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Kodak reports its first quarter swings to profit

Eastman Kodak Co. on Tuesday reported a profit in the first quarter despite a decline in sales during the period.2016 KODAK SPONSOR Logo_EKY_161020

The company reported net earnings attributable to Kodak of $7 million, or 5 cents a share, up from a loss of $18 million, or 41 cents a share, in the first quarter 2016.

The company logged revenues of $357 million, down 5 percent from $377 million. On a constant currency basis revenues were down $14 million, or 4 percent.

The company reported strong growth in key product lines for the quarter:

  • Annuities revenue for Kodak Prosper Inkjet grew by 26 percent;
  • Volume for Kodak Sonora Process Free Plates grew by 24 percent; and
  • Volume for Kodak Flexcel NX Plates grew by 22 percent.

“I’m pleased with our continued profitability and by the strong performance of our growth engines— Sonora Plates, Flexcel NX Packaging and the Prosper Inkjet business,” CEO Jeffrey Clarke said. “We expect continued strong execution in these growth businesses, which will continue to increase our quality of earnings.”

The decrease in revenues was primarily driven by pricing pressures in the pre-press plates business and the expected continued decline in legacy consumer inkjet printer cartridge sales, the company said.

The company ended the first quarter with a cash balance of $378 million, a decrease in cash of $56 million for the quarter. The cash burn reflects the use of cash in working capital items such as seasonal inventory increases for revenues during the remainder of the year.

“The increased use of cash in the first quarter compared with the prior year is consistent with our expectations,” said David Bullwinkle, chief financial officer.

The company adjusted its 2017 guidance to reflect the retention of its Kodak Prosper as well as supplier price increases in aluminum impacting Kodak’s largest division. The company now expects revenues of $1.5 billion to $1.6 billion for the year.

Print Systems Division, Kodak’s largest division, had revenues of $213 million in the quarter, an 8 percent decline.

Kodak stock (NYSE: KODK) closed at $10.75, up from Monday’s close of $10.55. The company reported its results after the market closed.

(c) 2017 Rochester Business Journal. To obtain permission to reprint this article, call 585-363-7269 or email madams@bridgetowermedia.com

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