Kodak shares tank on news of loan suspension

The U.S. International Development Finance Corp. (DFC) has put a hold on its $765 million loan to Eastman Kodak Co. in light of an investigation of the matter by the U.S. Securities and Exchange Commission. The agency made the announcement on Twitter Friday evening.

As a result, Kodak shares (NYSE: KODK) plummeted Monday more than 40 percent from Friday’s close at $14.88. By the close of trading, shares had rebounded slightly to $10.73.

When Kodak and the DFC on July 28 announced details of the loan, Kodak shares soared from a July 27 close at $2.62 to more than $16. By Wednesday morning, shares had reached $43.45.

But on Aug. 4, The Wall Street Journal reported that the U.S. Securities and Exchange Commission will investigate the circumstances surrounding the loan. Congressional leaders also are looking into both the loan and the substantial number of shares picked up by company leaders ahead of the announcement, according to a letter sent to Kodak Executive Chairman James Continenza.

Continenza was issued 1.75 million stock options by the board the day before the loan announcement, triggering an outcry from analysts and investors.

“On July 28, we signed a letter of interest with Eastman Kodak,” Friday’s DFC tweet read. “Recent allegations of wrongdoing raise serious concerns. We will not proceed any further unless these allegations are cleared.”

In a retweet of the DFC’s tweet Friday, Peter Navarro, assistant to the President and director of the Office of Trade and Manufacturing Policy at the White House, said “VERY disappointed last week’s great deal with Kodak tarnished by allegations. Absolutely RIGHT move by DFC! We must redouble efforts to bring our pharma manufacturing home!!”

The potential windfall would allow Kodak to reinvent itself with a new division, Kodak Pharmaceuticals, that would manufacture components of generic drugs.

The July 28 letter of interest noted that it was not a done deal and that the loan could be any dollar amount up to $765 million. Both Kodak and the DFC said at the time that they could continue due diligence.

On Monday, a Kodak spokesperson said the company appreciates and supports the DFC’s decision to await clarification before moving forward with the process. In fact, on Friday, Kodak said it had appointed a special committee of independent directors to oversee an internal review of “recent activity” by the company and related parties in connection with the loan.

The committee comprises directors Jason New and William Parrett and the internal review will be conducted for the committee by Akin Gump Strauss Hauer & Feld LLP.

Kodak is slated to report quarterly earnings on Tuesday.

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Kodak loan under scrutiny

It’s a Kodak Moment the company probably wasn’t planning on.

When Eastman Kodak Co. announced last week that it would receive a $765 million loan from the government to begin manufacturing generic drugs here and at a plant in Minnesota, it was met with much fanfare. And deservedly so.

After all, Rochester’s onetime largest employer has for many years been on the decline, a shell of its former self. In its heyday, Kodak had more than 60,000 people on its Rochester payroll. The company employs less than one-tenth that amount here now. And company stock for at least the last three years has languished at less than $10 a share. Until last Tuesday.

When Kodak and the U.S. International Development Finance Corp. (DFC) on July 28 announced details of the loan, Kodak shares soared from a July 27 close at $2.62 to more than $16. By Wednesday morning, shares had reached $43.45. Share price has since backed off to the $15 to $17 range due to a dilution of shares.

But on Aug. 4, The Wall Street Journal reported that the U.S. Securities and Exchange Commission is investigating the circumstances surrounding the loan. Congressional leaders also are looking into both the loan and the substantial number of shares picked up by company leaders ahead of the announcement, according to a letter sent to Kodak Executive Chairman James Continenza.

Continenza was issued 1.75 million stock options by the board the day before the loan announcement.

SEC filings show that Continenza purchased 46,700 additional shares of Kodak stock, while board member Philippe Katz purchased 5,000 shares on the same day. In an interview with CNBC following the announcement, Continenza said Kodak had been working on the loan deal for a “few months” prior to the July 28 announcement, according to the congressional letter, which was signed by James Clyburn, chairman of the select subcommittee on the coronavirus crisis; Carolyn Maloney, chairwoman of the committee on oversight and reform; and Maxine Waters, chairwoman of the committee on financial services.

“During the period when Kodak was reportedly engaged in confidential negotiations for the loan award, the company also awarded stock options to you and members of Kodak’s board of directors that are now worth millions of dollars,” the letter states. “On May 20, the company awarded 240,000 stock options to board members, which were reportedly worth approximately $4 million as of July 31.”

