Lamprell still searching for new CEO, cuts jobs to reduce costs
- Business & Finance
Lamprell, a provider of fabrication, engineering and contracting services to the energy industry, has not been able to find the right candidate for the role of its new CEO following its current CEO decision to retire, and will therefore extend the CEO’s as well as Executive Chairman’s stay.
In addition, the company said it would reduce its headcount by 100 people in an effort to reduce costs in a challenging, low oil price market.
Lamprell CEO James Moffat decided to retire back in August 2015, and a decision was supposed to become effective June 30, 2016. However, Lamprell announced on Tuesday that John Kennedy and James Moffat have agreed to extend their respective roles as Executive Chairman and Chief Executive Officer while the search process to find a new CEO continues.
John Kennedy and James Moffat will remain in their respective roles until December 31, 2016 or until the appointment of a new CEO if this is earlier, Lamprell said. Further to the extension of his period as a Director and CEO, James Moffat’s exclusive consultancy agreement post-retirement will run until the end of March 2017, the company added.
In addition, Lamprell said, given the continuing challenges in market conditions and as the construction cycle of current projects moves towards completion, the Group is implementing a number of cost saving measures in its fixed and variable costs.
In continuation of the earlier overhead reduction programme, the Group has taken immediate steps to reduce its management, professional and administrative headcount by around 100 people or a total of 8% of all overhead staff. This includes project support personnel, as some of the ongoing projects reach completion, as well as back-office staff. The Group is also targeting other operating and overhead savings, Lamprell stated.
John Kennedy, Executive Chairman for Lamprell, said: “The Board has been assessing potential candidates for the role of CEO to replace James Moffat following his retirement later this year. The CEO search process remains a key priority for the Board and we are determined to find the right candidate. In the current operating environment, the Board and executive management will provide leadership continuity. Accordingly, I am delighted that Mr Moffat has agreed to defer his retirement which will allow us to continue to benefit from his extensive experience and depth of knowledge of the industry during these challenging times.”
James Moffat, Chief Executive Officer for Lamprell, said: “Lamprell maintains a high degree of flexibility in its business structures providing us with room to streamline the organisation to adapt to the market environment. In order to adjust our resources to current lower activity levels we continue our on-going drive for overhead reductions and have taken proactive steps to reduce our cost base and focus on tight cash management within the Group’s operations, both of which will help to underpin our projections and preserve our long term future.”