Kodak Launches New Cost Reduction Program, Philip J. Faraci Leaving the Company
ROCHESTER, NY—Sept. 10, 2012—Antonio M. Perez, chairman and CEO of Eastman Kodak announced organizational changes and expanded cost structure reductions to reflect Kodak’s strategic focus on the Commercial, Packaging & Functional Printing Solutions and Enterprise Services business, and the sales processes of its Personalized Imaging and Document Imaging businesses.
Kodak expects to reduce its workforce by approximately an additional 1,000 employees by the end of 2012. The company has reduced its workforce by approximately 2,700 employees worldwide since the beginning of 2012. The annualized savings generated by these headcount reductions, including compensation and benefits, is approximately $330 million. An analysis of further operational and workforce reductions is under way.
“Kodak is becoming a more focused and competitively scaled company,” Perez said. “We recognize that we must significantly and expeditiously reduce our current cost structure, which is designed for a much larger, more diversified set of businesses. We are reorganizing our senior management team, an action that will help accelerate the creation of a sustainable cost structure for operating our business for the benefit of our customers and position our Personalized Imaging and Document Imaging businesses for successful sales.”
Under the new management structure:
• The Commercial, Packaging & Functional Printing Solutions and Enterprise Services business will primarily include the Digital Printing and Enterprise (DP&E) and Graphics, Entertainment and Commercial Films (GECF) units. DP&E President Douglas J. Edwards and GECF President Brad W. Kruchten will report directly to Perez.
• Philip J. Faraci, President, is leaving the company. Perez noted that as Chief Operating Officer, Faraci played an important role in helping transform the company. With Faraci’s assistance, the company has developed excellent operational leadership processes to take forward its remaining businesses.
• CFO Antoinette P. McCorvey has decided to leave the company. Rebecca A. Roof, a managing director of AlixPartners, the company’s restructuring advisory firm, will become CFO on an interim basis, reporting to Perez. Roof has served in similar capacities for other companies that have successfully emerged from Chapter 11 restructurings, and she has deep experience in scaling overhead costs, implementing cost reduction programs, managing liquidity and raising capital, and executing asset sales—all critical areas of focus for Kodak as the company concludes its restructuring.