W HAT WE DID
So, armed with full recognition of both our challenges and our
strengths, we set out to re-shape the company, adjusting to the
new realities of the market.
During 2002, we relied on our V alues to set the context in
which we operated. From there, we focused relentlessly on a
very clear plan with three priorities:
n TO PRESERVE THE FINANCIAL HEALTH OF THE COMPANY ;
n TO RETURN TO PROFITABILITY IN 2003;
n TO CONTINUE TO INVEST IN OUR FUTURE .
During the course of the year — with a recovery in the
telecommunications industry still nowhere in sight — we
restructured the company and dramatically lowered our cost
structure. Meanwhile, we focused our research and develop-
ment efforts and recommitted ourselves to building those 
businesses which presented the most attractive near-term
opportunities for growth — a large part of which are outside
the telecommunications segment. Our diverse portfolio and
wealth of skills across a wide variety of markets had never
been more important.
The plan — painful though it is — is working.
P RESERVING OUR FINANCIAL HEALTH
Now, let’s take a look at our financial picture. Our 2002 sales
from continuing operations were $3.2 billion, a significant
decline from 2001 sales of $6.1 billion. Losses in our
telecommunications segment and significant restructuring
and impairment charges drove a net loss of $1.3 billion or
$1.39 per share in 2002.  
Despite these lowered revenues and net loss, I take great
pride in saying that Corning continues to be a financially
sound company. We developed a three-part plan for achieving
this goal: maintaining significant cash balances; using excess
cash to reduce our debt; and continuing to have access to our
$2 billion revolving line of credit. And we have achieved
significant success in each of these areas. 
Although it has been a very painful process, we have dramat-
ically slowed the rate at which we are consuming cash and
short term investments. Much of this, regrettably, was through
a variety of plant closures and the elimination of about 7,100
jobs, in addition to the 12,000 jobs we eliminated last year.
As a result, a major drain on cash has been due to severance
payments. Beyond severance, our actual cash usage for our
operations has become very low. We have also added to our
cash reserves through such actions as our preferred stock
offering in July, and the sale of our Ohio-based precision lens
business to 3M late in the year. As a result of all these actions,
we were able to end the year with about $2.1 billion in cash
and short-term investments. 
In keeping with this strategy, we also continue to pay down
debt each quarter. Over the course of 2002 and the first month
of this year, we repaid about $975 million in debt, including
commercial paper.  
We haven’t touched our $2 billion in credit — and we don’t
intend to. We maintain our access to this credit by keeping our
debt-to-capital ratio lower than 60 percent. Our ratio at year
end was 46.7 percent, well within the compliance range in our
credit agreement. And as we execute on our plan to pay down
debt, that ratio will drop even further.
All that said, we are preserving what we believe is a strong
liquidity position. And our balance sheet will continue to
improve in 2003 as we gain more benefits from last year’s
restructuring actions. We will continue to maintain our focus
on improving our cash flow and reducing our debt levels as
we look ahead to our longer-term goal of regaining an invest-
ment-grade debt rating. 
R ETURNING TO PROFITABILITY
In 2003, we will focus our energy on the plan to return to
profitability. We are on track to reach that goal, and let me
explain a few of the reasons why.
Our Technologies segment has had a strong year, and has set
aggressive goals for both sales and profit growth for 2003. The
time is right for these businesses to lead the way to our return
to profitability — particularly our liquid-crystal display, envi-