UK bookmaker Ladbrokes has begun the search for a successor to chief executive Richard Glynn after revealing that he is to step down at the end of his five-year contract next year.
Glynn has served as CEO since April 2010, having joined from Sporting Index. At the time he was given a clear mandate to implement a fundamental re-engineering of its business and operational and digital capabilities.
This was focused on its underperforming online division, which ultimately lead to its strategic partnership with Playtech, while another key target was to double the company's share price over the five-year term.
While the Ladbrokes board noted that the recovery programme had taken longer to deliver than originally thought, blaming this on economic and regulatory issues, it said that the changes were “deeply embedded in the organisation” and that attention should now be focused on delivering sustainable growth from “a much stronger operational and digital platform.”
With a month to go, Ladbrokes said that it is now trading in line with expectations for the current year, and noted that it is confident further progress will be made in 2015.
Following extensive and constructive discussions between the board and Glynn, Ladbrokes said that he will complete his term and continue in his role as CEO into 2015.
In the meantime, the company will begin a selection process to identify his successor, evaluating both internal and external candidates. Once an appointment has been made, Glynn will remain as chief executive to ensure a smooth transition.
“On behalf of the board, I would like to thank Richard for his leadership of the company and his considerable achievements in delivering a new digital future for Ladbrokes,” the operator’s chairman Peter Erskine commented. “He has devoted enormous energy and dedication to securing the transformation of the Company and the benefits of that work are beginning to be seen.
“I am pleased that he will both see through the final steps of the implementation plan and be on hand to facilitate an orderly succession process,” he continued. “Ladbrokes has been transformed and is a far stronger company as a result of his work.”
Glynn added that it had been a privilege to lead Ladbrokes during what he described as a “crucial” phase in the company’s development. He praised his team’s resilience and professionalism during an “intense period of activity,” but believed that the time was right to identify his successor.
“I will continue to serve the company to help ensure a smooth succession,” he said. “I look forward to the company, the shareholders, our partners and in particular everyone in the team reaping the benefits, over the next few years, of all that has been sown.”
Analyst Simon French of Cenkos reiterated a sell rating for the company and noted that an external appointment was most likely, given that the most likely internal candidate, Nick Rust, agreed to take over as CEO of the British Horseracing Authority last month and will depart the company in April next year.
Since replacing Chris Bell as CEO, Glynn’s tenure has seen a number of senior executive depart as well as large numbers of redundancies as the business was restructured.
Glynn pursued a number of different strategies as he looked to revamp the company's online division. At first he looked to grow the business through the acquisition of Sportingbet, though this was scrapped due to regulatory concerns over its grey market businesses.
He then looked to organically grow the business, building a proprietary mobile and online sportsbook offering. However both projects suffered numerous delays, ultimately seeing the operator turn to Playtech to revitalise the digital business, which has begun to pay off.
Glynn has been unable to increase Ladbrokes' share price however, and will miss out on a substantial bonus had he successfully increased the share price from 156.10 pence per share to 297 pence over the five-year period.
“Everyone at Ladbrokes has worked incredibly hard over the past, nearly five years, to deliver the transformation programme,” Glynn said of the project. “We have faced significant operational challenges, as well as economic and regulatory headwinds. However I am pleased that the business is fundamentally stronger than it was and now has the operational and digital capabilities to compete effectively.”
“We have delivered against all of the recent milestones and increasingly shown real competitive momentum,” he added.