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Eastman Kodak (EKDKQ.PK) will stop selling consumer inkjet printers in 2013 as part of its...

Eastman Kodak (EKDKQ.PK) will stop selling consumer inkjet printers in 2013 as part of its efforts to focus on commercial solutions. Kodak's move comes shortly after Lexmark announced plans to abandon the inkjet market, which has been hit hard by the adoption of online/mobile photo viewing. H-P (HPQ), whose printing division is posting revenue declines, stands to benefit from Kodak and Lexmark's moves. Separately, Kodak is asking a bankruptcy court to give it until Feb. 28 to file a restructuring plan.
Comments (16)
  • superlooper
    , contributor
    Comments (63) | Send Message
     
    The cards have been dealt...one more major consolidation is due in the commercial printing & packaging field....EK: division of Agfa? or FujiFilm?
    28 Sep 2012, 12:57 PM Reply Like
  • Seeker959
    , contributor
    Comments (69) | Send Message
     
    I'd add EFI to that list superlooper.
    28 Sep 2012, 01:03 PM Reply Like
  • csparksrmc
    , contributor
    Comments (23) | Send Message
     
    No film, no printers, no decent offer for patents.........how is Kodak going to make its comeback?
    28 Sep 2012, 01:41 PM Reply Like
  • berbno1
    , contributor
    Comments (1203) | Send Message
     
    I took my $.18 and going out with my wife for a nice dinner. Hope Perez chokes on his...
    28 Sep 2012, 01:49 PM Reply Like
  • Seeker959
    , contributor
    Comments (69) | Send Message
     
    It's a better chance he'll choke as he got a lot more than $0.18, he's made off with millions and will probably get his reorg extension so he can continue to draw a salary until every borrowed dime has been taken out!
    28 Sep 2012, 02:27 PM Reply Like
  • HIS MONEY
    , contributor
    Comments (67) | Send Message
     
    According to the most recent MOR, Kodak's "Liabilities subject to compromise" remain greater than 60 % of total liabilities at just over 3 BIL. Should Kodak successfully "compromise" with retirees, total liabilities should be greatly reduced. Kodak has yet to even cancel healthcare benefits for medicare eligible retirees. The MOR also indicates that Kodak presently has over 1 BIL in cash worldwide.

     

    Also according to WSJ article published yesterday, Kodak is:

     

    1) Presently working with potential financing partners to help them emerge from bankruptcy,

     

    2) Considering outsourcing production of the Prosper Print Presses or creating a joint venture with companies in Asia.

     

    3) Exchanging drafts of a deal for the patents with a consortium of buyer.

     

    Additionally, there are pending sales for the PI and DI businesses, pending sales of 105,000 Kodak Kiosks, ongoing litigation in the Kodak v. ITC case concerning '218 patent validity, and pending summary judgement hearing in the Kodak v. Apple case concerning sale ability of additional (8) Apple contested patents, et al ongoing litigation such as Kodak v. FujiFilm. Kodak will also soon have a defacto monopoly on motion picture film as Fuji is allegedly discontinuing this business. Kodak also received approval from BK court earlier this month to proceed with signing new deals with major motion picture movie studios.

     

    The story is a long way from over.

     

    Disclosure: I am long EKDKQ. All of the above is in my opinion, and based on facts as I understand them. Investors are advised to complete their own due diligence
    29 Sep 2012, 08:31 PM Reply Like
  • onorato65
    , contributor
    Comments (4) | Send Message
     
    They are running out of time my man.
    1 Oct 2012, 10:21 AM Reply Like
  • Seeker959
    , contributor
    Comments (69) | Send Message
     
    His Money doesn't get the fact that even if Kodak survives, his stock will be worthless as any deal to the creditors "Subject to Compromise" will surely include the issuance of stock or warrants based on the fact that they will ultimately receive less than 100 cents on the dollar.

