Time to weave a tighter Feltex

Having steered Feltex through one of its toughest chapters, fill-in chief executive Peter Thomas will remain in the carpet-maker's top job to continue leading its recovery.

Thomas' appointment to chief executive yesterday, made three days before the carpet-maker's annual meeting, follows a five-month international search to replace former chief Sam Magill, who stepped down in August after two profit downgrades this year.

Thomas was one of five candidates for the job and the only one with carpet industry experience, something chairman Tim Saunders said the board saw as necessary.

"Given the challenges Feltex faces, which became more apparent and clear during the process, there is immense value appointing an individual who understands the immediate issues facing Feltex and what needs to be done to overcome them," Saunders said.

A board member of nine years, Thomas was also part of the CSFB Private Equity Group that bought Feltex from BTR Nylex through a management buy-out in 1996.

He starts his new role, which is Melbourne-based, immediately. His contract runs until June 2008. Although his package had not been confirmed, it would be materially lower than Magill was paid, he said.

He inherits a company faced with restoring its profitability after its struggles this year have seen the share price plunge from its $1.70 issue price in June last year to as low as 39c. They closed 1c lower at 50c last night.

As acting chief executive, Thomas presided over the bulk of the corrective action the profit downgrades triggered. Last month, 235 jobs were axed and a Melbourne yarn plant closed - a move expected to save the company $15 million a year.

With the operational review almost complete, Thomas did not expect to make any more radical changes, but he said reviewing the efficiency of operations would be ongoing.

He would not comment in detail about the review and market conditions in advance of Thursday's annual meeting when shareholders would get a full update on the company.

The meeting is expected to be eventful, with Magill set to take his directors' seat, despite a resolution to vote him off the board.

Thomas said he saw his tenure as a building role. "My long association with Feltex has left me in no doubt that it is a fundamentally sound company." 

 
PETER THOMAS

Born: New Zealand.

Education: Bachelor of Commerce, the University of Auckland.

Career: 1973-1980 international banks, in New York and London. 1981-2000 executive with Credit Suisse First Boston, managing director of its Australian operations (1983 to 1994) and chairman of its New Zealand operations (1990 to 1994); Feltex director since 1997.

Family: Married, three children.