The lawmakers are requesting a number of documents and information from Continenza by Aug. 18 including:

• All documents and communications related to DFC’s loan to Kodak, including but not limited to documents and communications regarding:
o Kodak’s interest in obtaining a loan or entering into any agreement with the federal government to manufacture pharmaceutical ingredients;
o discussions or negotiations with DFC, the Department of Defense (DoD), the White House or any other federal agency;
o Kodak’s ability to manufacture or procure pharmaceutical ingredients;
o any solicitation or request for proposals;
o any offer, bid or proposal from your company;
o any possible commitment made by any pharmaceutical company to purchase active pharmaceutical ingredients from Kodak;
o all loan documents;
o any performance contracts associated with the loan; and
o any agreements with subcontractors, vendors, or other third-party sellers and manufacturers.
• All documents and communications related to the issuance of Kodak stock, options, or other securities to any Kodak officer or director, including but not limited to the award of options to members of Kodak’s board of directors on May 20, 2020 and to Continenza on July 27, 2020.
• All documents and communications related to the purchase or exercise of Kodak stock, options, or other securities by any Kodak officer or director, including but not limited to the share purchases by Continenza and Katz on June 23, 2020.
• A list of all meetings or phone conferences with any federal employee, official, agent, representative, or volunteer, including but not limited to any White House, DOD, or DFC employee, regarding the topics described in this letter.

And at least half a dozen law firms have said they are investigating claims against Rochester’s photo giant.

“My suspicion is it’s likely when the dust settles from the Securities and Exchange Commission looking into the matter that they will find that Kodak’s senior execs followed all the rules,” said George Conboy, chairman of Brighton Securities Corp. “I don’t have any evidence for that contention. It’s just that it is such an obvious large purchase immediately prior to a major positive event, and unless Kodak’s senior people are really stupid, they’re not going to buy unless it’s part of a disclosed regular program of purchases.”

Conboy expects the SEC to discover that Continenza’s June purchase of shares is part of a planned series of purchases and complies with all applicable securities regulations. The 1.75 million shares that were granted last week, however, is a little more curious, he said.

“Management has said that he was approved for the options a little over a year ago when they made a borrowing deal with some private equity firms that lent (Kodak) a bunch of money, and because that loan deal involved convertible debt — meaning the lenders could convert some or all of their loan to stock, which we found out a few days ago that they elected to do — the board says that they granted the CEO these options so that his existing position in the shares would not get diluted,” Conboy explained.

That, he said, was unconventional.

“It is not conventional for a board of directors to save senior management from dilution due to capital transactions. And while that’s a little curious, it’s a lot more curious why that grant finally took place Monday morning prior to the press conference,” Conboy said. “If I had to suspect, I would suspect that they said holy smokes, are we going to get around to doing this grant? We better do it. So they did it.”

Conboy also noted that everyone pointing their fingers at management for cashing in on Tuesday’s announcement could have bought the stock themselves at $2 or $3 a share in the last couple of years.

“Further, if statements from the company are correct, and I have no reason to disbelieve them, Continenza has never sold any stock, and some of the early share grants are still under water because people should remember that when Kodak came out of bankruptcy back in 2013, the shares were in the mid $20 (range),” he noted.

The DFC said in its statement last Tuesday that terms of the loan were still being worked out and that Kodak could receive all or a portion of the $765 million. And even if the company gets the full amount and is able to convert its manufacturing facility rather quickly, can they sell the generic drugs at a profit, Conboy wondered.

“How about the idea that China sells this stuff now?” Conboy said. “Kodak may have a higher cost than a Chinese company. So how does Kodak compete profitably? What we don’t know: Are the feds planning to offer some kind of tax break to pharma companies that source their stuff domestically? It might make sense.”

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Kodak to begin making generic drugs; stock price triples

Eastman Kodak Co. shares (NYSE: KODK) tripled Tuesday on news that the photo giant will receive a $765 million loan from the U.S. International Development Finance Corp. to begin producing pharmaceuticals. Kodak stock closed at nearly $8 Tuesday, up from Monday’s close of $2.62 a share.

