31 October 2006 — Rochester (NY): Eastman Kodak has recorded a year-on-year earnings increase of $877 million for the third quarter of 2006, from sales of $3.2billion.
In a statement, the company said the sharp rise was largely as the result of the recording of a tax valuation charge in the year-ago quarter of $778 million.
The company also reported a $98 million increase in digital earnings, driven by wider gross profit margins, from strong earnings performance in the Graphic Communications and Consumer Digital businesses, and the result of the company’s global cost-reduction initiatives.
Based on its third-quarter 2006 performance, the company maintains it is confident of achieving its 2006 cash and digital earnings goals, and expects digital revenue growth somewhat below its 10 percent target, as a result of the company’s focus on margin expansion.
This corresponds to a total revenue decline of approximately 6 percent.
"Our business transformation is on track," said Antonio M Perez, chairman and CEO of Eastman Kodak. "I am encouraged by our third-quarter results, especially because they reinforce our confidence in our full-year performance, which is the basis on which I manage the company.
" While I am fully aware of the challenges to largely complete our restructuring by the end of next year, this performance represents clear progress toward our goals and gives us good momentum to carry into the fourth quarter and 2007."
The company’s Graphic Communications Group sales were $880 million, compared with $886 million in the year-ago quarter. Strong digital revenue growth from digital plates, commercial inkjet, NexPress colour and document scanners during the quarter was offset by expected declines in the traditional product portfolio.