Kodak 2013 Annual Report Download - page 40

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Table of Contents
Gross Profit
Current Year
The increase in the Graphics, Entertainment and Commercial Films Segment gross profit percent for the year ended December 31, 2013 was
primarily driven by favorable price/mix within Intellectual Property and Brand Licensing (+5pp). Also contributing to the improvement was
favorable price/mix within Entertainment Imaging & Commercial Films (+2pp) driven by the impact of pricing actions as noted above, and
manufacturing and other cost improvements within Graphics (+4pp) due to productivity improvement initiatives. Partially offsetting these
improvements was unfavorable price/mix within Graphics (-2pp) due to pricing pressures in the industry, and increased manufacturing and
others costs within Entertainment Imaging & Commercial Films (-2pp) driven by lower production volumes. Manufacturing and other costs
were also negatively impacted by the revaluation of inventory from the application of fresh start accounting (-2pp).
Prior Year
The decrease in the Graphics, Entertainment and Commercial Films Segment gross profit percent for the year ended December 31, 2012 was
due to unfavorable price/mix, primarily in Intellectual Property and Brand Licensing (-5pp) due to the $61 million licensing revenue reduction
as noted above, and in Graphics (-1pp) largely due to competitive pricing within the prepress solutions industry. Also contributing to the
decline was increased costs within Entertainment Imaging & Commercial Films (-1pp) driven by lower production volumes.
Selling, General and Administrative Expenses
The decreases in SG&A from 2012 to 2013 and 2011 to 2012 were primarily the result of cost reduction actions.
Research and Development Costs
The decreases in R&D from 2012 to 2013 and 2011 to 2012 were primarily attributable to cost reduction actions resulting from focused
development activities on core products.
DIGITAL PRINTING AND ENTERPRISE
PAGE 38
Successor
Predecessor
Predecessor
Predecessor
(in millions)
Four Months
Ended December
31, 2013
Eight Months
Ended August
31, 2013
% of Sales
(Combined)
Year Ended
December
31, 2012
% of
Sales
% Change
vs. 2012
(Combined)
Year Ended
December
31, 2011
% of
Sales
% Change
vs. 2011
Net sales
$
284
$
519
$
939
(14
%)
$
1,099
(15
%)
Cost of sales
243
373
813
(24
%)
1,139
(29
%)
Gross profit
41
146
23
%
126
13
%
48
%
(40
)
(4
%)
415
%
Selling, general and
administrative expenses
67
128
24
%
274
29
%
(29
%)
410
37
%
(33
%)
Research and development
costs
33
55
11
%
132
14
%
(33
%)
163
15
%
(19
%)
Segment loss
$
(59
)
$
(37
)
(12
%)
$
(280
)
(30
%)
66
%
$
(613
)
(56
%)
54
%