     

    I say the current share pool will represent about 5% of the new share pool so if Kodak winds up with +250 million then the existing shares net out 5 cents but that is a huge if. I'm betting the shares just get cancelled as Kodak is fire selling or abandoning almost all of it's businesses with exception to Packaging and commercial plateless printing, they are even downsizing commercial print. The new business should be able to pull in about $700 million a year in sales and the new company should be 3,000 people. The big question will be if they can ever make money on their products, as of the last 2 months the answer is no. So much for their highly prized innovation if they can't even get breakeven on the stuff they sell.

     

    BTW His Money, you also aren't accounting for the $100 million in burn they are experiencing right now, this will continue until the end of reorg unless history doesn't repeat and they magically start making money. 7 months until the end of reorg means $700 million at current rate, that'll leave them with Shareholders deficit of 2.1 billion with 3.1 billion of that "Subject to Compromise" Do you think any creditors will be happy to take 30 cents on the dollar, if so that leaves the share price of 0 or maybe the creditors will take 20 cents on the dollar so you can have a share worth $1.00 :) Creditors might have been idiots to have let kodak squander so much money before they cut kodak off but I can't see everyone willing to help kodak out going forward.
    2 Oct 2012, 12:25 PM Reply Like
  • HIS MONEY
    , contributor
    Comments (67) | Send Message
     
    We must also account for the 3,900 recent layoffs, 2,700 were completed prior to the end of SEP, while the remaining 1,200 began receiving pink slips yesterday. Kodak estimates these layoffs will yield about 340 MIL per year in cost savings.

     

    Some of the most recent layoffs have to do with Kodak's decision to exit the consumer inkjet business, which has been bleeding cash for years. This decision should also attenuate cash loss.

     

    Kodak has already demonstrated a 32% improvement when comparing Net Loss averages from Mar thru Jun to Net Loss averages in Jul and Aug. And the additional recent cost cuts should create an environment conducive for additional improvements.

     

    I personally feel that Kodak must complete at least 1 major asset sales prior to Ch. 11 emergence in order for existing common to survive. And, if Kodak is granted a POR exclusivity extension on Oct 17th, the likelihood of this happening is significantly increased.

     

    In a worst case scenario, existing common shareholders would still likely receive pro rata shares in the new common, and possibly warrants for additional new shares going forward. Again, this is a worst case scenario, but with a myriad of assets on the block, ongoing litigation with Apple, et al, ongoing negotiations with retirees, and additional liability cuts, in my opinion there are a number of scenarios in which existing common can be salvaged.

     

    All of the above is in my opinion, of course. Investors should complete their own due diligence.
    3 Oct 2012, 09:07 AM Reply Like
  • Seeker959
    , contributor
    Comments (69) | Send Message
     
    So His Money,

     

    Are you still holding this one? I hope not for your sake but I was always pretty sure Kodak wasn't gonna transition to a great company while keeping the shares in tact.

     

    What do you think will happen to the common?
    1 May 2013, 02:05 PM Reply Like
  • Seeker959
    , contributor
    Comments (69) | Send Message
     
    His Money,

     

    When you say the loss improvement is 32% are you accounting for the decline in sales of 28%, when I did the math I found that the improvement was only about 2 to 3%?

     

    I disagree with your worst case scenario, I know that worst case scenario is chpt 7 for kodak, wipe out the shares completely and creditors get pennies on the dollar, this probably won't happen but for shareholders in any company going through BK the worst case scenario is a total loss.

     

    His Money my single biggest issue at this point is still the last 2 months showing a loss on goods and services sold. If they don't fix this then they can downsize to 100 people and still lose money as something is still seriously wrong at Kodak. remember these losses are before all the restructuring and interest charges so even if they right size Kodak they'd still be losing money even if they cut selling and administrative expenses to 0 and we know that's not possible.

     

    You and I are different kinds of investors as I can't see the value at kodak or maybe I can but my calcs a year ago were something like 300 million in potential assets after debt repayment with an overall chance of survival of 5% thus the stock to me was worth $15 million or just over 5 cents a share. I won't bother going over the math I used but it was based on the selling of the patents at 1 billion and that didn't happen.

