Eastman Kodak Profits Drop 59 Pct.

Wednesday, January 17th 2001, 12:00 am

By: News On 6

ROCHESTER, N.Y. (AP) â€” Eastman Kodak Co., beset by a sharp slowdown in film sales, posted a 59 percent drop in fourth-quarter profit but its operating results matched Wall Street's lowered forecasts.

The world's largest photography company said Wednesday it earned $194 million, or 66 cents a share, in the last three months of 2000, down from $475 million, or $1.50 a share, a year earlier.

The results include $6 million in after-tax costs associated with closing its Elmgrove manufacturing hub for this quarter and a $120 million gain in the year-ago period from selling a film archive and a scientific instruments business.

Excluding those charges, Kodak said it earned $200 million, or 68 cents a share, down from $475 million or $1.50 a share a year ago. Sales fell 6 percent to $3.56 billion from $3.8 billion.

That matched Wall Street expectations for the latest quarter. Its shares were up 13 cents at $41.44 in morning trading on the New York Stock Exchange.

Kodak lowered its earnings projections last month for the second consecutive quarter to reflect a sudden slump in film sales beginning in September that it blamed largely on a slowing U.S. economy. The dip in sales prompted U.S. retailers to cut back film inventories.

Chief executive Dan Carp said he expects the soft sales to persist through the first half of the year and then pick up again. ``Our business plans assume a stronger economy in the second half of 2001,'' he said.

U.S. sales of rolls of film, which had been growing at a 7 percent clip through the summer, fell 4 percent in the fourth quarter while prices edged down 1 percent.

Kodak's losses in digital photography widened dramatically to $60 million from $17 million a year ago and $6 million in the third quarter. Sales of digital products, which account for 23 percent of overall sales, rose 1 percent to $824 million.

For all of 2000, Kodak earned $1.407 billion, or $4.59 per share, up from $1.39 billion, or $4.33 per share, in 1999. Sales eased to $13.99 billion from $14.09 billion.

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On the Net: http://www.kodak.com