Andy Raynor, last week promoted to chief executive of the firm, which is the UK’s first listed accountancy consolidator, said its three-year buying spree was over.
‘I have no acquisition plan, nor do I think it right today that I have one,’ he said. ‘There are certain things that I want to do with the business but I think I’ve got all the raw material I need to make a great business.’
Despite a rise in sales, Tenon last week reported a loss of £114m. Its turnover increased to £92m, up from £55m last year, but this was not enough to offset a massive write-off of £106m on acquisition goodwill previously valued at £190m. Following the ‘disappointing’ 2002 results, Tenon is restructuring its business and last week announced it would dispose of Livingstone Guarantee to refocus its corporate finance branch. Earlier this month it asked employees in five of its 33 offices to justify their jobs or face redundancy. Pending the consultation period there is no definite number for potential job losses but Raynor said it was unlikely that there would be none. The second phase of Tenon’s restructuring plan consists of revising management and giving power to those with profitable operations. ‘I think the head office shouldn’t be there. We need to make sure we’re putting the business back in the hands of the operators,’ Raynor said. Phase two also aims to identify and harness internal talent. ‘There has been a little bit too much looking outside and I think there should be an awful lot more of making sure that we develop and enhance the people we have,’ Raynor said. Raynor has given himself 90 days to complete phase two of the restructuring. He believes that a recovery of the share price will then soon follow. Tenon’s share price stood at 11.75p on Tuesday – down from a high of 183.5p toward the end of 2000.
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