Going… consumer printers such as this.
Kodak has asked for an extension in the time available to file its reorganisation plan to the US Chapter 11 court.
It wants to extend this until 28 February 2013. It has also announced that it will wind down sales of its consumer inkjet printers and will in future concentrate on selling ink to its existing installed base.
In its submission, Kodak described the ‘substantial progress’ it has made toward reorganisation goals since filing for Chapter 11 on 19 January 2012. The case is large and complex, it said, involving some $5 billion in assets, global operations, thousands of contracts and leases, thousands of potential creditors, and ongoing asset sales.
The restructuring includes the reduction of its global workforce by more than 2700 jobs so far in 2012, with the current expectation of a further reduction of at least 1200 employees (up by 200 from the 1000 previously announced).
At the end of August the company announced that it was putting its entire Personalized Imaging and Document Imaging operations up for sale, marking an intention to get out of consumer photography and business scanners altogether. Together these divisions have been responsible for about 40% of turnover in recent financial results.
Selling off… those famous yellow film boxes.
Once completed, these moves will see Kodak as essentially a supplier of hardware, software and consumables for professional industrial printing plus the professional movie film business. The print related product lines include its offset plates and related platesetters, NexPress and Digimaster sheet fed toner presses, Versamark and Prosper inkjet web presses and imprinting heads, plus consumables, workflow and related software to support these.
Keeping: digital presses and offset pre-press systems.
The company said it will target commercial, packaging and functional printing solutions and enterprise services. Functional printing appears to be a so far unannounced move into printed electronics and similar industrial applications. Enterprise solutions involve its campaign management and high end document software.
Keeping… professional motion picture films.
The professional movie business remains a major user of film, despite the encroachment of digital systems.
The company’s move into consumer multi-function printers was originally intended to turn the sector’s usual sales model on its head. Instead of selling home and small office printers at artificially low costs but charging a lot for ink, Kodak sold its printers with a higher purchase cost but much lower ongoing ink costs than the competition. Although the company says it will carry on with ink sales, this will likely be a declining revenue stream over the next few years. Despite the company’s claim that stopping printer sales will help its cash flow, this seems to be a short term benefit: desktop inkjets aren’t noted for long lifetimes. So once it can’t sell replacement printers to consumers, they’ll have to take their business, and ink purchases, elsewhere.
Keeping… inks for the printers it won’t sell any more.
‘Kodak is making good progress toward emergence from Chapter 11, taking significant actions to reorganise our core ongoing businesses, reduce costs, sell assets, and streamline our organisational structure,’ said Antonio M Perez, Kodak chairman and chief executive officer. ‘Steps such as the sale of Personalized Imaging and Document Imaging, and the Consumer Inkjet decision, will substantially advance the transformation of our business to focus on commercial, packaging and functional printing solutions and enterprise services. As we complete the other key objectives of our restructuring in the weeks ahead, we will be well positioned to emerge successfully in 2013.’
Contact: www.kodak.com
