Kodak out of bankruptcy as reimaging is complete
By The Associated Press
Published: Wednesday, Sept. 4, 2013, 12:01 a.m.
ROCHESTER, N.Y. — Kodak emerged from bankruptcy protection on Tuesday, vastly different from the company of old.
Gone are the cameras and film that made it famous. The company hopes to replace them with new technologies such as touch screens for smartphones and smart packaging embedded with sensors.
“Look for a case of a company that had to go through this kind of excruciating restructuring and kept innovating,” CEO Antonio Perez said. “It just doesn't happen, but we've done it.”
Kodak said its old stock is canceled as of Tuesday. Creditors are getting stock in the restructured company.
Eastman Kodak Co., credited with popularizing photography at the start of the 20th century, started to struggle toward the end of the century, first with Japanese competition and later when it failed to react quickly enough to the shift from film to digital photography.
Perez was appointed CEO in 2005. Under his leadership, the company had restructured its money-losing film business by 2007. The company closed 13 factories, shuttered 130 film-processing labs and eliminated 50,000 workers around the world at a cost of about $3.4 billion.
Kodak expected demand for film to decline, but gradually. The company anticipated that new demand from emerging markets such as China would offset some of the decline in the United States. But Perez said Chinese consumers opted for smartphones instead of cameras, and demand for film plummeted.
Meanwhile, the economic collapse of 2008 and the resulting plunge in interest rates left some of the company's pension obligations underfunded. It was those obligations, along with other legacy costs, that Perez said eventually resulted in the January 2012 bankruptcy filing.
Revenue dropped from about $13.3 billion in 2003 to $6 billion in 2011.
Under court oversight, Kodak continued to shed costs in the form of businesses, facilities and workers. It shut down its consumer camera business and sold off an online photo service. It spun off its personal and document imaging businesses to its pension plan and sold off many of its patents. It took its name off the theater that hosts the Academy Awards each year.
The company will emerge with about 8,500 employees, just a fraction of the 145,000 it had at its peak in the 1980s. Revenue is expected to total $2.7 billion this year.
Perez said that by slimming down, Kodak is able to focus research and development on businesses the company sees as more profitable. The restructured company's operations are split between a trio of businesses: packaging, graphic communications and functional printing.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Real estate goes techno
- Harsh winter sets back Western Pa. maple harvest
- CVS suit could be test case
- Minorities crucial to filling Marcellus shale gas drilling jobs
- Prepaid cards start to elbow aside bank accounts
- Diaper makers do due diligence
- Samsung introduces free streaming radio service
- ‘Boomerang’ buyers get another chance at homeownership
- JPMorgan whistle-blower gets $64M for mortgage fraud tips
- Lawrenceville firm Songwhale benefits from growth in e-commerce
- Obamacare enrollment has ‘lot of ground to cover’