Photography giant Eastman Kodak is to slash up to 15,000 jobs worldwide over the next three years.

The news comes after the US firm announced a sharp fall in profits for the last three months of 2003.

Kodak said the job cuts - which represent around 20% of its global workforce - would save the company up to $1bn (£546m) a year by 2007.

The firm said last week that it would stop selling traditional film cameras in the US, Canada and Western Europe.

It plans to cut product lines with declining appeal in favour of fast-growing digital products.

'Absolutely required'

Kodak said it would also take $1.3bn to $1.7bn in charges over the next three years, as it moves to reposition itself to keep pace with the development of digital products.

Antonio Perez, the company's president and chief operating officer, said the job cuts were "absolutely required for Kodak to succeed in traditional markets as well as the digital markets to which our businesses are rapidly shifting".

The cuts were "the consequence of market realities" and would help fund future growth, he said.

New York-based Kodak reported fourth quarter net profits of $19m, compared with $113m for the same period in 2002.

However, the firm said sales in the quarter totalled $3.78bn, up 10% from a year ago.

Separately, Kodak said it would launch a $35m offer to buy the remaining shares of Japanese digital camera supplier Chinon Industries which it does not already own.

Kodak said the move would enable it to increase its global design and manufacturing capability for consumer digital cameras and accessories.