U.K. Defense Supplier Cobham Names New CEO
August 17 2016 - 4:30AM
Dow Jones News
LONDON—British defense equipment supplier Cobham PLC on
Wednesday said it was parting ways with Chief Executive Bob Murphy,
after a string of earnings missteps, and named David Lockwood, the
current head of U.K. technology company Laird PLC, to replace
him.
The company that makes air-to-air refueling systems for Boeing
Co. and Airbus Group SE military tanker planes said Mr. Murphy was
leaving his post of CEO and director to pursue other opportunities.
He will leave by year-end.
Mr. Murphy joined Cobham four years ago after 13 years at BAE
Systems PLC, the U.K.'s largest defense company by sales. Mr.
Murphy moved to strengthen the company's nondefense activities,
including the acquisition of Aeroflex Holding Corp. in 2014 for
$920 million. The shift came just as a prolonged decline in
military spending had started to turn around and weakness emerged
in commercial markets.
Cobham has suffered under a series of profit warnings and failed
to return to growth amid weakness in some of its key markets. This
month the company cut its dividend payment as it swung to a pretax
loss in the first half.
The company in April announced a rights issue that angered
investors and caused shares to plummet.
Shares in Cobham, which had fallen more than 33% this year, rose
more than 6% in London on Wednesday.
Cobham also suffered with problems on several key programs,
including the Boeing Co. KC-46A airborne refueling plane for the
U.S. Air Force. The program has run over cost and behind schedule,
though it received a boost this month when the Pentagon approved
the design for production.
The company in June also named David Mellors as its new chief
financial officer. Mr. Mellors, who joins from British defense
company QinetiQ, is due to start Jan. 1.
Mr. Lockwood, 54, will join the company as CEO and director by
Jan. 1, 2017, Cobham added, though he could take the role earlier.
He previously worked at BAE Systems PLC and French defense and
aerospace supplier Thales SA. Mr. Lockwood's annual salary will be
£ 690,000 ($900,000), Cobham said.
Mr. Lockwood isn't expected to radically change Cobham's
strategy to build a more diversified business. The move predates
Mr. Murphy becoming chief executive. It had been endorsed by
Chairman John Devaney, who on Wednesday called defense and
communications technology "the heart of Cobham."
Separately, Laird said Mr. Lockwood's resignation as chief
executive was effective from Sept. 5 and that current finance head
Tony Quinlan would succeed Mr. Lockwood. Richard Harris, currently
group financial controller, will be the company's interim finance
head until a permanent successor has been found, Laird added.
Write to Robert Wall at robert.wall@wsj.com and Tapan Panchal at
Tapan.Panchal@wsj.com
(END) Dow Jones Newswires
August 17, 2016 04:15 ET (08:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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