Just a couple of weeks after sorting out a new chief executive, troubled infrastructure group Balfour Beatty is now looking for a new finance director.
Its shares jumped in the middle of October when it announced it had poached turnaround expert Leo Quinn from defence group Qinetiq to be its new chief executive. The company had issued five profit warnings in two years and rejected a takeover approach from rival Carillion. It recently sold engineering consultancy Parsons Brinckerhoff to WSP Global for £753m, with the cash used for a share buyback programme, to reduce its pensions deficit and to generally boost its balance sheet.
Now it says Duncan Magrath, who has been finance director for six years, will leave the company in 2015 once a successor has been found. Balfour’s executive chairman Steve Marshall said:
Following the completion of the Parsons Brinckerhoff disposal and the announcement of our new group chief executive, Duncan will be seeking new career challenges in 205.
Balfour’s shares have edged up 0.2p to 154.7p, and Liberum analysts said:
This will not surprise anyone. The challenge will be to build a strong leadership team, with the recently appointed chief executive, Leo Quinn, a new finance director and a new chairman.
Our view is that another warning is well within the realms of possibility. However, there is huge recovery potential and deep value, with a PPP business worth more than the enterprise value. [It is on a] 2015 PE of 14.9 times, for what that is worth.
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