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Polaroid Posts $109.9 Million Loss,

July 18, 2001

CAMBRIDGE, Mass. (AP) _ Camera and film maker Polaroid posted a second-quarter loss of $109.9 million, greater than what Wall Street expected, as it struggled with debt and major restructuring.

For three months ended July 2, Polaroid lost $2.36 per share, compared with earnings of $26.6 million, or 59 cents a share a year ago.

Excluding one-time items, including a $53 million income tax charge and inventory liquidations, the Cambridge-based Polaroid lost 84 cents per share. Analysts surveyed by Thomson Financial/First Call expected a loss of 69 cents per share.

Shares of Polaroid were off 11 cents to $1.00 in early trading on the New York Stock Exchange.

The Cambridge-based company posted a $36 million operating loss for the second quarter, in line with a previous earnings forecast. It also posted revenues of $333.5 million, down 31 percent from $485.6 million in the year-ago period.

Last week, Polaroid received a waiver on a $363 million line of credit that was set to expire last Thursday, and announced that it would explore a merger or sale as it tries to handle its debt.

The company also said that it would miss $46 million in interest payments to bond holders over the next three months, and now faces negotiations to restructure that debt.

Chairman and chief executive officer Gary T. DiCamillo said the company was continuing to move forward in its attempt to cut costs and reduce debt.

He said the company plans to generate cash by completing restructuring, reducing working capital, consolidating manufacturing, reducing capital spending and selling assets.

Polaroid, founded in 1937, made its name producing instant cameras and film., but has been hurt by the ongoing shift to digital technology.

The company laid off 950 workers in February and 2,000 last month.

For the six months ended July 2, Polaroid lost $200.8 million, or $4.35 per share, on revenue of $664.3 million. In the year-ago period, Polaroid earned $25.2 million, or 56 cents per share, on revenue of $887.9 million.

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On the Net: http://www.polaroid.com

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