Carillion, the UK’s second largest contractor, has announced a number of changes to its executive team, including the departure of its Zafar Khan, its group finance director. The moves come as interim chief executive Keith Cochrane launches a strategic review of the company and its options.
The changes follow a profit warning in July that led to the immediate resignation of Richard Howson, its chief executive, and a 39% fall in its share price. The company, which had a turnover of £5.2bn ($6.9bn) last year had been listed on the FTSE-250 league table of the UK’s largest companies, but was relegated at the end of last month.
The company’s share price has fallen about 80% over the course of 2017.
Mr Khan had been group finance director at Carillion since August 2016. He joined the company as finance director for the Middle East and North Africa in 2011. Before that he was the chief financial officer of Associated British Ports Holdings.
Emma Mercer, the finance director of Carillion’s UK construction business, will take over as chief financial officer with immediate effect. Andy Jones, the chief executive of Carillion’s Canadian business, will take on the chief operating officer’s role.
A third appointment is Lee Watson, who is on secondment from accountant Ernst & Young; he will become "chief transformation officer".
Mr Howson initially took up role of chief operating officer, but he will leave at the end of September. Carillion had previously said he would stay on for a year.
The company blamed its poor performance on "difficult markets" in the wake of the Brexit vote and measures to cut borrowing for the profit warning.
However, it also announced that it was making a £845m writedown in relation to three public-private partnership (PPP) projects: the Midland Metropolitan hospital in Smethwick in the West Midland, the Royal Liverpool University Hospital and a road in northeast Scotland, the Aberdeen Western Peripheral Route.
Other problem contracts included a home for the National Audit Office and a tram-train link between Sheffield and Rotherham.
Carillion is divided into three main divisions: construction, construction services and outsourcing, and PPPs. Two executives from the services division will also be leaving: Adam Green, the managing director of the construction division and Nigel Taylor, the managing director of the services business, will leave on 30 September.
Shaun Carter, group strategy director, will step down from the construction and support services firm by "the end of the year".
Carillion is due to reveal details of its strategic review on 29 September.
Image: Carillion’s shares have fallen 80% this year (Carillion)