At the direction of President Trump, DFC CEO Adam Boehler will sign a letter of interest today to provide the loan in support of the launch of Kodak Pharmaceuticals, a new arm of the company that will produce critical pharmaceutical components. The project will mark the first use of new authority delegated by Trump’s recent executive order that enables DFC and the U.S. Department of Defense (DOD) to collaborate in support of the domestic response to COVID-19 under the Defense Production Act (DPA).

Signed by Trump on May 14, Executive Order 13922 gives the DFC CEO the authority under the DPA to leverage its financial tools to re-shore production of strategic resources and strengthen related domestic supply chains in response to COVID-19. On Friday, Trump signed four executive orders aimed at limiting drug prices.

“Addressing the unprecedented challenges we face today — and preparing for future crises — requires innovative ideas and partnerships,” Boehler said in a statement. “Today, we are bringing together the significant resources and expertise of the private sector and U.S. government. We are pleased to support Kodak in this bold new venture. Our collaboration with this iconic American company will promote health and safety at home and around the world.”

Kodak Pharmaceuticals will produce critical pharmaceutical components that have been identified as essential but have lapsed into chronic national shortage, as defined by the Food and Drug Administration (FDA). Although Americans consume roughly 40 percent of the world’s supply of bulk components used to produce generic pharmaceutics, only 10 percent of the materials are manufactured in the U.S.

According to various news reports, Kodak Pharmaceuticals will make ingredients for generic drugs, including the antimalarial drug hydroxychloroquine that Trump took, saying it would stave off COVID-19. The FDA on July 1 cautioned against taking the drug for COVID-19 outside hospital settings due to the risk of heart rhythm problems.

Eastman Kodak Co. Executive Chairman Jim Continenza
Eastman Kodak Co. Executive Chairman Jim Continenza

“Kodak is proud to be a part of strengthening America’s self-sufficiency in producing the key pharmaceutical ingredients we need to keep our citizens safe,” said Kodak Executive Chairman Jim Continenza. “By leveraging our vast infrastructure, deep expertise in chemicals manufacturing and heritage of innovation and quality, Kodak will play a critical role in the return of a reliable American pharmaceutical supply chain.”

Continenza told the Wall Street Journal that the government wants to wean the U.S. off its dependence on China and India for generic drugs.

“If we have learned anything from the global pandemic, it is that Americans are dangerously dependent on foreign supply chains for their essential medicines,” said Peter Navarro, assistant to the President and director of the Office of Trade and Manufacturing Policy at the White House. “This DFC-Kodak partnership is a big win for the use of President Trump’s DPA powers, a big win for New York and a huge step forward towards American pharmaceutical independence.”

Local officials celebrated the news Tuesday.

“Our residents created a legacy working at Kodak to provide world-class products and countless memories for people throughout our nation and our world,” said Mayor Lovely Warren. “Now, we will get another opportunity to show the world our ingenuity and quality again through Kodak Pharmaceuticals. I look forward to more Rochesterians going to work and building a new chapter in our shared history.”

Monroe County Executive Adam Bello added: “Today marks a new chapter for Eastman Kodak, which has been a world leader in innovation for over 130 years and has always called Rochester ‘home’. In this time of unprecedented challenge, this opportunity will showcase the best of Monroe County and our ability to quickly adapt to the needs of our new economy, even while responding to the COVID-19 crisis. I am excited to see Kodak leading this forward thinking initiative and am confident that our skilled workforce will make it a success.”

DFC’s loan will accelerate Kodak’s time to market by supporting startup costs needed to repurpose and expand the company’s existing facilities in Rochester and St. Paul, Minn. The company will incorporate continuous manufacturing and advanced technology capabilities. The letter of interest that will be signed in Rochester today indicates Kodak’s successful completion of DFC’s initial screening and will be followed by standard due diligence conducted by the agency before financing is formally committed, officials said.

“This is about assuring our supply chains now and in the future,” said Rear Admiral John Polowczyk, who leads the White House Supply Chain Task Force. “Kodak is stepping up to help onshore pharmaceutical production and this DPA action will allow the modernized Strategic National Stockpile to have domestic resiliency. Once Kodak ramps up we will have the ability to tap into that capacity for domestic use.”

