Speaking at the company’s annual meeting this morning, Wendell P. Weeks, Corning Incorporated’s (NYSE: GLW) chairman, chief executive officer, and president, told shareholders that he believed the company’s performance over the past two quarters is a strong indication that “we have successfully formed bottom and are beginning to march up.”
He also took the opportunity to underscore Corning’s longevity and resilience. “In 162 years, Corning has been through recessions, depressions, world wars, industry meltdowns, and numerous evolutions driven by changing markets,” he said. “Corning is no stranger to tough times, and the leadership team has worked hard to ensure that the company is stronger than any challenge we face.”
2012 Results and 2013 First-Quarter Performance
Weeks acknowledged that 2012 was a tough year. “But thanks to a solid foundation and outstanding execution by our 29,000 employees, we reached key milestones in each of our major business segments and had the highest sales in the company’s history,” he said. “More importantly, we are positioned for growth in 2013.”
Weeks devoted a significant portion of his remarks to detailing the company’s progress against its mandate to “Form Bottom and March Up.” Highlights include:
- Signing supply agreements with several leading display makers, which the company believes will stabilize share at each, allow Corning to manage capacity more efficiently, and help maintain moderate price declines
- Introducing new glass compositions for high-performance displays
- Growing sales in the Specialty Materials segment by 25%
- Completing a major acquisition in Life Sciences that expands Corning’s product portfolio and market reach, while positioning the segment to become a $1 billion business
- Launching new products such as ultra-slim Corning® Willow™ Glass
Weeks told shareholders that Corning was building on that momentum in 2013. Yesterday, the company reported results ahead of expectations, including an increase in core earnings. Weeks said that Corning expects to grow revenue, improve profits, and generate strong cash flow this year.
Weeks emphasized that Corning would continue to innovate. He shared examples of new products that Corning expects to launch in the coming months, including the company’s first antimicrobial glass offering and an all-optical distributed antenna system to improve wireless communication. He also noted that Corning is honoring its commitment to return cash to shareholders. Yesterday, the company announced a share repurchase of $2 billion and a quarterly dividend increase from $0.09 a share to $0.10 a share. “These actions underscore the Board’s confidence in Corning’s financial health and in our ability to continue generating strong operating cash flow,” said Weeks.
Looking ahead, Weeks described Corning’s future as “very bright.”
“For more than 160 years, our scientists have taken advantage of the technical and artistic properties of glass to drive new innovations, and we’ve consistently challenged people’s ideas about what glass can do,” explained Weeks. “As Corning extends the capabilities of glass, more and more customers from a broad range of industries are turning to us to solve tough problems.”
The opportunities driving Corning’s growth include:
- The proliferation of mobile devices, which increases the need for thin, tough cover glass
- The growing demand for bandwidth, which creates the need for fiber optic networks
- The evolution to higher-resolution display devices, which depends on specialty glass that can meet rigorous technical requirements
- Tighter environmental regulations in developed and emerging markets, which drive demand for emissions-control products
- And the aging of the global population, which increases the need for more effective drug therapies
A Special Company
Weeks closed his remarks by summarizing the value that he believes Corning offers to investors: financial strength and stability; business segments that are tied to key growth trends; strong cash flow and a sustainable dividend; and an innovation portfolio that creates the opportunity for significant growth.
On a more personal note, he shared his thoughts on what makes Corning so special. “This is a company responsible for numerous life-changing innovations; a company with a relentless desire to make things better; a company that manufactures products that make a real difference in the world; a company that has always upheld the values instilled by Amory Houghton Sr. in 1851.”
Following his report on the state of the company, Weeks recognized retiring directors Gordon Gund and Onno Ruding for their many years of distinguished service. He said, “They have both left an indelible mark on Corning and helped us honor our commitment to good corporate governance. We have been enriched by their experience, their wisdom, and their friendship.”
