12 May 2019 Business

Kodak prepares for post flexo phase

The sale of the flexible packaging division paves the way for the new CEO to mark his mark on a new Kodak.

Kodak, under new CEO Jim Continenza, is reshaping to take what he calls a “one Kodak approach to the industry”. And that focus will be on advanced and applied materials, the coatings that go on plates, films and which can be applied through inkjet heads.

He also promised a shake up in the divisional structure in a call with analysts on the publication of the company’s Q1 results, the first since the sale of the flexo packaging division for $312 million to a private equity funded company, Miraclon.

The money was not enough to repay the whole of the debt that is due to be repaid by September this year. It has, however, knocked a large hole in it and Kodak is confident of refinancing the remaining $70 million by the end of this month. After that there will be a focus on generating cash and changes to the company’s reporting structure. This suggests a shake up to the current management team and their responsibilities.

In the first quarter the printing systems division continues to dominate. It delivered revenues of $192 million from the $291 million overall. And while the division delivered a $5 million Ebitda profit, losses elsewhere meant and overall Ebitda loss of $6 million. This was an improvement on the $9 million loss from Q1 last year.

Printing plates come within the PSD segment. Here sales of the Sonora products rose 22% compared to 2018. Part of the reason has been the launch of the Sonora X, a more robust process-free plate extends the scope of the technology into longer runs and UV printing.

Annuity revenues from Prosper rose 12% helping the division maintain overall revenues and avert a loss. The Kodak Software Division, comprising the Prinergy family return a $1 million loss on sales of $14 million. Brand Film and Imaging was the division with the largest loss, $7 million min sales of $49 million. There would have been $6 million loss from the flexo packaging division, reported as discontinued operation, in the figures.

By Gareth Ward

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Sonora plate

Sonora plate

Growing sales of the Sonora plate and an increase in ink and replacement heads for Prosper point to the future for Kodak as it tidies its books with the sale of the flexible packaging division.

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