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Corning Updates Third-Quarter Outlook in CEO Presentation at Citi Global Technology Conference

Post Time:Sep 14,2009Classify:Company NewsView:332

CORNING, N.Y., September 10, 2009 – Corning Incorporated (NYSE:GLW) Chairman and Chief Executive Officer Wendell P. Weeks will provide an update on the company’s recovery from the recent earthquake in Japan while speaking to investors at the Citi Global Technology Conference in New York City today at 8:00 a.m. Corning’s comments at the conference can be heard via webcast at www.corning.com/investor_relations.

Addressing the earthquake’s impact on Corning’s facility in Japan, Weeks will note that “the restart of our Shizuoka plant is on track,” adding that the facility is restarting capacity this month with more planned in October. He will also say that the company undertook additional efforts to ease some of the impact from the disruption by restarting production units in Taiwan that it originally planned to have available later this year. The company will note it has been allocating capacity to its customers, but customer demand still exceeds its ability to supply. The company expects that the rebuild at Shizuoka will result in approximately $22 million in incremental accelerated depreciation charges in the third quarter.

The company now anticipates sequential volume at its wholly owned business to be down less than 5% sequentially in the third quarter, versus its previous estimate of down 5% to 10%. At Samsung Corning Precision Glass Co., Ltd. (SCP), the company’s equity company, third-quarter volume guidance remains unchanged at flat to up slightly sequentially. The company estimates the sales impact from the disruption will be about $25 million in the third quarter. The impact of the disruption has been partially mitigated by restarted production in Taiwan. The net impact to corporate gross margin will be approximately 2% in the third quarter, primarily related to the incremental accelerated depreciation.

The display supply chain “is expanding in preparation for what we now believe will be a stronger fourth quarter than we previously thought,” Weeks will say. “As a result, we now anticipate worldwide glass demand in the fourth quarter will be as strong as the third quarter.” The company has not finalized its fourth-quarter outlook, but at this time believes volume at both its wholly owned business and SCP will be flat to up slightly versus the third quarter.

The company also expects fourth-quarter glass pricing to be flat sequentially.

On the retail front, Weeks will report, “LCD TV demand continues to be robust.” Preliminary retail data provided by NPD, an independent consumer market research firm, suggests LCD TV unit sales in the U.S. in August increased 14% over last year. “We were encouraged by the week-to-week trend, which showed significant year-over-year growth in the third week of August. We believe this step up in demand was the result of strong back-to-school sales,” Weeks will add. Similarly, August unit sales increased in Japan by 57%, as indicated by independent research firm BCN.

Corning's comments to investors at the Citi Global Technology Conference will be available by accessing the IR events calendar on Corning's Web site. To access the calendar, go to www.corning.com/investor_relations and click Investor Events on the left.

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 instability 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; 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.

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Source: CorningAuthor: shangyi

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