The imaging giant says its revenue declined largely because of lower sales of traditional products, a planned reduction in digital camera sales, and the absence, compared to the year-ago period, of significant non-recurring patent licensing revenue.
Revenue from Kodak’s core digital growth businesses – consumer and commercial inkjet, workflow software & services, and packaging solutions – increased 13 per cent, fuelled by 44 per cent revenue growth in consumer inkjet printers and ink, and 89 per cent revenue growth in Packaging Solutions.
The revenue decline rate for the company’s Film, Photofinishing and Entertainment Group slowed to 10 per cent in the third quarter.
Kodak’s Graphic Communications Group third-quarter 2011 sales were US$665m, a 1 per cent increase over the prior-year period. The third-quarter loss from operations for the segment was US$55m, compared with a loss of US$35m in the year-ago quarter.
Antonio Perez, CEO of Kodak says the results primarily reflect start-up costs to support growth opportunities in commercial Inkjet, unfavourable price/mix for digital plates, and increased raw material costs.
He says, “More than anything, the results of this quarter reflect our continued progress toward establishing digital growth businesses that will form the nucleus of a new Kodak.
“In Consumer Inkjet, ink gross profit dollars doubled in the third quarter and year-to-date. Our installed base of printers is now sufficiently large that we expect to meet a key milestone in the fourth quarter – achieving positive gross profit for this business as a whole, driven by ink gross profit.”
Meanwhile, the Group’s packaging solutions sales increased 89 per cent in the quarter and more than 130 per cent year-to-date. In Commercial Inkjet, revenue for the entire PROSPER product line rose 40 per cent in the third quarter, and Kodak anticipates revenue recognition for PROSPER presses will accelerate in the fourth quarter.
The company adds however that it continued to incur higher-than-planned start-up costs for its PROSPER systems in the third quarter and associated delays in revenue recognition, while demand declined for legacy VERSAMARK inkjet presses.
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