During the meeting’s formal business, shareholders elected the following 12 directors to one-year terms: John Seely Brown, 73, retired chief scientist of Xerox Corporation; Stephanie A. Burns, 58, retired chairman and chief executive officer of Dow Corning Corporation; John A. Canning, Jr., 68, co-founder and chairman of Madison Dearborn Partners, LLC; Richard T. Clark, 67, retired chairman, president, and chief executive officer of Merck & Co., Inc.; Robert Cummings, 63, vice chairman of investment banking, JPMorgan Chase & Co.; James B. Flaws, 64, vice chairman and chief financial officer, Corning Incorporated; Kurt M. Landgraf, 66, president and chief executive officer of Educational Testing Service; Kevin Martin, 46, Partner of Patton Boggs LLP and former Chairman of the Federal Communications Commission; Deborah D. Rieman, 63, executive chairman of MetaMarkets Group and retired president and chief executive officer of Check Point Software Technologies, Incorporated; Hansel Tookes, 65, retired chairman and chief executive officer, Raytheon Aircraft Company; Wendell Weeks, 53, chairman, chief executive officer, and president, Corning Incorporated; and Dr. Mark S. Wrighton, 63, chancellor and professor of chemistry at Washington University in St. Louis.
Shareholders also approved the company’s executive compensation as disclosed in the 2013 proxy statement and ratified PricewaterhouseCoopers LLP as independent registered public accounting firm for the 2013 fiscal year.
Immediately following the annual meeting, Dr. David L. Morse, executive vice president and chief technology officer, provided an overview of Corning’s Science and Technology organization. After briefly reviewing Corning’s legacy of research and development, Morse declared, “I am pleased to report that we are still making life-changing innovations.”
He shared examples of several programs in Corning’s innovation portfolio including advanced glass such as Eagle XG® Slim, Corning Lotus™ Glass, and Corning® Willow™ Glass that will enable high-performance displays; antimicrobial glass that could kill more than 99% of germs on its surface; ultra-capacitors that can improve fuel consumption; and Corning’s new all-optical ONE™ Wireless platform, which will increase the capacity and efficiency of communications networks.
Morse underscored Corning’s unwavering commitment to innovation and promised shareholders, “We will always challenge conventional wisdom.”
The company hosted a live audio webcast of the 2013 annual meeting of shareholders in Corning, N.Y., from 11 a.m. to 12:15 p.m. EDT, April 25, 2013. To access the webcast, please go to www.corning.com/investor_relations, select “Investor Events” in the left-hand column, and click on “More Information" next to the archived event. No password is required. The audio webcast will be archived on the website for one year following the broadcast.
Forward-Looking and Cautionary Statements
This press release contains “forward-looking statements” (within the meaning of the Private Securities Litigation Reform Act of 1995), which are based on current expectations and assumptions about Corning’s financial results and business operations, that involve substantial risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include: the effect of global political, economic and business conditions; conditions in the financial and credit markets; currency fluctuations; tax rates; product demand and industry capacity; competition; reliance on a concentrated customer base; manufacturing efficiencies; cost reductions; availability of critical components and materials; new product commercialization; pricing fluctuations and changes in the mix of sales between premium and non-premium products; new plant start-up or restructuring costs; possible disruption in commercial activities due to terrorist activity, armed conflict, political or financial instability, natural disasters, adverse weather conditions, or major health concerns; adequacy of insurance; equity company activities; acquisition and divestiture activities; the level of excess or obsolete inventory; the rate of technology change; the ability to enforce patents; product and components performance issues; retention of key personnel; stock price fluctuations; and adverse litigation or regulatory developments. These and other risk factors are detailed in Corning’s filings with the Securities and Exchange Commission. Forward-looking statements speak only as of the day that they are made, and Corning undertakes no obligation to update them in light of new information or future events.
About Corning Incorporated
Corning Incorporated (www.corning.com) is the world leader in specialty glass and ceramics. Drawing on more than 160 years of materials science and process engineering knowledge, Corning creates and makes keystone components that enable high-technology systems for consumer electronics, mobile emissions control, telecommunications and life sciences. Our products include glass substrates for LCD televisions, computer monitors and laptops; ceramic substrates and filters for mobile emission control systems; optical fiber, cable, hardware & equipment for telecommunications networks; optical biosensors for drug discovery; and other advanced optics and specialty glass solutions for a number of industries including semiconductor, aerospace, defense, astronomy, and metrology.