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Eastman Kodak Financial statement analysis;
By analysis the financial statement of Eastman Kodak had found the trend in many areas of in each financial
statement as
Balance Sheet:
This Kodak balance sheet provide the details information about company assets and liabilities where Kodak
assets are in declining stages where they like to liquidate the current assets to the minimum by selling of the
other properties which they are giving good returns for the company profitability. Because of declining sales
and fading of Kodak brand the receivable ratio also reflect the decline trend but it does not reflect in good
operating profit figures.
Income Statement:
The Kodak company income statement also shows that the management are committed to huge cuts in
operating expenses which totaled $1.4 billion in 2011 and will likely be forecasted around $1 billion in the
ear 2012 and well in placed to go down under $1 billion by 2014. The Operating expenses should be reducing
in the research and development, administrative and general costs. Plus improving in incremental sales. The
management had decided to lay off more than 2000 employees around the world which presently at more
17,000 working with Kodak company which is one of criteria for decrease in profitability of the company
because of their high salaries and related expenses.
The business operations for the Kodak company is not healthy where the business revenue continue to decline
from last year's $6 billion to this year is about $4.4 billion. As this is th significant decline in sales number
because of redundant technology, fading company images and not able to with stand in the Kodak product
digital camera lack in innovation are the causes of company decline in sales and its revenue. But the
management of Kodak still believes with expansion of its market operations in other parts of the world like
African and Far East countries can fetch Kodak’s digital camera revenue to increase $4.5 billion in 2013 and to
$4.8 billion in 2014, with high growth prospects in these emerging markets in the subsequent years. And also
company expects the products growth in digital color printing and specialty printing segments
And these are market segments where the high growth potential had been expected:
Enterprise Document Management
$16.6bn market with 13% growth rate expected
Scanners $0.9bn, 2%
Capture Software $0.5bn, 10%
Services $15.2bn, 14%
Analog Products + Servic
Print $32.4bn
5%CAGR
• Software $1.3bn, 8%
• Services $31.8bn, 5%
Enterprise Brand &
$2.1bn 12% growth rate
Marketing Software
 Gross Profit was 14% of sales, as compared to 27% of sales in the year-ago period.
 Selling, General and Administrative (SG&A) expenses were $1275 million, a $116 million
decline from the prior-year which is good sign.
 Research and Development (R&D) expenses were $274 million, a $44 million decline from the
prior-year which also shows that management are not in position to lavish expenditure in this
segment which doesn’t yield any better results.
 Significant decline in finance activities leads to improve in cash reserve at about negative 6
million $..
 Kodak Company now expects its total revenue to be in the range of $6.3 billion to $6.4 billion.
Previously, the company forecasted full-year revenue to be in the range of $6.4 billion to $6.7
billion
Ratio Analysis:
The ratio analysis statement had the suitable tools for the management to make the decision making easy
by comparing the trend between the previous year’s operations to present year figures for making the
strategic decision for better company business operations. And the Kodak company had set to reach $1.4
billion as in sales revenue in the year and this cash usage attributed to the operating businesses to improve
notably rom significant profitability improvements in new emerging markets and also the other products
like inkjet, printers as well as digital cameras .Plus good serving to the existing customer bases
CASH FLOW STATEMENT:
Cash flow statements of Kodak company also doesn’t show the good picture with decline in
revenue leads to slower generation of cash for investing, financing and operation purposes as
company needs to have enough cash on hand to pay its expenses and purchase assets. The net
income continue to to deep further negative balance of about (764) millions is quite alarming for
Kodak business prospects and positive changes in inventory level is one of the good figure in
cash flow statement which shows decline to about 131million $.And the company are slowly get
rid of the debts and it had good positive debt restructuring programs in place.