Kodak Losses Reported – Twice as Bad as Expected
Industry analysts who predicted recent losses for photography and printer brand Kodak were unpleasantly surprised when their predictions were proved wrong, but by massive losses by the company in the third business quarter.
Kodak reported a loss of $222 million, or 83 cents a share, twice the amount that several analysts predicted before the losses were reported. The increase in losses by Kodak has been massive, as last year’s third quarter saw the company lose just $43 million.
Additional losses have been put down to several factors, one of which was a 25% drop in Kodak share prices earlier in the year after the company took out a £103 million loan and hired Jones Day, a law firm concerned with bankruptcy protection cases, causing Kodak to deny bankruptcy speculation following the discovery.
Kodak Chief Executive Antonio M. Perez pointed out several contrary factors in the company, such as a 44% increase in sale of digital printers and ink and an 89% jump in packaging product sales. This increase has been attributed to Kodak’s recent concentration on selling digital printers, funded by the camera firm’s sale of many photography patents.
The company’s entire cash trove valued at $862 million in cash at the end of the third quarter of 2011, down from $957 million the second quarter. Industry experts are worried, primarily due to the fact that Kodak may not be able to keep afloat if it’s available spending money is gone by the end of the year.
A decline in film and digital camera sales has also seen company revenue fall 17% to $1.46billion. Kodak analysts previously forecast an annual loss of $200-$400 million,but are currently expected to instead post increased 2011 loss figures of between $400-$600 million.