Sir Ralph Norris, Fletcher chairman. Photo / Greg Bowker
Sir Ralph Norris, Fletcher chairman. Photo / Greg Bowker
Fletcher Building shares sank 8.4 per cent after downgrading its profit guidance and announcing the departure of CEO Mark Adamson.
The stock dropped to a 16-month low of $7.41.
Francisco Irazusta was named as interim CEO and chairman Ralph Norris said the board deemed it the right time for newleadership. The announcement came with a profit warning and a $220 million impairment.
The profit downgrade follows a 15 per cent cut to guidance to full-year earnings in March as a result of overruns at two major construction projects.
The company said operating earnings were about $525m in the year ended June 30, down from its earlier guidance of $610m to $650m. Its results would include an impairment "of up to $220m against its Iplex Australia and Tradelink business units.
The company said as work had continued on major projects in its Building + Interiors business "it has become apparent that losses in B+I will exceed those previously estimated".
While Adamson will receive his contractual entitlements, Fletcher Building said that all of his share options will lapse and he will forfeit all shares in its long term incentive scheme.
He would not be paid a short term incentive relating to the 2017 financial year.
