Kodak's CEO Criticized
Updated: Thursday, July 11 2013, 03:11 PM EDT
Rochester, N.Y – Kodak CEO Antonio Perez has remained optimistic about the company’s prospects, even in the face of bankruptcy.
"We are all excited about our future," he said in a video message to the public on the day Kodak filed for Chapter 11.
The continued assurances that Kodak’s transformation is just around the corner has led to a loss of credibility, say some analysts.
"For at least the year, we’ve seen overly exuberant statements come out of 343 State Street, things like by 2012 Kodak will be a profitable and sustainable company," said George Conboy of Brighton Securities. "We know that’s not going to happen."
Perez arrived in 2003 at Kodak from Hewlett Packard. He was elevated to CEO and chairman in 2005. During his years at Kodak, sales fell from $13 billion to $6 billion. The worldwide workforce was cut by 45,000.
Patrick Cowan lost his job at Kodak last year after 30 years working at the company.
"The ship sunk under his guidance and whoever’s the captain of the ship…needs to step up and take responsibility," Cowan said.
Perez inherited a company struggling to make the switch from film to digital. Kodak was already on the decline. Analysts say he did a good job identifying and monetizing patents. But his digital printing strategy took longer than expected to execute and become profitable. Meantime, Kodak turned away from heavy investment in consumer products.
"He came into a pretty bad situation and it’s clear he didn’t execute well," said investment analyst Christopher Carosa. "The bottom line is the bottom line in this business, in any business. The fact that his company is filing for bankruptcy is telling you he failed to achieve the goals he should have achieved."
Kodak has not made Perez available for public comment. The Democrat and Chronicle called for him to address the media and talk about Kodak’s future.
A management team typically stays in place during a restructuring, said bankruptcy expert Lucien Morin, II. But creditors could apply to the court for a change in management.
Law 360 reported that bondholders raised objections in court Friday about Kodak’s line of credit, believing the company would burn through the cash.
"I think you will see bondholders and others in the bankruptcy asking for Mr. Perez’s resignation," said Conboy. "Time has come for him to go. He brought Kodak from being an iconic company to being in bankruptcy."