Kodak 2005 Annual Report Download - page 129

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New Kodak Operating Model and Change in Reporting Structure
As of and for the year ended December 31, 2005, the Company reported fi nancial information for three reportable segments (Digital & Film Imaging
Systems, Health Group, and Graphic Communications Group) and All Other. However, in September of 2005, the Company announced the realignment
of its operations to accelerate growth in the commercial, consumer and health markets. The move is designed to enhance the Company’s operational
performance and to accelerate profi table growth. In connection with the realignment, the Company’s new reporting structure will be implemented
beginning in the fi rst quarter of 2006 as outlined below:
Consumer Digital Imaging Group Segment: The Consumer Digital Imaging Group segment encompasses digital capture, kiosks, home printing
systems, business development, inkjet systems, digital imaging services and imaging sensors. This segment provides consumers, professionals and
cinematographers with digital products and services.
Film and Photofi nishing Systems Group Segment: The Film and Photofi nishing Systems Group segment encompasses consumer and professional
fi lm, photographic paper and photofi nishing, aerial and industrial fi lm, and entertainment products and services. This segment provides consumers,
professionals and cinematographers with traditional products and services.
Health Group Segment: There are no changes to the Health Group segment. The Health Group segment provides digital medical imaging and
information products, and systems and solutions, which are key components of sales and earnings growth. These include laser imagers, digital
print fi lms, computed and digital radiography systems, dental radiographic imaging systems, dental practice management software, advanced
picture-archiving and communications systems (PACS), and healthcare information systems (HCIS). Products of the Health Group segment also
include traditional analog medical fi lms, chemicals, and processing equipment. Kodak’s history in traditional analog imaging has made it a leader in
this area and has served as the foundation for building its important digital imaging business. The Health Group segment serves the general radiology
market and specialty health markets, including dental, mammography, orthopedics and oncology. The segment also provides molecular imaging for
the biotechnology research market.
Graphic Communications Group Segment: As of January 1, 2006, the Graphic Communications Group segment consists of Kodak Polychrome
Graphics LLC (KPG), a leader in the graphic communications industry; Creo Inc., a premier supplier of prepress and workfl ow systems used by
commercial printers worldwide; NexPress Solutions, Inc., a producer of digital color and black and white printing solutions; Kodak Versamark, Inc., a
provider of continuous inkjet technology; and Encad, Inc., a maker of wide-format inkjet printers, inks and media. Kodak’s Document Products and
Services organization, which includes market-leading production and desktop document scanners, microfi lm, worldwide service and support and
business process services operations, is also part of this segment.
All Other All Other is composed of Kodak’s display and components business for image sensors and other small, miscellaneous businesses. Effective
January 1, 2006, the development initiatives in consumer inkjet technologies will be reported within the Consumer Digital Imaging Group segment.
Additionally, effective January 1, 2006, the Company will change its cost allocation methodologies related to distribution costs, indirect selling, general
and administrative expenses, and Corporate research and development costs.