KODAK CEO OUTLINES PICTURE OF PROGRESS.

NEW YORK--(BUSINESS WIRE)--May 1--Eastman Kodak Company CEO George M. C. Fisher today gave investors and the news media a look at strategies the company has in place to solidify its leadership in both photographic and digital imaging.

"Over the past two-and-a-half years, we have changed the

While Fisher expressed satisfaction with the progress Kodak people have achieved so far in improving the company's performance on many fronts, he acknowledged there is still plenty to do. In this connection, he cited on-going efforts to:

- support high yield products and services;

- improve quality and cycle times;

- bring the digital business to profitability;

- reduce sales, general and administrative costs without

sacrificing advertising; and

- stimulate growth.

Kodak is driving considerable growth in emerging markets such as China, India, and Eastern Europe. "China currently is the fifth largest market in the world," Fisher said. "By year's end, it will be third." Kodak is supporting this growth with a network of sales offices in major cities and hundreds of employees. The company's brand awareness is up more than 90% in China. Sales grew 60% in 1995 alone.

In established markets, Kodak has set the stage for growth through innovation, product differentiation, and digital imaging.

The new Kodak Advantix system stands as a prime example of the benefits the company expects to achieve through innovation. "Our research indicates that by 1999, the Advanced Photo System will add five percent to the industry size by that year," Fisher said. He noted that Kodak Advantix film is likely to account for three to four percent of all U.S. film sales this year.

The company also reported that initial tests comparing Advantix emulsions to those of competitors show superior color and printing compatibility for the Kodak product.

Fisher also addressed the company's continuing efforts to reduce its sales, general and administrative costs while improving its support of high margin products and services.

"Throughout a number of businesses, we are pursuing strategies that reduce costs through simplification and productivity improvements, reposition products through product differentiation and pricing, and provide us value through new product innovations," Fisher said.

"This strategy -- coupled with a manufacturing cost structure for consumables that we believe is the lowest in the world -- makes Kodak's traditional businesses among the world's most competitive," Fisher said.

Kodak's focus on improvement also extends to its research and development operations, where the company is looking to boost performance and drive innovation, not slash budgets. The company has a major initiative underway to improve R&D cycle times. It expects a 50% improvement this year alone. By the year 2000, the company intends to shorten development times to as low as 15 to 20 percent of traditional development cycles.

The company's new corporate structure, where Kodak's business will be run more by its worldwide business units than its corporate functions, will facilitate these strategies. As an example, activities common to all businesses -- such as finance, human resources, information systems, purchasing, and legal -- will be housed in shared service centers to improve efficiency and reduce costs.

Fisher acknowledged that the photographic industry is facing an era of consolidation. "The forces driving this change include technology substitution from digital imaging, price pressures from large customers, the increased investment required to compete in innovations like the Advanced Photo System, a shift in geographical market mix that requires more attention to emerging markets where prices are lower, and in some cases excess capacity.

"Near term this can mean both opportunity and added pricing pressures. Long term, as the marketplace reshuffles, pricing will be less of a factor and Kodak should emerge as an even stronger player in the silver halide arena with the low cost production position, the most recognized brand name and share gains," Fisher said. -0- Editor's Note: For additional information about Kodak, visit our web site on the Internet at: http://www.kodak.com/

CONTACT: MEDIA CONTACTS:

Charles S. Smith Paul C. Allen

Corporate Media Relations Corporate Media Relations

Eastman Kodak Company Eastman Kodak Company

Phone: 716/724-4513 Phone: 716/724-5802

Fax: 716/724-0964 Fax: 716/724-0964