Corning Profit Declines Sharply; Stock Down - Update

(RTTNews) - Specialty glass maker Corning Inc (GLW) Tuesday reported a plunge in second-quarter profit, hurt by one-time expenses, notwithstanding a 25 percent growth in sales. Sales growth was recorded at key segments, partly offset by soft demand for Gorilla glass used in smartphones and tablets. Earnings for the quarter missed Wall Street estimates, while sales surpassed expectations.

Corning Chief Financial Officer, in a conference call, said the company expects weaker-than-estimated growth in cover glass shipments for 2014 and now projects an increase of about 20 percent due to lower demand for tablets and touch notebooks.

The company expects its third-quarter LCD glass volume to be up by a mid-single digit percentage, sequentially. LCD glass price declines are expected to moderate further in the quarter.

Corning also slashed its capital expenditure guidance for 2014, and now expects to spend $1.3 billion from a prior estimate of $1.5 billion.

Shares of the company dropped about 10 percent in morning trade on the New York Stock Exchange.

The Corning, New York-based company's second-quarter earnings to common stockholders plummeted to $145 million or $0.11 per share from $638 million or $0.43 per share last year.

Results for the quarter included, among other items, transaction-related expense of $155 million, compared with a gain of $265 million a year ago.

Excluding items, core earnings for the quarter climbed to $0.37 per share from $0.32 per share a year ago.

On average, 16 analysts polled by Thomson Reuters expected earnings of $0.38 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter jumped 25 percent to $2.48 billion from $1.98 billion in the prior year.

Core sales were up 28 percent at $2.58 billion. Analysts estimated sales of $2.53 billion for the quarter.

Display Technologies segment core sales surged 62 percent from a year ago, Optical Communications segment sales were up 14 percent, and Environmental Technologies segment sales climbed 25 percent.

Sales in Corning's Specialty Materials segment were comparable with a year ago. Gorilla Glass sales were less than anticipated in the quarter, due to lower retail demand for smartphones and high-end tablets, and lower-than-expected sales for planned new models.

Corning shares are trading at $19.88, down $2.17 or 9.85%.