Business

FESPA has welcomed the recently merged Swiss trade association Verband Werbetechnik + Print (Association of Advertising Technology and Print) to its global community of member associations, ratifying the decision at its recent General Assembly in Lisbon, Portugal.

The new entity, abbreviated to VWP, is the result of the consolidation in Spring 2009 of Verband Sieb-und Digitaldruck Schweiz (VSDS), and Verband Werbetechnik (VWT). The VWP brings together businesses in Switzerland that are engaged in advertising and print production, embracing both screen and digital processes.

The VWP’s principal goals include: the support and growth of businesses in these industries; representation of members’ interests with third-party institutions and government bodies; development of apprenticeships, training and development in all business and production disciplines; promotion of quality assurance and profiles through rules and guidelines for members; and development of links and agreements with other business organisations.

VWP board member Pablo Morf, explains: “The synergies we achieve with this merger allow us to intensify our focus on benefits to our members. As a larger organisation, we can use our combined resources more quickly and effectively to deliver a broader range of professional support services that address the changing needs of our stakeholders. Unified, our organisation is stronger and more prominent in the market, and can drive positive change. The VWP’s continued membership of FESPA guarantees further advantages to our members, giving them immediate access to best-practice information, global market research, educational materials and events, and a host of business development opportunities.”

FESPA CEO Nigel Steffens comments: “VSDS was a long-standing member association of FESPA, so we are delighted to welcome the new VWP to the fold. FESPA has been a strong advocate of this consolidation, having seen their close working relationship at first hand during our FESPA Digital exhibition in Geneva, Switzerland, in 2008.

He adds: “This is an inspirational example of how business support organisations can build partnerships and combine complementary strengths and service offerings to deliver greater value to their members. We are working through challenging times for all businesses. SMEs in particular need to be able to access affordable and relevant support and advice, and unite with similar businesses to tackle bigger issues such as training and skills development, which may hold the key to their future success. We look forward to working with the VWP in the years to come, and to welcoming their members in person at FESPA 2010 in Munich in June next year.”

An appetite for business rather than frustration with the economic situation: viscom continues on the upswing and sets markers for upturn DISPLAY/POS-World new core segment starting 2010

Düsseldorf. An appetite for business rather than frustration with the economic situation, impulses for an economic upturn and innovations with a stimulating effect: there was hardly a hint of crisis at viscom which, with a marked increase in visitor numbers, set a signal for an economic upturn in the entire sector.

"In a generally difficult economic environment, viscom was able to demonstrate its strength as a positive impulse giver", Hans-Joachim Erbel, Managing Director of Reed Exhibitions Deutsch¬land GmbH, remarked at the close of the three-day event. With more than 10,900 trade visitors, viscom succeeded in growing by more than 22 percent compared to the previous event in Düsseldorf (2007: 8,900), again exceeding last year's top result in Frankfurt. Growth was generated equally at home and abroad.

"Our exhibitors' innovative capacity beats the crisis", is how viscom Director Petra Lassahn delightedly sums up the course of the three fair days. This is also evident from the results of the business barometer, a survey taken at viscom by an independent research institute. According to this survey, more than 80 percent of the companies interviewed expect a positive trend in business, with only one in six expecting the economic situation to deteriorate further. The optimism is due primarily to the business generated by the large number of innovations presented at viscom.

This is not only true for the digital high-tech segments which attracted great interest from a broad range of advertising agencies and retailers at the Digital Signage World, and will continue to expand considerably. The segment of industrial inkjet printing which is used increasingly in industrial production - as in the clothing and furniture industries or in interior furnishings - is also attracting a growing number of customers at viscom who can gain an impression of the possibilities already available in production technology at this stage. There are hardly any limits these days to the industrial processing of all types of materials. More than 150 materials were presented at viscom in the "Industrial Inkjet meets Materials" special show. This is another reason why, with a new visitor structure, viscom is attracting new target groups to the fair and developing more and more into an event also frequented by advertising agencies, decision-makers from industry and the retail sector as well as the manufacturing sectors. A trend that again continued this year.

