Eastman Kodak


was gaining about 2% in premarket trading after the company said its second-quarter earnings will exceed previous guidance, as well as Wall Street's consensus estimate.

The company now expects to earn 97 cents a share, compared with earnings of 12 cents a share in the year ago quarter.

Excluding a tax benefit and a writedown, Kodak expects to earn 85 cents a share, up form the company's original forecast of 60 cents to 70 cents a share but lower than the $1.12 a share posted in the year-ago quarter. Analysts polled by Thomson Financial/First Call had been looking for 63 cents a share.

Kodak said the better-than-expected results reflect improved manufacturing productivity and operational performance, as well as the early cost benefits of its restructuring program.

The company added that sales in virtually all divisions declined from a year ago, more than originally expected due to continued economic weakness. In a press release, Kodak said, "We're doing what we said we would do -- cutting costs, achieving manufacturing improvements, generating cash and introducing new products and services."

Overall sales in 2002 are expected to be slightly below 2001's numbers, with operating earnings for the second half at about $1.35 to $1.75 a share, but the company said achieving the upper half of that range will "require better economic performance than we've seen to date." Analysts are expecting about $1.44 for the half.

Shares of Eastman Kodak were recently climbing 57 cents to $27.21 after closing at $26.24 Wednesday.