Eastman Kodak Company (NYSE: KODK) today reported financial results for the second quarter, ended June 30, 2016, delivering a return to profitability based primarily on an increase in GAAP income from continuing operations.
- GAAP net income was $8 million for the quarter ended June 30, 2016, an improvement of $31 million over the same period a year ago. Income from continuing operations was $16 million for the quarter, a $31 million improvement over the prior year.
- The company ended the quarter with a cash balance of $513 million, equal to the cash balance at the end of the first quarter of 2016. In the same period a year ago, the cash balance declined by $33 million.
- Revenues for the second quarter were $397 million, compared with revenues of $434 million in the same period last year, a reduction of $37 million, or 9%.
- Operating expenses (SG&A and R&D expenses) on a GAAP basis were $60 million for the second quarter, a 14% reduction compared to the prior-year second quarter.
- Operational EBITDA for the second quarter of 2016 was $34 million, flat with the second quarter of 2015. On a constant currency basis, Operational EBITDA improved by $3 million year over year for the quarter.
- The company reiterated 2016 revenues guidance of $1.5 billion to $1.7 billion and Operational EBITDA guidance of $135 million to $150 million.
- During the quarter, the company had a major presence at the drupa print industry trade show, introducing more than 20 new products and technologies and exceeding sales targets.
- The company remains committed to completing the sale of the KODAK PROSPER business, which is presented within discontinued operations. Kodak continues to make significant investments in the business, which grew its year-over-year annuity revenue by 35% in the second quarter.
“I’m pleased with Kodak’s return to profitability and the continued improvement of our quality of earnings,” said Jeff Clarke, Kodak Chief Executive Officer. “While overall revenues declined, the company showed growth in our SONORA Plates, FLEXCEL NX Systems and motion picture film businesses.”
Revenues in the second quarter of 2016 were $397 million, a 9% decline from the second quarter of 2015. The decrease was primarily driven by year-over-year price declines and lower equipment sales in the Print Systems Division, as well as the expected continuing decline in legacy consumer inkjet printer cartridge sales.
Net income improved by $31 million year over year to $8 million for the quarter ended June 30, 2016. Operational EBITDA increased 29% year over year on a constant currency basis, excluding the expected decline in the consumer inkjet business’ Operational EBITDA before corporate costs. This was primarily due to productivity and cost improvements from core businesses.
The company’s cash balance was unchanged at the end of the quarter, compared with a decrease in cash of $33 million in the same period a year ago. For the six-month period ended June 30, 2016, cash used in operations improved by $74 million compared with the prior-year period.