Kodak calling it quits?

[Archiver]

Kodak Alaris markets the film. Kodak (Eastman Kodak, strictly named, but usually referred to just as ‘Kodak’ and the company being referred to here) makes the film.

More than $US16 trillion in stock market wealth has been created in the past 10 years. Someone will buy Kodak’s fermenting leftovers. Some of the wealth that buys it will no doubt have been made out of Kodak on the way up (big time historically and in 2020) and down (now, and every other time since the mid-2000s apart from 2020). It’s a sort of financial cycle of life.

I think I might drive over to the old Kodak estate and have a hot drink at one of the places that were built in its stead. I'll have a hot chocolate and something sweet with my Kodak sensored M9 on the table, thinking about the cycle of camera life.

 

[Freakscene]

I think I might drive over to the old Kodak estate and have a hot drink at one of the places that were built in its stead. I'll have a hot chocolate and something sweet with my Kodak sensored M9 on the table, thinking about the cycle of camera life.

I worked at Kodak in Coburg for a while. Were I 10 or 20 years older, I’d probably have worked there for a decade or more, and have been unemployed and with poor employability when it closed. I left because the writing was on the wall, even though 2004 was their best year. There are some ok places to get a coffee in the Coburg Hill Shopping Center, and Sawaar Cafe across Elizabeth Street.

 

[Disappointed_Horse]

This is bad news for sure. If Eastman Kodak goes down, I'm not too confident that anyone else will buy the assets and keep producing film. A large part of Kodak's problems over the last 20 years is that they have been geared up to produce film at the scale required when film was at its peak around 1990–2000, and those economies of scale don't really work when the demand for film is only a small percentage of what it once was. Who is going to buy a factory set up to produce tens of millions of rolls of film, when the current demand is in the tens of thousands? From an economic standpoint, that would make as much sense as buying a factory that makes horse-drawn carriages by the thousands.

 

[wlewisiii]

So the instigating PetaPixel article has this as an update from Kodak:

A Kodak spokesperson reached out to PetaPixel after publication of this article with the following statement.

“The ‘going concern’ language in Kodak’s 10-Q is essentially required disclosure because Kodak’s debt comes due within 12 months of the filing. Kodak is confident it will be able to pay off a significant portion of its term loan well before it becomes due, and amend, extend or refinance our remaining debt and/or preferred stock obligations,” the spokesperson says.

“To fund the repayment, we plan to draw on the approximately $300 million in cash we expect to receive from the reversion and settlement of our U.S. pension fund (the Kodak Retirement Income Plan, or ‘KRIP’) in December. However, the KRIP reversion is not solely within Kodak’s control and therefore is not deemed ‘probable’ under U.S. GAAP accounting rules, which is what triggered the ‘going concern.’ Once the KRIP reversion is completed Kodak will be virtually net debt free and will have a stronger balance sheet than we have had in years.”

Kodak Says its Survival is in Jeopardy Amid Debt Obligations

 

[Freakscene]

This is bad news for sure. If Eastman Kodak goes down, I'm not too confident that anyone else will buy the assets and keep producing film. A large part of Kodak's problems over the last 20 years is that they have been geared up to produce film at the scale required when film was at its peak around 1990–2000, and those economies of scale don't really work when the demand for film is only a small percentage of what it once was. Who is going to buy a factory set up to produce tens of millions of rolls of film, when the current demand is in the tens of thousands? From an economic standpoint, that would make as much sense as buying a factory that makes horse-drawn carriages by the thousands.

Kodak massively downsized in the mid-2000s and made their plant a lot more flexible. They closed production for all of November last year, in part to scale up but also to make some production aspects more flexible.

You can take a tour: Film Factory Tours

 

[TenEleven]

So the instigating PetaPixel article has this as an update from Kodak:

Kodak Says its Survival is in Jeopardy Amid Debt Obligations

Thank you for this.... typical.

Hey at least that gets the clicks twice. Once for the hype and then for the retraction.

 

[Prest_400]

Kodak has published a statement which can be seen in social media, but also their website:

Statement Regarding Misleading Media Reports

Kodak clarifies it is not closing or filing bankruptcy; plans debt repayment and pension fund transaction for a stronger balance sheet in 2025.

www.kodak.com

The most important things to know are:

• Kodak has no plans to cease operations, go out of business, or file for bankruptcy protection.
• To the contrary, Kodak is confident it will repay, extend, or refinance its debt and preferred stock on, or before, its due date.
• When the transactions we have planned are completed, which is expected to be early next year, Kodak will have a stronger balance sheet than we have had in years and will be virtually net debt free.
• The "going concern disclosure" is a technical report that is required by accounting rules.
• We will continue to meet our obligations to all pension fund participants.

 

[DownUnder]

Kodak has published a statement which can be seen in social media, but also their website:

Statement Regarding Misleading Media Reports

Kodak clarifies it is not closing or filing bankruptcy; plans debt repayment and pension fund transaction for a stronger balance sheet in 2025.

www.kodak.com

Well, what do we expect them to say? Admit yes to all the rumours floating around?

Obviously they couldn't really say anything else. And expect their shares to still be worth more than the paper they are printed on.

By chance yesterday in a shopping mall in Malang, East Java I bought a book with a lot to say about Kodak's massive downgrading of its film production in the early 2000s. 'The Disappearance Of Darkness: Photography at the End of the Analog Era' by Robert Burley, published in Canada in 2013.

A truly revelatory bit of photo history. I'm now reading it in segments. Well worth acquiring if you can find it, one of the best $10 books I've bought.

 

[Dralowid]

I assume that the huge volumes of film that kept these big factories going came from the movie industry?

 

[NIKON KIU]

Probably Medical industry too, remember the old days, X rays were recorded on film. That industry was among the first to go digital.

Kiu

 

[Cascadilla]

I assume that the huge volumes of film that kept these big factories going came from the movie industry?

Yes, the movie industry generated huge volume back in the day. While movie productions went through a lot of film by still photography standards, when theatrical projection was on film, each 35 mm release print contained roughly a mile and a half of film (90 feet/minute). And since you had to have a print in your possession to show the movie, this meant that a blockbuster movie that opened on a thousand screens simultaneously implied a thousand release prints had been made. Kodak made a good product and was incredibly efficient at it so their margins were high. The movie industry probably supported still photography to a considerable degree in this period. I worked as a projectionist in the late 1980's at a college film program so I got to heft a lot of 50# film shipping containers that survived the trip on Greyhound buses from Fort Lee, NJ.

 

[splitimageview]

I expect them to say exactly what they said. 😆