Langford working on secret 'satellite project' for FBD
Chairman Berkery did not reveal details of €16k-a-month earner
Published 01/05/2016 | 02:30
Former FBD chief executive Andrew Langford is working on a secret FBD project outside the day-to-day affairs of the business, for which he is being paid €16,300 a month.
Chairman Michael Berkery said that at the time Langford resigned, the former boss was working on a "satellite project".
"At that time in July, Andrew and the company had another commercial project outside of the day-to-day management of FBD, I would say something of a satellite project, underway," Berkery told shareholders at FBD's agm on Friday.
"We agreed as a board, and we agreed as a remuneration committee etc, that Andrew had a contribution he could make, not in the day-to-day management of FBD.
"That project is underway, he is engaged to deliver it, and I will report at another time about that.
"That project is not involved on the floor or in the FBD head office, or directly here. That project has commercial benefit and value to the company and as shareholders I believe it is the right project to do, it is well worth doing and Andrew is the best person equipped."
However, Berkery added: "If between now and the end of this year . . . Andrew should take up full-time employment in any other sphere that (project) will come to an end immediately, and all payments will cease. We'll wrap up that project and we'll wrap up it up in advance of his parting."
Berkery said the company expects Langford to be able to complete the work within the time available.
FBD's annual report says that Langford "agreed to make his experience and services available to the company from 1 February 2016 to 31 December 2016 for a fee of €16,300 per month so long as he was not in full-time employment elsewhere".
Langford stepped down last July after seven years in the role of chief executive. The company swung to a loss of almost €4m in 2014, and lost €85.5m before tax in 2015, with the share price more than halving in the period from the middle of January 2014 to Langford's departure. At last year's agm, in May, Berkery gave Langford a strong vote of confidence, saying Langford had "the unequivocal support of the board". "It's the challenge that makes the man or the person, and I think he'll rise to the challenge," Berkery added.
Berkery was speaking about Langford's project during a raucous agm at which the FBD board came under fire from a disgruntled employee who was also a shareholder.
Speaking to the Sunday Independent after the meeting, FBD chief executive Fiona Muldoon would not reveal the details of Langford's project.
She told shareholders that the company's primary focus is on returning to profitability and that premium hikes are likely.
"That means we have to have full price adequacy, we must collect more in premiums than we pay out in losses. That does mean that premiums essentially have to go up until we are making more from premiums than we are paying in costs.
"It does have to be judged and it has to be judged in the light of what books are more profitable than others.
"We will judge it and we will judge it finely, and we are aware of our customer base and what they're going through, but FBD has got to protect its shareholders and it has got to return to profitability.
"I believe that FBD has broadly stabilised in the second half of 2015 . . . we have a clear strategy, it has been articulated, we continue to strengthen our customer base in the Irish agricultural and small business sectors, and we will pursue a single-brand consumer strategy under the FBD brand. We have a path to full-year profitability by 2017."
She said the company is not taking a "huge" amount of new motor insurance business, but that she was happy with the new business it had taken on.
Sunday Indo Business