Stockmarket cheers Kodak sackings

Global film giant Kodak has announced plans to sack up to 
15,000 workers — 23 percent of its world-wide staff — over the 
next three years. The announcement has prompted grave concerns 
for the jobs of Kodak's 400 Australian employees, including a 
major film manufacturing plant in Coburg, Victoria.

"There's been concern for a couple of months now as Kodak has 
made a couple of announcements to shareholder briefings that have 
indicated that the structure of their film-making plants is going 
to change dramatically", said Brian Daley of the Liquor 
Hospitality and Miscellaneous Workers' Union (LHMU).

"As a film producing plant, Coburg is at least one of the plants 
that may be subjected to closure."

The LHMU has been liaising with members since announcements about 
the international company's long-term future began and says 
morale is low.

"Our people are very concerned about what will happen to their 
jobs. Management has not sought to reassure them that they have 
got any longer term future."

The LHMU has jumped quickly into negotiations with Kodak and the 
Victorian Government in a bid to prevent the factory's closure.

"LHMU delegates will meet at the Coburg facility — where 250 
people are employed — and hold talks with members about how we 
can create new opportunities to secure these jobs."

"The LHMU is optimistic about our ability to put the best case 
for maintaining jobs in Australia", said Mr Daley.

Meanwhile Kodak has proved unrepentant on the announcement, not 
surprising given the big cheer the company got from the stock 
market.

Kodak's share price instantly jumped $3.61 on the US stock 
market, or 13 per cent. This was on top of recent gains of 14 
percent made in anticipation of a restructure.

Kodak, which produced the world's first mass-market camera in 
1888, has been struggling with the speed of the shift from film 
to digital photography.

Digital cameras already make up the majority of new cameras sold 
in the US, Australia and many European countries. In response 
Kodak announced earlier in January it would withdraw their film-
based cameras from those markets completely by the end of this 
year.

Overall, Kodak is placed only fifth in the international digital 
camera market.

However, the Kodak outlook is not quite as "mass-sackings or 
perish" as its workers might be led to believe.

For the fourth quarter of 2003 Kodak had net income of US$19 
million — or seven cents a share. Though it is still turning a 
profit, if you compare that figure with the same period last year 
— US$131 million or 39 cents a share — the result looks 
disastrous.

If you remove "one-off" expense items, however, then you get a 
startling result of $199 million, 70 cents a share. This was way 
beyond market analysts' expectation of 52 cents.

And despite stiff competition in the digital industry Kodak's 
overall sales still rose 10 percent in during the year.