Tuesday 26 September 2017

Tight-lipped McGann urged to 'stamp authority' on Aryzta

Gary McGann. Photo: Tom Burke
Gary McGann. Photo: Tom Burke

Gavin McLoughlin and Samantha McCaughren

Aryzta's new chairman Gary McGann has been urged to "stamp his authority and defend shareholders" after a disastrous week for the Swiss-Irish food company.

Over €1bn of shareholder value was wiped off the company on Tuesday after it warned markets that earnings per share are running 20pc behind its last financial year.

The warning is the latest setback for Aryzta chief executive Owen Killian, whose position at the head of the Cuisine de France owner is coming under intense scrutiny.

McGann would not make any comment when contacted by the Sunday Independent. The call for action on his part was issued by analysts at Societe Generale this week.

"We think Aryzta's profit warning could be a catalyst for new chairman Gary McGann to consider replacing the management team... the company has been underperforming for some time, and it's getting worse," the note reads. "Management sees no fundamental challenge, but we do."

Killian acknowledged in Aryzta's profit warning that it needed to re-establish investor confidence, adding that management was "committed to returning the business to solid performance and growth and dealing with the challenges presented".

In a call with analysts he said he did not accept that the company had a structural problem, saying it had been caught offside by difficulties in North America.

The difficulties include the loss of some manufacturing contracts from rivals after Aryzta began developing its own consumer brand to compete with them.

Sunday Indo Business

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