Earnings decline and executive exodus pounds Yell Group shares

Directory giants Yell Group (LON: YELL) is still feeling the aftermath of a difficult day yesterday after it released a less than impressive annual financial report and announced the departures of both the CEO and Chief Financial Officer. The share priced slumped to a 22 per cent loss as a result yesterday, and the price has continued to fall another 10 per cent today.

Rob Hull
shareprices.com - Wednesday, May 19, 2010

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Yell shares fell 22 per cent yesterday

The group’s results were in line with analyst expectations with the publisher of the Yellow Pages having a difficult time of late due to the economic downturn and a loss of much of its advertising revenues.

Revenue for the financial year ended March 31 dropped 11.5 per cent to £2.12bn and adjusted earnings fells 24 per cent to £619m.

But despite the losses, Yell said it had slashed its net debt by £1.1bn to £3.1bn.

The report was then soon followed by a news release that both John Condron, Chief Executive Officer, and John Davis, Chief Financial Officer, were both leaving the firm.

Condron, who has been with the group for over 30 years, said he would be leaving within 12 months to retire at the age of 60.

And Davis, 48, said he wanted to leave to pursue new job opportunities elsewhere.

Bob Wigley, Chairman of Yell, said: “The Board and I will naturally be very sorry to see both Johns depart but we fully understand their reasons, and the timing and process of their departures ensure we can run a thorough and orderly succession process”.

The news saw the share price in Yell close 22 per cent down at 36.76p yesterday when the market closed.

And the directory group remained as one of the biggest FTSE 250 fallers today, opening 0.5 per cent down and continuing to hit a low of 33.15p before 10:00BST – a loss of 9.82 per cent.

However, Yell did send an enticing message to anyone looking to take a punt on the stock by saying: “the stabilising print retention rate and the continued growth in the run-rates of internet sales support our confidence about the future and about our ability to benefit strongly when the economic recovery is fully established”.

 

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