Corning Incorporated : Corning Announces Fourth-Quarter and Full-Year Financial Performance

    Corning Incorporated : Corning Announces Fourth-Quarter and Full-Year
                            Financial Performance



                   Annual sales largest in company history
            2012 Corning^® Gorilla^® Glass sales exceed $1 billion

CORNING, N.Y. - Corning Incorporated (NYSE: GLW) today announced its results
for the fourth quarter and full year of 2012.

Fourth-Quarter Highlights

  *Sales were $2.15 billion, a 14% year-over-year increase. The quarter
    performance reflects the largest quarterly sales in Corning history. 

  *Earnings per share were $0.34,* excluding special items, the company's
    first year-over-year quarterly improvement since 2010; GAAP earnings per
    share were $0.19. 

  *Display Technologies total glass volume from Corning's wholly owned
    business and Samsung Corning Precision Materials Co., Ltd. (SCPM)
    increased sequentially by a high-single digit percentage, reflecting
    overall improved market demand throughout the quarter. Price declines in
    Corning's wholly owned business were slightly higher than in the third
    quarter, as expected. For SCPM, price declines were consistent with the
    previous quarter.

  *Specialty Materials sales were up 68% on a year-over-year basis and 10%
    sequentially, driven by the continued strength of Corning^® Gorilla^®
    Glass. 

  *Telecommunications sales improved 10% over the year-ago period and 3%
    sequentially. 

Full-Year Highlights

  *Sales were $8.01 billion, a 2% increase over $7.9 billion last year,
    representing a sales record for the company.

  *Excluding special items, earnings per share for the year were $1.29*
    compared to last year's $1.76*. GAAP earnings per share for the year were
    $1.15 versus $1.77 last year. 

  *Free cash flow for the year was $579 million*.

*These are non-GAAP financial measures. The reconciliation between GAAP and
non-GAAP measures is provided in the tablesattached tothis news release, as
well as on the company's investor relations website.

Quarter-Four Financial Comparisons

                       Q4 2012 Q4 2011 % Change
Net Sales in millions  $2,146  $1,887  14%
Net Income in millions $283    $491    (42%)
Non-GAAP Net Income    $498    $513    (3%)
in millions*
GAAP EPS               $0.19   $0.31   (39%)
Non-GAAP EPS*          $0.34   $0.33   3%

Full-Year Financial Comparisons

                       2012   2011  % Change
Net Sales in millions  $8,012 $7,890 2%
Net Income in millions $1,728 $2,805 (38%)
Non-GAAP Net Income    $1,940 $2,789 (30%)
in millions*
GAAP EPS               $1.15  $1.77  (35%)
Non-GAAP EPS*          $1.29  $1.76  (27%)

*These are non-GAAP financial measures. The reconciliation between GAAP and
non-GAAP measures is provided in the tablesattached tothis news release, as
well as on the company's investor relations website.

"Corning made good progress in 2012, despite some challenging economic
conditions and changing market environments," Wendell P. Weeks, chairman,
chief executive officer and president, said. "We set a record for annual sales
performance and increased our dividend by 20 percent. And we advanced a number
of new technological innovations, which we believe will open additional
markets for our products in the future."

"We made major progress on our goal of stabilizing Display Technologies'
performance, primarily through moderating price declines. Corning Gorilla
Glass sales exceeded $1 billion for the year, a great example of another
successful Corning innovation," Weeks said.

Fourth-Quarter Segment Results
Sales in the Display Technologies segment were $800 million, an increase of
approximately 3% over the year-ago quarter.

Telecommunications segment sales were $540 million, a 10% year-over-year
increase. The quarter's results were helped by stronger fiber-to-the-home
sales, particularly to Australia's national broadband network project;
excellent demand for Corning Mobile Access wireless products; and optical
fiber sales in China.

Specialty Materials segment sales were $399 million, a 68% year-over-year
increase. The quarter performance was a sales record for the business, ignited
by consumer sales of handheld and IT devices containing Corning Gorilla Glass,
which can now be found on more than 1 billion devices worldwide.

