Kodak 2005 Annual Report Download - page 48

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January 5, 2004, and the other factors described above. As noted above, the NexPress-related entities are expected to become accretive by 2007,
and Kodak Versamark is expected to be slightly dilutive through 2004 and accretive thereafter.
KPG’s earnings performance continued to improve on the strength of its leading position in digital printing plates and digital proofi ng, coupled with
favorable operating expense management and foreign exchange. The Company’s equity in the earnings of KPG contributed positive results to other
income (charges), net during 2004.
All Other
Worldwide Revenues
Net worldwide sales for All Other were $122 million for 2004 as compared with $96 million for 2003, representing an increase of $26 million, or 27%.
Net sales in the U.S. were $57 million in 2004 as compared with $45 million for 2003, representing an increase of $12 million, or 27%. Net sales
outside the U.S. were $65 million in the current year as compared with $51 million in the prior year, representing an increase of $14 million, or 27%.
Losses From Continuing Operations Before Interest, Other Income (Charges), Net and Income Taxes
Losses from continuing operations before interest, other income (charges), net and income taxes for All Other increased $98 million from a loss of
$93 million in 2003 to a loss of $191 million in 2004. Increased levels of investment for the Company’s display business and consumer inkjet
development activities primarily drove the increase in the loss from operations.
Earnings from Discontinued Operations, Net of Income Taxes
Earnings from discontinued operations, net of income taxes, for 2004 were $475 million, or $1.66 per basic and diluted share and were primarily
related to the sale of Kodak’s Remote Sensing Systems business (RSS), which contributed $466 million to earnings from discontinued operations,
including the after-tax gain on the sale of $439 million. The 2003 earnings from discontinued operations, net of income taxes, were $64 million, or
$.22 per basic and diluted share and refl ects net of tax earnings of $27 million primarily related to reversals of tax and environmental reserves as well
as $40 million of after-tax earnings from RSS.
Net Earnings
Net earnings for 2004 were $556 million, or $1.94 per basic and diluted share, as compared with net earnings for 2003 of $253 million, or $.88 per
basic and diluted share, representing an increase of $303 million, or 120%. This increase is primarily attributable to the reasons outlined above.
Summary
(in millions, except per share data) 2005 Change 2004 Change 2003
Net sales from continuing operations $ 14,268 + 6% $ 13,517 + 5% $ 12,909
(Loss) earnings from continuing operations before interest,
other income (charges), net, and income taxes (599) -589 (87) -129 302
(Loss) earnings from continuing operations (1,455) -1,896 81 -57 189
Earnings from discontinued operations 150 -68 475 +642 64
Cumulative effect of accounting change (57) — —
Net (loss) earnings (1,362) -345 556 +120 253
Basic and diluted net (loss) earnings per share:
Continuing operations (5.05) -1,904 .28 - 58 .66
Discontinued operations .52 -69 1.66 +655 .22
Cumulative effect of accounting change (.20) — —
Total (4.73) -344 1.94 +120 .88
The Company’s results as noted above include certain one-time items, such as charges associated with focused cost reductions and other special
charges. These items, which are described below, should be considered to better understand the Company’s results of operations that were
generated from normal operational activities.