Yet even in the "classic" segments of advertising technology and light advertising with their predominantly trade character, innovative capacity helps to reach new markets and target groups by using new technologies and materials. A case in point is the first "European Wrap Star" which demonstrated the design possibilities available today with the use of new high-performing films.

All in all, 15 product innovations and best practice applications from the segments of Digital Printing/Large Format Printing, Light Advertising, Signmaking and Digital Signage received awards at this years' viscom (for more detailed information on these, visit www.viscom-messe.de).

In the segments relevant to POS which, with the application of new materials and finishing techniques as well as of digital media and lighting technologies, are growing in importance for product presentation and packaging, viscom further strengthened its leadership. Especially the combination of classic displays, digital POS media and innovations in material technology proves that viscom has the potential to become the POS industry's central trade fair in future.

From 2010 onwards, this is to become another viscom core segment named DISPLAY/POS World, specifically targeting manufacturers and suppliers of display, POS and packaging solutions. "For our exhibitors and visitors, the concentration of exhibitors from the Display/POS sector in a segment of their own represents an additional asset and ideally complements our established core segments advertising technology, lighting technology, digital and individual printing, as well as finishing technology and digital signage", says viscom-Chefin Petra Lassahn. In addition to the exhibition area, the segment will also include an extensive supporting programme as well as the traditional SUPERSTAR contest.

viscom frankfurt will take place from 28 to 30 October 2010 in Hall 3 of the Frankfurt Exhibition Centre.

Hahnemühle FineArt GmbH celebrated its 425 anniversary this year, making it one of the world's oldest continuously trading paper mill. Throughout its history, Hahnemühle has been uniquely sensitive to environmental issues in an industry that is notorious for its exploitation of the natural world. Today Hahnemühle continues to lead with its sustainable production processes.

"The green rooster, the brother of the Hahnemühle red rooster, was created to show that we care about the environment. Caring means offering environmentally-sound products, use of green power production and the sponsorship of environmental initiatives. In doing so, last year we saved 3000 tons of carbon dioxide, introduced bamboo fiber and sugar cane waste- based papers and donated more than $100,000 to environmental initiatives," said Joerg Adomat, Hahnemühle CEO.

The main resources necessary for the product of paper are water, pulp and a tremendous amount of electrical energy. Hahnemühle has addressed all of these from a product quality and sustainability perspective:

Water: The Hahnemühle paper mill was originally established on the banks of the pure, spring-fed Ilme river near the town of Dassel in the beautiful Solling region of Lower Saxony, Germany. This essential in the manufacture of premium quality fine art paper. Today this region has been designated as a Nature Protection Area by a European Flora Fauna Habitat directive. As a resident of this beautiful area, Hahnemühle has adapted sustainable fresh water and contaminant-free sewage recycling programs that exceed even the most stringent FFH directives. Now, 425 years later, the water of the Ilme is still classified as "drinking quality".

Pulp: The Hahnemühle product portfolio encompasses more than 500 different types of fine art, filter, and technical papers, many of which are used in precision industrial and medical applications that require the highest degree of purity. Since many of these applications rule out the use of recycled paper fibers, the importance of using sustainable forest resources becomes paramount to the company's green initiatives.

The company uses pulp from 20 different deciduous and conifer tree species worldwide and insists that its suppliers be certified for sustainable forestry practices that meet or exceed the equivalent of Forest Stewardship Council directives.

In addition to wood pulp, Hahnemühle also uses six different types of cotton linters and rags made from the super-soft, non-aging fibers of totally renewable cotton plant seed vessels.

In recent years Hahnemühle has developed two new "green" papers that have been added to the Digital FineArt Collection. The first was Bamboo 290gsm made from the fast growing fibers of the bamboo plant. The latest is Sugar Cane 300gsm, 75 percent of which is made from bagasse fibers, a by-product of sugar cane processing that would otherwise be burned. Cotton fibers gleaned from recycling our own paper waste make up the remaining 25 percent.

Electricity: The production of paper is an energy-intensive process; most of which is electrical. In January of 2009, Hahnemühle switched to one of Europe's most eco-friendly electrical energy providers called LichtBlick. The power provided by this company is generated entirely from easily sustainable power sources. No atomic, coal, gas or petroleum fuels are used. This will allow us to eliminate approximately 3,000 tons of CO2 emissions annually, a figure that roughly equals Hahnemühle's total paper production for a year.

