ROCHESTER (New York) - CORNING Inc. said on Tuesday it is cutting 3,500 jobs, or 13 per cent of its payroll, as demand slumps for glass used in flat-screen televisions and computers.
The specialty glass and ceramics maker, the world's largest maker of liquid crystal display glass, announced the cutbacks as its fourth-quarter profit plunged 65 per cent to US$249 million (S$374.2 million), or 16 cents a share, from US$717 million, or 45 cents a share, a year earlier.
Excluding one-time items, its profit of 13 cents a share came in well below Wall Street's forecast of 20 cents a share.
Sales fell 31 per cent to $1.08 billion from $1.58 billion, below US$1.16 billion in sales forecast by analysts polled by Thomson Reuters.
In December, the company withdrew all guidance for the October-December period because of volatility in the LCD market. It previously said earnings would fall below an earlier projection of 20 cents to 28 cents a share on sales between US$1.1 billion and US$1.2 billion.
The cutbacks at Corning, which employs 27,000 people, will result in first-quarter restructuring charges of US$115 million to US$165 million before taxes as well as fourth-quarter charges of US$22 million. The move will bring annualized savings of US$150 million to US$200 million, it said.
About 1,500 of the 3,500 jobs being eliminated are salaried employees. The company also is cutting more than 1,400 temporary jobs.
The restructuring program will include a selective early retirement program and consolidation of manufacturing plants.
The 157-year-old company is based in the city of Corning in rural western New York.
In premarket trading, Corning's shares fell 65 cents, or 6.5 per cent, to $9.30. -- AP
Wednesday, January 28, 2009
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