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Kodak Broadens Layoff Plans

7/20/2005 09:02:00 AM Eastern

Rochester, N.Y. — Citing “faster-than-expected” decline in its film business, Kodak announced that it would broaden its projected layoffs, raising the previously announced target from 15,000 to 22,500-25,000 positions as it declared a $146 million second quarter net loss.

Concurrent with the layoffs, Kodak plans to reduce its traditional manufacturing infrastructure by $1.8 billion. Both activities are expected to “largely completed” by the middle of 2008 and “will result in a business model consistent with what is necessary to compete profitably in digital markets,” the company said.

Kodak expects to shed 7,000 positions in its manufacturing wing and 2,300 positions in general business administration. To date, the company has cut over 13,000 employees since it announced its restructuring.

While the company’s film business collapsed, digital sales surged with second quarter sales coming in 43 percent above the same period a year ago.

Total company sales totaled $3.686 billion, up six percent from the second quarter of 2004.

The company’s digital and film imaging segment, which includes its consumer film and digital camera products, totaled $2.151 billion in sales, down 12 percent.

While the division was brought low by declining traditional products, its digital sales racked up large gains, including a 63 percent increase in sales of its printer docks and related media for home printing, a 25 percent increase in consumer digital camera sales, and a 24 percent increase in the sales of Picture Maker kiosks and related media.