     

    So if I did the math now I'd look at the burn until March 13 and I'll even drop it to 500 million from sept - feb. that means they'd be at 1.9 billion in debt with 3.1 billion subject to compromise, even if the compromise is $0.50 on the dollar that leaves $300 million and assuming they are profitable in March 2013 and beyond then the value of the common would be $300 million or $1.10 a share but I think they have only a 10% chance of coming even close to this so I'd discount the shares by 90% to $0.11 as of now but when you start to factor in the lack of profit anywhere in the company as in not 1 division makes money anymore, not even professional services is showing profit so that to me is a big issue that will prevent them from exiting BK. That's why I'm not a buyer.

     

    Now if I knew I'd buy today and they'd announce the departure of Antonio Perez then the stock would probably double in the short term but I'm pretty sure Antonio has finished the company off.
    3 Oct 2012, 01:01 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (8158) | Send Message
     
    Are the common shareholders going to be wiped out?
    30 Apr 2013, 02:03 PM Reply Like
  • Seeker959
    , contributor
    Comments (69) | Send Message
     
    DeepValueLover,

     

    The common won't be wiped out completely as Kodak still needs buy-in from all the parties to emerge from BK, I'd think though that when I said in October that the shares had a value of $0.05 based on the probability of the shares surviving the BK process without serious dilution was about 5%, in this case I bet Kodak common will be diluted by 90% but I feel like it'll be closer to 95%, if the new company has revenue of $1.5 billion a year and a profit of best case say $100 million then the enterprise value may be $1 billion and if dilution was 95% then the current shares would be worth $50 million or $0.184 a share.

     

    Of course the issue with Kodak is that Commercial Printing is still losing money, 8 million in the last quarter but the division is growing, the Movie side of their business made $38 million but is shrinking and will eventually be losing money so if they don't fix that then they may be back in BK sooner rather than later.

     

    BTW look at my history, I have been negative on this stock for 2 1/2 years now and guys like "His Money" have been bullish on the stock, as of today my negative calls have been more accurate than the positive calls but if you own shares at today's $0.12 then I'd dump them even though my best case is $0.184 because I really think this is a dog and Antonio Perez may have been a bad choice for leading Kodak through this transition.
    1 May 2013, 02:03 PM Reply Like
  • Seeker959
    , contributor
    Comments (69) | Send Message
     
    DeepValueLover, it appears I was dead wrong on the common, it looks like they will be wiped out 100%.
    2 May 2013, 01:18 PM Reply Like
  • HIS MONEY
    , contributor
    Comments (67) | Send Message
     
    I concur with Seeker959. IMHO Kodak needed approx 1.0-1.5 BIL from the IP sale for current shareholders to thrive post BK. Kodak received about 1/2 that amount, or roughly 500 MIL, from the DI/KISS IP sale. Moreover, Kodak basically gave away the DI/PI divisions to satisfy the KPP (UK Pension) liabilities. The balance sheet was too just too deep in the RED IMHO. That said, it appears Kodak may trade on the NYSE once again; albeit via new equity. The recent deal with Unipixel may be a sign of good things to come for the new Kodak.
    1 May 2013, 04:08 PM Reply Like
  • Seeker959
    , contributor
    Comments (69) | Send Message
     
    His Money we agree!!!! I think Kodak will replace top management and the BOD and will continue in the commercial printing market, I think they may even totally fade away from the movie business. Maybe I'll buy the new shares but right now given that it looks like the old shares will be cancelled for $0.00 I would not be a buyer at $0.10.

     

    I do see revenue of $1.3 billion in their future for say 2014 but hopefully they can make $65-90 million on that revenue and that'll justify their future but it's more likely they will be bought up straight out of BK as I think they won't have enough operating cap to survive.
    2 May 2013, 01:17 PM Reply Like
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