Recycling: Whenever possible, Hahnemühle processes its own paper trimming waste and returns it directly into the production cycle. The excess waste trimmings that Hahnemühle cannot use are accumulated and forwarded to other fabricators, effectively eliminating virtually all its mill waste. Finally, all Hahnemühle packaging is made from fully recyclable materials.

Eastman Kodak Company has reported third-quarter 2009 results that reflect improved operating performance in a number of businesses, contributing to significant year-over-year improvement in cash performance including positive cash generation before restructuring payments.

The company’s third-quarter results also demonstrate the success of continued focused investments that Kodak is making in new products and core growth businesses, especially consumer and commercial inkjet. Cost containment and more tightly focused spending on research and development also positively contributed to the company’s third-quarter results. Consistent with its seasonal trend, the company expects cash and earnings performance to improve significantly in the fourth quarter of the year.

The company’s ability to achieve significant improvement in fourth-quarter results is predicated upon a modest improvement in the market for its consumer and commercial products, the introduction of new, higher-margin digital cameras and devices, stronger demand for its Prepress products, and the benefits from a number of intellectual property transactions executed in a manner that maximize shareholder value.

“On a sequential basis, the positive trends are clear. Our sales are stabilizing and some businesses are showing real signs of growth in the fourth quarter. That, combined with operational improvements in several of our key product lines, increases our optimism for significant improvement in the fourth quarter, our largest quarter of the year,” said Antonio M. Perez, Chairman and Chief Executive Officer, Eastman Kodak Company. “We also continue to gain significant traction with our new consumer and commercial inkjet businesses, and the productivity improvements that we’ve implemented thus far are helping to drive improved cash performance. We believe all of these factors are sustainable and they give me increased confidence that we are on track for a much improved fourth-quarter performance and achievement of our full-year earnings and cash targets.

“Our consumer inkjet hardware and ink products enjoyed another quarter of revenue growth that exceeded 100 percent, earning us a larger share of the market, and commercial inkjet customer commitments for our PROSPER Press Platform continue to grow rapidly in anticipation of delivery beginning in early 2010. While consumer demand and commercial credit markets remain constrained for the time being, we are well positioned to deliver sustained profitability as the economy improves.”    

For the third quarter of 2009:

* Sales worldwide totaled $1.781 billion, a decrease of 26% from $2.405 billion in the third quarter of 2008, including 2% of unfavorable foreign exchange impact. Revenue from digital businesses totaled $1.209 billion, a 26% decline from $1.641 billion in the prior-year quarter, primarily as a result of the global recession and continued restrictions in the credit markets that are dampening commercial printing purchases. Revenue from the company’s traditional business decreased 25% to $572 million, in line with the industry decline.
* The company’s third-quarter loss from continuing operations, before interest expense, other income (charges), net, and income taxes was $81 million, compared with earnings on the same basis of $147 million in the year-ago quarter.

On the basis of U.S. generally accepted accounting principles (GAAP), the company reported a third-quarter loss from continuing operations of $111 million, or $0.41 per share, compared with earnings on the same basis of $101 million, or $0.35 per share, in the year-ago period. Items of net expense that impacted comparability in the third quarter of 2009 totaled $48 million after tax, or $0.18 per share, primarily related to restructuring charges, asset sales, and tax related items. Items of net benefit that impacted comparability in the third quarter of 2008 totaled $40 million after tax, or $0.13 per share, due primarily to certain changes to the company’s post-employment benefits, partially offset by restructuring and rationalization costs. (Please refer to the attached Items of Comparability table for more information.)