Boehler and Continenza will sign the letter and be joined by Navarro, Polowczyk and Deputy Secretary of Defense David Norquist. The signing ceremony will follow recorded remarks from Trump and New York Gov. Andrew Cuomo.

Once fully operational, Kodak Pharmaceuticals will have the capacity to produce up to 25 percent of active pharmaceutical ingredients used in non-biologic, non-antibacterial generic pharmaceuticals while supporting 360 direct jobs and an additional 1,200 indirectly. The company plans to coordinate closely with the Trump Administration and pharmaceutical manufacturers to identify and prioritize components that are most critical to the American people and U.S. national security.

Similar to a commercial loan, the loan must be repaid over 25 years, Continenza told the Wall Street Journal.

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Kodak’s losses widen in Q1

Eastman Kodak Co. on Tuesday reported a $111 million net loss in the first quarter, a $93 million decline from the photo giant’s $18 million net loss in the first quarter last year.

For the quarter ended March 31, Kodak reported sales of $267 million, down from $291 million in the year-ago quarter.

The first-quarter net loss included expense of $167 million related to the increase in deferred tax valuation allowances for locations outside the U.S. and income of $53 million related to the change in fair value of embedded derivatives in the Series A Preferred Stock and Convertible Notes.

“Kodak started the quarter on a positive trajectory and the actions we took last year to strengthen our balance sheet are helping us manage through the slowdown,” said Jim Continenza, Kodak’s executive chairman. “Kodak employees have risen to the challenge of the pandemic, continuing to serve our customers and redirecting resources to produce isopropyl alcohol for hand sanitizer and manufacture face masks using our ESTAR film base. Looking forward, we will continue with our plans to double down on digital print, launch exciting new products and realign our business to focus on customers.”

Kodak ended the quarter with a cash balance of $209 million, down from the December 31, 2019 cash balance of $233 million.

“During the economic slowdown caused by the COVID-19 situation, we are managing our working capital tightly to ensure sustainability for our customers and employees,” Continenza said. “We continue to pursue cost-reduction efforts to preserve cash and position Kodak for a strong rebound when business conditions start to improve.”

Kodak shares (NYSE: KODK) closed Tuesday at $2.69 but had fallen roughly 15 percent by mid-afternoon Wednesday to $2.30.

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Kodak revenue, earnings decline in third quarter

Eastman Kodak last week reported a third-quarter loss of $5 million, despite growth in key print and film product areas.

For the quarter ended Sept. 30, the one-time film giant posted revenues of $315 million, down from $329 million in the same quarter last year. The Rochester company’s $5 million loss compared with net earnings of $19 million for the third quarter last year. On a per-share basis, the loss was 35 cents.

“The company will continue to concentrate on delivering industry-leading solutions to customers in our core print and film businesses,” Executive Chairman Jim Continenza said in a statement last Thursday. “Looking ahead to 2020, we will focus on generating cash by growing profitable revenue, making smart investments and eliminating unnecessary spending.”

Revenues for Kodak’s film business have grown 21 percent year-to-date and volume for Kodak Sonora Process Free Plates grew by 22 percent in the first nine months.

Kodak finalized its relationship with Lucky HuaGuang Graphics Co. Ltd. in China, a supply agreement that will help Kodak fulfill its customer demand.

“We have strengthened our financial position by eliminating significant interest costs with the transactions completed earlier in the year,” Kodak CEO David Bullwinkle said. “For the year-to-date, we have delivered growth in Sonora Process Free Plates, Prosper Inkjet annuities and our film business. We plan to build on those successes and drive further cost efficiencies to help achieve our goal of generating cash.”

Kodak shares (NYSE: KODK) have ranged from $1.87 to $4.40 in the last year and were trading at $2.52 on Monday afternoon.

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Kodak partners to launch new products

Kodak has partnered to launch launch a sport drone, a first-person view drone capable of reaching speeds of more than 75 mph. (Photo provided)
Kodak has partnered to launch a sport drone, a first-person view drone capable of reaching speeds of more than 75 mph. (Photo provided)

Eastman Kodak Co., on the heels of the sale of its Flexographic Packaging Division, has announced several of new projects and collaborations.

The former one-third of Rochester’s Big Three this week said it has partnered with a leading provider of K-12 science, technology, engineering and math (STEM) programs to launch a sport drone, a first-person view drone capable of reaching speeds of more than 75 mph.

