Thursday April 26, 5:25 pm Eastern Time
Kellogg Earnings Fall, Meet Estimates
By Deborah Cohen
CHICAGO (Reuters) - No. 2 U.S. cereal maker Kellogg Co. (NYSE:K - news) on Thursday said first-quarter earnings dropped 24 percent .......
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Thursday April 26, 10:24 pm Eastern Time
Starbucks Profit Up, Cautions on Sales
By Scott Hillis
SEATTLE (Reuters) - Starbucks Corp. (NasdaqNM:SBUX - news) on Thursday posted a quarterly profit that met estimates, but the top gourmet coffee retailer slightly lowered its full-year revenue forecast, citing the slowing U.S. economy.
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Japan Factory Production Falls 2.1% in March; Household Spending Drops 3%
Japan's industrial production and household spending fell in March, suggesting falling demand at home and overseas is pushing the world's second-biggest economy closer to recession. More...
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Sony Seen Posting Fiscal Fourth-Quarter Loss on Price Squeeze, Inventories
Sony Corp. will probably report a loss in the fourth quarter because of lower prices for electronic products and slower-than-planned progress in cutting inventories, analysts said. More...
quote.bloomberg.com
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Now they are expecting higher GDP??????
U.S. Economy Probably Grew at 1.1% Rate in First Quarter; Businesses Pause
The U.S. economy probably expanded at a 1.1 percent annual rate in the first quarter as businesses reduced investment in equipment while lowering stockpiles of autos and other goods, analysts said in advance of today's government report. More...
quote.bloomberg.com
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Thursday April 26, 5:08 pm Eastern Time
Corning Net Up, Cuts Outlook
CORNING, N.Y. (Reuters) - Corning Inc. (NYSE:GLW - news), the world's largest fiber-optic cable maker, said on Thursday its first-quarter profits rose 47 percent, but drastically cut its full-year outlook and said it was reducing its work force because of a slowdown in customer spending.
The company said pro forma profits in the quarter ended March 31 declined to $277 million, or 29 cents a share, compared with $188 million, or 23 cents a share, in the same period last year.
After a March earnings warning by Corning, analysts had trimmed expectations to 28 cents, excluding goodwill, with a range of 26 cents to 29 cents, according to Thomson Financial/First Call.
However, Corning cut its full-year outlook to 90 cents to $1.00 a share from its previous guidance of $1.20 to $1.30 a share, and said it will have cut about 4,300 full-time and temporary jobs by the end of this month. Corning earned $1.23 a share last year.
The company also cut its outlook for 2001 revenues to a range of $7.8 billion to $8 billion from its previous guidance of $8.2 billion to $8.5 billion. It also expects fiber volume to grow this year at a rate of 15 percent to 20 percent, and photonics technologies business to be flat.
First-quarter revenues for the Corning, N.Y.-based company rose 42 percent to $1.9 billion from $1.35 billion.
Corning's stock closed on Thursday off 4.46 percent, or 98 cents, at $21.00 in New York Stock Exchange trading. Over the past year, it has underperformed the Standard & Poor's 500 Index by about 59 percent.
``The capital spending outlook for network carriers continues to soften and is now impacting all of our telecommunications businesses more significantly, including optical fiber,'' Corning President and Chief Executive John Loose said in a statement.
``Capital availability constraints in the market are negatively impacting carriers' ability to build and upgrade networks, contributing to recent significant reductions in high-data-rate fiber demand from our top customers,'' he added.
Corning said it expects second-quarter sales to be about $1.8 billion to $1.9 billion, with pro forma earnings in the range of 18 cents to 21 cents a share compared to last year's 31 cents. Analysts had set an estimate of 29 cents for the second quarter, First Call said.
In response to the slowdown, Loose said Corning has cut capital spending by 20 percent. The company also said it is cutting an additional 1,000 jobs in the Photonic Technologies business, bringing the cuts in that unit this year to 2,500 and the overall company total to 4,300.
Further job cuts may be needed, the company said. A restructuring charge may be taken in the second quarter as a result of these April and potential future job cuts.
Fiber-optic cable is the backbone of telecommunications and the Internet. Corning and other optical equipment shares have been hit this year as telecommunications companies have trimmed spending and cut production levels.
Nortel Networks Corp. (NYSE:NT - news; Toronto:NT.TO - news), a major competitor as well as customer of Corning's, last week reported first-quarter losses in line with an earlier warning. The largest telecom gear maker added, however, earnings could improve next quarter as it cuts 5,000 more jobs and trims costs.
Another Corning rival, JDS Uniphase Corp. (Toronto:JDU.TO - news; NasdaqNM:JDSU - news), on Tuesday posted a $1.3 billion fiscal third-quarter net loss and set plans to cut some 5,000 jobs, or 20 percent of its work force. The company, whose products help boost its customers network speed and capacity, also warned the demand slump would pinch fourth-quarter profits.
Including one-time items, Corning posted a first-quarter net income of $132 million, or 14 cents a share, compared with $77 million, or 9 cents a share, in the same period last year.
Last month, Corning warned its 2001 pro forma profits would be below expectations and suggested more layoffs could be on the way because of slower customer spending. It said its outlook for first-quarter profits was 28 cents to 31 cents a share, compared to Wall Street expectations then of 29 cents.
Corning said it expected pro forma earnings of $1.20 to $1.30 a share for the year. Its previous estimate was $1.40 to $1.43.
It estimated 2001 revenues at $8.2 billion to $8.5 billion, up 15 to 20 percent from $7.1 billion in 2000.
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