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Kodak Reports Q2 Loss, Expects Improved Second Half of 2009

July 30, 2009
ROCHESTER, NY—July 30—Eastman Kodak Co. (NYSE:EK) today reported second-quarter 2009 results that reflect the weak global economic climate and forecasted improved financial results for the second half of the year.

The company’s second-quarter results also reflect focused investments that Kodak is making in new products and core growth businesses, as well as disciplined cost management and more tightly focused spending on research and development. These actions will lay the groundwork for the second-half cash and earnings improvement that the company expects.

For the second quarter, Kodak reported a loss from continuing operations of $191 million, or $0.71 per share. Second-quarter sales were $1.766 billion, a 29% decline from the year-ago quarter, including approximately 5% of unfavorable foreign exchange impact.

“While we continue to be challenged by the global recession, we remain committed to our strategy and have the financial resources available to implement our business plans,” said Antonio M. Perez, Chairman and Chief Executive Officer, Eastman Kodak Company. “We have every expectation that our cash flow pattern this year will mirror the pattern of previous years, with a sizable increase in cash generation in the second half of 2009. During the second quarter we continued to execute on our strategy, with our consumer inkjet hardware and ink revenue growth significantly outpacing the market. We’ve recently announced the first sale of our Kodak PROSPER S10 Imprinting System, and the first letter of intent to purchase a Kodak PROSPER Press powered by our Stream Inkjet Technology. We are successfully focusing on those things within our control – strengthening the return on our cash-generating businesses, further developing our core growth businesses, maintaining and enhancing our leading market share position, introducing innovative new products, and driving a leaner cost structure – all of which will create operating leverage and position Kodak for a stronger second half of 2009.”

For the second quarter of 2009:

* Sales worldwide totaled $1.766 billion, a decrease of 29% from $2.485 billion in the second quarter of 2008, including 5% of unfavorable foreign exchange impact. Revenue from digital businesses totaled $1.173 billion, a 28% decline from $1.636 billion in the prior-year quarter, primarily as a result of the global recession and continued restrictions in the credit markets. Revenue from the company’s traditional business decreased 30% to $593 million, primarily as a result of industry-related declines in our traditional businesses and the negative impact on volumes related to the uncertainty of labor contract negotiations in the entertainment industry. These labor contract negotiations were concluded in June 2009.
 

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