Kodak 2011 Annual Report Download - page 44

FILM, PHOTOFINISHING AND ENTERTAINMENT GROUP
Revenues
The decrease in net sales from 2010 to 2011 was driven by lower volumes, primarily attributable to industry-related declines. Favorable price/mix
partially offset the volume declines, due to pricing actions (+1%) implemented to mitigate rising commodity costs and revenues from a non-recurring
intellectual property licensing agreement (+1%).
The decrease in net sales from 2009 to 2010 was primarily driven by volume declines across all SPGs within the segment. These volume declines in
Traditional Photofinishing (-5%) and Film Capture (-3%) were primarily driven by secular declines in the industry. The volume declines for
Entertainment Imaging
(-7%) were also largely attributable to secular declines, including the effects of digital substitution.
Gross Profit
The decrease in FPEG gross profit margin from 2010 to 2011 was driven by higher costs, primarily related to silver. Partially offsetting this decline
was favorable price/mix, due to pricing actions implemented to mitigate the rising silver costs (+1pp) and an increase in gross profit from a non-
recurring intellectual property licensing agreement (+1pp).
(dollars in millions)
For the Year Ended
December 31,
2011
% of Sales
% Change
2010
% of Sales
% Change
2009
% of Sales
Total net sales
$
1,547
-
12
%
$
1,762
-
22
%
$
2,262
Cost of sales
1,330
-
8
%
1,453
-
17
%
1,755
Gross profit
217
14
%
-
30
%
309
18
%
-
39
%
507
22
%
Selling, general and
administrative expenses
172
11
%
-
13
%
198
11
%
-
31
%
287
13
%
Research and development
costs
11
1
%
-
45
%
20
1
%
-
39
%
33
1
%
Earnings from continuing
operations before interest
expense, other income
(charges), net and income
taxes
$
34
2
%
-
63
%
$
91
5
%
-
51
%
$
187
8
%
For the Year Ended
December 31,
Change vs. 2010
2011 Amount
Change vs.
2010
Volume
Price/Mix
Foreign
Exchange
Manufacturing
and Other
Costs
Total net sales
$
1,547
-
12
%
-
16
%
2
%
2
%
n/a
Gross profit margin
14
%
-
4pp
n/a
2pp
0pp
-
6pp
For the Year Ended
December 31, Change vs. 2009
2010 Amount
Change vs.
2009
Volume
Price/Mix
Foreign
Exchange
Manufacturing
and Other
Costs
Total net sales
$
1,762
-
22
%
-
20
%
-
2
%
0
%
n/a
Gross profit margin
18
%
-
4pp
n/a
-
1pp
0pp
-
3pp
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