Other third-quarter 2009 details:

* Gross Profit was 20.3% of sales, a decline from 27.5% in the year-ago period. This decline in margin was driven by lower intellectual property licensing royalties and unfavorable foreign exchange, partially offset by continued productivity improvements.
* Selling, General and Administrative (SG&A) expenses, on a GAAP basis, were $318 million in the third quarter, down 14%, or $51 million, from $369 million in the year-ago quarter, as a result of company-wide efficiency gains. Excluding a non-cash benefit from a change in the company’s post-employment benefits in the prior year quarter, the company reduced SG&A expenses, relative to the prior year quarter, by $78 million, or 20%.
* Research and Development expenses, on a GAAP basis, were $81 million in the third quarter, down 15%, or $14 million, from $95 million in the year-ago quarter, driven by a focus on investments in core growth businesses. Excluding a non-cash benefit in the prior year quarter, the company reduced R&D expenses, relative to the prior year quarter, by $33 million, or 29%.
* Third-quarter 2009 cash generation, before restructuring payments, was $29 million, compared with cash usage on the same basis of $78 million in the year-ago quarter. This corresponds to net cash used in continuing operations from operating activities on a GAAP basis of $16 million in the third quarter, compared with a net cash usage of $47 million in the third quarter of 2008. As was the case in 2008, the company expects to generate the majority of its cash flow in the fourth quarter of the year, consistent with its historic seasonal pattern.
* Kodak held $1.147 billion in cash and cash equivalents as of September 30, 2009, up from $1.132 billion on June 30. This excludes $575 million of restricted cash that the company deposited in a cash collateral account to be used to fund the previously announced repurchase of Convertible Senior Notes due 2033.
* The company’s debt level stood at $1.748 billion as of September 30, 2009, and includes $575 million in Convertible Senior Notes due 2033, for which the company completed a tender offer on October 19, 2009. As of the tender offer expiration date, approximately 98% of the outstanding 2033 Notes were tendered, representing an aggregate principal amount of approximately $563 million. The company’s debt balance as of September 30, 2009 would have been $1.185 billion if the tender offer for the 2033 Notes had been completed at that date.

Segment sales and earnings from continuing operations before interest, taxes, and other income and charges (segment earnings from operations), are as follows:

* Consumer Digital Imaging Group third-quarter sales were $535 million, a 35% decline from the prior-year quarter, including a decrease in intellectual property royalties. Third-quarter loss from operations for the segment was $89 million, compared with a profit of $24 million in the year-ago quarter. The year-over-year variance was driven by lower intellectual property licensing royalties of $157 million. Excluding the impact of intellectual property royalties, segment earnings improved. This was driven by improved profitability in consumer inkjet systems, including a 128% revenue increase in consumer inkjet printer hardware and ink and lower costs as a result of the company’s move to a more efficient product platform; improved operating performance in Digital Capture & Devices; and reduced SG&A and R&D expenses across the segment.
* Graphic Communications Group third-quarter 2009 sales were $674 million, an 18% decline from the third quarter of 2008. This revenue decrease was primarily driven by a market-related decline of 16% in Prepress Solutions as well as associated declines in workflow. Third-quarter earnings from operations for the segment totaled $10 million, compared with earnings of $22 million in the year-ago quarter. This earnings decline was primarily driven by lower volume, which resulted in unfavorable factory absorption and negative price/mix across several product lines, along with a negative impact from foreign exchange, partially offset by cost reduction efforts across all product lines and significant operational improvements in Electrophotographic Printing Solutions.
* Film, Photofinishing and Entertainment Group third-quarter sales were $572 million, a 25% decline from the year-ago quarter. Third-quarter earnings from operations for the segment were $47 million, compared with earnings of $77 million in the year-ago period. The decrease in earnings was driven by industry-related declines in volumes, negative price/mix, and unfavorable foreign exchange, partially offset by significant operational improvements in Traditional Photofinishing, cost reductions across the segment, and improvement in raw material costs.

2009 Outlook

Kodak today provided an updated outlook regarding its targets for 2009 performance, recognizing the ongoing uncertainty created by the global economic environment.

