Eastman Kodak Co. said yesterday it will slash its work force by 20 per cent and take up to $1.7 billion in charges over the next three years as the company accelerates a painful shift away from the waning film photography market.

Kodak, which unveiled a new strategy in September to shift investments into digital markets, said it will cut 12,000 to 15,000 jobs worldwide, a move it expects to save the company $800 million to $1 billion by 2007.

The Rochester, New York-based imaging giant announced the cuts as it reported an 83 per cent fall in fourth quarter net income as film camera demand continued to decline.

Kodak posted net income of $19 million, down sharply from $113 million, a year earlier.

Earnings from continuing operations, before the impact of cost reductions and other one-time items, were $199 million, it said.

The earnings included a positive impact of 11 cents a share related to employee-benefit and incentive-compensation accruals reported in prior quarters.

Analysts had expected 52 cents per share on average.