Kodak officials say the latest earnings report shows the company is making progress. But as it released the fourth quarter and full year numbers on Tuesday Kodak also announced it is selling one of its businesses.
The company did show a net profit of $24 million in the fourth quarter, compared to a loss a year ago. Revenues of $467 million for the quarter were down 12 percent compared to last year, partly due to currency fluctuations and also because of the expected decline in its older consumer inkjet business.
Kodak has been focusing on commercial packaging and printing since it emerged from bankruptcy two and a half years ago, and now it says it will sell the commercial Enterprise inkjet business, called PROSPER.
CEO Jeff Clarke says that business has a lot of potential, but it would be best served by a company with a larger sales and distribution network.
“The PROSPER business has significant potential for accelerated growth. To achieve its full economic potential Prosper will be best leveraged by a company with significantly larger sales and distribution footprint in their digital printing markets,” Clarke told analysts and investors in a conference call.
At Brighton Securities, Chairman George Conboy says selling that business will impact Kodak's sales picture.
“It will hurt revenues and it won’t do much for profits because if someone else is going to be out there manufacturing, selling, what are you going to get? Royalties perhaps, but you won’t be making as much as if you made a product and successfully sold it.”
Kodak says it is in talks with prospective buyers for the PROSPER inkjet business.
For 2015 overall, Kodak saw a net loss of $80 million, down from a loss of $123 million a year before. Clarke says he's pleased with the performance of the company last year, saying that it delivered strong operating performance and delivered greater than the targets for cost savings and improved the quality of the company's earnings."
The CEO of the Greater Rochester Chamber of Commerce Bob Duffy released this statement about the earnings report:
"I spoke with Kodak CEO Jeff Clarke and support his decisions and love his optimism for the future of Kodak. I share that same optimism for our hometown company. Rochester Chamber applauds Jeff and his Kodak team on their work to stay ahead of the evolving technology and markets expected to strengthen the company moving forward. It is also important to note Kodak's commitment to attracting companies to and growing Eastman Business Park, identified by the Finger Lakes Regional Economic Development Council as our region's number one priority project. We also expect Eastman Business Park to play an important role as a hub for AIM Photonics investments. As a Greater Rochester Chamber of Commerce Partner member, Kodak has our unequivocal support"
