Financially suffering Willbros Group energy contractor named both a new CEO and chairman late Thursday as it opted to separate the two positions as urged by activist investors.
Willbros Chairman and CEO John McNabb, 71, is stepping down Dec. 1, but remaining on the board until mid-2016. Willbros Chief Operating Officer Michael Fournier, 52, will take over as the new CEO and lead independent director S. Miller Williams will become the new non-executive chairman.
McNabb served as chairman for eight years but just took over the CEO role last year amid financial woes, a leadership overhaul and a clash with activist shareholders who alleged mismanagement and entrenched cronyism. Willbros has been in the process of downsizing and selling business units ever since.
“A year ago the board placed their trust in me to lead Willbros and deal with our balance sheet challenges and operating problems,” McNabb said in a prepared statement. “These issues were exacerbated by the significant decline in oil prices and the rapid changes in our markets. Over the last 12 months, we have reshaped Willbros, which is now configured to be a leaner and more focused construction and maintenance contractor for energy infrastructure.”
Willbros also reported a net income loss of $17.2 million for the third quarter after the market closed on Thursday, which is down from a loss of nearly $3.4 million during the same period last year. But McNabb noted there was still a sequential improvement from the second quarter that saw a $19 million net loss.
In a prepared statement, Fournier, who joined the company in 2011, said the company is in much better shape and prepared to soon move into profitability again.
Andrew Shapiro, president of the California-based Lawndale Capital Management firm that owns nearly 5 percent of Willbros shares, has served as the most vocal critic of McNabb. Shapiro said he is pleased with the moves, especially the separation of the CEO and chairman roles.
“We look forward to working with him (Fournier) as the CEO,” Shapiro said. “He seems pretty capable and knowledgeable.”
Willbros risked losing its New York Stock Exchange listing this summer when its value fell below $1 a share for about 45 days, but it has since ticked back up to $2.31 a share at Thursday’s close. The stock traded at more than $13 a share as recently as June 2014 before oil prices dropped.
Willbros is expecting to close soon on the sale of its pipeline engineering and services business for $130 million in cash to Massachusetts-based TRC Companies as part of its downsizing and reorganization. The deal involves transferring 850 employees to TRC Companies in offices in Tulsa, Houston, Kansas City, Denver and Pittsburgh. Just more than 100 of those jobs are in Houston.
Willbros also recently sold its downstream engineering services and its heater engineering services business units to Baton Rouge, Louisiana-based Bernhard Capital Partners.