http://www.thewest.com.au/20020521/business/tw-business-home-sto57150.html --------------------------------------------------------------------- Market gets Lend Lease chief's scalp --------------------------------------------------------------------- By Carolyn Cummins --------------------------------------------------------------------- THE Lend Lease board yielded to market pressure yesterday and revealed the exit of long-standing chief executive David Higgins, while dousing expectations of a rapid rise in 2003 net profit. --------------------------------------------------------------------- Chairman Jill Ker Conway described the surprise shift as "bringing new leadership to bear". --------------------------------------------------------------------- Mr Higgins"contract runs until 2004 but he will move on when a replacement is found. He has been chief executive of Lend Lease for more than seven years. --------------------------------------------------------------------- He declined to comment on whether he would receive a big payout, such as the $15 million Lend Lease paid to failed US director Sheryl Pressler for the 2001 year. --------------------------------------------------------------------- Mr Higgins was paid $2.1 million for the year to June 30 - a sharp fall compared with $4.8 million in the 2000 year, reflecting the group's poor results for the 12 months. --------------------------------------------------------------------- Shock announcements are becoming the norm at Lend Lease as it makes its way through the transition of core business activities, a path it has been walking for the past two years. --------------------------------------------------------------------- As a result its share price has fallen from a high of $23 in November 2000 to a low of about $9.56. --------------------------------------------------------------------- In that time it has gone from a property developer to a two-pronged global real estate business and funds manager. --------------------------------------------------------------------- It now has its Real Estate Solutions business run by Ross Taylor and incorporating developer Bovis Lend Lease, and the Real Estate Investments arm run by David Ross and covering global funds management. --------------------------------------------------------------------- Lend Lease's new chief will cover both business segments and will aim to communicate the strategy to investors. --------------------------------------------------------------------- Analysts said although Mr Higgins was a well-respected strategist he failed to properly communicate the changes within the company to the investment community. --------------------------------------------------------------------- The company also continues to struggle to convince investors it can replace the steady profit stream from the funds management arm, MLC, which it sold to National Australia Bank for $4.6 billion in November 1999. --------------------------------------------------------------------- A senior Bovis executive based in the US, Luther Cochrane, was one name put forward yesterday as a possible candidate. --------------------------------------------------------------------- Investors yesterday reacted by selling the shares down 6.66 per cent, or 77¢, to $10.80. During the day the price hit a low of $10.50. --------------------------------------------------------------------- The search for the new executive will be conducted by a yet-to-be-appointed international recruitment agency but will look at internal and external candidates. --------------------------------------------------------------------- The group has always prided itself on a strong internal succession program but that went awry when two key employees, Matthew Banks and Peter Waliknowski, left two years ago. --------------------------------------------------------------------- In revealing the shift at the top table, Ms Ker Conway also poured cool water on some analysts"profit forecasts for the 2002-03 financial year but denied the company faced a profit downgrade. --------------------------------------------------------------------- The range for the earnings stands at $225 million to $250 million. --------------------------------------------------------------------- Ms Ker Conway said the group's internal estimates were at the lower end of analysts"expectations. She confirmed that the year to June 30 would see a profit of more than $210 million. --------------------------------------------------------------------- One analyst said he estimated profit growth in the 2002-03 year of about 25 per cent, taking the profit to about $225 million. ----------------------------------------------------------------------SYDNEY MORNING HERALD --------------------------------------------------------------------- LLC Description: LEND LEASE CORPORATION LIMITED ORDINARY Market Status: Normal Time: 22/05/2002 - 11:48:58 Last Change In Value Change In Percent 10.7300 0.1400 1.3220% High Low Opened Closed Trades Volume Traded All Ordinaries 10.8000 10.5900 10.5900 10.5900 502 1,523,076 11:48:58 3,338.8998 0.3094%
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