Kodak Reports Q2 Net Earnings of $4 Million, Continued Growth in Key Products

Eastman Kodak Company reported financial results for the second quarter 2018, delivering net earnings of $4 million on revenues of $372 million and continued growth in its Kodak SONORA Process-Free Plates, Kodak FLEXCEL NX Packaging and Kodak PROSPER Inkjet businesses.
 
Revenues for the quarter ending June 30, 2018 were $372 million, a decline of $9 million compared with the second quarter of 2017. The company reported second-quarter GAAP net earnings of $4 million and operational EBITDA of $9 million, down $3 million compared with the second quarter of 2017. The decrease was primarily driven by the $7 million year-over-year adverse impact of the cost of aluminum, which was partially offset by growth in key products as well as cost reductions in Kodak’s Advanced Materials and 3D Printing Technology Division.
 
“We continue to see growth in our SONORA plates, FLEXCEL NX and PROSPER annuities businesses. When adjusted for aluminum and foreign exchange, operational EBITDA increased thirty three percent year over year,” said Jeff Clarke, Kodak CEO. “For the second half of 2018 our priorities will be focused on the sale process for the Flexographic Packaging Division, improving efficiency of our operations through the announced restructuring actions and continuing to deliver growth in strategic areas.”
 
The company reiterated 2018 guidance for revenues of $1.5 billion to $1.6 billion and revised guidance for Operational EBITDA to $55 million to $60 million to reflect increased aluminum supplier costs and timing of commercialization of new products.
 
Kodak ended the quarter with a cash balance of $275 million, down $38 million from the March 31, 2018 cash balance of $313 million. The company expects a cash balance of $300 million to $310 million at year-end 2018. The expects to generate cash in the second half of 2018.
 
“The company’s use of cash in Q2 primarily reflects the seasonal build of working capital. We expect to generate cash over the remainder of the year and to address the September 2019 maturity of the term loan,” said David Bullwinkle, Kodak CFO. “To strengthen our liquidity, we have initiated actions to reduce operating costs, including driving greater efficiencies in investment spending and operations of our mature businesses.”