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 user 2009-10-02 at 2:04:38 pm Views: 55
  • #22479

    CEO Perez to stay at Kodak through 2013
    ROCHESTER, N.Y. — Eastman Kodak Co.’s chairman and chief executive, Antonio Perez, has agreed to remain at the helm through 2013, the photography products maker said Wednesday.Kodak shares, which have rallied from an all-time low of $2.01 in March, fell 10 cents, or 2 percent, to $4.85 in afternoon trading after trading as low as $4.69 earlier in the session.Deutsche Bank analyst Chris Whitmore said the drop reflects disappointment that, with Perez staying on, Kodak won’t be curtailing weighty investments in its money-losing inkjet printer businesses. “There’s some hope of a more significant strategy change and it doesn’t seem like we’re going to get that,” he said.

    Perez, a native of Spain who turns 64 in November, ran Hewlett-Packard Co.’s digital printing operations before moving to Kodak in 2003 and succeeding Dan Carp as CEO in June 2005.Kodak said its board amended Perez’s employment deal to reinforce a mutual intent that he remain in charge at least through Dec. 31, 2013. The agreement doesn’t have an expiration date but includes terms scheduled to expire in December 2010.

    The 128-year-old photographic film pioneer, battling to remodel itself in the digital age, is shedding 3,500 to 4,500 jobs this year, reducing its payroll to around 20,000 from a 1988 peak of 145,300. The economic downturn has cut deeply into sales of digital cameras, film and commercial printing products.”I am delighted by the opportunity to continue our work of achieving sustainable, profitable growth,” Perez said in a statement.Richard Braddock, presiding director of Kodak’s board, said Perez has taken Kodak through a historic transformation “that has created powerful new digital businesses along with a solid balance sheet. He and his team are taking the right actions to guide Kodak through this very challenging economic climate.”Kodak is investing heavily in digital printing businesses — consumer inkjet printers and high-speed commercial presses and software — while leaning on cash generated by motion-picture film, retailer kiosks and other high-margin products.

    Over the last week, it completed a $700 million debt refinancing deal by giving two seats on its expanded 14-member board to Kohlberg Kravis Roberts & Co. The private equity fund spend $300 million on Kodak notes due in 2017 and warrants to purchase 40 million Kodak shares at $5.50 a share.Whitmore said investor worries revolve around dashed hopes that Kodak might move toward “maybe a less aggressive growth strategy in inkjet, commercial printing, digital cameras and the like … product lines that have yet to generate any real signs of return. Kodak doesn’t have a lot of cash. The cash generated from the film business has been more than offset by cash burned in those other products.”

    In April, Kodak scrapped its 25-cent semiannual dividend and trimmed the salaries of top executives by 10 percent.Perez, whose base salary of nearly $1.1 million hasn’t changed since 2005, took a 15 percent salary cut of about $107,500 for the balance of 2009. He got no performance-based bonus or stock awards last year and drew compensation valued at $2.1 million, down 81 percent from the $11.7 million he received in 2007.