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Kodak Reports 31% Q1 Revenue Drop

Rochester, N.Y. –

Eastman Kodak

reported Thursday a first-quarter loss on a 31 percent revenue drop as
declining film sales out stripped increases in its digital businesses.

In addition to slowing sales, the company said a 14 percent
decline from the film business in the period was impacted by rising materials
costs, especially the skyrocketing price of silver, which is a key component in
film manufacturing.

In total, the company showed a first-quarter loss of $249
million, compared with a $119 profit a year ago.

Kodak said the Consumer Digital Imaging Group saw first-quarter
sales of $330 million, compared with $884 million in the period a year ago.

The company’s consumer inkjet printer business rose by more than
50 percent in the period.

A first-quarter loss from operations for the segment was $168
million, compared to earnings of $401 million in the prior-year quarter. This
decline in revenue and earnings was primarily due to the $550 million
non-recurring intellectual property transaction in the first quarter of 2010,
the company said.

Revenue dropped 31 percent to $1.3 billion. Excluding the intellectual
property transaction, revenue fell 3 percent as the digital business showed a 2
percent revenue increase from the same period last year, Kodak said.

Kodak Chief Executive Antonio Perez said with the digital
increases and other positive factors he continues to expect a return to
sustainable profitability by 2012.