Looking Ahead | Investor Relations | Corning

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Our Priorities for 2017 and Beyond

Our Priorities for 2017 and Beyond

In 2017 and beyond, we aim to sustain momentum in all Corning businesses while leveraging new innovations to drive both near- and long-term growth, and to extend our commitment to return cash to shareholders.

Focusing Our Portfolio

Focusing Our Portfolio

Corning has tremendous opportunities before it. From a shareholder value perspective, the challenge is to select the right opportunities.

We apply both financial and strategic criteria to make our selections. Our financial hurdles include market size, return on invested capital, and sustainability of margins.  Our strategic criteria are about increasing our probability of success and reducing the cost of innovation.

We are best-in-the-world in 3 Core Technologies, 4 Manufacturing & Engineering platforms, and 5 Market-Access Platforms.

Our probability of success increases as we apply more of these best-in-the-world capabilities. Our cost of innovation declines as we reapply our talent and repurpose our assets. Additionally, by combining multiple capabilities, we create higher and more sustainable competitive barriers.

As we focus our portfolio, we are dedicating 80% or more of our resources to opportunities that use at least two of our Core Technologies, Manufacturing & Engineering platforms, or Market-Access Platforms.

Our framework allows us to direct up to 20% of our resources at opportunities that leverage a single capability. But when we do that, the potential payoff must be dramatically higher, because we know the chance of success will be lower.

The framework also means that we will consider removing assets falling outside our core capabilities. While we operate these assets well and they return more than their cost of capital, we recognize that others may find them more synergistic, and we will consider transactions that create value for our shareholders.

Invest in Innovation

Invest in Innovation

Our commitment to innovation is unwavering and gives us a strong competitive advantage. On average, we invest in research and development at slightly more than twice the rate of our peers. This investment supports greater profitability. We want to capture growth in today’s businesses while creating innovations for tomorrow.

Some recent results of this dedication include:                          

  • Corning Valor™ glass, a remarkable new glass packaging solution that helps protect patient and improves pharmaceutical manufacturing
  • Corning® Gorilla® Glass SR+, which delivers an unparalleled combination of scratch resistance, optical clarity and toughness for wearable devices
  • Corning® Gorilla® Glass 5, designed to provide further protection against breakage from everyday drops
  • Corning® Gorilla® Glass for Automotive interior and exterior solutions that are driving innovations that enable cleaner, safer and more connected cars.
  • Corning® Iris™ glass, enabling thinner displays with replacement for plastic light-guide plates
  • Corning’s ONE™ Wireless technology that delivers robust, reliable optical connections in venues like Texas A&M University’s Kyle Field and Mercedes-Benz Stadium, home of Atlanta Falcons, starting in 2017
  • Corning® DuraTrap® GC gas particulate filters that reduce emissions from gasoline direct injection vehicles
  • Lotus™ NXT supports high resolution LCD and OLEDs with LTPS and Oxide backplanes, offering best-in-class glass dimensional stability, which is named “Total Pitch Variation,” in panel makers’ high-temperature manufacturing processes

Return Cash to Shareholders

Return Cash to Shareholders

In October 2015, Corning announced a Strategic and Capital Allocation Framework that reflects the company’s financial and operational strengths, as well as its ongoing commitment to capital stewardship. Recognizing the company’s significant progress across multiple fronts, the Framework was updated in June 2016. Corning now expects to generate and deploy more than $26 billion through 2019, up from the previous plan to deploy more than $22 billion.

The Strategic and Capital Allocation Framework consists of two primary actions:

  • Return more than $12.5 billion to shareholders through share repurchases and increased dividends. As part of this plan, Corning intends to target an adjusted debt-to-EBITDA ratio of two times, and to reduce its global cash to approximately $2 billion.
  • Invest approximately $10 billion in Corning’s focused portfolio. Over the next four years, Corning will concentrate its RD&E investment, capital spending, and strategic M&A on a cohesive set of 3 core technologies, 4 manufacturing & engineering platforms, and 5 market-access platforms. Corning, already a leader in these areas, believes its focused-portfolio approach will allow it to generate substantial growth and returns for investors.

Recent successes include cash distributions, strategic transactions, product introductions, moderating pricing environment in Display, and our advancement of lowest cost manufacturing positions.