Following the announcement of John Leighfield’s retirement from RM at the end of March (see John Leighfield retires from RM), the company has today announced his replacement as Chairman... none other than Microgen’s Chairman, Martyn Ratcliffe.
Leighfield and Ratcliffe are two very different characters. There’s no doubt that Leighfield put his heart and soul into RM, but it may be that Ratcliffe is just what RM needs right now to help get the company through a tough period. Just after the announcement of Leighfield’s departure, it was announced that RM was taking decisive action to cut its cost base (see RM takes action on cost base).
Ratcliffe has proven, in his role at Microgen and also in his role as Chairman of Sagentia Group (where he was appointed in April 2010) that he always has a firm grip on the finances. At Microgen he recently pleased investors by improving operating cash generation by 15% even after returning a significant sum to shareholders (see Microgen – you can’t argue with the cash), while at Sagentia he spent his first year turning the business profitable (see Sagentia marches onwards and upwards). No doubt RM will be hoping that Ratcliffe can keep the ship steady during what is proving to be a particularly challenging 2011 in the education sector. Though it may not be a particularly easy ride as he will undoubtedly be tough in his actions.
Indeed, George O'Connor's (Panmure Gordon) expressed his nervousness this morning about what is in store: "In our view – like a good engineer Martyn solves problems with hammers (the bigger the problem – the bigger the hammer). We wait with delight – although we are squeamish – but suffering shareholders (stock has underperformed FTSE All Share by 36% over the past 12 months) should be pleased".