashboard display system featuring Gorilla Glass for Automotive.
Optical Communications – Optical Communications returned to growth – and expects growth to continue – as customers increase spending to support growing bandwidth requirements. In 2020, the company introduced new and innovative solutions that help speed the deployment of 5G. Corning launched its Evolv™ 5G-ready connectivity solutions featuring compact, easy-to-install terminals that connect the fiber network to neighborhoods and businesses. Operators can save up to $500 at each terminal site by dramatically lowering installation costs and speeding deployment. By collaborating with Verizon, Corning is enabling 5G mmWave indoor deployments for enterprise customers. Additionally, Corning is working with Qualcomm Technologies to deliver indoor networks that are 5G-ready, easy-to-install, and affordable and with EnerSys to simplify the delivery of fiber and electrical power to small-cell wireless sites.
Display – Retail demand for TV and IT products remains strong. Demand for large-size TVs continues to grow – 75-inch sets were up more than 60% for the full year. Large TVs are most efficiently made on Gen 10.5 fabs and Corning is well-positioned to capture that growth with its Gen 10.5 plants in China, including its two newest Gen 10.5 facilities, in Wuhan and Guangzhou, which are now expanding production to meet customer demand.Fourth-Quarter and Full-Year 2020 Results and Comparisons
(In millions, except per-share amounts)*Core performance measures are non-GAAP financial measures. The reconciliation between GAAP and non-GAAP measures is provided in the tables following this news release, as well as on the company’s website. The largest difference between our GAAP and core results stemmed from restructuring charges, which are primarily non-cash, as well as non-cash, mark-to-market losses associated with the company’s currency-hedging contracts.
**Not MeaningfulFourth-Quarter Segment ResultsDisplay TechnologiesIn Display Technologies, fourth-quarter sales were $841 million, up 2% sequentially and 6% year over year, and net income was $217 million, up 11% sequentially and 21% year over year. Corning’s volume grew by a low-single digit percentage sequentially. Sequential price declines were very moderate, as expected.Optical CommunicationsOptical Communications fourth-quarter sales were $976 million, up 7% sequentially and 8% year over year, driven by strength in both carrier and enterprise businesses. Fourth-quarter net income was $141 million, up 23% sequentially and 127% year over year, driven by increased volume and favorable cost performance. Management expects Optical Communications to grow in 2021 as customers increase investments in their optical networks.Environmental TechnologiesEnvironmental Technologies fourth-quarter sales were $445 million, up 17% sequentially and 19% year over year driven by improving markets and more Corning content. Greater adoption of GPFs and diesel filters to meet regulations in China increased Corning’s total addressable market.Specialty MaterialsSpecialty Materials fourth-quarter sales were $545 million, up 20% year over year, due to strong demand for premium cover materials, strength in the IT market, and demand for semiconductor-related materials. Full-year sales increased 18% to $1.9 billion. Life SciencesLife Sciences fourth-quarter sales grew 23% sequentially and 7% year over year to $274 million. Segment results reflect strong demand for research consumables and bioproduction products.Upcoming Investor Events (Virtual)
On Feb. 11, Corning will attend the Goldman Sachs 2021 Virtual Tech and Internet Conference. On Feb. 23, Corning will attend the UBS West Coast Conference. And on Mar. 1, Corning will attend the Morgan Stanley Technology, Media, and Telecom Conference.Fourth-Quarter Conference Call Information
The company will host a fourth-quarter conference call on Wednesday, Jan. 27, at 8:30 a.m. EST. To participate, please call toll free (877) 710-0209 or for international access, call (315) 625-3068 approximately 10 to15 minutes prior to the start of the call. The Access Code is 128 5416. To listen to a live audio webcast of the call, go to Corning’s website at http://www.corning.com/investor_relations, click “Events,” and follow the instructions.
Tony Tripeny, executive vice president and chief financial officer, said, “In 2020, we successfully navigated a very challenging year. We strengthened our balance sheet, achieved growth in the second half, and generated free cash flow of $948 million for the year.”Tripeny continued, “We expect year-over-year growth to accelerate in the first quarter of 2021. We expect core sales of $3.0 billion to $3.2 billion – compared with $2.5 billion in the first quarter last year – and EPS of $0.40 to $0.44, which is double last year’s first-quarter EPS at the low end of the range. We will continue to focus on operational excellence, cash-flow generation, and prudent capital allocation.”Market-Access Platform HighlightsCorning holds a leadership position in each of the markets addressed by its five Market-Access Platforms. Throughout 2020, the company advanced important growth initiatives and reported the following highlights:Life Sciences – Corning deployed its broad Life Sciences capabilities to combat the pandemic by supplying technologies that help customers develop novel treatments and vaccines, provide mass testing, and accelerate vaccine production. In the second quarter, Corning was awarded $204 million in funding from the Biomedical Advanced Research and Development Authority to substantially expand domestic manufacturing capacity for Corning Valor® Glass vials. In the fourth quarter, Corning shipped Valor Glass vials to multiple COVID-19 vaccine manufacturers that support more than 100 million doses. Corning also received a $15 million award from the U.S. Department of Defense and U.S. Department of Health and Human Services to further expand domestic production capacity for robotic pipette tips used in support of COVID-19 diagnostic testing. The company was also recognized by BioNTech for its role in the successful development of its COVID-19 vaccine.
