Kodak reports lower third-quarter net earnings
Eastman Kodak Co. reported financial results for the third quarter 2022, including consolidated revenues of $289 million, essentially level with last year, but GAAP net income declined to $2 million, compared with $8 million for Q3 2021.
“For the third quarter of 2022, Kodak delivered year-over-year revenue growth for the sixth consecutive quarter. I’d like to thank our loyal customers and our employees for helping us deliver these results,” said Jim Continenza, Kodak’s Executive Chairman and CEO. “This continuing growth reflects our management team’s experience with difficult business environments and our commitment to finding ways of putting our customers first despite ongoing inflationary and supply chain challenges. We continue to invest in digital print technologies such as the KODAK PROSPER ULTRA 520 Press, which offers offset print quality and can help printers mitigate the supply and cost risks of traditional printing plates and eliminate the significant carbon footprint associated with manufacturing and distributing them. In addition, we continue to make significant investments in our Advanced Materials & Chemicals business, such as our minority stake in Wildcat Discovery Technologies, Inc., a private technology company that is developing a breakthrough EV and energy storage ‘super cell’ battery technology. Looking forward, we’ll continue to make strategic decisions focused on driving smart revenue for Kodak.”
On June 15, 2022, Kodak exercised its right to draw an additional $50 million of aggregate principal in the form of delayed draw term loans under the Term Loan Credit Agreement. On July 13, 2022, Kodak invested $25 million received from the loans to acquire a minority stake in Wildcat Discovery Technologies, a company developing EV technology.
Kodak ended the third quarter with a cash balance of $216 million, a net decrease of $146 million from Dec. 31, 2021. The decrease is primarily attributable to increases in working capital, the impact of higher costs, increased capital investment, and the investment in Wildcat Discovery Technologies, partially offset by proceeds received under the Term Loan Credit Agreement.
“In the third quarter, the company’s primary uses of cash were investments in our previously-announced growth initiatives and increasing working capital to support our existing operations,” said David Bullwinkle, Kodak’s CFO. “Our profitability during the quarter was negatively impacted by the challenging business environment, including factors such as increasing labor and materials costs and the impact of foreign exchange.”
Revenue and Operational EBITDA by Reportable Segment Q3 2022 vs. Q3 2021
| ($ millions) | |||||||||||||||||
| Q3 2022 Actuals | Traditional Printing | Digital Printing | Advanced Materials & Chemicals | Brand | Total | ||||||||||||
| Revenue | $ | 169 | $ | 55 | $ | 58 | $ | 3 | $ | 285 | |||||||
| Operational EBITDA | $ | 7 | $ | (6 | ) | $ | 3 | $ | 3 | $ | 7 | ||||||
| Q3 2021 Actuals | Traditional Printing | Digital Printing | Advanced Materials & Chemicals | Brand | Total | ||||||||||||
| Revenue | $ | 166 | $ | 58 | $ | 55 | $ | 4 | $ | 283 | |||||||
| Operational EBITDA | $ | 5 | $ | (2 | ) | $ | – | $ | 3 | $ | 6 | ||||||
| Q3 2022 vs. Q3 2021 Actuals B/(W) |
Traditional Printing | Digital Printing | Advanced Materials & Chemicals | Brand | Total | ||||||||||||
| Revenue | $ | 3 | $ | (3 | ) | $ | 3 | $ | (1 | ) | $ | 2 | |||||
| Operational EBITDA | $ | 2 | $ | (4 | ) | $ | 3 | $ | – | $ | 1 | ||||||
| Q3 2022 Actuals on constant currency vs. Q3 2021 Actuals B/(W) |
Traditional Printing | Digital Printing | Advanced Materials & Chemicals | Brand | Total | ||||||||||||
| Revenue | $ | 19 | $ | 2 | $ | 4 | $ | (1 | ) | $ | 24 | ||||||
| Operational EBITDA | $ | 4 | $ | (1 | ) | $ | 4 | $ | – | $ | 7 | ||||||