Kodak Takes Hit in Q4, Full-Year Gross Profit Improves
“In a year with significant external headwinds affecting a number of industries in which we participate, I am very encouraged by the performance of our key digital growth businesses, which will form the basis of Kodak’s digital future,” said Antonio M. Perez, chairman and CEO, Eastman Kodak. “During 2010, these new businesses grew by a combined 18 percent, and all of our digital businesses as a group delivered more than $300 million in earnings for the year. This was our best digital earnings performance ever, and in line with our segment earnings forecast for the year. We also delivered positive cash generation in the fourth quarter and ended the year with more than $1.6 billion in cash on our balance sheet.
“That said, there were particular business challenges in 2010 that we are aggressively addressing. We enter the new year with a highly competitive digital portfolio, a strong presence in key markets, a continued commitment to effective cash management, and a significant amount of positive momentum in our key growth initiatives. All of this positions us well to continue our progress as a profitable, digital company.”
Segment sales and earnings from continuing operations before interest expense, taxes, and other income and charges (segment earnings from operations), were as follows:
• Graphic Communications Group full-year 2010 sales were $2.681 billion, a 2 percent decline from the prior year. Full-year loss from operations for the segment was $29 million, a $13 million improvement from the prior-year. The year-over-year earnings improvement was driven by cost improvements in electrophotographic products and lower raw material costs.
Fourth-quarter 2010 sales were $757 million, a 3 percent decline from the fourth quarter of 2009. Fourth-quarter earnings from operations for the segment were $12 million, as compared with $36 million in the year-ago quarter. This earnings decline includes increased investment to support future growth opportunities in Commercial Inkjet and Workflow Software and Services, as well as negative price/mix in digital plates.