Courtaulds Textiles sacks chief executive
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Your support makes all the difference.Courtaulds Textiles has sacked its chief executive, Noel Jervis, and replaced him with executive director Colin Dyer, in a bid to improve the group's performance following its May profits warning.
Mr Jervis could receive around pounds 500,000 compensation for being ousted from Courtaulds, where he has worked for 30 years, all his working life. The talks could last another fortnight.
John Eccles, Courtaulds' chairman, said: "Noel had an extremely good grasp of the industry, great ideas and the ability to see into the future.
"But implementation was not his strong point."
He added: "He was strong on what we had to do, but weak on actually doing it. When we issued our profits warning in May there was a downgrading of forecasts (by analysts of our results). We had to look seriously at how we could change the situation and we came to the conclusion that a change of leadership would help." Mr Eccles insisted there had been no pressure from institutional investors to sack Mr Jervis.
Courtaulds's shares dipped a penny to 378p on the news.
The chairman said Mr Jervis had been earning pounds 200,000-pounds 250,000 a year and was on a two-year rolling contract.
He said the company was in talks with its legal advisers and a decision on the exact amount of Mr Jervis's pay-off would be made shortly.
Mr Eccles said that, six years after the demerger with Courtaulds, the company had to continue to sharpen its focus on key clients like Marks & Spencer, and speed up moving out of businesses which were not core activities. "We must continue to move our activities offshore into lower-cost economies."
The board, he said, had reviewed the position of the company against the background of "difficult trading markets over the last year" and had decided that while the group's strategy was sound, the pace of change needed to be speeded up.
"The directors thank Noel for his contribution to the company over his long period of service," he said.
The group's main areas, he said, would continue to include lace products, stretch and performance fabrics, other contract clothing, branded clothing and home furnishings and supplying Marks and Spencer.
Mr Dyer, who replaces Mr Jervis, is 43 and joined Courtaulds in 1982. His promotion to chief executive is from the position of executive director responsible for branded and own-label clothes, the firm said.
Mr Dyer's pay package has not yet been determined. His existing rolling two-year contract is worth pounds 150,000-pounds 200,000 a year.
Courtaulds Textiles said trading continued in line with its statement issued on 1 May. Then the group said an expected loss in its US operations would drag down group profits in the first half of 1996.
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