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On Heels of $75 Million Loss, Kodak Seeking to Sell PROSPER Enterprise Inkjet Business

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Eastman Kodak reported results for its fourth-quarter 2015, as well as full-year 2015, with a net loss of $75 million for full-year 2015, compared to a net loss of $118 million for full-year 2014, an improvement of $43 million. However, reported a profit for its fourth quarter of 2015, with net income of $24 million for the fourth quarter, compared with a net loss of $42 million for fourth-quarter 2014.

Revenue for full-year 2015 was $1.8 billion, compared to revenue of $2.1 billion for full-year 2014.

Kodak says these product lines achieved strong growth in full-year 2015:

  • Volume for KODAK SONORA Process Free Plates grew by 50 percent.
  • Volume for KODAK FLEXCEL NX Plates grew by 26 percent.
  • Revenues for the Software and Solutions Division increased by 12 percent on a constant currency basis, or 4 percent on a reported basis.

Operating expenses were $330 million for Kodak’s fiscal year that on December 31, 2015, a 24-percent improvement from the prior-year period. Kodak ended the year with a cash balance of $547 million.

2016 Guidance

For full-year 2016, Kodak is forecasting revenue of $1.5 billion to $1.7 billion

Fourth-Quarter 2015

Revenue for fourth quarter of 2015 was $467 million, a 12-percent decline versus fourth-quarter 2014. Kodak says the revenue decline was primarily due to “the expected continued decline in legacy consumer-inkjet printer cartridge sales,” non-recurring licensing revenue in the prior-year period, as well as pricing reductions in digital plates within Kodak’s Print Systems Division.

“We are executing well within the new divisional structure, and making the progress necessary in our key businesses to drive future growth,” commented John McMullen, Kodak Chief Financial Officer. “We are also exceeding our aggressive cost goals to ensure we have the structure and capacity we need to invest in growth and to return the company to sustained profitability.”

Performance by division is as follows:

The Print Systems Division

The Print Systems Division (PSD), Kodak’s largest division, had revenues of $292 million in fourth-quarter 2015, an 11-percent decline compared to fourth-quarter 2014. Operational EBITDA (earnings before interest, taxes, depreciation and amortization) for the quarter was $37 million, 23-percent better than the same period a year ago. PSD had full-year 2015 revenues of $1.106 billion, a 12-percent decline compared to full-year 2014. Full-year Operational EBITDA was $98 million, 5-percent better than the same period a year ago.

On a constant-currency basis, PSD revenues declined 4 percent, while Operational EBITDA improved by 15 percent. Kodak says the decline in year-over-year revenues was due primarily to foreign-exchange currency effects, “global economic volatility” (particularly in Brazil, Japan, and China), and competitive pricing pressures.

Highlights for the division include the successful transition of SONORA plate manufacturing from the United Kingdom to the Americas, the release of two new products, KODAK ELECTRA MAX Thermal Plates and KODAK LIBRA VP Digital Plates, and the increase in KODAK NEXPRESS Digital Color Production Press placements by approximately 16 percent, from 67 to 78 units.