By Graham K. Rogers

Among the companies reporting financial results this week is Kodak who had earlier filed for bankruptcy and is in a delicate state at the moment. Its plan to focus on the most profitable parts of the business along with better cost controls has seen improvements including a better cash balance for Q1 2012.

The main parts of the press release on the finances are below:

Selling, General and Administrative (SG&A) expenses decreased by $84 million compared to the first quarter of 2011, as Kodak reduced its investment in unprofitable business lines and consolidated into two business segments - Commercial and Consumer. Kodak's liquidity improved, ending the first quarter with a cash balance of $1.4 billion, up $500 million from year-end 2011, as a result of $600 million in net new financing, utilization of the Chapter 11 process, and reduced year-over-year cash usage for continuing operations.

Revenue of $965 million in the quarter represented a decline of 27% from the same period in the prior year, reflecting the exit of digital cameras, continued secular decline of the traditional businesses, and a $61 million reduction in revenue associated with a tax refund sharing agreement with intellectual property licensees. This reduction is the result of a refund of Korean withholding taxes recorded in the quarter as a $122 million income tax benefit.

The Consumer Segment's loss improved by $23 million in the first quarter of 2012 to $164 million from $187 million in the same period in the prior year. Excluding the impact of the Korean tax refund, the Consumer Segment generated an $84 million year-over-year improvement in profitability. Driving this improvement were several factors, including enhanced cost controls, solid revenue growth in the retail systems solutions business driven by higher demand for consumables, a 34% increase in consumer inkjet ink revenues, and the decision to phase out of the digital capture business.

On the basis of GAAP, the company reported a first quarter net loss of $366 million compared with a net loss of $246 million from the prior-year quarter. The results reflect the improvement in segment profitability discussed above, reorganization costs associated with the Chapter 11 case, the absence of a gain from an asset sale in the prior-year quarter, and higher restructuring charges, partially offset by the tax benefit from the net impact of the Korean tax refund.

Kodak noted that as of March 31, 2012, it was in compliance with all covenants under its lender agreements.

Graham K. Rogers teaches at the Faculty of Engineering, Mahidol University in Thailand. He wrote in the Bangkok Post, Database supplement on IT subjects. For the last seven years of Database he wrote a column on Apple and Macs.