Corning expects surging flat-screen TV sales will bring high demand for its glass in 2010

Corning expects high demand for TV glass

ROCHESTER, N.Y. — Corning Inc. said Friday that robust sales of flat-screen televisions, computers and handheld devices this year will again boost demand for its liquid-crystal-display glass.

The specialty glass and ceramics maker expects sales and profits to rise moderately in 2010 as the global appetite for LCD-TVs drives an anticipated 14 percent to 22 percent jump in glass industry volume. But it also projected a slowdown in LCD-TV growth in the United States and stalled sales of optical fiber.

Based in western New York, Corning is the world’s largest maker of LCD glass, accounting for nearly two-thirds of the market. It plans to ramp up investment in China, building its first glass-melting factory there — possibly this year — at a cost of $400 million to $700 million.

Corning expects 171 million LCD-TVs will be sold this year, about 21 percent more than last year. Total glass volume could reach 3 billion square feet, up from 2.45 billion square feet in 2009, it said.

“While global economies certainly remain uncertain, we’re confident that we will deliver strong performance once again in 2010,” Chief Executive Wendell Weeks told analysts and institutional investors at an annual meeting in New York.

The outlook did not stop company shares from sliding amid a broad sell-off this week on Wall Street.

Corning shares fell 77 cents, or 4.2 percent, to $17.48. The stock is trading at the higher end of a 52-week range of $9.16 to $20.85.

Growth of LCD-TVs sales in North America will slow as market penetration in the United States reaches 90 percent this year, and China will become the global leader in total TV sales — about 70 percent of them LCD models. The Chinese market for LCD-TVs could reach 37 million, up 32 percent from 2009, Corning said.

Because LCD glass is its biggest business by far, a market dip last winter triggered by recession jitters prompted Corning to cut 3,500 jobs. The 159-year-old glass pioneer also makes ceramic auto-pollution filters and is the world’s largest producer of optical fiber and cable. It employs 24,500 people.

Although it didn’t provide specific financial guidance, Corning said its LCD glass and auto-filter businesses will drive gains in year-over-year sales and profits. But it doesn’t expects growth this year in its fiber business because spending on big capital projects is typically slow to rebound during economic downturns.

In contrast, Corning expects “a significant increase in demand” for its Gorilla glass, a highly durable and nearly scratch-resistant cover glass used in more than 75 products, from cell phones and laptops to handheld game devices. Introduced in 2008, it generated $80 million in revenue last year and could be a $300 million business within the next few years, the company said.

Analysts surveyed by Thomson Reuters expect Corning, on average, to earn $1.75 in 2010 on $6.28 billion in sales. In 2009, its profit slid 62 percent to $2.01 billion, or $1.28 a share, on a 9 percent drop in sales of $5.4 billion.

On the Net: www.corning.com