Today Eastman Kodak reported third quarter financial results. It comes I'm sure as no surprise that once again Kodak lost money on their operating businesses - $220 million over the last 90 days. Losses were bad enough, but all eyes were on the cash balance: $862 million, down from $957 at June 30. At first glance the math suggests that Kodak has a year's worth of cash on hand, based on this quarter's loss. But CEO Antonio Perez expects "to end the year with as much as $1.4 billion in cash, before any proceeds from the sale of our digital imaging patent portfolios, reflecting the company's seasonal generation of cash in the fourth quarter." That will be good news indeed, if true. But where will Kodak get the added cash? Management stated that they have taken in $120 million so far this quarter, and that current quarter is historically a good one for Kodak. I would not be surprised to see the sale of a business unit. Kodak will at this point throw nearly anything over the side to keep from sinking any faster. Rumors coming out of the Big Yellow Box suggest that the Image Sensor Solutions business is up for sale. That wouldn't surprise me, since to meet Mr. Perez's Q4 cash estimate they'll have to haul in quite a bit, and it's probably not coming from operations - look for more red ink there. Kodak is said to be looking to borrow more money- tough to do when your situation is so dire.

I hope Kodak pulls out of its nosedive, but I have little faith in senior management there any more. We will continue to follow this sad story closely and provide analysis of the headlines. For timely updates, follow me on Twitter (gtconboy).

GTC

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