FTSE 250 firm Essentra will replace chief executive Colin Day with Coats boss Paul Forman, following two consecutive profit warnings and falling share values.
Forman will be tasked with reversing the fortune of the industrial supply firm, which has seen its share price tumble by more than 40 per cent over the past year. It is expected that he will slim down the company’s portfolio in an attempt to write off some of the company’s £434m in debt.
Essentra, which was formerly known as Filtrona, produces everything from self-adhesive tape to ironmongery, but it is perhaps best known for its cigarette filters.
Day announced his departure earlier this year after a tenure which was characterised by a string of diverse acquisitions. In the first six months of the year, Essentra’s pre-tax profits fell by six per cent to £43m, while overall revenue was down by one per cent to £545m. At the time, then-CEO Day blamed the results on “a number of challenges – notably in the filter products and health & personal care business”, but reassured investors that “the company remains fundamentally strong”.
He predicted that Essentra would deliver a stronger result in the second half of 2015, with a full-year outlook of a “mid single-digit decline in like-for-like revenue, with adjusted operating profit in the region of £155-165m.”
Forman is expected to assume the post of chief executive at the start of 2017, while Day, who has been with the company since 2001, is likely to continue as a non-executive director.