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Kodak Has Lower Q3 Sales, Reduced Loss

10/31/2006 11:38:00 AM Eastern

Rochester, N.Y. – Eastman Kodak reported a reduced net loss of $37 million and a sales decrease of 10 percent for the third quarter ended Sept. 30.

The net loss of $37 million was far lower than last year’s $914 million loss due to the inclusion of a valuation allowance against net deferred tax assets In the U.S. Earnings from continuing operations in the quarter were $2 million versus a lost of $123 million in the year-ago quarter.

Sales in the quarter were down 10 percent to $3.2 billion down from $3.6 billion in the year ago quarter due to a 19 percent decline in what Kodak called “traditional sales.”

Digital earnings across Kodak’s portfolio were $105 million, compared with $7 million in the year ago quarter, marking the first time that the company’s quarterly digital earnings growth exceeded the quarterly decline in traditional earnings. This performance was primarily due to improvements throughout the digital portfolio, Kodak said.

However Consumer Digital Group sales were $640 million, down 3 percent. Earnings from operations increased by $85 million from a loss of $61 million in last year’s third quarter for a profit of $24 million in the current quarter.

Film and Photofinishing System sales were $1.07 million down from $1.35 billion last year at the same time. Earnings went from $174 million in last year’s third quarter to $139 million for this year’s quarter.