Tegel Group chairman James Ogden has unexpectedly quit the board effective immediately after less than a year overseeing the poultry company's direction as a publicly listed company, without an explanation.
Ogden, who is also a director of Warehouse Group, Vista Group International, Summerset Group and Alliance Group, joined the Tegel's board ahead of its initial public offering in May last year, when it raised $284 million selling shares at $1.55 apiece. The shares rose as high as $1.80 in August, but have since tumbled, recently trading at $1.17 as a glut of chicken has driven down prices and seen investors lower their expectations for the company's earnings, which are scheduled for June 27.
"The board would like to take this opportunity to thank Mr Ogden for his leadership and dedication to the board and Tegel over the past year and wishes him all the very best for the future," it said in a statement without saying why he left. The company wasn't immediately available for comment.
Independent director David Jackson has been elected to succeed Ogden as chair, and the board has kicked off a process to find a replacement director, Tegel said.
Tegel retained just $1.2 million from the capital raised in last year's IPO, with $129 million going to repay existing shareholders, $130 million to repay external debt and $23.3 million on IPO and listing costs and an expensed management bonus. The company was taken public by its second private equity owner after Affinity Partners, which kept a 45 percent stake in the float, acquired Tegel in a leveraged buyout from Pacific Equity Partners and ANZ Capital in early 2011. PEP had, in turn, bought Tegal from HJ Heinz in 2005.
In December, Tegel warned annual earnings would miss the company's prospectus forecast due to the oversupply of chicken weighing on prices and as rising freight costs squeezed margins. Annual underlying earnings before interest, tax, depreciation and amortisation are expected to be between $75 million and $85 million in the year ended in late April, down from projected proforma earnings of $87.4 million for the 2017 year, while net profit will likely be between $33 million and $41 million, compared to a projected $45.6 million. The company affirmed that forecast in a presentation last month.
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