Mouchel boss resigns after accounting error

The chief executive of one of the country’s leading highways consultants has resigned.

Richard Cuthbert stood down with immediate effect yesterday after the consulting and highway maintenance group issued a profit warning following a review of contract risks and project claims.

The review led by new finance director Rod Harris, who joined in June from Carillion Business Services, concluded that net impact could be around £8.5m.

Cuthbert led Mouchel’s fight against takeover bids from both Costain and Interserve last year.

In a short statement Mouchel said: “Richard Cuthbert has tendered his resignation with immediate effect, and he will work with the group for a short period to ensure an orderly handover.

“Bo Lerenius will become executive chairman until a new chief executive has been appointed.”

In June, Mouchel reported that it expected a significant one-off profit on one of its long-term contracts to offset lower profitability than originally expected following commercial conclusions on a number of contracts.

This week it said: “The group was very recently informed that, as a result of an actuarial error, the one-off gain will be £4.3m lower than previously expected, which has an immediate and corresponding impact on the profits the group will report for the year to 31 July 2011.”

The review of contract risks and project claims, taking into account the continuing challenging business environment, also required further provisions.

“As a result, the group has decided to increase provisions in respect of these contract risks and project claims by a similar amount to the reduction in the one-off gain.”

Bo Lerenius said: “I would like to express the board’s gratitude to Rich for his many years of service and his continuing belief in and commitment to the business.

“The board will focus on maintaining Mouchel’s position in its core markets in the interests of all its stakeholders.”

 

Related Posts

 
Comments

No comments yet.