$82 million balance sheet turnaround for Kodak US
Kodak continues its long walk from bankruptcy with its quarterly loss, before restructuring and other costs, contracting to US-$53 million from the previous year’s loss of -$135 million for the same period – an $82 million shift back towards the black, but with an overall net loss of US-$299 million, the company still has a long way to go to reach profitability.
The reduction in the loss figure of the company’s 2012 second-quarter result represents a shift of $82 million in the right direction for the company, which has been undergoing aggressive and significant structural changes since it filed for bankruptcy in the US in January this year.
However, on the basis of US generally accepted accounting principles (GAAP), the standard framework of guidelines for financial accounting in the US, Kodak reported a net loss of US-$299 million for the second quarter, far outstripping its loss of US-$179 million for last year’s quarter.
Before its reorganisation costs, however, the company saw a second quarter loss of US-$139 million, which equates to US$40 million improvement on the previous year. The company’s reorganisation costs came to US$160 million for the second quarter.
Since the company filed for bankruptcy it has worked towards increasing its stakes in the global commercial print sector, while distancing itself from its origins as an imaging technology company. Over the past few months, the company has moved towards selling off around 1,100 imaging patents in its Digital Capture and Kodak Imaging Systems and Services technology portfolios.
The company attributes much of its financial growth for the second quarter to reduced operating expenses in the period compared to the previous year. Kodak has reported a cash balance at the end of the quarter of around US$1.257 billion, however it also reported a total revenue drop of 27 per cent from the previous year to US$1.077 billion for the quarter.
“I am pleased with our progress, and our operating results are both improved from last year and also ahead of our plan,” says Antonio M. Perez (pictured), Kodak chairman and CEO. “We are committed to sustaining the progress required to successfully emerge from Chapter 11 [bankruptcy].”
The company pointed to its exit from the digital camera market, its reduced sales of traditional products, and a negative impact of currency exchange as the prime culprits behind its 27 per cent slump in total revenue for the quarter when compared to last year.
“The improvement in the operating performance of our businesses reflects the dedication of our people to serving customers and in turn, the positive response we are seeing from our customers,” says Perez. “Across our businesses, we continue to offer unique technologies and strong value propositions. We will continue improving our operating performance while balancing liquidity and growth. We are on the right path to complete our successful reorganization.”