UPDATE 2-Morgan Sindall CEO steps down after profit warning

Tue Nov 6, 2012 1:21pm GMT

Quotes

   

* Says will miss 2012 trading forecast

* Announces board reshuffle, operational changes

* Shares down 5.4 percent

By Stephen Mangan

LONDON, Nov 6 (Reuters) - British construction group Morgan Sindall said it would miss its full-year trading forecast because of tough markets and that chief executive Paul Smith had resigned.

Executive chairman John Morgan will return to the position of CEO as part of a boardroom reshuffle that will see senior independent director Adrian Martin become non-executive chairman.

Morgan Sindall also said on Tuesday it was facing a 10 million pound ($16 million) restructuring charge this year, including office closures and a redundancy programme as it aims to make 55 million pounds of annualised savings over the three-year period to the end of 2012.

Market deterioration had hit the short-term outlook into 2013, and the company is continuing to be highly selective when bidding for new work, it said.

Morgan was CEO from 1994-2000 before becoming executive chairman in 2000 and handing over to Paul Smith.

Liberum Capital analyst William Shirley cut his estimate for 2012 earnings per share by 4 percent to reflect weaker than expected affordable housing profit.

He had cut his 2013 forecast last month by 7 percent and expected others to follow, which would bring consensus down about 10 percent towards his estimate.

Morgan Sindall operates through five divisions of construction and infrastructure, affordable housing, fit out, urban regeneration and investments.

Its construction business is being reorganised to focus delivery through regional hub offices, with a number of smaller regional offices being closed.

Morgan Sindall shares were down 5.4 percent at 625.75 pence at 1320 GMT.

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