PCS Edventures! Inc. and its subsidiary Thrust-UAV, a drone manufacturing company and authorized Kodak brand licensee, have launched the Kodak Riot 250R Pro Sport Drone that was built for the consumer market. The high-performance drone takes pilots into the cockpit and transmits real-time video feedback to operators wearing FPV goggles.

“The Kodak licensing agreement is an incredible opportunity for both Thrust-UAV and Kodak,” said Thrust-UAV director of business operations Joe Egusquiza in a statement. “It’s bringing together Kodak, a company whose brand has been a global symbol of trust for generations, and Thrust-UAV, a cutting-edge UAV design and development team. Kodak’s global presence, branding and retail experience, combined with Thrust-UAV’s dedicated design, development and production capabilities in the drone market create the synergy to make a big impact in this rapidly-growing market.”

Kodak's new Kodak Portrait 3D Printer. Geared toward the 3D desktop professional market, the Portrait Printer will offer distinctive features such as the dual extrusion system and a fully enclosed, all-steel structure, allowing high-temperature builds. (Photo provided)
Kodak’s new Kodak Portrait 3D Printer. Geared toward the 3D desktop professional market, the Portrait Printer will offer distinctive features such as the dual extrusion system and a fully enclosed, all-steel structure, allowing high-temperature builds. (Photo provided)

Kodak also this week announced a partnership with Smart International, the authorized global brand licensee of 3D printing, to bring the Kodak Portrait 3D Printer to North America and Europe. The printer currently is on display at the Formnext industry tradeshow in Germany.

Geared toward the 3D desktop professional market, the Portrait Printer will offer distinctive features such as the dual extrusion system and a fully enclosed, all-steel structure, allowing high-temperature builds.

“We are delighted to launch the new 3D printer with Smart International and build upon our excitement about this growth industry and the impact that it can have on professional 3D printing and imaging overall,” Kodak director of brand licensing and vice president, Consumer and Film Division Joel Satin said.

Kodak on Wednesday said it has expanded its offerings for Kodalux Light Control Technology. Kodalux is a new class of light control materials which can be coated on fabrics for use in the management of light, delivering 100 percent blackout.

Fabricut Inc., one of the world’s largest distributors of decorative fabrics, will offer customers the ability to incorporate Kodalux technology for blackout on its Fabricut Contract line of fabrics.

“With the Kodalux product we are able to offer a simpler FR blackout solution, eliminating the needs for a separate liner, while still maintaining the hand and drape of decorative women fabrics,” Kodak Chief Customer Officer Tom Cavanagh said.

In addition to woven drapery fabrics, Kodalux can be coated on prepared-for-print fabrics for exhibition signage or window treatments which are printed by either direct or indirect dye sublimation.

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Kodak to offer mail-in digitizing service

cassette-compact-electronics-157544Those little yellow envelopes you once used to send film in for developing are making a comeback, of sorts.

Eastman Kodak Co. has introduced the Kodak Digitizing Box, a service designed to help transfer old memories into modern viewing options. The Kodak Digitizing Box is aimed at making digitizing aging media easy, officials said Tuesday.

As part of a new brand licensing agreement with AMB Media LLC, a direct-to-consumer digitizer of home movies and photos, the new service allows customers to mail their old movies and photos to the digitizer and have them transferred to plug and play media, DVDs or digital downloads. The originals are returned with the new media.

“Kodak has been capturing and preserving people’s memories for more than a hundred years, said Joel Satin, director of brand licensing and vice president consumer & film division. “This partnership with AMB Media reflects that legacy with a contemporary application for consumers of many ages and backgrounds.”

The Kodak Digitizing Box offers four options of service, with 19 types of media available for conversion to digital, including VHS tapes, reel to reel audio tape, Super 8 film, 35mm slides and picture negatives, among others.

“The Kodak brand brings instant trust and recognition for customers needing to digitize their families’ old home movies and photos,” AMB Media Co-founder Adam Boeselager said. “For some it’ll be the completion of a journey: maybe their grandfather recorded their childhood on an old Super 8mm film reel and sent it to Kodak to be developed, and now decades later that film can be digitized and modernized with the Kodak Digitizing Box service.”

