Car dealership giant Pendragon's CEO departs inside three months
Mark Herbert leaves the group behind car dealers Evans Halshaw and Stratstone weeks after it issued a profit warning for 2019.
Thursday 27 June 2019 16:57, UK
Troubled car dealer Pendragon has been dealt another blow after its newly appointed chief executive resigned less than three months into the job.
Mr Herbert, who only started working at Pendragon on 1 April , left suddenly on Thursday by "mutual consent" and will be gone by the weekend.
Shares in the group, which trades under the Evans Halshaw and Stratstone dealership brands, fell more than 5% on the news.
Analysts have suggested there may have been a clash of opinions over how best to turn around the car business, following a string a profit warnings, the last of which was issued two weeks ago.
Mr Herbert revealed losses at the company's Car Store division would be £25m this year, up from an £11.9m loss in 2018.
Liberum analysts said: "While not explicit in the statement, the conclusion we draw from today's announcement is that there may have been a difference of opinion on the level of change required.
"From our perspective, we remain to be convinced on the Car Store stand-alone used car strategy, particularly given the business is expected to make a loss of £25m this year."
Independent retail analyst Nick Bubb said of Mr Herbert departure: "He is evidently fed up with the mess."
Chief operating officer Martin Casha and chief financial officer Mark Willis, who joined at the same time as Mr Herbert, will run Pendragon in the meantime, while the search for a replacement is under way, the company said.
The former boss had planned a major strategic update in September, but this has been "postponed" until the new chief executive is found. There was no word initially from the company on how far the plans had progressed.
Chris Chambers, chairman of Pendragon, said: "The board remains fully committed to realising the long-term strategy.
"In the nearer term, despite challenging market conditions and the costly stock reduction programme, our focus will remain on taking steps to improve the performance of the business as outlined in our recent financial and operational review."