Fletcher Building (FBU) seems to have found a new chairman to replace Ralph Waters who steps down later this year.
Although there was no mention of the new job, there is no other reason why Fletcher would seek out someone with the stature in the business community of Sir Ralph Norris, the former head of the Commonwealth Bank and before that, Air NZ.
But when Mr Waters told the AGM last October of his plan to step down, he said the replacement director would be considered in the search for a new chairman.
But there is no one else on the board with Mr Norris’ standing and experience, so he looms as the certain replacement.
Fletcher Building said that Mr Norris will be an independent director and the appointment will be effective from April 2014.
Sir Ralph retired as managing director and chief executive officer of the Commonwealth Bank of Australia in November 2011 following a 40 year career in the banking sector in Australia and New Zealand, including as chief executive officer of ASB Bank, a CBA subsidiary and the gig at Air New Zealand.
Sir Ralph is a director of Fonterra Cooperative Group and Origin Energy and a former director or chairman of the Business Council of Australia, the International Monetary Conference, Sovereign Insurance, the NZ Bankers’ Association, NZ Business Roundtable and the Australian Bankers’ Association.
FBU 1Y – Fletcher Building grabs former Comm Bank boss – he looks like the new chairman
Mr Waters said Sir Ralph brings "valuable skills and experience from leading large organisations, both in New Zealand and Australia".
The appointment, which will temporarily bring the size of the board to nine members, "is being made ahead of Ralph Waters’ retirement at the end of 2014", Fletcher said.
Mr Waters said in October that although he was seeking re-election to the board, he wanted to retire from the role before its tenure ends in March 2015.
He has been with the construction company for 12 years, and became chairman in 2010 on the retirement of Sir Roderick Deane. Mr Waters is a former CEO of the company. He was appointed to the Woolworths board late last year.
One thing to look for from the company in the next month is a possible trading update with the impact of the rising Kiwi dollar in mind on the company’s revenues and earnings from Australia. As well the Kiwi dollar remains solid against the US dollar, which would impact revenue and earnings from Asia, the US and Europe.
The chairman told shareholders in October the current forecast for the earnings before interest and tax for the year end June 2014 was between $NZ610 million and $NZ650 million.
He also warned the strengthening New Zealand dollar against the Australian dollar would cost the company about $NZ15 million if it continued to hover around A88 cents. The Kiwi dollar is now well above that level – at just under A95 cents. That would see the adverse impact on Fletcher top the $NZ25 million mark.
Fletcher shares yesterday ended with a 1.9% gain (or 16c) at $8.56.
