March 24, 2014
Last week, Eastman Kodak released their 2013 financial results. After emerging from a 20-month Chapter 11 bankruptcy in September, Kodak largely looks like a new company with a new CEO, new ticker symbol, and a new business strategy. However, they still remain an unfinished project with the goal of profitability.
The printing technology company posted a loss for 2013, but a significantly smaller loss than in 2012. Sales came in at $2.35 billion and were $150 million short of what the company had forecast. Sales were down in large part due to the accelerated decline in the motion picture film business and because of poor desktop inkjet sales. Kodak isn't projecting any major turnaround for 2014 but they have expectations to put it close to profitability, but not completely in the black. A major component of getting closer to profitability will be continued cost cutting in 2014. At the end of 2013, Kodak employed 2,300 local individuals, down 34% from the previous year, a far cry from 1982 when they had 60,400 local employees.
Although Kodak has successfully emerged from bankruptcy and has taken small steps toward profitability, they still remain a work in progress. To quote the Chairman of our firm, George T. Conboy, in a recent article from the Democrat and Chronicle: "They are out of bankruptcy, but they aren't out of the woods. You need to see a company that can consistently raise its revenues and make profits. We have not seen that yet. We'd like to see it..."
Ethan Wade, Financial Advisor
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).