Mobile Consumer Electronics – Innovation adoption drove Specialty Materials sales up 18% year over year despite the declining smartphone market. The company launched Corning® Gorilla® Glass Victus™, the toughest Gorilla Glass yet, which is featured on six Samsung devices. Corning also invented the world’s first transparent, color-free glass-ceramic, which is featured on the front cover of the latest iPhone. Apple and Corning partnered to develop and scale manufacturing of Ceramic Shield, which offers unparalleled durability and toughness. Strength in the IT market contributed to sales growth as work- and learn-from-home trends remained pervasive throughout the year, driving demand for tablets and touch-screen laptops.
Automotive – Environmental Technologies is recovering faster than its markets, driven by more Corning content in both automotive and diesel. Fourth-quarter results were highlighted by year-over-year growth in gasoline particulate filter sales as adoption expanded in Europe and China. Additionally, Groupe Renault honored Corning with a 2020 Supplier Award for innovation for Corning® FLORA® substrates. Mercedes-Benz recently debuted the MBUX Hyperscreen dashboard display system featuring Gorilla Glass for Automotive.
Optical Communications – Optical Communications returned to growth – and expects growth to continue – as customers increase spending to support growing bandwidth requirements. In 2020, the company introduced new and innovative solutions that help speed the deployment of 5G. Corning launched its Evolv™ 5G-ready connectivity solutions featuring compact, easy-to-install terminals that connect the fiber network to neighborhoods and businesses. Operators can save up to $500 at each terminal site by dramatically lowering installation costs and speeding deployment. By collaborating with Verizon, Corning is enabling 5G mmWave indoor deployments for enterprise customers. Additionally, Corning is working with Qualcomm Technologies to deliver indoor networks that are 5G-ready, easy-to-install, and affordable and with EnerSys to simplify the delivery of fiber and electrical power to small-cell wireless sites.
Display – Retail demand for TV and IT products remains strong. Demand for large-size TVs continues to grow – 75-inch sets were up more than 60% for the full year. Large TVs are most efficiently made on Gen 10.5 fabs and Corning is well-positioned to capture that growth with its Gen 10.5 plants in China, including its two newest Gen 10.5 facilities, in Wuhan and Guangzhou, which are now expanding production to meet customer demand.Fourth-Quarter and Full-Year 2020 Results and Comparisons
(In millions, except per-share amounts)*Core performance measures are non-GAAP financial measures. The reconciliation between GAAP and non-GAAP measures is provided in the tables following this news release, as well as on the company’s website. The largest difference between our GAAP and core results stemmed from restructuring charges, which are primarily non-cash, as well as non-cash, mark-to-market losses associated with the company’s currency-hedging contracts.
**Not MeaningfulFourth-Quarter Segment ResultsDisplay TechnologiesIn Display Technologies, fourth-quarter sales were $841 million, up 2% sequentially and 6% year over year, and net income was $217 million, up 11% sequentially and 21% year over year. Corning’s volume grew by a low-single digit percentage sequentially. Sequential price declines were very moderate, as expected.Optical CommunicationsOptical Communications fourth-quarter sales were $976 million, up 7% sequentially and 8% year over year, driven by strength in both carrier and enterprise businesses. Fourth-quarter net income was $141 million, up 23% sequentially and 127% year over year, driven by increased volume and favorable cost performance. Management expects Optical Communications to grow in 2021 as customers increase investments in their optical networks.Environmental TechnologiesEnvironmental Technologies fourth-quarter sales were $445 million, up 17% sequentially and 19% year over year driven by improving markets and more Corning content. Greater adoption of GPFs and diesel filters to meet regulations in China increased Corning’s total addressable market.Specialty MaterialsSpecialty Materials fourth-quarter sales were $545 million, up 20% year over year, due to strong demand for premium cover materials, strength in the IT market, and demand for semiconductor-related materials. Full-year sales increased 18% to $1.9 billion. Life SciencesLife Sciences fourth-quarter sales grew 23% sequentially and 7% year over year to $274 million. Segment results reflect strong demand for research consumables and bioproduction products.Upcoming Investor Events (Virtual)
On Feb. 11, Corning will attend the Goldman Sachs 2021 Virtual Tech and Internet Conference. On Feb. 23, Corning will attend the UBS West Coast Conference. And on Mar. 1, Corning will attend the Morgan Stanley Technology, Media, and Telecom Conference.Fourth-Quarter Conference Call Information
The company will host a fourth-quarter conference call on Wednesday, Jan. 27, at 8:30 a.m. EST. To participate, please call toll free (877) 710-0209 or for international access, call (315) 625-3068 approximately 10 to15 minutes prior to the start of the call. The Access Code is 128 5416. To listen to a live audio webcast of the call, go to Corning’s website at http://www.corning.com/investor_relations, click “Events,” and follow the instructions.
