FirstGroup board revamped
John McFarlane, FirstGroup’s new Chairman, has replaced half of the company’s Non-executive Directors. Three new Non-executive Directors have been appointed with effect from 24 June 2014. They are Warwick Brady, easyJet’s Chief Operating Officer; Drummond Hall, Senior Independent Director at WH Smith and Imelda Walsh, who chairs the remuneration committees at William Hill, Mitchells & Butlers and Mothercare. John Sievwright, David Begg and Colin Hood will retire from the Board.
In its most recent financial report, the company announced it was not to pay a dividend to shareholders this year.
John McFarlane said, ‘Since taking on the role at the beginning of the year, I have reviewed the business plans and actively engaged on major decisions and forward plans with the senior team. I have also met all of our major shareholders. It is fair to say that they are very supportive of the Group, but are disappointed we have not matched this support with appropriate returns. Turning this situation around is therefore the first priority of the Board. I am encouraged that the Group has an attractive portfolio of transport businesses. On the other hand, two of our businesses, First Student and UK Bus, have not performed, and are well short of their potential and delivering lower margins than their competitors. Although both divisions have faced challenging economic conditions in their respective markets, we cannot escape that we should have managed them better. Progress has been made in addressing the performance of these two divisions, with headway being made in UK Bus in particular, but there remains much to do still. Fixing these and delivering the business plans we announced recently is the Group’s key priority.’
‘Taking together the current stage of the First Student and UK Bus recovery programmes and our commitment to the capital investment programme, it will take some time before the Group is able to deliver a profile of consistent surplus cash that can be distributed to shareholders. I would like to thank John, David and Colin for their dedication and contribution to the company, and particularly for their support to me as incoming Chairman.’