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Kodak Q1 loss narrows, revenues drop 19%

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Rochester Business Journal
May 6, 2014

Eastman Kodak Co. on Tuesday reported its first-quarter net loss narrowed but revenues dropped more than 19 percent.

The company, which emerged from Chapter 11 bankruptcy in September, posted a net loss of $36 million for the first quarter versus $85 million a year ago, on a comparable basis. On a generally accepted accounting principles basis, the net earnings in the first quarter of 2013 were $283 million, including other operating income, net of $494 million, primarily from a gain of $535 million from the sale of the company’s digital imaging patent portfolio.

Kodak logged first-quarter sales of $482 million, down from $594 million. More than half of the drop was attributed to continuing declines in film and consumer inkjet products, the company said. In addition, non-recurring licensing revenue was $24 million lower than in the first quarter of 2013.

“Kodak’s transformation continues. The path to sustainable growth and profitability is not a straight line, but we continue to progress, especially in the strategic technology businesses which will constitute the new Kodak,” CEO Jeffrey Clarke said in a statement. “Our results, while within expectations, reflect the steep declines in our mature businesses, which are currently offsetting the increasing momentum we are seeing in our strategic technology businesses.”

The company saw significant increases in sales for its key new products in packaging, digital printing and digital plates, said Clarke, who became CEO in March.

He noted the company’s strong liquidity, with cash of $809 million exceeding debt of $677 million, provides flexibility to continue investing in the business to support future growth.

“In 2014, we will invest about $100 million in R&D and about $40 million in capital improvements to continue bringing innovative solutions to market for our customers, and improving the efficiency of our operations,” Clarke said.

The company reported sales in the Graphics, Entertainment & Commercial Films segment of $316 million, down 18 percent. Most of this decline stemmed from the reduction in motion picture film and onetime licensing revenue, the company said. The segment loss was $30 million compared with a profit of $16 million a year ago.

The Digital Printing & Enterprise segment had sales of $166 million, down 16 percent from a year ago. Nearly two-thirds of the decline was related to lower sales in the consumer inkjet business, the company said. The segment loss was $25 million compared with $18 million in the first quarter 2013.

Kodak reported its results after the market closed Tuesday.

(c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


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