Environmental Technologies segment sales were $219 million, a decline of 6%
from its performance a year ago. The decline was slightly higher than the
company's expectations, the result of reduced demand for light-duty and
heavy-duty diesel products.

Life Sciences segment sales were $185 million, a 29% increase year over year.
The growth was driven primarily by increased sales from the recent acquisition
of the majority of the Discovery Labware business.

Dow Corning Corporation's gross equity earnings, excluding special items, were
$33 million,* a decline of 33% on a year-over-year basis and 13% sequentially.
The primary reason for the decline was weak results in the sales and
production of polysilicon for the solar industry. Sales of polysilicon for the
semiconductor industry remain stable. Corning's GAAP equity loss from Dow
Corning Corporation was $54 million.

Gross margin in the quarter was 42%, compared to 44% at this time a year ago.
Corning ended the year with $6.1 billion in cash and short-term investments.
Capital spending for the year was $1.8 billion. Corning's effective tax rate
for the year was 18.4%.

In the quarter, the company had a number of non-GAAP special items, primarily
related to restructuring and asset impairments across the company's business
segments, and at Samsung Corning Precision Materials and Dow Corning.

Looking Forward
James B. Flaws, vice chairman and chief financial officer, said, "We are not
without challenges in 2013 as we continue to face an uncertain global economy,
but we enter the year with prospects for growth in Specialty Materials,
Telecommunications, Environmental Technologies and Life Sciences. In our LCD
glass business, we expect our market share to be stable, and price declines to
be moderate."

Flaws will provide investors with details on the company's 2013 outlook at its
annual Investor Relations meeting in New York on Friday, Feb. 8. As a preview,
he provided the following highlights:

  *In the Display Technologies segment, Corning expects first-quarter total
    glass volume from its wholly owned display business and Samsung Corning
    Precision Materials to increase on a year-over-year basis, but to decline
    sequentially by mid-single digits. This volume decline is in line with
    previous first-quarter seasonal declines. Corning's LCD glass volume is
    anticipated to grow for the full year. Price declines in the quarter for
    our wholly owned business are expected to be more moderate versus the
    previous quarter. SCPM's price declines should be similar to last quarter.
    

  *Telecommunications segment sales in the first quarter are expected to
    increase on a year-over-year basis. A rise in demand for Corning's optical
    fiber and cable, combined with growth of fiber-to-the-home sales in
    Australia, and enterprise networks solutions, should bring about a strong
    year for the company's Telecommunications segment. 

  *Specialty Materials segment sales are expected to decline in the first
    quarter, which is typically the lowest quarter of the year for this
    business. For the full year, the company is anticipating double-digit
    market growth for Gorilla Glass, driven by its continued popularity as a
    cover glass for smartphones and tablets, and the emergence of touch
    technology on notebook computers.

  *Environmental Technologies first-quarter results are expected to decline
    from last year's record quarterly sales. For the full year, the company
    anticipates that the worldwide auto and heavy-duty diesel truck markets
    should grow year over year. 

  *In the Life Sciences segment, sales are expected to increase significantly
    year over year for both the first quarter and full year, benefiting from
    its recent acquisition.

Flaws pointed out two external factors that could negatively affect Corning
this year. "The current unfavorable solar industry conditions are expected to
continue for Dow Corning's subsidiary, Hemlock Semiconductor Group, and could
worsen if trade rulings on the importation of solar polysilicon into China are
negative. These problems are likely to impact Corning's equity earnings for
the year," he said. "The depressed solar industry demand led Dow Corning to
impair certain assets of the Hemlock business in the fourth quarter of 2012,
and if performance deteriorates, conditions could lead to further
restructurings and impairments in 2013," he added.

"Corning believes steps are available to mitigate the impact of the solar
industry problems as the year progresses. Hemlock prepared for the potentially
negative volatility in the solar market by requiring strong and firm contracts
with customers and getting customer pre-payments against these contracts. If
necessary, Hemlock's management is prepared to take action to enforce its
customers' contractual responsibilities," Flaws said.

