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Kodak Reports Key Businesses Gaining Momentum

April 28, 2011
ROCHESTER, NY—April 28, 2011—Eastman Kodak reported first-quarter results that it said reflect continued momentum of the company’s core digital growth businesses and improved cash performance.

First-quarter sales were $1.322 billion, a 31 percent decrease from the year-ago quarter, primarily due to a $550 million non-recurring intellectual property licensing transaction in the year-ago period. Excluding the impact of the prior-year intellectual property transaction, first-quarter sales decreased by 3 percent and digital revenue increased by 2 percent.

Revenue in several of the company’s well established digital businesses increased, while revenue in Digital Capture & Devices decreased, reflecting the company’s previously announced strategy for this business to trade top-line growth for improved full-year earnings.

Revenue from the company’s core digital growth businesses—Consumer and Commercial Inkjet, Packaging Solutions, and Workflow Software & Services—increased by 23 percent, fueled by a greater than 50 percent increase in Consumer Inkjet. First-quarter revenue from the company’s Film, Photofinishing and Entertainment Group declined by 14 percent.

On the basis of U.S. generally accepted accounting principles (GAAP), the company reported a first-quarter loss from continuing operations of $249 million, compared with earnings on the same basis of $119 million in the year-ago period.

“Our strategy is working,” said Antonio M. Perez, chairman and CEO, Eastman Kodak. “We saw continued momentum in our strategic digital growth businesses, revenue growth in several of our established digital businesses, and improved cash performance, all of which position us well to achieve our two key financial metrics for the year related to growth and cash.

“I am particularly pleased with the performance of our core digital growth businesses—Consumer and Commercial Inkjet, Packaging Solutions, and Workflow Software & Services. Revenue growth in these businesses continues to accelerate and in the first quarter grew by a combined 23 percent, in line with our plan to grow these businesses in aggregate by 40 percent for the full year,” Perez said. “We also saw revenue growth in Prepress Solutions, Electrophotographic Printing, and Document Imaging. We are off to a good start for 2011, and we remain confident that we will complete our transformation into a sustainable, profitable company in 2012.”

Other first-quarter 2011 details:

• The company’s first-quarter loss from continuing operations, before interest expense, other income (charges), net, and income taxes was $227 million, compared with $389 million in earnings in the year-ago quarter. This earnings decline primarily reflects the impact of a non-recurring intellectual property transaction in the first quarter of 2010 that was not repeated in the first quarter of 2011.
 

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