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Kodak to sell Flexographic division, eliminate 325 jobs

kodak-from-cacade-webEastman Kodak Co. on Thursday reported a decline in second-quarter revenue and announced plans to unload its profitable Flexographic Packaging Division to pay down debt.

The company also plans to eliminate some 325 positions, although company officials did not say how its Rochester facilities might be impacted.

For the quarter ended June 30, Kodak reported sales of $372 million, a $9 million decline from the second quarter last year. Net income for the quarter was $4 million, with operational earnings before taxes of $9 million, down $3 million from the year-ago quarter. Kodak officials said $7 million of that decline was related to increased costs of aluminum.

On a per-share basis, Kodak reported a 2-cent loss in the second quarter.

“We continue to see growth in our Sonora plates, Flexcel NX and Prosper annuities businesses,” Kodak CEO Jeff Clarke said in a statement. “When adjusted for aluminum and foreign exchange, operational EBITDA increased 33 percent year over year.”

Clarke said the second half of the year will bring a focus on the sale of Kodak’s Flexographic Packaging Division, improving efficiencies through restructuring and continuing to deliver growth in strategic areas.

The one-time photo giant ended the quarter with cash on hand of $275 million and expects to generate cash in the second half of 2018, company officials said. As part of its second-quarter filing, Kodak included a disclosure of going concern, which stated that “Kodak has debt coming due within 13 months and does not have committed financing or available liquidity to meet such debt obligations if they were to become due in accordance with their current terms.”

Kodak has entered into a non-binding letter of intent with a counterparty that holds a significant principal amount of the company’s loans, which would provide for a complete refinancing of the loans with a maturity date of 18 months from closing.

According to the Securities and Exchange Commission filing, based on forecasted cash flows, there are uncertainties regarding Kodak’s ability to meet commitments in the U.S. as they come due. Kodak’s plans to improve cash flow include reducing interest expense by decreasing the debt balance using proceeds from asset sales, further restructuring Kodak’s cost structure, and paring investment in new technology by eliminating, slowing and partnering with investors in product development programs.

Kodak’s flexographic division employs some 300 people globally and for the last 12 months reported revenues of $150 million. Flexography is a form of printing that uses flexible plates to print on various packaging surfaces.

“We have already received strong interest in this business from multiple, potential strategic and financial buyers,” said Kodak CEO Jeff Clarke in an earnings call after the bell Thursday.

Kodak reiterated its 2018 guidance of $1.5 billion to $1.6 billion in revenues, with earnings before taxes of $55 million to $60 million to reflect increased aluminum supplier costs and timing of commercialization of new products.

Shares of company stock (NYSE: KODK) had fallen nearly 7 percent Friday morning to $3.22.

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Eastman Business Park celebrates switch from coal to natural gas

When George Eastman started building Kodak Park in 1891, the first building constructed in the former orchard was a power plant.

Such was the importance of energy to the camera and film manufacturer.

In 2018, energy is still critical and now underlies the renaissance of the former Kodak Park as Eastman Business Park. The park is home to 110 companies and 6,500 employees.

“We are very excited about manufacturing coming back as a really relevant part of that growth,” said Dolores Kruchten, president of Eastman Business Park. Nearly all the speakers who came to celebrate the natural gas-powered energy project unveiled Tuesday remarked on the importance of energy to bringing more companies and more jobs to the business park.

The ribbon-cutting ceremony was held in a tent overlooking building 371, which has actually been creating power with gas since March. The low-slung blue building in view of the event tent was dwarfed by a neighboring blue building, which had been the coal-fired power plant for the park until late last winter. The transition means the end to 127 years of burning coal at the site.

“With this park and with this new plant, our world really is endless,” said John Prunkl, CEO of Ironclad Energy Partners, the parent company of RED-Rochester, the company delivering power to other businesses at the park.

Craig Bennett, president of RED-Rochester, said switching over from coal to gas without interrupting the energy flow to Eastman  Business Park customers was a little like “changing your tire while going down the highway at highway speeds.”  But with lots of local construction help and plant operators with 30 and more years’ experience, the transition was made.

The switch-over brings significant environmental benefits – reductions in sulfur dioxide emissions by 99 percent, carbon dioxide by 50 percent, particulates by 80 percent, Bennett said. The cut in pollutants isn’t just theoretical, he said. “It’s happened, it’s in place and we’re enjoying the benefits.”

