Travel retailer WH Smith has today named ex-Balfour Beatty chief Leo Quinn as executive chair, replacing Annette Court in a leadership shakeup aimed at reviving the business and restoring investor confidence.
Its shares rose more than 11% this morning in London trade. They have fallen about 42% in the past 12 months.
Quinn joins WH Smith as the retailer grapples with the fallout from accounting errors in its North America business that sent shares tumbling, delayed annual results, prompted an audit probe and the exit of its then-CEO.
"The Board strongly believes that Leo's record of leadership and significant experience of successfully delivering transformation for large international companies make him the right candidate to deliver the Group's return to stability and long-term growth strategy," outgoing Chair Court said in a statement.
In his over a decade-long tenure at Balfour, Quinn strengthened the company's finances, moving it from heavy indebtedness to a net cash position by 2024, with the stock soaring 190%.
Quinn also brings seven years of US experience - valuable for WH Smith as it focuses on hiring executives familiar with its key market of North America.
The company's biggest shareholder Causeway Capital supported Quinn's appointment, saying he was the right executive to lead the travel retailer.
"WH Smith urgently needs a leader who is disciplined on capital spending and focused on rebuilding North American margins," said Jonathan Eng, a portfolio manager at Causeway.
Quinn is slated to receive a potential £24.5m share award, if he doubles the company's value over five years, in addition to his £360,000 base salary.
Court will step down after the company's annual general meeting on February 2, with senior independent director Simon Emeny serving as interim chair until Quinn joins in April.
Previous WH Smith chief executive Carl Cowling stepped down in November after an investigation into an accounting blunder in its US division and as the retailer warned over profits once again.
Mr Cowling was replaced by Andrew Harrison, chief executive of the group's UK division, on an interim basis until the appointment of a permanent successor.
It followed an independent review by Deloitte which found a number of "shortcomings" in which the group overstated profits in the US business by as much as £50m because of issues with its audit process.
WH Smith said last month it would claw back about £1.5m in overpaid bonuses from former bosses, including Mr Cowling, just a week after it confirmed it was being investigated by the Financial Conduct Authority over the affair.
The retailer told investors in December that it had kickstarted a remediation plan, to strengthen its governance and controls, ensure processes are aligned across the group, and enact cultural change involving training and monitoring.
WH Smith is now focused solely on its 1,300 shops in global travel locations, including at airports and train stations, after selling its high street chain of about 480 shops to Hobbycraft owner Modella Capital in June.
As part of the deal, the WH Smith name is disappearing from streets and being replaced by brand TGJones.
The slimmed-down business reported a pre-tax profit of £108mn for the year to the end of August, excluding what it deems one-off costs.
Additional reporting by PA