"Among the many macro-economic uncertainties we face is the valuation of the
Japanese yen versus the U.S. dollar," Flaws said. "While beyond our control,
the recent sharp depreciation of the yen could negatively impact our reported
net earnings if the present level holds or the currency depreciates further in
2013. We are evaluating ways to potentially mitigate the impact of any further
weakening in the yen-to-dollar exchange rate."

"We have strong business momentum entering this year," Flaws said. "We
introduced our third version of Gorilla Glass earlier this month at the
International Consumer Electronics Show in Las Vegas, and the acceptance was
overwhelmingly positive. The expanding popularity of touch-enabled devices
should present even greater opportunities for our market-leading cover glass
solution."

Flaws also noted that Corning has the potential to create several new
high-growth market opportunities with Corning^® Willow(TM) Glass, an
ultra-slim, flexible glass that will enable next-generation displays, touch
screens and other devices; and with its anti-microbial glass that reduces and
kills drug-resistant bacteria and viruses. 

Corning also sees significant future growth opportunities in the
telecommunications market with rapidly expanding demand for mobile
technologies and optical fiber network expansions in developing markets. 

"The positive market trends in our major businesses should drive demand for
all of Corning's existing and emerging technologies, creating terrific
opportunities for us," Flaws concluded.

Upcoming Investor Events
Corning will host investors and provide more information on its 2013 outlook
at its annual investor meeting in New York on Friday, Feb. 8 beginning at 8
a.m. ET at Cipriani on 42^nd Street. Corning will showcase products and
technologies prior to and following the formal meeting at 9 a.m. ET. Attendees
can register online at the company's investor relations website. 

Also, company executives will be presenting at the Goldman Sachs Technology
and Internet Conference in San Francisco on Feb. 12, and the Morgan Stanley
Technology, Media & Telecom Conference on Feb. 26, also in San Francisco.

Fourth-Quarter Conference Call Information
The company will host a fourth-quarter conference call on Tuesday, Jan. 29 at
8:30 a.m. ET. To participate, please call toll free (800) 230-1074 or for
international access call (612) 234-9960 approximately 10-15 minutes prior to
the start of the call. The password is 'QUARTER FOUR'. The host is
'NICHOLSON'. To listen to a live audio webcast of the call, go to Corning's
Web site at www.corning.com/investor_relations and click Investor Events on
the left. A replay will be available beginning at 10:30 a.m. ET and will run
through 5 p.m. ET, Tuesday, Feb. 12, 2013. To listen, dial (800) 475-6701 or
for international access dial (320) 365-3844. The access code is 276093. The
webcast will be archived for one year following the call.

Presentation of Information in this News Release
Non-GAAP financial measures are not in accordance with, or an alternative to,
GAAP. Corning's non-GAAP net income and EPS measures exclude restructuring,
impairment and other charges and adjustments to prior estimates for such
charges. Additionally, the company's non-GAAP measures exclude adjustments to
asbestos settlement reserves, gains and losses arising from debt retirements,
charges or credits arising from adjustments to the valuation allowance against
deferred tax assets, equity method charges resulting from impairments of
equity method investments or restructuring, impairment or other charges taken
by equity method companies and gains from discontinued operations. The company
believes presenting non-GAAP net income and EPS measures is helpful to analyze
financial performance without the impact of unusual items that may obscure
trends in the company's underlying performance. Reconciliation of these
non-GAAP measures can be found on the company's website by going to
www.corning.com/investor_relations and clicking Financial Reports on the left.
Reconciliation also accompanies this news release.

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 thefinancial 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 fluctuationsandchanges in the mix of sales
between premium and non-premium products;new plant start-upor
restructuringcosts; 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 otherrisk factors
aredetailedin 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.

Media Relations Contact:   
Daniel F. Collins           
(607) 974-4197               
collinsdf@corning.com   

Investor Relations Contact:
Ann H. S. Nicholson
(607) 974-6716
nicholsoas@corning.com

Q4 2012 Financial Tables

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Source: Corning Incorporated via Thomson Reuters ONE
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