* For the full year, Kodak now expects its total revenue decline rate to be at the high end of the previously forecasted range of 12% to 18%, due, in part, to results to date and to the company’s increased focus on cash and earnings.
* Kodak is targeting 2009 segment earnings that will be within the previously communicated range of $0 to $200 million. Correspondingly, the company previously forecasted 2009 GAAP loss from continuing operations of $200 million to $400 million, and continues to forecast that GAAP results will be at the low end of that range, reflecting its latest assessment of restructuring charges, interest expense, and interest income.
* For full-year 2009, the company reiterates its goal to achieve positive cash generation before restructuring payments. This corresponds to a 2009 goal of net cash used in continuing operations from operating activities on a GAAP basis of not more than $250 million.

Electronics For Imaging, Inc., a world leader in customer-focused digital printing innovation, has announced its results for the third quarter of 2009. For the quarter ended September 30, 2009, the Company reported revenues of $100.9 million, compared to third quarter 2008 revenue of $144.7 million.

GAAP net loss was $(12.2) million or $(0.25) per diluted share in the third quarter of 2009, compared to a GAAP net loss of $(3.6) million or $(0.07) per diluted share for the same period in 2008.

GAAP net income was $1.2 million or $0.02 per diluted share for the nine months ended September 30, 2009, compared to a GAAP net loss of $(8.9) million or $(0.17) per diluted share for the same period in 2008.

Non-GAAP net loss was $(2.6) million or $(0.05) per diluted share in the third quarter of 2009, compared to non-GAAP net income of $10.4 million or $0.20 per diluted share for the same period in 2008.

Non-GAAP net loss was $(13.1) million or $(0.26) per diluted share for the nine months ended September 30, 2009, compared to non-GAAP net income of $34.5 million or $0.61 per diluted share for the same period in 2008.

"We are pleased with the sequential revenue increases in all our lines of business, led by 22% growth in our inkjet business driven by several new inkjet product introductions," said Guy Gecht, CEO of EFI. "We will continue to bring industry-leading innovation to the market and expect our positive momentum to continue which combined with strict cost controls should result in our return to profitability in the current quarter."

Separately, the Company announced today that its Board of Directors has approved the use of the balance, in the amount of $70 million, of its previously authorized $100 million share repurchase program.

Electronics For Imaging, Inc., a world leader in customer-focused digital printing innovation, today announced that its Board of Directors (the "Board") has approved the repurchase of up to $70 million worth of shares of its common stock through the use of a "modified Dutch auction" tender offer. This approval utilizes the balance of the previously authorized $100 million share repurchase program. EFI currently expects that it will commence the tender offer during the fourth quarter of 2009, at which time it will announce, among other things, the price range in which it will offer to purchase shares.

The tender offer will be financed from EFI's existing cash reserves. The funding of the $100 million share repurchase authorization represents the approximate after tax cash proceeds received from the sale of EFI's excess real estate holdings earlier this year.

"The decision by the Board and Management to immediately deploy the remaining balance of our $100 million repurchase program through a tender offer completes our goal of returning the cash generated from our real estate sale to our stockholders," said Guy Gecht, CEO of EFI. "We believe repurchasing our shares combined with bringing new innovative products to market will create value for our stockholders."

The tender offer announced in this press release has not yet commenced. This press release is for informational purposes only, and is not an offer to purchase or the solicitation of an offer to sell any shares of EFI common stock. The tender offer, if commenced, will be made solely by and subject to the terms and conditions set forth in the tender offer documents, including the Offer to Purchase and the Letter of Transmittal, that will be distributed to holders of EFI's common stock and filed with the Securities and Exchange Commission ("SEC"). Before any decision is made with respect to the tender offer, holders of EFI's common stock are urged to read the Schedule TO, including the Offer to Purchase, the Letter of Transmittal and other related materials when they become available and any other documents filed with the SEC because they will contain important information about the tender offer.

Holders of common stock will be able to obtain these documents as they become available free of charge at the SEC's website at www.sec.gov, or at the SEC's public reference room located at 100 F Street, N.E., Washington, DC 20549. In addition, holders of common stock may also request copies of the Schedule TO, the Offer to Purchase, the Letter of Transmittal and other related materials filed with the SEC free of charge by contacting EFI's information agent for the tender offer. The tender offer will not be made to, and tenders of EFI's common stock will not be accepted from or on behalf of holders, of EFI's common stock in any jurisdiction in which the making or acceptance of such tender offer is not permissible.