Monroe County Executive Cheryl Dinolfo said she grew up within walking distance of Kodak Park and is happy to see manufacturing jobs start to return along with the cleaner air.

“For me, it’s always about jobs. Jobs, jobs, jobs.  We want people to live and prosper in Monroe County,” she said. When companies consider relocating to the area, Dinolfo said, “they want to know about the cost of doing business. Energy is part of the cost of doing business.”

Kruchten said the pipeline of companies interested in the park now is fuller than it has ever been in her three years working there. The steam generated by the power plant is prized by food processors and other manufacturers, she said.  The chilled water capabilities can be used to cool buildings or in manufacturing processes, she said.

Business park officials said the $75 million conversion project is the largest investment that has been made in the industrial park in more than 30 years.

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Kodak employees honor Eastman by stuffing bus with school supplies

Eastman Kodak Co. employees "Stuffed A Bus" with school supplies for the Rochester City School district to Honor George Eastman's birthday July 12. (Photo provided)
Eastman Kodak Co. employees “Stuffed A Bus” with school supplies for the Rochester City School district to Honor George Eastman’s birthday July 12. (Photo provided)

More than 350 Eastman Kodak Co. employees honored the 164th birthday of their company’s founder July 12 by doing something he likely would have done himself: give back to the community.

“Stuff A Bus” was organized to celebrate businessman and philanthropist George Eastman. A school bus was “stuffed” with more than 1,200 school supplies from Kodak licensing partner Cra-Z-Art, as well as numerous supplies donated by staffers. Supplies included crayons, pencils, colored pencils, glue sticks and more. Kodak donated roughly 300 backpacks for the bus stuffing.

The school supplies are being donated to the Rochester City School District for the upcoming school year.

The event, which also included an employee cookout to celebrate Eastman, was in conjunction with Kodak’s Print for Good initiative, a program that was designed to help support literacy initiatives here in Rochester and around the world, company officials said.

In 2017, Kodak held a birthday party for Eastman, and during that event more than 2,500 books were collected and donated to the Urban League of Rochester and the Scott Spino Foundation.

School supplies were donated for RCSD's upcoming school year. (Photo provided)
School supplies were donated for RCSD’s upcoming school year. (Photo provided)

Born in 1854, Eastman began dabbling in photography at 24. From 1880 to 1889, Eastman worked on his Eastman Dry Plate Co. and Eastman Dry Plate and Film Co. He formed the Eastman Co. in 1894 and it has been known as Eastman Kodak since 1892.

But Eastman was known not only for founding the company that bears his name, but also for being one of Rochester’s foremost philanthropists at the time. His gifts were instrumental in the founding of the United Way of Greater Rochester, as well as Eastman School of Music and Eastman Dental Dispensary, among many others.

“If a man has wealth, he has to make a choice, because there is the money heaping up. He can keep it together in a bunch, and then leave it for others to administer after he is dead. Or he can get it into action and have fun while he is still alive,” Eastman once said. “I prefer getting it into action and adapting it to human needs, and making the plan work.”

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Kodak reports first quarter loss

kodak1bEastman Kodak Co. on Wednesday reported a $25 million net loss in the first quarter, as well as a decrease in assets.

For the quarter ended March 31, Kodak reported revenues of $357 million, unchanged from the first quarter last year. Kodak’s $25 million net loss for the quarter compares with earnings of $7 million in the same quarter a year ago.

The company reported operational earnings before interest, taxes, depreciation and amortization (EBITDA) of $1 million for the quarter. The company ended the quarter with a cash balance of $313 million, down $31 million from the fourth quarter cash balance of $344 million.

“Our use of cash for the first quarter was in line with our expectations and significantly improved from the same period a year ago,” Kodak CFO David Bullwinkle said. “We have meaningfully improved productivity and are on track to deliver over $50 million year on year cost savings in 2018.

Kodak officials said the company experienced continued growth in its Kodak Sonora process-free plates, Kodak Flexcel NX packaging and Kodak Prosper inkjet businesses.

“We are on plan to deliver full-year revenue and operational EBITDA performance within the expected guidance range,” Kodak Chief Executive Jeff Clarke said in a news release.

