Kodak Suspends Stock Buyback Program

Eastman Kodak Co. suspended its $2-billion stock buyback program to accelerate debt-reduction efforts and give it the financial flexibility to pursue acquisitions. Kodak, which has struggled with lower sales and profits in an intensely competitive market and slowing economic environment, said the move was not an indication of lower-than-expected cash flows. It said first-quarter cash flow is in line with expectations and is consistent with normal seasonal patterns. Analysts on average are expecting Kodak to earn 52 cents a share in the first quarter, down more than 45% from a year earlier. In December, Kodak set a stock buyback pace of about $1 million per day under a $2-billion repurchase authorization approved in April 1999. The 1999 buyback authorization was about 90% fulfilled, with 32 million shares having been repurchased for a cumulative price tag of about $1.8 billion, the company said. The suspension of the buyback will help return the company’s debt-to-capital ratio to its targeted level of about 40%, Kodak said. Shares of Kodak fell 84 cents to $43.98 on the NYSE. The stock has recovered from a low of $35.31 in mid-October, which followed a profit warning in September.