Corning to put $1B in flat-glass business

Corning Inc. said Friday it expects to plow about $1 billion this year into its most profitable business - ultra-thin glass used in flat-screen computers and televisions.

The industrial materials and glassware company plans to boost capital spending from $857 million in 2004 to between $1.2 billion to $1.4 billion in 2005, with about three-quarters being invested in its display technologies division.The business recorded fourth-quarter sales of $311 million, up 56 percent from a year ago, helped mainly by a surge in revenues from liquid-crystal-display glass.Even while LCD glass prices are projected to fall about 5 percent in the first quarter, Corning expects its shipments will grow by more than 50 percent this year.LCD televisions could account for 10 percent of all TVs sold worldwide in 2005, up from 5 percent last year, and as much as 21 percent of TV sales in 2007, the company said.

At an investors meeting in New York, Corning reaffirmed that it expects to earn 11 cents to 13 cents per share in the first quarter when one-time costs are excluded and generate sales ranging from $980 million to $1.03 billion.

Analysts surveyed by Thomson First Call expected a per-share profit of 12 cents on $1.02 billion in sales.

Corning, which is based in rural western New York, said it will invest $70 million to expand a $200 million factory in nearby Erwin that makes emissions-control filters for diesel-powered vehicles. The filters trap soot and convert lung-choking gases into carbon dioxide, nitrogen and water vapor.

By 2007, all new diesel vehicles on U.S. highways will need to be equipped with the smog-busting devices. The worldwide market could exceed $1 billion by 2008 and, just as it dominates the gasoline emission-control business, Corning expects to remain ahead of Japanese rivals.

James Houghton, who guided Corning's recovery from the telecommunications crash of 2001, is stepping down as chief executive in April. He will be succeeded by longtime heir apparent Wendell Weeks, the company's president and chief operating officer.

The telecom slump forced Corning to shed noncore and money-losing businesses. Under Houghton, it shut more than a dozen plants and nearly halved its work force. It employs about 25,000 people.

Corning shares rose 27 cents, or 2.4 percent, to close at $11.32 in Friday trading on the New York Stock Exchange. The shares have traded in a range of $9.29 and $13.33 over the past 52 weeks.

600450 Corning to put $1B in flat-glass business
Date: 7 February 2005

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