Kodak’s largest division, its Print Systems Division, had first quarter revenues of $216 million, a $3 million increase from the first quarter last year. Kodak’s Enterprise Inkjet Systems Division reported revenues of $31 million, down from $37 million a year ago, while the Flexographic Packaging Division posted revenues of $37 million, up $4 million from the same period last year.

Shares of company stock (NYSE: KODK) opened Wednesday at $5.49, but by Thursday morning had fallen to $5.175.

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Kodak names O’Grady to lead Print Systems Division

kodak-towerEastman Kodak Co. has named John O’Grady as president of its Print Systems Division. O’Grady will assume the role April 24.

O’Grady currently serves as president of the Consumer and Film Division and is former general manager of worldwide sales for the Print Systems Division. He will replace Brad Kruchten, who is retiring after 36 years with Kodak.

“Brad has been an important part of our company for many years, and I thank him for his tremendous commitment to Kodak and outstanding accomplishments,” Kodak CEO Jeff Clarke said in a statement. “John O’Grady is very well positioned to lead the Print Systems Division. His industry experience is unparalleled.”

Clarke will lead the Consumer and Film Division on an interim basis until a successor is appointed, working closely with O’Grady during the transition.

“It’s difficult to follow a leader like Brad Kruchten, but he’s built an all-star team and I look forward to working with them as we continue to deliver world-class commercial printing solutions,” O’Grady said. “With new products in our portfolio like our Sonora X plates and the Nexfinity electrophotographic press, we are poised to thrive globally.”

Last month, Kodak reported revenues of $1.5 billion, a $112 million decline from fiscal 2016. Company officials blamed the drop on volume and pricing declines within the company’s commercial print business and volume declines in Kodak’s consumer inkjet and industrial film and chemicals businesses.

Shares of company stock Tuesday (NYSE: KODK) were relatively flat at $5.02.

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Kodak releases corporate responsibility report

kodak-logoEastman Kodak Co. has released its 2016 corporate responsibility report, highlighting 10 new environmental and social sustainability goals it plans to achieve by 2025. It is the first such report since 2013.

Kodak’s aim is to continue the progress it has made against environmental goals through a variety of measures taken over recent years. One local measure is the repurposing of Eastman Business Park’s solvent recovery operations, once used for film and chemical manufacturing in the 1920s, to recycle 40 million pounds of methanol, ethanol and other potentially hazardous materials in 2016.

By 2025, Kodak’s aim across all global operations is to commit to working toward a number of goals including:
• Waste: Approach zero waste at Kodak sites worldwide by achieving 99 percent overall waste diversion from landfill and incineration.
• Greenhouse Gas Emissions: Reduce GHGs from worldwide Kodak operations by 25 percent.
• Water: Reduce water consumption from worldwide Kodak operations by 25 percent.
• Water/Energy: Enable Kodak customers to reduce water consumption, energy consumption, greenhouse gas emissions and fossil fuel energy consumption with innovative products and alternative energy solutions.
• Recycling: Triple the quantity of spent solvents recovered by Kodak from external sources.
• Safety: Achieve 25 percent reduction in occupational injury rate.
• Diversity & Inclusion: Maintain 100 percent Human Rights Campaign Foundation (HRC) Index score and continue to be included on the organization’s list of “Best Places to Work for LGBT Equality” each year.
• Community Outreach: Double the number of hours Kodak employees support local communities through philanthropy and volunteerism. Maintain employee community service engagement in 100 percent of communities in which Kodak operates worldwide.

“At Kodak, we continue to leverage our deep domain expertise in scientific innovation to provide the most advanced and environmentally-friendly technologies to reach our goals,” said Kodak CEO Jeff Clarke, in a statement. “I’m excited about the programs we have in place and am looking forward to what the growing adoption of our sustainable technologies will mean for the future as we look to move the needle on better environmental practices.”

The report notes that in 2016 water use at Kodak facilities decreased from 4.8 million cubic meters to 4.4 million, while energy usage decreased from 4,141 terajoules to 4,105 terajoules. Hazardous waste at Kodak facilities declined to 13,597 metric tons last year from 16,591 metric tons in 2015.

The imaging technology company has some 6,573 employees globally, including roughly 1,750 in the Rochester area. Once the region’s largest employer, the company now ranks third among manufacturers in the Greater Rochester area.

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