Kodak Reports Full-Year 2019 Financial Results
March 17, 2020
Eastman Kodak Company (NYSE: KODK) today reported financial results for the full year 2019, including revenues of $1.2 billion, continued growth in key product areas and net earnings of $116 million, including the gain on the sale of the Flexographic Packaging Division.
- Revenues for 2019 of $1.2 billion.
- GAAP net earnings of $116 million for the year ended December 31, 2019.
- Operational EBITDA for the year of $12 million.
- Key product lines achieved strong year-over-year growth for the full year 2019:
- Volume for KODAK SONORA Process Free Plates grew by 22 percent.
- Annuity revenues for the KODAK PROSPER inkjet platform grew by 5 percent.
- The company ended the year with a cash balance of $233 million, flat compared with year-end 2018.
- The company completed the sale of its Flexographic Packaging Division and repaid in full $395 million of its First Lien Term Loans.
“In many ways, 2019 was a transformative year for the creation of One Kodak,” said Jim Continenza, Kodak’s Executive Chairman. “We consolidated our divisional structure, strengthened our financial position and returned our focus to our core print and advanced materials and chemicals businesses. For 2020, we’ll continue to become more customer-centric, launch groundbreaking print products and, most important, focus on generating cash.”
For the year ended December 31, 2019, revenues decreased by approximately $78 million compared with the same period in 2018. Kodak ended the year with a cash balance of $233 million, flat when compared to the December 31, 2018 cash balance.
“We generated positive cash flow in the fourth quarter of 2019 and had breakeven cash flow for the full year 2019,” said David Bullwinkle, Kodak’s CFO. “We also delivered strong performance in our key growth areas of SONORA Process Free Plates and PROSPER inkjet annuities in 2019. Looking forward, we will continue to execute on opportunities to operate more efficiently and grow profitable revenue to achieve our goal of generating cash on a consistent basis.”
Effective January 2020, Kodak changed its organizational structure. Prepress Solutions, formerly part of the Print Systems segment, will operate as a separate segment named the Traditional Printing segment. Electrophotographic Printing Solutions, formerly part of the Print Systems segment, will be combined with the Enterprise Inkjet Systems segment and Kodak Software segment to form the Digital Print segment. The Brand, Imaging and Film segment, except for the licensing of the Kodak brand to third parties, will be combined with the Advanced Materials and 3D Printing segment to form the Advanced Materials and Chemicals segment. The licensing of the Kodak brand to third parties will operate as a separate segment named the Brand segment. The Eastman Business Park segment will no longer be a reportable segment.
Revenue and Operational EBITDA FY 2019 vs. FY 2018
|FY 2019 Actuals||PSD||EISD||KSD||BFID||AM3D||EBPD||Total EK|
|Revenue||$ 836||$ 128||$ 56||$ 209||$ 3||$ 10||$ 1,242|
|Operational EBITDA *||$ 41||$ (5)||$ 2||$ (13)||$ (12)||$ (1)||$ 12|
|FY 2018 Actuals||PSD||EISD||KSD||BFID||AM3D||EBPD||Total EK|
|Revenue||$ 896||$ 136||$ 65||$ 210||$ 4||$ 9||$ 1,320|
|Operational EBITDA *||$ 28||$ 4||$ 7||$ (22)||$ (12)||$ (4)||$ 1|
|FY 2019 vs. FY 2018 Actuals
|Revenue||$ (60)||$ (8)||$ (9)||$ (1)||$ (1)||$ 1||$ (78)|
|Operational EBITDA *||$ 13||$ (9)||$ (5)||$ 9||$ -||$ 3||$ 11|
|FY 2019 Actuals on constant currency ** vs. FY 2018 Actuals
|Revenue||$ (39)||$ (6)||$ (8)||$ 2||$ (1)||$ 1||$ (51)|
|Operational EBITDA *||$ 10||$ (9)||$ (5)||$ 10||$ -||$ 3||$ 9|
* Total Operational EBITDA is a non-GAAP financial measure. The reconciliation between GAAP and non-GAAP measures is provided in Appendix A of this press release.
** The impact of foreign exchange represents the 2019 foreign exchange impact using average foreign exchange rates for the twelve months ended December 31, 2018, rather than the actual exchange rates in effect for the twelve months ended December 31, 2019.
Kodak is a global technology company focused on print and advanced materials & chemicals. We provide industry-leading hardware, software, consumables and services primarily to customers in commercial print, packaging, publishing, manufacturing and entertainment. We are committed to environmental stewardship and ongoing leadership in developing sustainable solutions. Our broad portfolio of superior products, responsive support and world-class R&D make Kodak solutions a smart investment for customers looking to improve their profitability and drive growth. For additional information on Kodak, visit us at kodak.com, follow us on Twitter @Kodak, or like us on Facebook at Kodak.
Cautionary Statement Regarding Forward-Looking Statements
This press release includes “forward-looking statements” as that term is defined under the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning Kodak’s plans, objectives, goals, strategies, future events, future revenue or performance, capital expenditures, liquidity, investments, financing needs and business trends and other information that is not historical information. When used in this press release, the words “estimates,” “expects,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “predicts,” “forecasts,” “strategy,” “continues,” “goals,” “targets” or future or conditional verbs, such as “will,” “should,” “could,” or “may,” and similar expressions, as well as statements that do not relate strictly to historical or current facts, are intended to identify forward-looking statements. All forward-looking statements, including management’s examination of historical operating trends and data, are based upon Kodak’s expectations and various assumptions.
Future events or results may differ from those anticipated or expressed in the forward-looking statements. Important factors that could cause actual events or results to differ materially from the forward-looking statements include, among others, the risks and uncertainties described in more detail in Kodak’s Annual Report on Form 10-K for the year ended December 31, 2019 under the headings “Business,” “Risk Factors,” “Legal Proceedings” and/or “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” and in other filings Kodak makes with the U.S. Securities and Exchange Commission from time to time, as well as the following: Kodak’s ability to improve and sustain its operating structure, cash flow, profitability and other financial results; Kodak’s ability to achieve cash forecasts, financial projections and projected growth; Kodak’s ability to achieve the financial and operational results contained in its business plans; Kodak’s ability to comply with the covenants in its various credit facilities; Kodak’s ability to fund continued investments, capital needs and restructuring payments and service its debt and Series A Preferred Stock; changes in foreign currency exchange rates, commodity prices and interest rates; Kodak’s ability to effectively anticipate technology trends and develop and market new products, solutions and technologies; Kodak’s ability to effectively compete with large, well-financed industry participants; continued sufficient availability of borrowings and letters of credit under Kodak’s revolving credit facility, Kodak’s ability to obtain additional financing if and as needed and Kodak’s ability to provide or facilitate financing for its customers; the performance by third parties of their obligations to supply products, components or services to Kodak; Kodak’s ability to effect strategic transactions, such as divestitures, acquisitions, strategic alliances and similar transactions, or to achieve the benefits sought to be achieved from such strategic transactions; and the impact on Kodak of the global economic environment or medical epidemics such as the recent coronavirus outbreak.
There may be other factors that may cause Kodak’s actual results to differ materially from the forward-looking statements. All forward-looking statements attributable to Kodak or persons acting on its behalf apply only as of the date of this press release and are expressly qualified in their entirety by the cautionary statements included or referenced in this press release. Kodak undertakes no obligation to update or revise forward-looking statements to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events, except as required by law.
Worldwide Communications Director