Kodak to slash up to 10,000 more jobs

“Our disappointing start to the first half of this year makes it clear that I need to make some changes and make them now,” announced Antonio Perez, CEO who took over the top job in June.

“Kodak is a company with product portfolios that are proceeding on two very different tracks. As sales of our traditional consumer products and services decline faster than anticipated, we are moving more aggressively to reduce cost," he said.

The $146 million loss comes on the heels of a net profit of $136 million last year. However revenue rose to $3.69 billion from $3.46 billion last year.

Many of the job losses will be in the traditional manufacturing plants and will cost Kodak $2.7 billion to $3 billion, up from expected charges of $1.3 billion to $1.7 billion announced originally. The rapid decline in film sales, the company’s traditional cash cow, is making it more difficult to service these costs as well as the charges of its switch to digital technologies.

In the emergent heavily digital company, manufacturing assets, including plants, factories and other equipment will be cut to around $1 billion, compared with $2.9 billion in January 2004. Perez said the new cuts would save the company about $800 million on an annual basis.

At the same time, Kodak says its digital efforts are succeeding. Second-quarter digital sales increased 43 percent, and digital revenue in June exceeded traditional film revenue on a monthly basis for the first time.

In Australia Kodak has already closed its Coburg film manufacturing plants and is currently consolidating its diverse workforce following the takeover of Creo. At PacPrint, Garron Helman, managing director, Kodak Graphic Communications Group Asia Pacific said he did not expect to shed many jobs in the region, although he made it clear he would be looking for synergies and improved costs.